Renters’ Rights Bill
Wednesday 9th October 2024
(1 year, 10 months ago)
Commons ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts
19:00 - The House divided: - Ayes: 104 / Noes: 424 - Question accordingly negatived.
Madam Deputy Speaker (Judith Cummins)
I inform the House that the reasoned amendment in the name of Kemi Badenoch has been selected.
The Secretary of State for Housing, Communities and Local Government (Angela Rayner)
I beg to move, That the Bill be now read a Second time.
I hope the entire House will agree that everyone should live in a decent, safe and affordable home. Everyone should, but not everyone can. That is why, as Housing Secretary, I have put decency at the heart of my plans for housing, and taken steps to ensure that all homes are warm and safe. Nowhere is that more needed than in the private rented sector, which plays an undeniably critical role in our housing system.
I want to be clear from the outset that this Government recognise the important role of landlords, most of whom provide good-quality homes for their tenants. But this is a sector in serious need of reform. Millions of people live in fear of section 21 no-fault evictions that could uproot them from their homes and communities, and they are forced to live in homes that are riddled with damp and mould, too scared to complain in case they end up being evicted and homelessness, and knowing that another potential tenant will be desperate enough to move in.
Mr Luke Charters (York Outer) (Lab)
During the general election campaign—a stressful time indeed— I was served with a section 21 notice. Thankfully, my family supported me, but such support is not available to everyone. Does my right hon. Friend agree that ending no-fault evictions will give British families the peace and stability that they desperately need?
Angela Rayner
I thank my hon. Friend for giving us the benefit of his personal experience—an experience that is suffered by far too many families. Hundreds of thousands of young families are in temporary accommodation, in many cases because of section 21. In 2019 the ending of this scandalous practice was included in the previous Government’s manifesto, but we are still waiting. It has taken us just four months to bring the Bill to the House, because we felt that the need for it is critical. Too many young people are priced out of leaving home, unable to move to the big city where they could start their careers because of sky-high rents, and that too must change—I know that many hon. Members agree.
The Conservatives promised to pass a renters reform Bill in their 2019 manifesto, but, in a desperate attempt to placate their Back Benchers, they caved in to vested interests, leaving tenants at the continued mercy of unfair section 21 eviction notices. They dithered, delayed and made excuse after excuse for their inaction. What has been the human cost of that failure? Since 2019, when the Conservatives first promised action, more than 100,000 households have faced a no-fault eviction, with 26,000 facing eviction last year alone. Too many families facing homelessness; too many families priced out of a safe and secure home; and too many families stuck in cold, rotting, damp homes—that is the inheritance that we need to fix.
Dawn Butler (Brent East) (Lab)
I thank my right hon. Friend for pursuing renters’ rights in this way. Does she agree with the Mayor of London that we should consider setting caps for rent increases?
Angela Rayner
I will set out later in my speech what we are doing to ensure that renters get a fair deal.
This is why we have moved so speedily in getting this Bill to its Second Reading. We will not take another four years, which is why we have done it in less than four months. I must give credit where it is due, because many parts of the Bill build on the good work of my predecessor in the Department. However, let me be clear that this is a fundamentally different Bill; it goes above and beyond the last Government’s Bill in several critical ways. This is not just a renters reform Bill; it is a Renters’ Rights Bill, a plan to ensure that all private tenants can aspire to a decent, affordable and safe home.
Sir Desmond Swayne (New Forest West) (Con)
Changing tenants involves significant expense for both tenant and landlord—my interests can be found in the Register of Members’ Financial Interests—and the ability of a tenant to end a tenancy after two months presents a significant risk to the landlord, particularly in the student rental market, where re-letting a property within the academic year can present a considerable difficulty. Will the Secretary of State at least consider amendments in Committee to address that issue?
Angela Rayner
I say to the right hon. Gentleman, whose interventions are normally more pithy, that the Bill accommodates the unique circumstances of students. I hope he can see that we are trying to strike a balance. I am sure that his entry in the Register of Members’ Financial Interests proves that he is one of those landlords I would like to commend for being decent landlords. We want to ensure that the standard that I am sure he gives to his tenants is applied across the whole country.
Many right hon. and hon. Members will have heard heartbreaking stories from constituents who have been forced to leave their homes with little or no justification. This Government will remove the threat of arbitrary evictions by finally bringing to an end no-fault evictions. Unlike the previous Government, who put in place last-minute caveats, we will abolish no-fault evictions for new and existing tenancies at the same time, to give all tenants the same security immediately.
Jake Richards (Rother Valley) (Lab)
In Maltby in my constituency, the campaign group Big Power for Little London has been campaigning to end no-fault evictions for years, because the community have suffered as a result of rogue landlords. I am very grateful to the Housing Minister, who is sitting next to the Secretary of State, for agreeing to meet the group later this year. Does my right hon. Friend agree that this Bill will be welcomed by the thousands of campaigners across the country who have fought so long for this important change?
Angela Rayner
I absolutely agree with my hon. Friend. I, too, pay tribute to the Housing Minister for the work that he did in opposition and in getting us here today.
In saying that we need to end the cruel practice of no-fault evictions, I recognise the huge pressures on the court system as a whole, which have been caused by years of Tory failure and neglect. To support the changes, we will digitise the county court possession process, working closely with colleagues in the Ministry of Justice to create a modern, efficient service for our courts. We will also take steps to ensure that, wherever possible, disputes will be resolved at an early stage, and the new private rented sector landlord ombudsman service that the Bill introduces will play a vital supportive role.
Shaun Davies (Telford) (Lab)
I welcome the Deputy Prime Minister to her place. Does she agree that no-fault evictions are bad not only for tenants but for local councils, which across the country spend billions of pounds on temporary accommodation? It causes havoc for children and the education system, as young people have to go from one school to another.
Angela Rayner
I absolutely agree with my hon. friend, and I pay tribute to him for the work that he did in local government before coming to this place. He will know about the direct impact of this issue, as will many Members of this House. It is not just about having a home; no-fault evictions have an effect on children, and on a person’s life, job, income and everything else that they want to do. That is why it is so important that, whereas the previous Government made no progress in four years, we are now at this stage of the Bill after four months and we intend to continue at speed.
Andrew George (St Ives) (LD)
I warmly welcome the Bill. It is right that we should regulate to avoid bad practice in the sector, but does the Secretary of State agree that measures should be available to enable, and indeed incentivise, good practice? Given that the previous Government gave millions of pounds to holiday homeowners in various tax incentives to encourage that sector, surely there must be methods by which the Government can incentivise good practice. Otherwise, the Bill might become counterproductive.
Angela Rayner
I thank the hon. Member for his comment. I hope that he recognises from my opening remarks that good landlords have nothing to fear from this Bill, and we will help them. The new database will help landlords to understand and meet their legal duties, and we will provide clear guidance. I will talk more about how that database will work.
Part 1 of the Bill will introduce a new, modern tenancy system that removes fixed-term tenancies, meaning that tenants can stay in their home until they decide to end the tenancy, and they will only need to give two months’ notice. This will end the injustice for tenants who want or need to leave at short notice but cannot, and allow both landlords and tenants the flexibility to respond to changes in their circumstances.
I want to make it clear that our Bill ensures that landlords will still be able to reclaim their properties when they legitimately need to, through clear and robust possession grounds. We have also considered the unique situation of student accommodation and specialist sectors such as stepping-stone accommodation, for which the Bill also includes a possession ground. In most cases, tenants will have four months’ notice, so that there is time to find a new home, and landlords will have to wait a year from the beginning of a tenancy before they can use the “moving in and selling” grounds for eviction. This honours our commitment to level the playing field decisively for renters, which goes further than the last Government’s ambitions. Of course, landlords will still be able to quickly evict tenants who engage in antisocial behaviour and make other people’s lives a misery, to protect the strong communities that we want to see flourishing around the country.
The Bill will also empower tenants to challenge unfair rent increases that are designed to drive them out. It will prevent tenants from being bound by rent review clauses, putting them in a stronger position to challenge unreasonable rent hikes at tribunal.
Jeremy Corbyn (Islington North) (Ind)
I welcome most of what is in this Bill. A third of my constituents live in the private rented sector. The last time I looked, there were hardly any available properties to rent in my constituency that were within the local housing allowance. The level of rent is astronomical, unaffordable and driving working-class communities out of inner-city areas. Does the Secretary of State not agree that the Bill needs to go further and bring in rent controls, so that housing is available for all people?
Angela Rayner
I understand the right hon. Gentleman’s point, but I disagree on how to resolve the issue. Rent controls restrict housing supply, which does not help anyone, but our Bill takes practical measures to help renters by empowering tenants to tackle unreasonable rent hikes and prohibiting unfair rental bidding, and we will continue to assess potential action on sky-high rents. Hopefully, we are taking measures that will help his constituents and others across the country.
Melanie Onn (Great Grimsby and Cleethorpes) (Lab)
Could my right hon. Friend clarify whether, under the Bill, landlords and letting agents will be prevented from requiring individuals who do not have all the correct supporting information to pay excessive deposits, which prohibit people from getting secure properties for their families?
Angela Rayner
My hon. Friend makes a really important point about deposits and paying rent in advance. This Bill will protect tenants from requests for large amounts of rent in advance, but we are in listening mode. We will keep this issue under review during the passage of the Bill, and we will take the necessary action. We think that we have done enough on that, but we are open to interventions, if people feel that they would help.
Unlike in the previous Government’s Bill, the tribunal will not be able to increase rent above what was originally proposed by the landlord. In cases of undue hardship, we will give the tribunal the power to defer rent increases by up to two months, thereby finally ending the injustice of economic evictions.
However, that is not all we will do to tackle unfair rent costs. We remain committed to ending rental bidding wars, which all too often price hard-working families out of a home. Landlords and letting agents will be required to publish an asking rent for their property, and will not be allowed to ask for, encourage or accept a higher offer. We are delivering real change for working people.
Andrew Griffith (Arundel and South Downs) (Con)
The challenges faced by tenants in the private sector are very real, but is the right hon. Lady familiar with the law of unintended consequences? What have she and her officials learned from the study of the application of similar rules in Scotland, which have made the plight of renters worse, not better?
Angela Rayner
I do not accept that from the hon. Member. We have had scare stories about this before. As I have said, the majority of landlords are doing the right thing. The Bill is about fairness for landlords and tenants, and I think it strikes the right balance. I am acutely aware of the law of unintended consequences. In fairness, the previous Government were batting around these ideas for years, after promising in their manifesto to tackle the issues, but they let down the people who are in these situations, who deserved better from their Government. This Government will do better than the previous Government.
As I set out at the start of my speech, tackling the blight of poor-quality homes is a priority of mine and of this Government. That is why part 3 of the Bill will apply a decent homes standard to the sector for the first time, requiring privately rented homes to be safe, secure and free from hazards.
Ben Coleman (Chelsea and Fulham) (Lab)
My right hon. Friend will be aware that the Darzi report last month highlighted the severe problem of damp and mould, particularly in the private sector, and the bitter impact of that, notably on children’s health. Over a third of my constituents in Chelsea and Fulham live in privately rented homes, and in Fulham the council has had to chase landlords 74 times in the past year alone to address damp and mould. It is tremendous that the Government are tackling this, and I know that my constituents will be delighted. May I ask her to ensure that councils are resourced sufficiently to exercise the stronger investigatory and enforcement powers that the Bill provides?
Angela Rayner
We are extending ring-fenced extra resources to councils, because we recognise the need to do that. I want to pick up on my hon. Friend’s comment on children’s health. This Bill will also make good on our promise to extend Awaab’s law to the private sector. When I met Awaab’s family recently, I made a commitment to putting safety first, and it is an honour to pay tribute to Awaab’s legacy, and to his parents’ resolute campaigning for meaningful change for the many thousands of families living in unfit homes. I hope that no family ever has to endure what that family had to.
Paul Waugh (Rochdale) (Lab/Co-op)
It was an utter tragedy and a source of national shame that the two-year-old toddler Awaab Ishak died of a respiratory disease caused by extensive mould in his family’s flat. I am delighted that this protection will be offered in the private rented sector. Will my right hon. Friend make sure that the private rented sector upholds its obligations to all its tenants in future?
Angela Rayner
Absolutely; I thank my hon. Friend for that comment. That has been at the forefront of our minds, and not just in our work on this Bill. Hon. Members will recall that it is only a few weeks since we had the report on phase 2 of the Grenfell inquiry, so when we talk about providing housing, it is at the forefront of my mind that houses have to be safe for people. It is absolutely scandalous that here in Britain at the moment we cannot guarantee that, and I will do everything I can as Secretary of State to fix that problem.
Talking about families more widely, we will also end the abhorrent practice of denying a family a home purely because they receive benefits or have children, by making it illegal for landlords and letting agents to discriminate against tenants on that basis. This Bill is about social justice and fairness for all.
Ms Stella Creasy (Walthamstow) (Lab/Co-op)
I thank my right hon. Friend on behalf of the many families in Walthamstow who have been in exactly that position. One of the things that drives my constituents mad is having to move repeatedly because of rent increases that they cannot afford, because it means that their good credit rating stops and starts, which makes it harder for them to get on the housing ladder. What more can we do to tackle this discrimination against tenants and give them a chance of owning a home in the future, by tackling this basic issue of credit ratings, perhaps with a good credit passport?
Angela Rayner
This is a wider issue to do with the poverty trap that so many people face this country. I am also proud to plug the employment Bill that will be coming forward this week. It is another incredibly important part of this Government’s agenda; the Prime Minister mentioned it earlier today. We want to make sure that the working people of this country feel better off, and are able to get on and do the things in life that we should expect anyone to be able to do—things that we were able to do as a result of the toils of the generations before us.
I want to talk database. Part 2 of the Bill will introduce a new online private rented sector database, to the benefit of landlords and tenants alike. Landlords will need to provide key information about the properties they let out, including around property standards and compliance with the law, helping tenants to understand more about the property and the landlord who they are looking to rent from.
Mr Joshua Reynolds (Maidenhead) (LD)
Energy efficiency is really important in the rented housing sector, so does the Secretary of State agree that it is important that the Bill ensures that landlords upgrade their rented properties to an energy performance certificate grade C or above by 2028?
Angela Rayner
I agree that we should be moving towards doing everything we possibly can to be efficient, and there will be consultations on that issue. One of the things that shocked me in bringing this Bill forward was that the standards are so low for some; we need to really ramp them up. The bottom line for me in bringing this Bill forward is that people should have safe, secure homes that are free from hazards. We can then build on that. We are doing much more as a Government on our ambitions to do that, working with landlords.
The database, alongside greater guidance and support from the Government, will also help landlords to understand and meet their legal duties. Good landlords should be supported and helped. In addition, the database will provide local authorities with the information that they need in their enforcement activities to drive out rogue landlords. In this Bill, I have also taken steps to support local government in its crucial role in keeping tenants safe and rooting out bad actors from the sector. That is why, as well as setting up the database, the Bill will give local authorities stronger powers to root out and punish the small number of landlords who deliberately flout the law, and will increase the maximum civil penalties, so that we punish offenders and further support local authorities.
Ben Obese-Jecty (Huntingdon) (Con)
Where I previously lived, there was a huge number of illegal houses in multiple occupation. Those residents are potentially not protected by this legislation. In giving local authorities more enforcement powers against rogue landlords, how exactly will we define a rogue landlord, and protect people who will potentially be off the radar?
Angela Rayner
There are separate rules for HMOs, but we are also extending ringfenced civil penalties to support councils more, because we need to make sure that there is enforcement. A database will be important when we are looking at what we face, and also in making sure that we can take action. The problem is not every landlord. Most landlords act in a reasonable way, but we need to make sure that action is taken against those who do not.
We recognise the important role that tenants play in holding their landlords to account, and we want to incentivise them to do so. That is why we have significantly strengthened rent repayment orders. To empower tenants to take direct action against unscrupulous landlords, the Bill will add new rent payment order offences, double the maximum penalty for offences, and ensure that offenders will more often pay the maximum penalty. When landlords break the rules, tenants must have recourse to action.
Finally, I want to mention pets. It is a shame the Speaker is not here, because this was my bit for him! Our reforms are aimed squarely at improving the lives of people and families, but I trust that right hon. and hon. Members will agree that pets are not just animals but family. That is why this Bill will make it easier for tenants to request the ability to have a pet in their home. It will also allow landlords to require insurance covering pet damage, so that everyone is covered and no one is left unfairly out of pocket.
Dr Neil Hudson (Epping Forest) (Con)
It is important that this legislation balances the rights of both tenants and landlords. We all know the benefits of pet ownership to our physical and mental health, and indeed to the animals. I very much welcome the fact that clauses 10 and 11 will allow pet ownership in tenancies, but can the Secretary of State reassure the House that those clauses will allow responsible pet owners to ask to keep pets in their property while ensuring that landlords are insured in case of property damage caused inadvertently, or perhaps advertently, by pets?
Angela Rayner
The hon. Gentleman is absolutely right that there is a balance to be struck. We are ensuring that landlords are protected with insurance. It is about reasonableness—so long as it is not an antisocial parrot that speaks all night, I am sure everyone will agree that this is a good thing.
The Bill will finally address the insecurity and injustice that far too many renters experience. We value the contribution made by responsible landlords who provide quality homes to their tenants, but there is no place for unscrupulous landlords who tarnish the reputation of the entire sector by seeking to exploit or discriminate against tenants.
This Government were elected with a mandate to deliver change, and this Bill is the first of many with which we will honour our promise to the people. After the last Government failed to legislate for renters’ rights in five years, we have introduced this Bill within our first 100 days in office. This will change the lives of millions of people, so for them, and for future generations, I commend this Bill to the House.
Madam Deputy Speaker (Judith Cummins)
I call the shadow Secretary of State.
Mrs Kemi Badenoch (North West Essex) (Con)
It is a privilege to open for the Opposition on Second Reading of the Renters’ Rights Bill in this momentous week. As the Secretary of State mentioned, Labour reaches 100 days in office this week, for which it is to be congratulated, as not everyone gets to 100 days—Sue Gray didn’t. [Hon. Members: “Liz Truss didn’t!”] Neither did Sue Gray. The point is that not everyone gets to 100 days, so we congratulate the Government. So far, the only real actions we have seen are the noisy infighting and chaos that resulted in the hurried reset we saw over the weekend—oh dear. This Renters’ Rights Bill will only add to the chaos.
The first time the Secretary of State and I faced each other across the Dispatch Box, I warned her that she is being stitched up by the Prime Minister and the Chancellor. I also told her that we are here to help, and we are, especially as it has been a particularly rough time to be a woman in the Labour party. It is not just the sacking of Sue Gray—she is soon to be awarded what Winston Churchill called a “disapeerage”—as the hon. Member for Canterbury (Rosie Duffield) has taken the brave decision to leave the Labour party. I have followed the hon. Lady’s career in this place closely and, although we do not agree on everything, she is very brave.
Dawn Butler
On a point of order, Madam Deputy Speaker. This is Second Reading of the Renters’ Rights Bill, and the shadow Secretary of State is all over the place.
Madam Deputy Speaker
I am sure the shadow Secretary of State will come back to that subject.
Mrs Badenoch
I am still on that subject, Madam Deputy Speaker.
As I was saying, the hon. Member for Canterbury took the brave decision to leave the Labour party. I have followed her career in this place closely and, although we do not agree on everything, she is very brave. Perhaps the Secretary of State will feel nervous as she introduces the Bill, because I know that her Department is already breaking promises of its own. It promised a new national planning policy framework within 100 days, yet there is no new framework. There is just a consultation, as I predicted during our last debate on this subject.
To be fair, the Department has finally produced this Renters’ Rights Bill, after copying and pasting quite a lot of our Bill, but it is still not ready. The truth is that it cannot fix the rental market by tying it in knots with further interventions and directives. The simple truth is that this Bill will not work and the proposals will fail.
We know the Bill will fail because this approach has been tried in Scotland by those great experts in failure, the Scottish National party. Research by Indigo House, the housing expert, has found that none of the Scottish legislation since 2017 has protected the majority of private residential tenants against excessive rent increases or high advertised market rents. It has discovered that tenants have found it more difficult to find a home, and that there is a particularly negative impact on those in greatest need, including homeless households and those with less economic power, such as those claiming welfare benefits.
Andrew Griffith
My right hon. Friend is making a powerful speech on an important subject. Is she familiar with this week’s report from Scotland’s Housing Network revealing that 16% of landlords are reducing their supply, and fully 12% are considering leaving the sector over precisely this sort of attempt to over-regulate what would otherwise be a free market?
Mrs Badenoch
I have not seen that specific report, but I have seen others that indicate that this is happening. We have to be careful. I appreciate that the Government want to make renting more secure and affordable, and we want to do that too, but this Bill will have the opposite effect, as we have seen in Scotland. As this Government will find out over the course of this Parliament, they cannot buck the market.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Does the Secretary of State recall why the previous Government failed to introduce such measures, as they intended?
Mrs Badenoch
Yes, I do recall. The reason why our Bill did not get through is that we recognised its flaws. That is what I mean when I say that I worry about the Secretary of State, because the bright young things in Downing Street who have sent her out with this Bill do not care if it fails. They will take the credit today, but she will get the blame tomorrow, and tenants will get bad regulation, shortages and higher prices, as we have seen in Scotland. Those higher prices will be paid by tenants, especially young people and the less well off.
Shaun Davies
Is it not the case that, as the country will see from the right hon. Lady’s speech, tenants in the private rented sector will fear the return of the Conservative party, in the same way as mums who rely on maternity pay?
Mrs Badenoch
That question is nonsense. My point is that tenants will not be able to find properties to rent in the first place. From that intervention, it seems that Labour still does not understand these concepts.
We worry that the higher prices will be paid by tenants, especially young people and the less well off. Demand is rising in England, but availability is not keeping up. Forty-seven per cent. of landlords have either attempted to sell a property in 2023 or are thinking of doing so, with the biggest reason being to their fear of new laws.
Markus Campbell-Savours (Penrith and Solway) (Lab)
Penrith and Solway contains the Lake District national park and other tourist areas. Does the right hon. Lady recognise that the previous Government’s failure to introduce their promised reforms to section 21 has led to many private landlords moving from the private rented sector into the holiday let market? Her reasoned amendment says the Bill will
“reduce the supply of housing”—
Mrs Badenoch
Private landlords react to legislation, which is why we say that such legislation will reduce housing in the private rented sector. Fifty-six per cent. of landlords cited our Renters (Reform) Bill as a factor in their decision to sell. We already recognise those flaws, and such a reduction in supply is bad for both tenants and landlords. We are losing homes in the private rented sector.
Nesil Caliskan (Barking) (Lab)
Does the right hon. Lady recognise that the reduction in supply over the past few years is primarily down to the increase in interest rates, which has driven landlords out of the sector? A sector that is fundamentally broken requires the Government to take action to provide security for those who need a home for themselves and their children.
Mrs Badenoch
Of course we want people to have security in homes, but to do that we need to increase supply. We did what we could when we were in government, and we will help this Government to deliver. The fact of the matter is that this legislation is not going to help. We would love it if it did—we tried to make it work and we could not—but it would have a negative effect.
Landlords provide a vital service. The private rented sector is essential for those who cannot yet afford a mortgage, for young people and for those who need to move for work. Landlords selling and giving up homes for rent for mortgages do not help many of the people who need to rent. The overwhelming majority of landlords are responsible—I am glad the Secretary of State acknowledged that—and law abiding, and they see their property as a sustainable long-term investment.
The Government claim the Bill will reform the rental market. We do not believe it will—it will break it. Respect for property rights is not just an abstract principle. It underpins confidence in our economy and legal system. If the Government do not protect property rights, investment is damaged. If investment is damaged, growth is hit. It is painfully clear to anyone who understands markets that the Bill will act as a powerful disincentive for anyone to rent out their property. Most tenants do not have friends and family to rent from and, unlike Members of the Labour party, they do not have millionaire donors to put them up, so they will suffer most when supply goes down and rents go up.
Luke Murphy (Basingstoke) (Lab)
If it was so patently obvious and it was such a fundamental principle of property rights, why did everyone on the Conservative Benches, including the right hon. Lady, stand on a manifesto committed to reform? Is it not the truth that rather than thinking such legislation would not work, the previous Government simply failed to deliver it, in common with many other things?
Mrs Badenoch
There is a big difference between having a headline in a manifesto and seeing the detail, as many Members on the Government Benches will soon find out. Earlier on, their Prime Minister could not answer the question about whether the Government will increase taxes. Campaigning is easy, but governing is hard.
Mrs Badenoch
We will find out soon enough.
Perhaps Members on the Government Benches are oblivious to these costs and dynamic effects—listening to their interventions, it appears so. I note that no impact assessment for the Bill is available, an omission that has rightly drawn criticism from the Regulatory Policy Committee. Will the Secretary of State tell us whether an impact assessment has been undertaken? If it exists, where is it? If it does not exist, why did the Government not ask for one? I hope this is not how the Labour Government mean to go on.
When I was in government, I provided impact assessments on all sorts of complex legislation. I know that is difficult and can create arguments, but I also know there is a lot more badly thought out and costly regulation where this came from, and we on the Opposition Benches are worried. I know Members on the Government Benches will want to point to the last Government’s Renters (Reform) Bill—I have heard their interventions—but the fact is, that Bill was flawed. I am quite happy to say that, but at least it recognised the practical effect of its provisions and would not have come into full effect until the courts were ready.
The then Levelling Up, Housing and Communities Committee warned in 2023 that the equivalent provisions in the Renters (Reform) Bill created
“a real risk that the current systems will be overwhelmed, and there will be a logjam with lengthy delays.”
This Government are pressing ahead with measures that will cause gridlock in our justice system, and pit landlords and tenants against each other in protracted litigation.
Ben Coleman
It is absolutely extraordinary to hear strong opposition to every part of the Bill from the right hon. Lady, or am I mistaken? Is she opposed to the parts of the Bill that will protect children from getting breathing problems and ending up being hospitalised? Is she against the protections the Bill introduces so that people can finally live in decent accommodation? If she does not oppose those things, why is she so relentlessly negative and—forgive me, as a new Member—so relentlessly patronising?
Mrs Badenoch
I do not mean to be patronising, but it is quite difficult when there are very clear issues that have a precedent in Scotland. The question is not why I am being patronising; the question is why the Government are ignoring what has happened when these proposals have been tried in another part of the UK. That is a serious problem. All of us here want the best for children and to see tenants do well. It is very wrong of the hon. Gentleman to ascribe negative motivations when we are pointing out problems with legislation. We on the Opposition Benches are doing our job. We do not think the Bill will work.
Mike Martin (Tunbridge Wells) (LD)
On that point, will the right hon. Lady give way?
Mrs Badenoch
I would like to make some progress.
The Government are pressing ahead with measures that will cause gridlock in the justice system, which will create even more problems for tenants. The people the Government are trying to help will not be able to get a home in the first place—none of us want to see that. We have to do better.
Dame Siobhain McDonagh (Mitcham and Morden) (Lab)
On that point, will the right hon. Lady give way?
Mrs Badenoch
I will give way first to the hon. Member for Tunbridge Wells (Mike Martin).
Mike Martin
I thank the right hon. Lady for giving way. Some 25% of Conservative MPs are landlords. Does that have any bearing on the Conservative party’s position on the Bill?
Mrs Badenoch
We need to focus on the contents of the Bill. If anyone has an issue with landlords in this House, it is Labour Members—I notice the hon. Member for Ilford South (Jas Athwal) ran away before the discussion about the Bill started. They should look at themselves, and the hon. Member for Tunbridge Wells had better check his fellow Members before asking that sort of question.
As I was saying, when the problems of protracted litigation in the courts are combined with the new, extended and highly convoluted notice requirements for recovering a property where the tenant has not paid the rent, a landlord whose tenant is in arrears will face many months of uncertainty and cost. Let me summarise in two words why the Bill will fail: unintended consequences. That is what we get when we start with policy rather than first principles.
Dame Siobhain McDonagh
Does the right hon. Lady think that there is already gridlock in the county courts? As of today, a landlord who secures a possession order will wait 12 weeks to get a bailiff’s warrant. Our courts are gridlocked right now.
Mrs Badenoch
That is an excellent point—we should not make the problem worse.
We should start with first principles not policy, but there are no first principles here that will help the Bill get through. We want to help the Bill become legislation to deliver for tenants and landlords. However, as I have heard from the comments that have been made, this seems to be about the left being seen to be tough on landlords and passing legislation with the right sounding title, rather than delivering real improvement to people’s lives.
I heard the Secretary of State teasing my right hon. Friend the Member for New Forest West (Sir Desmond Swayne), but it is hypocritical to criticise those of us in the House who declare our interests—we on the Conservative Benches do that well—when a Labour MP was disgraced in the press for letting out unsanitary homes with mould. The Government should look at why they have Members who are behaving that way.
We want a housing market that works for everyone—landlords, tenants and those who want to own their home. By attacking those who rent out homes, they will damage investment in new homes. They will push landlords out of the market and drive up rents. That is bad for everyone. By piling on excessive regulation, they will push good landlords out and empower those bad landlords who simply ignore the rules. We need to look at enforcement of the rules we already have.
We all agree that renters need a better deal, but this Bill is not going to work. It is not what renters need—we found that out and we want to help deliver a good Bill. If the Government want to help renters, they should drive up housing supply: so far, no sign of that. If the Government want to help renters, they need to reduce immigration: so far, no sign of that. Some 80% of recent migrants have moved into the private rental sector, creating a demand the sector cannot cope with. If the Government want to help renters, they need to enforce existing rules against the bad landlords that do not look after their tenants, rather than create new rules that will make the problem worse.
This legislation is typical of Labour in government. We have tabled a reasoned amendment because the Bill fails to fix the major issues and adds yet more rules and regulations to keep the bureaucrats busy, rather than finding solutions to help those tenants who desperately need them.
Madam Deputy Speaker (Judith Cummins)
I call the Chair of the Housing, Communities and Local Government Committee.
Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)
May I start by thanking the Minister for Housing and Planning, my hon. Friend the Member for Greenwich and Woolwich (Matthew Pennycook), for meeting me over recess to discuss the Bill. I know that he will be closing the debate later today.
I am afraid that one consequence of the Government’s prioritisation of this Bill is that, because my Committee has no members, I cannot yet speak as its Chair, but I very much look forward to doing so, and I thank the House for electing me to this important role.
The Bill is of great importance to many people in my Vauxhall and Camberwell Green constituency and to millions of renters across the country. Too often they feel the sharp end of a market that is not working for them. They can suffer inflation-busting rent rises under the threat of eviction. They can end up waiting far too long for repairs to serious problems. Data from Shelter highlights the fact that almost one in three households in my constituency lives in the private rented sector. In 2001, the number of households in private rented accommodation was 8,129. By 2021, that figure had increased to more than 13,178—a staggering 62% increase in just 20 years.
We have spoken about affordability and rent increases. This issue is pushing so many people into debt and putting them at risk of homelessness. According to Shelter, the average monthly rent in August 2024 in England was £1,327, but the figure for Lambeth is almost twice the national average at over £2,210. We all know that wages are not rising in line with this increase. The reality facing many private renters today is that they can be evicted with only two months’ notice, often needing to find thousands of pounds to cover moving costs and deposits on a new property.
We have touched on the fact that most private landlords are good. The majority of them are providing a good service, and they play an important role in our housing ecosystem. The majority of them take their responsibilities seriously, but for far too long a minority of rogue landlords have been able to exploit loopholes in legislation to treat tenants in a frankly unacceptable way. The Bill must put an end to that, and provide tenants with the certainty and security they deserve.
In 2019, when I first stood for election, the Conservative manifesto promised to end no-fault evictions, yet half a decade later, renters are still desperately waiting for a fair deal and they cannot afford to wait any longer. I think about the emails that I have received since the start of the cost of living crisis, with constituents facing rent rises of between 20% and 30%. One constituent even emailed me to say that their rent had doubled in just one year. They said:
“I am a private renter. I’m particularly concerned about unfair rent increases. I am 47 and have lived in the same area for most of my time in London, but despite the huge amount of properties that have been built in the area, none is affordable to buy and few are affordable to rent.”
He goes on to say:
“I rent privately and my rent has been increasing faster than my salary. At this point in my life, things should feel more secure. If you want to truly end no-fault evictions, you need to address extortionate rent increases which are as good as an eviction for many.”
I know that many colleagues across this House have received similar emails, which highlights why this Bill is so badly needed.
It is critical that the Government act urgently on this matter, so I welcome the speed with which they have delivered this Bill to the House. It shows how seriously they take the private rented sector. Although this Bill is similar to the Renters (Reform) Bill, which was introduced under the previous Government, there are a couple of important differences that further improve the offer to private renters.
The raising of maximum fines in multiple areas, such as discrimination against those with children or those who are on benefits, is a step in the right direction, although the Renters’ Reform Coalition has called for an even larger fine to act as a proper deterrent. I hope the Secretary of State will take that on board.
The introduction of clause 55 outlawing rental bidding is also important. Since the general election in July, I have been contacted by tenants who are facing bidding wars. A person is told that they are going to view a rental property, and then, when they turn up, they are told that 45 other people will be viewing it with them and that the property will go to the highest bidder. That is just unacceptable.
I also welcome the extension to the protected period for no-fault eviction grounds and the required notice periods where these grounds are used.
Joe Powell (Kensington and Bayswater) (Lab)
Does my hon. Friend agree that one of the unintended consequences of section 21 is that people often do not report damp and mould or the repairs that they need for fear of eviction, because they will be pushed into finding a new tenancy, which they simply cannot afford?
Florence Eshalomi
I thank my hon. Friend for that intervention. That is really important. I give credit to the previous Government for Awaab’s law, which tackles the problems of damp and mould in the social housing sector, but it is vital that we have the same protections for private tenants who, frankly, live in squalor. We have seen emails from people talking about black mould. That is not acceptable. Housing benefit is being paid for those properties. We need to make sure that tenants are renting the right properties.
The Bill will increase security for tenants, and help deal with those big deposits that they have to save for. However, as some colleagues have highlighted, the success of the measures in this Bill will come down to enforcement. In its report on the previous Government’s Renters (Reform) Bill, the predecessor Levelling Up, Housing and Communities Committee found that measures making it easier for tenants to challenge rent rises in a first-tier tribunal could increase the workload of our justice system. We all know that our justice system is struggling under the backlog, and that backlogs are far too common. It is critical that the Government’s good intentions do not result in a system that tenants simply cannot access because of those lengthy backlogs. We cannot send tenants to tribunals if it ends with them being further frustrated by the judicial system. Will the Minister please tell me what work is under way to ensure that the tribunals are ready for this change in the law and can cope with the increase in cases?
The previous Committee also warned that levels of implementation could vary massively between different councils. The large number of landlords in this country can make enforcement in the sector quite challenging, particularly when local authority finances are so stretched. Although the introduction of the private rented sector database will help, we could see unscrupulous landlords fall through the cracks if there is not stringent enforcement by councils. The Bill will place new regulatory powers and enforcement responsibilities on local authorities.
The Minister is well aware that our councils are facing significant funding pressures. The Local Government Association reports that due to inflation, wage pressures, and cost and demand pressures, English councils face a £2.3 billion funding gap in 2025-26. What steps is the Minister taking to work with councils to ensure that there is sufficient enforcement of this legislation and that councils are properly resourced to carry out their new responsibilities effectively?
Finally, will the Minister please confirm whether the housing ombudsman will run the new private rented sector ombudsman, so that tenants can access justice in disputes? When I met the housing ombudsman, he mentioned that a number of cases that were brought before him were allowed when an appeal was made, so there is already failure at a local level. We also have to consider the fact that so many private renters are afraid to challenge their landlord because of the fear of eviction. We need a strong ombudsman to help them get the justice that they deserve.
I look forward to working with the Minister as this Bill progresses through Parliament. I hope that he will address the points I have made and ensure that we have a sector that works with our tenants, recognising how much they pay, and provides them with security, so that they no longer have to fear being evicted through no fault of their own. Thank you.
Mr Gideon Amos (Taunton and Wellington) (LD)
I have congratulated the Secretary of State on her position, but I also congratulate her colleague, the Minister for Housing and Planning, on his. He follows a long line of Ministers—the first, arguably, being Christopher Addison, the great Liberal and Labour Minister, who delivered not only the great Housing and Town Planning Act 1919, but more than half a million council houses. I am sure that the Minister will be delivering just as many over the next two or three years.
As the Member for Greenwich and Woolwich, the Minister also follows former Housing Minister Nick Raynsford, with whom I had the pleasure of working. I was going to say that something in the water of Greenwich and Woolwich produces great Housing Ministers, but unfortunately, following the legacy of the last Government, there is far too much in the water—and we really do not want to dwell on that. Seriously, the Minister is taking on an important portfolio, as is the Secretary of State, of course. Housing and planning have the power to touch every single person in the country and make up one of the most important roles in Government.
My own experience is limited to being a tenant and landlord—only ever a landlord of registered social housing; I am happy to declare that interest today. The Government face huge challenges, but we must not shrink from the overall objective of ending homelessness, which was enshrined in both the Liberal Democrat and Labour manifestos. The Government will have the full support of my colleagues on the Liberal Democrat Benches of the measures that they bring forward to that end. As my right hon. Friend the Member for Kingston and Surbiton (Ed Davey) has made clear and demonstrated, when opposition is needed it will be constructive and positive.
In that spirit, I am pleased to generally welcome the Bill, which will give tenants the security that all other residents already have and that tenants surely deserve, and put right the scandalous delay in bringing an end to no-fault evictions. We must encourage the majority of landlords out there, who are responsible, as are the majority of tenants. When those interests go together, we can deliver the thousands of private rented homes that we need in this country—we cannot do without them. It is right also to dwell on elements of the Bill that can support the supply of private rented housing.
Steve Darling (Torbay) (LD)
I refer colleagues to my entry in the Register of Members’ Financial Interests. I welcome this Bill, and want to reflect on my constituency. The national average proportion of renters in the private sector is 19%; in Torbay, the figure is 26%. That is mostly driven by the fact that we are the 10th worst authority in the country when it comes to the amount of social housing, at 8%, compared with a national average of 17%. Once upon a time, 35% of people in our nation had social rented accommodation. Does my hon. Friend agree that more should be done about the significant issue of absentee landlords?
Mr Amos
I certainly agree with my hon. Friend. We need a lot more council and social rented homes. I will return to that issue.
In the spirit of ensuring that a plentiful supply of rented housing comes forward, we urge the Government to retain the option for landlords and renters to agree between them fixed-term tenancies of three years, rather than periodic tenancies being the only product on the shelf, so to speak. We are worried that investors will be unlikely to invest ahead if they cannot see security of tenure coming from their investments. There could just be an increase in short-term holiday lets as a result, because there would be no difference between tenures.
If both renters and landlords are to have any faith in the courts when it comes to resolving disputes over evictions, the courts must have the investment to do the job. Put simply, and as was said earlier, there are not enough judges or bailiffs and the system simply will not work until there are. In the same way, local authorities must be funded properly to take on the new responsibilities in the Bill. In Taunton and Wellington, the local Somerset council has more than 10,000 people on the council housing waiting list and was brought the brink of bankruptcy by the Conservative Government’s cuts to proposed funding for social care—a crisis across the country that the outgoing Conservative leader of Somerset called a “ticking timebomb”, which was handed to the new administration.
In those circumstances, it is not surprising that Somerset and local authorities across the country are unable to enforce the standards of housing that we would want. The House of Commons Library found
“evidence of low and inconsistent levels of enforcement”
when it comes to addressing poor property standards. No amount of words in the Bill will make up for the need for resources; I was pleased to hear the Secretary of State mention funding for local authorities to discharge those duties. That is vital. The Bill also rightly makes separate provision for student housing, but it does not extend to one or more student renters renting together. If that does not happen, there could be a significant withdrawal of student housing from the market. We would be concerned to see that.
I turn to other provisions in the Bill. We welcome the protections for renters on benefits, who of course should not be discriminated against. We will also be seeking an assurance that the 12-month prohibition on re-letting following an eviction will also apply to re-letting furnished holiday lets, such as on Airbnb. We are pleased to see that, following the work of my hon. Friend the Member for North Shropshire (Helen Morgan) and of the Minister of Housing and Planning, who both worked on the Bill in the previous Session, no new, punitive definition of antisocial behaviour is being introduced. We thoroughly welcome that element of the Renters’ Rights Bill.
To support our serving military personnel and help address the recruitment challenge in these uncertain times, I also support the bid of my hon. Friend the Member for North Shropshire, also in the last Session, to ensure that MOD housing is also subject to the decent homes standard proposed in the Bill. It is curious that the Government often like to legislate for others; I want reassurance that they will legislate for their own MOD housing at the same time. Service personnel deserve decent homes just as much as anyone else. That decent homes standard surely must extend to better insulation and energy efficiency—to EPC level C, as was mentioned earlier.
I ask the Minister to meet the concerns of my constituents in Taunton and Wellington and across the country by agreeing guidance with landlords and the sector on what would constitute reasonable grounds for refusing permission to have a pet—a subject close to the heart of the Secretary of State, I know—and ensure that tenants are allowed to keep their pet once that has been agreed.
Above all, the Bill is about bringing an end to the shameful delays of successive Conservative Governments when it comes to protecting renters from unfair evictions. I heard the right hon. Member for North West Essex (Mrs Badenoch) say that she wanted to help the Bill— but she has also tabled an amendment to kill it. If that is helping, I would hate to see her definition of attacking something.
The change really cannot come soon enough. One of my constituents, Mike Godleman, came to me some time ago. He had been served with a section 21 eviction notice while recovering from major surgery. He had loved his home of over nine years. A couple of months ago, his councillor and I visited him to try to help him. We met a kind, gentle and creative man who taught sign language, loved dance and was a talented teacher and photographer. His charming sons Perez and Zakkai meant the absolute world to him, and he had become more of a friend to us than a constituent. His sons were a complete credit to him when we met them. Sadly, some 10 days ago Mike was found in his flat. He had passed away as a result of a pulmonary embolism—clearly not caused by his eviction notice, but surely people in Mike’s position should not have to suffer being made homeless as a result of a notice that inherently, and on the face of it, shows that there was no fault on his part.
Conservative Administrations since 1988 have ushered in a system in which the tenure that has grown most is the one that gives the least assurance to tenants; assured shorthold tenancies are now the most common form of tenancy. Their approach seemed designed to maximise disadvantage to renters—40% of renters now say that, as a result, their last home move was forced on them, adding turmoil to insecurity of tenure. In fact by repeatedly announcing that they would legislate but then failing to deliver on that legislation, the last Government prompted a massive 30% growth in Airbnb short-term lets, taking away more security of tenure from other tenants.
It is hardly surprising that Ministry of Justice reports show that standard procedure claims for possession and eviction massively increased under the last Conservative Government, while accelerated procedure claims doubled from 4,000 to 8,000. The Conservatives’ inaction was a shocking abandonment of thousands of tenants to increasing eviction rates, as landlords sought to pre-empt the often promised, but never delivered, end to no-fault evictions.
Markus Campbell-Savours
Does the hon. Member agree that, as I think the shadow Minister alluded to in her speech, there have been attempts to use no-fault eviction as a way to deal with people who are at fault, and that the failure of that system has now become an excuse for not reforming this injustice?
Mr Amos
I agree with the hon. Member. We must make sure that the courts are properly resourced so that the grounds that are in the Bill to provide for eviction, where it is justified, can work effectively. That is surely the way forward, rather than some back-door approach in which no-fault evictions are used for a multitude of reasons, many of them not justified.
While it is right to legislate to end no-fault evictions—measures that Liberal MPs such as the former Member for Bermondsey and Old Southwark, Simon Hughes, vehemently opposed from these Benches back in 1988 —we surely cannot think that the private sector alone is the answer to solving our nation’s housing crisis. The Government must be more ambitious, immediately banning no-fault evictions, building 150,000 council and social rent homes per year, a comprehensive programme to insulate all housing, a planning use class to control second homes and allowing councils to halt the right to buy, so that when we build council houses we are not trying to fill the bath with the plug taken out.
Those are the priorities that the Liberal Democrats will be campaigning for and working to see on the face of this Bill. I urge the Minister and the Government to take on as many of our suggestions as they possibly can.
Several hon. Members rose—
Madam Deputy Speaker (Judith Cummins)
Order. The House will be aware that more than 50 Members want to speak in today’s debate. I am imposing an immediate time limit of four minutes on Back-Bench speeches and six minutes on maiden speeches.
Dame Siobhain McDonagh (Mitcham and Morden) (Lab)
I stand to support the Second Reading of this Bill, particularly the abolition of section 21 no-fault evictions. It falls to my right hon. Friend the Secretary of State to introduce a Bill that will fulfil the hopes of the former Member for Surrey Heath to abolish section 21 evictions, which are the sole cause of crisis for homeless families right across our country.
We currently have 117,450 families in temporary accommodation, including 151,630 children and—disgracefully—more than 20,000 babies under the age of one. That comes at a cost to the British taxpayer of £1.6 billion a year—all of it public money badly spent; all of it undermining the finances of local authorities of all sizes and in every part of this country.
What bothers me most, however, is the families who present to me in my Mitcham and Morden constituency who are going through a section 21 eviction and know that temporary accommodation is on its way. Merton is a small south-west London borough and does not face the pressure that many others do, but those families know that they are going to be placed tens of miles away, if not hundreds of miles away, from their families and support networks.
Nesil Caliskan
On the point about temporary accommodation, does my hon. Friend agree that there is something perverse in this broken market when a family is faced with an eviction notice and a local authority has to rehouse them again in the private sector, costing the taxpayer more money?
Dame Siobhain McDonagh
I thank my hon. Friend for that intervention. Local authorities have to rehouse those families in identical accommodation, only in worse repair, because there are not the same legal provisions for temporary accommodation.
Children lose their places at school and their educational attainment falls, parents lose their employment, and babies die. We know through the work of Dr Laura Neilson, who works with me on the all-party parliamentary group for households in temporary accommodation, that between 2019 and 2023, 55 babies in temporary accommodation—in the 21st century, in the fifth biggest economy in the world—died for the want of a cot. Members right across the House know this, because we see the families and we talk to them, but most of our friends and neighbours would be shocked to the core that these things happen in our country.
I will give two examples from my last surgery. Mrs S is a nurse at St Helier hospital and Mr S works morning shifts at a local supermarket. They have three children, one of whom is non-verbal and has autism. Following a section 21 eviction from their home, they were placed 31 miles away from Merton, in Windsor—but only after they had spent eight hours in the reception of the civic centre and got their accommodation so late that when they turned up at Windsor, the estate agent was closed and they had nowhere to go. Mr S had to pay £300 for them to be in a hotel that night. Next day, when they turned up at the house, there were no beds, because nobody from the local authority—nobody from any local authority—checks the accommodation before the families move in. I say to hon. Members, “Don’t believe your local authority if they tell you they do, because they simply can’t do it.”
My second example is just in case anybody thinks this issue only affects families. Mr H has dementia. When he was evicted, he was placed 8 miles away, in Croydon. That is not far, but it caused South West London and St George’s Mental Health NHS Trust to remove him from its list and he lost the support he got from the geriatrician. We are doing these things to the most vulnerable people. That keeps me awake at night, and I think it should keep all of us awake at night.
Priti Patel (Witham) (Con)
I want to open my remarks by recognising that in this important debate we all want to ensure that families who rent have good access to quality homes and housing. That is the baseline that we must all recognise and acknowledge, with landlords in the private and social sector doing the right thing when it comes to their responsibilities, their obligations and their duties to their tenants.
This House needs to be honest with itself and recognise that during these debates in recent years, not just today’s debate, we have seen landlords vilified. There is no question but that there are some terrible and shocking examples—as was mentioned earlier, there are examples in this very House as well—and it is right that they are exposed. It is right that there are sanctions for those awful landlords and it is important that, throughout the passage of this Bill and the discussions in this House, we all act responsibly to set the right bar and the right standards. That is crucial.
Although we have those shocking examples, we should not forget that the overwhelming majority of landlords work hard to invest in their properties and do the right thing by their tenants. That is fundamental to providing housing supply in the market—there has been back-and-forth between those on the two Front Benches already around what will happen to housing supply, but we should bear that in mind through the type of regulation and legislation that this Government are intent on passing. We should not focus disproportionately on the minority who need to raise their bar and be held to account; as my right hon. Friend the Member for North West Essex (Mrs Badenoch) has said, we must work through the unintended consequences of this legislation.
I want to pose some questions to those on the Government Front Bench. First, from the landlords’ perspective, may we have some transparency on the costs and impacts? The Government will not have the details yet as this is a Second Reading debate, but we should recognise that during the passage of this legislation landlords will almost inevitably be passing on the costs arising from certain clauses through higher rents.
Coming back to unintended consequences, there are also clauses on controlling rent increases and initial rent reviews for tenants and they could be set higher; the Government should be thinking about this. The costs of selective licensing schemes already introduced by local authorities have been passed on to new tenants through tenancy agreements, so we need to look at what works and what does not work. Moreover, landlords are leaving the market as a result of what they know from the draft legislation about taxation and regulation, and we need to look at what that means for private sector supply and what will happen to the market costs of rent.
My next questions, in the time I have left, are on housing supply. I do believe that we need more social housing. I represent a constituency with four local authorities, and our house building has been phenomenal over the last decade. That has predominantly been in the private sector but also in the social housing sector. My local authorities play a very significant role in planning, housing and development, and we all recognise the heavy the work that takes place in those areas, but I would like to know how the Government are going to fund their enforcement policies for local authorities, and how the capability will be put in place and how the prioritisation will come together.
I know there will be further scrutiny and questions during the passage of this Bill, and I will be pressing those to the Government Front Bench.
Several hon. Members rose—
Madam Deputy Speaker (Judith Cummins)
I call Alex Baker to make her maiden speech.
Alex Baker (Aldershot) (Lab)
Thank you, Madam Deputy Speaker. For more than 100 years, since the dawn of universal suffrage, the people of Aldershot and Farnborough have sent Conservative MPs to speak for us in this place, so it is with great pride and even greater humility that I rise to give my maiden speech as the first woman and the first Labour Member of Parliament ever elected by my community. I congratulate everyone on both sides of the House who have made their maiden speeches before me.
Let me begin by paying tribute to my predecessor, Leo Docherty, for the seven years of service he gave to my constituency. Mr Docherty served our country in the Scots Guards, as a Member of Parliament and as a Minister of the Crown, and we wish him well for the future. Leo will be remembered as a champion for our armed forces, and I have already learned in my first few weeks as an MP to follow the maxim of the Parachute Regiment, be “ready for anything”, including the moment when I was told just a few weeks ago that a tornado—yes, an actual tornado—was landing in my constituency.
Whatever strong winds are yet to come, I am truly honoured to represent my home and the place where I am raising my family. Today I repeat the pledge I made to my constituents on the night I was elected: “No matter how you voted, or whether you voted for me or for anyone at all in the general election, I will dedicate myself to serving you, our neighbours and every corner of our community, in Aldershot, Farnborough, Blackwater, Hawley and Yateley.”
My politics has been shaped by people and place: my volunteering; community groups; residents’ associations; my church; and my career working with business and communities, from the co-operative movement to the regeneration of Battersea power station, where I helped build not just the bricks and mortar of a new town centre but a vibrant and diverse community, best represented by Battersea power station community choir, which I founded. These experiences taught me that every voice matters and that listening to one another is the first step to getting stuff done. That is the approach I am trying to bring as our new Member of Parliament, and I know from Danielle, Syfun, Katie and many other residents who have already come to me with housing cases how much we need to bring greater fairness to our private rental sector, so I am looking forward to supporting this Bill in the Lobby tonight.
The history of Aldershot and Farnborough is built on service and Great British innovation. We are the home of the British Army and the birthplace of British aviation. Our story began 170 years ago, as our country entered the Crimean war. It was in 1854 that Queen Victoria gave her blessing for the British Army to establish a permanent training camp in a small village on the Hampshire border. The Aldershot garrison town was the first complete military settlement built in the British Isles since the Romans. And Farnborough was transformed too, growing from a small railway town to become the home of the Army ballon factory and the Royal Aircraft Establishment and a hub for military aviation. It was there in 1908 that Samuel Cody piloted the first aeroplane to take flight in Britain. My home continues to deliver cutting-edge technology to this day, with every single Boeing commercial aircraft tested in the Farnborough wind tunnel.
Above all, Aldershot and Farnborough have been defined by the men and women who have served and sacrificed in every major conflict that our country has faced. We will always remember them. Today we are also home to the largest Nepalese community in the UK. The Gurkhas have served our country with outstanding bravery over generations, and I look forward to serving them and advocating for them in this place.
As well as our military heritage, my community has a rich cultural history. We hosted the Olympic games in 1948, when events were held in the Aldershot lido, where I now take my daughters swimming. We were the setting for several Bond films, the place where Charlie Chaplin made his stage debut, and where The Beatles gave their first performance in the south of England. We need to shout loudly and proudly about the great things that have happened and continue to happen in our constituency, and that is something I will always try to do.
There is Farnborough football club, whose women’s team are league champions and cup winners after their first ever season, and Aldershot Town—the Shots—who recently became the first football club to receive the Ministry of Defence gold award for upholding the armed forces covenant. There are great charities such as Step By Step, the Grub Hub, Yateley Industries, our Rotary clubs, the Vine Centre, and many more I could mention. They are all making a tremendous difference. And the world still comes to do business at the Farnborough air show every two years.
But for everything that is right with our community, I know from countless conversations on the doorsteps that many of my neighbours question whether our best days still lie ahead of us. I take that really seriously. I am ambitious for our towns—these communities that have played such a role in our national endeavour—and I believe that if we can bring people together, we can bring new opportunities to our home, breathe new life into our town centres, and realise our incredible potential. I am ready to play my part in that and hope others will join me.
Let me end with a promise, because as I begin my term I have found some inspiration in the work of the Royal Corps of Transport, which was based in Aldershot for many decades. These men and women kept our Army moving across land, air and sea, and their work continues today through the Royal Logistics Corps. They went by the motto “Nothing without labour”, and that serves as a reminder to me that everything we discuss in this Chamber, and everything we hope to achieve for our constituencies, begins and ends with hard work—struggle, toil, effort, doing our best. For as long as I have the privilege of representing my home in this place, I can promise that hard work is the very least that my constituents will get from me, every single day.
Madam Deputy Speaker (Judith Cummins)
I call Ayoub Khan to make his maiden speech.
Ayoub Khan (Birmingham Perry Barr) (Ind)
May I start by commending the eloquent maiden speech by the hon. Member for Aldershot (Alex Baker)?
When I was studying law with aspirations of becoming a barrister, I often recalled the words of Lord David Pannick KC. He once said that the Bar is like the Ritz hotel: the doors are open to all, but only a select few ever get in. Those words resonate as I stand here, privileged to represent my Birmingham Perry Bar constituents. There are many parallels between my journey to the Bar and my journey to this House. The Bar was once considered too elite for someone like me—a young man of colour from inner-city Aston, who grew up in one of the most deprived and disadvantaged areas in Birmingham. Yet despite all the barriers, I persevered and became a member of the legal profession, just as I now stand here as a Member of Parliament, representing a community rich in resilience and potential, despite its challenges.
Like many in this House—the most diverse in our nation’s history—I bring a unique story. Our diversity in race, religion and culture strengthens this Parliament, reflecting the richness of the nation that we serve. In this House, we have the immense privilege of debating, challenging, and holding the Government to account for the decisions that shape our country’s future. I recognise that our opinions often differ and are, at times, deeply polarised, but our respect for opposing views, and ability to agree to disagree, are what define our democracy.
My political journey began over two decades ago in 2003, when I was first elected to local government. It was a remarkable experience, not just because of my initial victory, but because after losing my seat in 2004, I challenged the result through an election petition, exposing Birmingham’s postal vote scandal. As the election commissioner in that tribunal commented—I paraphrase—“Mr Khan must be commended. He was the backbone of the petition, fighting this on a shoestring while studying at the Bar.” That defines my character—my commitment to fairness, justice and equality. Barristers are taught to act without fear or favour, a principle that guides my actions in public life. Winning as an independent is extremely rare, but that victory was not simply plucked out of thin air. It may surprise some, but during my political journey, I have contested seven local elections, three general elections, the west midlands police and crime commissioner election and a European election. As I have served my residents faithfully for over two decades, and will continue to do so, I am certainly no stranger to politics, and I take great exception to those who seek to undermine me, my campaign or my constituents.
Birmingham Perry Barr, like many constituencies, has its charms and challenges. It was once home to the great inventor James Watt, whose contributions were instrumental on a global level. My constituency is also home to the Jacobean Aston Hall in Aston Park, a stone’s throw from where I grew up and still live. We are home to Aston Villa football club, which, as we all know, is supported by His Royal Highness Prince William. And before anyone asks, no, I have not received any complimentary tickets—yet! The Commonwealth games at the Alexander stadium in Perry Barr brought much-needed positive global attention to our constituency.
However, we must not lose sight of the real challenges that we continue to face. Many people in Perry Barr, like others elsewhere in the country, are at breaking point. Our doctors and nurses are overwhelmed, struggling to deliver care under increasing pressure. Meanwhile, families are enduring unsafe and unsuitable temporary housing. Fly-tipping continues to plague large parts of the constituency. The cost of living means that child poverty has hit record highs. Crime and antisocial behaviour are rampant: just last week, our community faced another tragic murder.
Growing up, I had the support of youth workers, who helped to shape who I am today, but now, our youth centres are being dismantled. Youth services and employment opportunities are vital for reducing crime, tackling unemployment and ensuring a brighter future for Birmingham. Children with special needs are also being failed. I visited Anglesey primary school, where 20 non-verbal children with autism are confined to a dilapidated room. Their teachers are pleading for just £10,000 annually for better facilities. Those urgent issues require real solutions.
Let me turn to the substantive issue under debate. I have registered my interest in the Register of Members’ Financial Interests. Although I welcome the Renters’ Rights Bill, I urge the Government to take stronger action to address the appalling standards in temporary housing. We have 25,000 families on the waiting list for homes, and with Birmingham city council declaring bankruptcy, the situation is dire, but that is no excuse for the deplorable conditions that families are forced to live in. The Government must step in and provide support to bail out the council, just as we did with the banks. The people of Birmingham should not be made to suffer for the failures of local government.
I must acknowledge my predecessor, Khalid Mahmood, who was the first Muslim MP to be elected to this House. He paved the way for many, and I hope to build on his work to improve the lives of my constituents. Another name fondly remembered by my constituents is Jeff Rooker, a significant figure. A common bond between the three of us is our shared working-class heritage through our parents.
My late father, Iqbal Khan, worked 12-hour shifts at the steel factory, while my mother, Parveen Akhtar, raised me and my siblings. Both my parents sacrificed family ties in Azad Kashmir to pursue a better future for me and my siblings. I like to think that I have done them proud. At this point, I must also extend my heartfelt gratitude to my wife, children, extended family and friends, who have graciously shared me with my constituents throughout my political journey. Their unwavering support has been invaluable.
Finally, I would be doing a disservice to my constituents if I did not mention in my maiden speech the plight of the Palestinians. As a lawyer, dealing with evidence is my expertise, but a law degree is not necessary to see the injustice that we are all witnessing. On Monday, I told the Prime Minister that self-defence is a moot point, but not because I do not believe that sovereign nations have a right to defend themselves—they do. Despite desperate calls for a ceasefire, those pleas have fallen on deaf ears. Words without meaningful action are hollow. The only real action that the Government can take is to immediately halt all arms sales. If we are to truly claim the mantle of human rights defenders, we cannot acknowledge the suffering of some while turning a blind eye to that of others. Injustice anywhere is injustice everywhere. Our response must be comprehensive and principled.
I conclude my remarks with the words of Albert Einstein:
“The world will not be destroyed by those who do evil, but by those who watch them without doing anything.”
Madam Deputy Speaker (Ms Nusrat Ghani)
Parveen and Iqbal will indeed be proud. Time limits are limits, folks. If you look at me or at the clock, you will know when it is time to stop talking. I call James Naish to make his maiden speech.
James Naish (Rushcliffe) (Lab)
Thank you, Madam Deputy Speaker, for the opportunity to make my maiden speech in this important debate. I congratulate my hon. Friend the Member for Aldershot (Alex Baker) and the hon. Member for Birmingham Perry Barr (Ayoub Khan) on completing their maiden speeches. As the House will hear in a moment, I am used to being third, so this is an appropriate time to speak.
I have the honour of representing Rushcliffe in the south of Nottinghamshire. In these quarters, Rushcliffe is known for one thing: Baron Clarke of Nottingham. If politics were a beauty contest, Ken Clarke was Mr Rushcliffe for 49 years before being ennobled, despite remarking in his own maiden speech in 1970 that the constituency was a marginal. I am not sure that is how the local Labour party saw it for the next 54 years. During the campaign, though, my local campaign team—ever the optimists—actually knocked on Baron Clarke’s door, and he graciously invited us in. We chatted about various local issues before he unsurprisingly concluded that he would still be supporting the Conservatives at the election. At that point, his daughter helpfully piped up from the next room, “Remember, Dad, you’re in the Lords—you can’t vote any more”, condemning his party to one fewer guaranteed vote. I am honoured to follow in the footsteps of one of the great characters of this House. His pro-European views resonated strongly with the constituents of Rushcliffe, the only constituency in the east midlands to strongly support remaining in the EU. I will therefore endeavour to work closely with the Government to deepen ties with our European friends, neighbours and allies, as we must.
I also pay tribute to my immediate predecessor, Ruth Edwards, who served on several Select Committees. She was passionate about the rural environment, chairing the all-party parliamentary group on geographically protected foods. She also fought hard for the east midlands freeport and championed a network of safe spaces for domestic abuse survivors. I sincerely hope that Ruth is enjoying her time away from this House in what can only be described as her own personal zoo—the farm that she shares with a Labrador called Clemmie, chickens, bees, donkeys, a tortoise called Geoffrey, and three alpacas.
Like Vera, Florence and Coco the alpacas, I was lucky enough to be born part of a trio, the youngest of triplets. While the House of Commons Library is not 100% sure, I am likely to be the first triplet to stand in this place. Having spent my whole life sharing birthdays, cards, parties, exam results days and much more, it is nice to achieve something unique that is not shared with anyone else in my family, including a well-known podcaster who seeks to stay relevant by disagreeing agreeably.
I thank the people of Rushcliffe, especially the 73.2% who voted—one of the highest turnouts in the recent election. Since being elected, I have met representatives from our three great sports venues: Nottingham Forest’s City Ground, Trent Bridge, and the National Water Sports Centre. I have made several visits to the site of the Ratcliffe-on-Soar power station, the last working coal-fired power station in our country, which closed last week. Such was my commitment to visiting the site that on one occasion, running late, I decided not to fill up as I passed a garage, only to lose power three miles later as I was driving up the A453. I blocked the left-hand lane for an hour while waiting to be rescued—not the best place to be seen as the new MP for the area. Having worked in delivery in the energy sector for most of the past decade, I strongly believe that the advanced, clean, green energy agenda, through which we can build the technologies of the future, offers huge economic potential. I hope to speak regularly in this House on those topics.
Moving on to this debate, I draw the House’s attention to my registered interest in a property from which I receive a rental income. Only last weekend, I saw a comment online from a lady who moved to my constituency with six-year-old twins. She posted anonymously on a community Facebook group about a leak into her flat: “It’s one excuse after another, and nothing has been done for six months. For the past three weeks, my children have been ill as a result. Please, I need help and advice on what to do.” She told me that the stress was causing high blood pressure and had resulted in changes to her routine medication. That demonstrates that a person’s living conditions can have much broader implications for their health and wellbeing. I therefore welcome this Bill and its many provisions to promote longer-term secure tenancies, but as a former council leader, I encourage Ministers to consider how local authorities can be best resourced to take on extra enforcement work—a point already touched on.
It is an honour to represent the people of Rushcliffe, and I will seek to serve them as best I can for as long as I am in this House.
Madam Deputy Speaker (Ms Nusrat Ghani)
Hopefully, the Government Whips will know that the correct, elected triplet is in the Chamber and voting.
Rebecca Smith (South West Devon) (Con)
I congratulate the hon. Member for Rushcliffe (James Naish) on his maiden speech. He may be the first triplet I have ever met, so he can add that to his list of firsts.
I speak recognising that we want, understandably, to keep tenants safe and to ensure that those in the private rented sector have the security that we believe they deserve. However, I do worry that the Government’s good intentions in what they are seeking to achieve will actually leave us with no homes left to rent, or at least a significant reduction. Having worked in a homelessness team 20 years ago, I have seen at first hand the impact on those who are evicted. More recently, as the cabinet member for homes and communities, I had responsibility for homelessness, building safety, disabled facilities grants and the cross-party plan for homes that Plymouth city council has proudly worked through over the years.
I speak for tenants and landlords. No one can be responsible for homelessness and not want to ensure that people in vulnerable situations have the best opportunities. However, I also speak for the many excellent landlords in the city that I represent part of, not least those who are members of the South West Landlords Association, whose training I participated in while I was a cabinet member. They provide the vital rented homes that the city and the surrounding areas need, the loss of which will have an impact on the very tenants we are hoping to support.
None of this Bill will be relevant if there are no homes left to rent. Rightmove is currently claiming that there are 50 inquiries for every rental property in Plymouth. We also have 365 households in temporary accommodation, with 162 of those households in bed-and-breakfast accommodation. I am sad to say that those numbers have not really moved much in the last couple of years, because of the lack of private rented property. With this Bill, we may therefore be ignoring the dangers of the impacts on those tenants in temporary accommodation.
We need to ensure that the private rented market in cities such as Plymouth and the surrounding rural areas is fit for purpose, and at the moment it is completely broken. The fact that the homes are not necessarily always fit to in live is almost the least of the problems, because again, as I have said, if there are no homes to live in, people do not have anywhere to be.
Markus Campbell-Savours
This issue of landlords removing themselves from the sector was also brought up in the speech of the right hon. Member for Witham (Priti Patel). What does the hon. Member think happens to properties when landlords remove themselves from the sector?
Rebecca Smith
The hon. Member makes a very good point, and that brings me on nicely to the next section of my speech. One of my constituents has recently written to me to say that he is very sadly, having been a landlord for the same tenants for 25 years, selling his entire portfolio of 89 properties. Sometimes, we do actually see—[Interruption.] Will the hon. Member allow me to finish? Thank you.
We sometimes see some really constructive solutions to these problems. For example, while I was a cabinet member on a Conservative council under the Conservative Government, Plymouth city council, Plymouth Community Homes and Homes England were able to work together to purchase 86 three-bedroom properties from Annington Homes, which is the supplier for the MOD. So the hon. Member is correct that there are some options. However, although my constituent has approached the council, there has currently been no movement. The point I want to make in this section of my speech is about what more Homes England could do to ensure that when landlords leave the market as an unintended consequence of this Bill, their properties are bought by local councils, although they may need the grants that Homes England has so generously provided in the past.
Chris Curtis (Milton Keynes North) (Lab)
Does the hon. Member think that the houses disappear when the landlords move out of the market? The bricks and mortar are still there. The problems in our housing market are caused by the lack of supply and by private landlords taking advantage. Such movement of homes in a fixed market is not going to cause the problems that I think she is suggesting.
Rebecca Smith
My experience has been that this does impact on the market. That is why the market in Plymouth has failed, in the words of the chief executive of the city council, because those properties often get bought by a family who may not have been—[Interruption.] No, let me finish. Such a family may have been in a privately owned property, not a privately rented one. I feel that we are speaking to the same point, but ultimately the market in the constituency I represent is not working. I am speaking only about the evidence I have seen for myself, but the 89 properties that are going to be sold will mean 89 further households needing temporary accommodation. It they have to be found further accommodation when there are 50 inquiries for every rental property in Plymouth, there is clearly a problem, although I do take the points that Labour Members have made.
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. We need to reduce the number of interventions, because they eat into other Back Benchers’ time.
Naushabah Khan
I will be brief, Madam Deputy Speaker. Does the hon. Member recognise that a number properties are taken out of the private rented sector to be used as temporary accommodation because landlords are able to get a better deal, sometimes from councils, and that that also has an impact on the market?
Rebecca Smith
Yes, the hon. Lady is correct. That is part of the problem, and I go back to my point: it is why in cities such as Plymouth the private sector market is failing. Those temporary homes are needed for those who have been evicted from the private rented sector, and then we end up with them staying in temporary accommodation, rather than permanent homes. Ultimately, we are all seeking to achieve somewhere for people to live in the long term, not temporarily. I believe we all need that security, which is ultimately what the Bill is trying to achieve. I am just highlighting that if there is no supply, there are no homes for us to secure through this legislation.
I know that the Secretary of State recognises the important role of landlords, yet this Bill feels like a using sledgehammer to crack the nut of no-fault evictions and poor conditions, with significant unintended consequences, as the shadow Secretary of State, my right hon. Friend the Member for North West Essex (Mrs Badenoch), outlined. We will see properties leaving the market and therefore a further increase in the number of people not in accommodation. I take the House back to this figure: this Bill will increase, from 365 already, the number of households in the city I represent who are living in temporary accommodation.
Andrew Lewin (Welwyn Hatfield) (Lab)
It is a pleasure to follow my colleagues’ inspiring maiden speeches today. This is the first time I have risen to speak in a substantive debate, following my own maiden speech in the summer. I am proud to support this Bill, which is the most significant reform to the sector in more than a generation. It will end the exploitative practice of bidding wars. It will offer security to renters, and it will enshrine a commitment to a decent home being the right of everyone in our country.
Private renters are at the sharp end of our housing crisis. According to English housing survey data, one in five live in non-decent homes. In my constituency, it is a scandal that 1,300 people are paying to rent non-decent homes. The majority of them live in Hatfield, where the average cost of a two-bed to rent is £1,200 a month. The private rental sector accounts for more than one in four properties. For all the good and responsible landlords in the sector, too many have not taken their responsibilities to tenants seriously. Sadly, the last Government did not take their responsibilities to renters seriously either.
This comprehensive Bill will act where the Conservatives failed. The journey starts with a commitment to those who rent property, but who have been locked out of the process by rental bidding and rental wars. As it stands, landlords are free to invite closed bids for how much rent people are willing to pay, playing them off against each other to maximise their return. It is plainly wrong, and like so much of our housing system, it penalises people who are less likely to have access to savings or family wealth. As set out in clause 55, we will end that practice.
The Bill calls time on rental bidding, but it also calls time on no-fault evictions. Private renting can never offer the same security as home ownership or social housing, which is why this Bill is tied inextricably to a broader Government agenda of building 1.5 million homes over this Parliament and making building homes for social rent a priority again. Ending section 21 and moving to periodic assured tenancies is a significant strengthening of renters’ rights. If someone is moving into a rental home for the first time, they will have a year of security. It was two months under the last Government, but it will be 12 months under Labour.
The quality of our private rented homes is just as important as security of tenure. For too many people, once the battle to find a place to live is won, a new front opens with their landlord on the quality of their living conditions at home. There is a better than one in five chance that a private renter will be living in a non-decent property. The Bill will ensure that private renters are no longer second-class citizens and are protected by the decent homes standard.
I said in my maiden speech that I would always say where we agree with another party, and I congratulate the Conservatives on bringing in Awaab’s law in the course of the previous Parliament, but it is absolutely right that this Labour Government extend the law to the private sector, so that every renter in England can challenge dangerous conditions in the home and, crucially, do so safe in the knowledge that they will no longer be subject to a no-fault eviction simply for having the confidence to speak out.
There are thousands of renters in my constituency and 4.5 million across the country. The Bill is a landmark moment for all of them. I am proud that it is a priority for our Labour Government and I look forward to working with colleagues as it progresses through the House.
Richard Tice (Boston and Skegness) (Reform)
I congratulate hon. Members on their excellent maiden speeches this afternoon and declare an interest as someone who has been involved in the commercial and residential property sector for over 35 years.
The thing is, there are many good and noble intentions in the Bill. The Secretary of State outlined them and I think the whole House endorses them. She spoke about the need to balance rights between tenants and landlords. That is a matter of judgment, and I fully respect that the Government are making a series of judgments and decisions. The reality is, though, that in the last five years, the quantity of private sector properties available to rent in the United Kingdom has reduced by about 50%. As more restrictions and regulations are imposed, the quantity is going down. I think that is particularly so in Scotland, where there have been even tighter restrictions and the availability of properties for rent has reduced.
Of course, what we all want is the opposite—a greater supply of rental properties—but that requires additional capital for additional new homes to be built. That is a key objective of the Government that I think all of us support, but to ensure sufficient reward and attraction for that capital, landlords need to know that the balance of risks and rewards is appropriate and that vacant possession can be secured.
I am old enough, ladies and gentleman, to remember the ’70s and ’80s—[Hon. Members: “Surely not.”] I know. A two-tier market emerged between what were called assured tenancies and assured shorthold tenancies, for which vacant possession could be secured. Properties with assured tenancies were worth approximately only 80% of those with assured shorthold tenancies. I say to the Minister, in the Secretary of State’s absence, that the risk here is that if the Government get this wrong, the capital will disappear, the quantity of properties to rent will reduce and the quantity of supply to be built for the private rented sector will reduce.
I urge the Government to keep these measures under close review as the Bill passes through the House. If they get the balance wrong and it is made too difficult to secure vacant possession—particularly of properties with tenants involved in antisocial behaviour or not paying their rent—the supply will reduce dramatically.
Markus Campbell-Savours
I asked this question before and did not get a successful answer. Perhaps the hon. Member can tell us what will happen to those properties when landlords pull out of the market.
Richard Tice
It is a really good question, and I am happy to answer it. If the landlord pulls a property available to rent out of the market, it will go into the ownership sector and that property will not be available to rent.
We know that there is significant demand to rent, and I say to the Government that we want to increase the supply of properties available to rent. I therefore repeat the point that it is about risk and reward. The Government must make these judgments. I just say to the Minister that he should keep this closely under review. If the Government get the balance wrong, the market will reduce while demand will continue to rise, so rents will rise as the supply reduces. That is my concern. If the Bill passes—it is likely to—perhaps the Minister should review it in a year by looking at the data and seeing what is happening to rents, what is happening to supply and whether further tweaks and adjustments are needed.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Pam Cox to make her maiden speech.
Pam Cox (Colchester) (Lab)
I congratulate all those who have made their first speeches today. I look forward to continuing to work with them in the coming months.
I am here in this place at the pleasure of the voters of Colchester. [Hon. Members: “Hear, hear!”] I’ll take that. Colchester was the very first capital of Britain. In the year 49 AD, it was the first place in the country to be given the status of Roman colonia. Unfortunately, we held that title for only a decade, before a woman from Norfolk laid waste to the city. The Romans decided that a muddy river crossing in a little place called Londinium would be a safer bet. That was almost 2,000 years before another woman from Norfolk, more precisely South West Norfolk, entered Londinium and laid waste to the British economy. We Essex folk could have warned you of the dangers. [Laughter.] On my way into this place, I often walk past the imposing statue of that first Norfolk woman, Boudica, standing proud in her chariot on the embankment, and I feel like she is spurring me on to step up to the plate as Colchester’s first woman MP.
I am an historian by training and profession, and each day that I enter this House I remember that I am only here because of the commitment and effort of the generations who came before me—women and men who valued democracy and served their communities. I come from a family dedicated to service. My mother worked in public health and my father worked as a church minister. They taught my sisters and I the values of public service, and I have promised the residents of Colchester that, as their MP, I will put those into practice.
I am also very proud to be a member of a party whose leader has pledged to lead a Government of service. Those words mean a great deal to me—they are one of the reasons why I stood to be an MP. We are here only at the pleasure of those who put us here, and our job is to serve them.
I wish to pay tribute to my predecessors. Will Quince served as Colchester’s MP for nine years. He worked very hard for his constituents and was dedicated to their wellbeing. In particular, I highlight the work he did on baby loss, a cause that still means a great deal to him. I know that he is continuing to serve in his life after Parliament, in particular as an Army specialist reserve officer.
The connection between Colchester and the Army began with the Roman legions, and it continues today in the form of 16 Air Assault Brigade Combat Team, which is the British Army’s global response force and is able to respond to crises around the world at a few hours’ notice. I pay tribute to its service and bravery.
Will’s predecessor, Sir Bob Russell, was Colchester’s MP for 18 years, and he continues to serve it today as High Steward and as chief letter writer to the Colchester Gazette. No one is more passionate than Sir Bob about celebrating our city’s history, and I was proud to be at an unveiling of his most recent project, a statue celebrating the Colchester origins of the world’s most famous nursery rhyme, “Twinkle, Twinkle, Little Star”. Please come to see it, and while there you can take in the country’s oldest and longest Roman walls, its only Roman circus and one of the most impressive Norman castles, not to mention award-winning arts venues such as the Mercury theatre, Firstsite gallery and Colchester Arts Centre. On that matter, forget the hype around Oasis—Colchester Arts Centre and Stanway school together honed the rare talent of Blur. I am sure that sentiment is shared by the right hon. Member for Witham (Priti Patel), my constituency neighbour.
I would also like to recall one other predecessor, Charles Smith, who is the only other Labour MP in Colchester’s history. He was elected 79 years before me, almost to the day. Charles Smith, later Lord Delacourt-Smith, was part of that great reforming Government of 1945 that gave us the national health service, national parks, new towns and so much more. Now that was a Government of service. They took office after years of destruction, with the country in mourning, debt and crisis, yet they still generated hope, took action and laid the foundations for a brighter future for us all. We have a lot to learn from them.
I am very proud to speak in this debate on a bold Bill, which is in that spirit. It will bring much-needed change to our housing sector and uphold the rights of thousands of tenants to live in the decent homes that they deserve. The case for the Bill has been eloquently set out by the Deputy Prime Minister, the Chair of the Housing, Communities and Local Government Committee, and other speakers.
I am not a career politician. I have spent most of my life researching, teaching and leading in higher education, much of it at the outstanding University of Essex. I worked in social history and social sciences. It is my firm belief that only by understanding what has worked and what has mattered in the past can we hope to build a better future. I have written about the history of work, criminal justice, social care and education. I have used that knowledge to help to lead present-day policy change in youth services, family courts, women’s employment and victims’ rights. There is a red thread running through my work, which has traced how modes of governing have changed over time and how we have come to govern in the name of freedom with the aim of enabling people to truly flourish. If our country is to flourish, everyone must have the opportunity to thrive. We need decent public services that give everyone the best start in life and support us through to life’s end. That is a collective endeavour.
Colchester has been a wonderful home to me and my family. I stood for election first as a city councillor and then as an MP because I wanted to give back to that community that has given us so much. I thank my fantastic family and all the local campaigners who have been a brilliant support to me over the past few months and more. Old habits die hard: Members will be relieved to hear that I have resisted the temptation to circulate a reading list to go with this lecture, or speech, or to speak for my customary 50 minutes—Madam Deputy Speaker is looking at me. I am looking forward to working as hard as I can for those who have sent me here: the people of Colchester.
Olly Glover (Didcot and Wantage) (LD)
Let me start by congratulating the hon. Member for Colchester (Pam Cox) on her excellent maiden speech and her comprehensive survey of Colchester’s history.
On the morning of Friday 5 July I was elected as a Member of this House. My result was declared at around 6.30 in the morning. Like so many of us, I had been awake for 24 hours and I was exhausted but elated. When I got home I had breakfast and a couple of hours’ sleep. I was woken up by hearing something being put in my letterbox. That in itself was not unusual; my landlords received my post and put it in that box, as they lived just 25 metres away. I wondered what it could be: another magazine from a charity I support, a credit card bill or perhaps, even, a belatedly delivered Liberal Democrat election leaflet?
When I opened the letter, it was something even worse: a section 21 eviction notice stating that my landlords intended to retire, and giving me just over two months to move out and find somewhere else to live. I had been renting that home for more than four years. I have always rented, and up to that point I had generally had a good experience, so I have no particular axe to grind. But receiving that eviction notice via letter without any prior conversation or indication that it may be coming was not what I needed any morning, let alone that morning when my head was spinning from having been elected.
Receiving a section 21 eviction notice was tough for me, but it is far worse for many others—people with children, those who care for disabled or elderly relatives and those without the financial means to deal with the deposits and up-front rents associated with moving to a new place. Some tenants may seek a landlord notice period of more than two months, but the current market does not provide that, which shows that regulation is needed.
Exposure to many of these renting issues is, at root cause, driven by a lack of social or affordable housing to rent. In the town of Didcot in my Oxfordshire constituency, the average house price is 14.8 times the average annual salary. This significant disparity highlights the need for more homes that are cheaper than market rent, so that young people wanting to start families can afford to remain living in the area. More social and affordable housing would also ease pressures on some lower paid key worker roles in education and healthcare, which currently are hard to recruit.
There are many problems with the current renting arrangements, which I am pleased to say the Bill addresses. However, some organisations representing renters believe that it does not go far enough. For example, the charity Crisis feels that stronger action may be needed to protect tenants from unfair rent increases, and to remove some of the barriers that make it harder for low-income tenants to secure a private rented tenancy in the first place. Research commissioned by the TDS Charitable Foundation indicates that nearly half of private renters do not know where to turn if their landlord or letting agent fails to address a problem they may have. That highlights the need for better information for tenants on their rights and where to find support.
The Bill does not include a requirement for landlords to engage in dialogue or discussion with a tenant before issuing an eviction letter—something that would have helped in my case. As my hon. Friends the Members for Maidenhead (Mr Reynolds) and for Taunton and Wellington (Mr Amos) said, more could be done to require landlords to improve energy efficiency, and local authorities and courts will need to be properly resourced to enforce the Bill’s provisions.
In a free market economy people have the right to invest in property, but it is important to remember that a home is far more than a financial asset. Unlike stocks and shares, a home is a place of safety, security, shelter, warmth, comfort and privacy and somewhere to raise a family. That should always be our starting point.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Torsten Bell to make his maiden speech.
Torsten Bell (Swansea West) (Lab)
Thank you, Madam Deputy Speaker, and I praise the speech by the hon. Member for Didcot and Wantage (Olly Glover), who powerfully made the case for change that the Bill will deliver. I should also start by thanking all hon. Members for their indulgence, because it is just possible that another maiden speech is not the gap in their lives right now. Even Members on this side of the House have realised that there is one downside to such a big landslide.
My immediate predecessor in the seat named Swansea West served his constituency diligently; he campaigned on important issues like air quality. And I feel great affinity for his predecessor, Alan Williams; like me, he was an economist before he was a politician, and he focused on the bread and butter issues of raising living standards.
But today, Swansea West is not very west at all. In fact, half of the constituency in the north and east was previously represented by my hon. Friend—and more importantly, formidable friend—the Member for Neath and Swansea East (Carolyn Harris). I shall endeavour to emulate her passion and drive, but not her bold sartorial choices. In her maiden speech, she challenged Dylan Thomas’ famous description of Swansea as an “ugly, lovely town”, rightly noting that today it is “economically exciting, architecturally beautiful” and “culturally…groundbreaking”.
As someone new-ish to politics, I am more concerned about another phrase attributed to Thomas, labelling Swansea the “graveyard of ambition”. Fortunately, he never uttered such words, and the ambition of this great city is alive and well, as anyone who has watched the newly established Penlan under-10s team train in driving rain can attest. Perhaps there is an even more deeply held and widely shared ambition in the city, of our council, our business leaders and the myriad community groups that hold our city together—an ambition for a Swansea in which greater prosperity is created and greater prosperity is also shared. I shall play my part in realising that ambition and doing justice to the honour of being elected for this great city—the city in which both my parents started their inspiring careers of service.
But it was a person, not a place, that took a punt on me as a young man: the former Member for Edinburgh South West, Alistair Darling—an honourable Friend in here but always a friend to me. As the banks went bust, he taught me that politics is a vocation to be lived up to, not a game to be played, and that the MP’s role is to combine service to a community and also service to a cause. There is no greater community than Swansea and no greater cause than rebuilding the prosperity of it and this United Kingdom.
I am very much not the first Jack to lack a local accent. The city has welcomed so many. Early 18th century records show Jewish names beginning to crop up, and today, our mosques are crucial institutions—ones the whole community rallied around when violence and Islamophobia were seen on the UK’s streets this summer. Those fleeing the war in Ukraine have found Swansea a genuine city of sanctuary.
And while I may be the first Torsten to represent Swansea—and maybe anywhere—people with suspicious Scandinavian names are nothing new. Legend has it that a certain Viking provided the origin story of Swansea by settling on “Sweyns-ey”—Sweyn’s island. More recently, the 19th century poet, Walter Savage Landor recognised that the frankly overrated bay of Naples has nothing on Swansea bay. Economists like to talk about comparative advantages and, well, this is ours—glittering from the industrial might of Port Talbot to the more genteel Mumbles. Never mind Naples; there is a far more important comparison with Cardiff. It is a contest long settled by the writer Jan Morris, who succinctly concluded that “Swansea is much the nicer”.
It is, but it is no utopia. One in five children live in absolute poverty. The famous industrialist, Sir John Morris, founder of Morris Town—today’s Morriston—lies under St Matthew’s church. That building is today the base for Matthew’s House, a wonderful charity doing work that should never be needed, feeding hundreds of the most vulnerable residents in a city were 340 households become homeless every month.
Like many places that drove the industrial revolution, Swansea’s past offers much to be proud of, such as the schooners, built to sail around the horn carrying the copper nitrate that made the city rich, and the world’s first passenger train, instigated by an 1804 Act of this Parliament. It was pulled by horses—an experience perhaps not much slower than on today’s still inexplicably unelectrified main line.
We celebrate all this and more, but what my constituents are asking today is how we can build a better economic future—that is the question. The typical wage in Swansea is £536 a week, and House of Commons Library research shows that it has not risen by one penny since 2010. That is what economic failure on a colossal scale looks like. And while wages do not rise, insecurity does. A constituent recently opened her door to me, distraught at having seen her weekly hours cut from 15 to three overnight. None of us could live with that uncertainty, and no one should.
If mainstream politics cannot provide the very basics—decent homes, stable jobs and rising wages—many will turn away, from voting or to populists who seek to exploit these problems, not to solve them. Defeating populism also means rejecting fatalism, because we know that progress can be delivered; the minimum wage has proved it, and the employment Bill to be published tomorrow will do so again. Investment can be prioritised, potholes can be filled, and homes can be built.
Who owns the best view in Swansea? Not the owner of a mansion but the residents of Townhill, an estate for working people, built between the wars on the precious land in the heights above the city centre. Today we debate what are inexplicably delayed basic standards for the millions of renters squeezed out of both home ownership and social housing. The Bill bans landlords, in Wales or England, from discriminating against tenants who receive benefits or have children.
Swansea has many of the materials to build this shared prosperity. I will not list them all, but they include our great universities, a future and not just a past for Port Talbot, and the new opportunities to be seized from a tidal lagoon.
Service to a community and to a cause, to Swansea and to shared prosperity: to my constituents, I promise to give my all to that task. Finally, to hon. Members here I bring perhaps even more welcome news: that is one fewer maiden speech to go.
Jeremy Corbyn (Islington North) (Ind)
I pay tribute to all the new Members who have delivered their maiden speeches, and I wish them well as Members of the House. I draw particular attention to the maiden speech made by the Member for Birmingham Perry Barr (Ayoub Khan), my colleague in the Independent group.
The issue of housing that we are debating today should have been a huger issue in the general election than it actually was. A quarter of a million people in this country are homeless at any one time. In my own area, 2,000 people are living in temporary accommodation —or, sadly, sleeping rough—including 850 children. I pay tribute to the many organisations in my area that do a huge amount of work to try to alleviate the problems of homelessness, including Streets Kitchen, the Single Homeless Project, Shelter from the Storm, and Acorn, which represents private sector tenants.
I welcome the Bill. Much of it is very good. It is a huge improvement on what has gone before. Frankly, it should have been law a long time ago. However, there are one or two areas that I think we should consider. British renters, on average, spend 30% of their income on rent, and the proportion is far higher in London. One in five private tenants spend more than half of their salary on private sector rent. Young people, especially those moving into inner-city areas, for instance in London, Birmingham, Newcastle and Manchester, are saddled with student debt and, on top of that, are paying phenomenal amounts of rent, usually in shared flats. It is quite normal for young people in my constituency to be renting flats for more than £2,000 a month, which they have to share with three or four other people. They might be happy sharing for a short time in their 20s and 30s, but as they get older they want their own place. They have no savings and no ability to save, and they have no security of tenure either. Something has to change.
I made this point in my intervention during the Secretary of State’s opening speech. I welcome the Bill, because ending no-fault eviction and providing security of tenure is a huge step forward. Providing for some predictability when it comes to getting repairs done and rights of representation is good, and the role of local government in these measures is also good. However, unless we address the fundamental issue of very high rents in the private rented sector, we will not make any progress.
In my constituency, about a third of people live in the private rented sector—up from less than 10% when I was first elected to the House many years ago—and the figure is rising all the time. The rents are incredibly high. When somebody who is on universal credit and eligible for housing benefit looks for a flat in my area, none is affordable within the local housing allowance. It is simply far too expensive, so the only thing that happens is that people move out. We need to bite the bullet and introduce rent controls in this country. It would not be the end of the world, and they would not destroy the private rented sector. Rent controls have been introduced in Berlin, and they are quite common across much of Europe and in the United States. Unless we introduce rent controls, we are going to have a continuing long-term problem.
I want to finish by saying that we are dealing with a desperate housing shortage in this country, and it will be resolved only by the comprehensive building of council housing with secure tenure and genuinely affordable rent. That will deal with the scourge of homelessness.
Madam Deputy Speaker (Ms Nusrat Ghani)
For the benefit of new colleagues, one does not stride past a Dispatch Box once a debate is taking place.
Rachel Hopkins (Luton South and South Bedfordshire) (Lab)
It is a pleasure to speak in this debate and express my full support for the Bill. I welcome the swift action of the ministerial team in bringing forward this vital legislation, which is the most significant package of reforms to the private rented sector in over 40 years.
As the Member of Parliament for Luton South and South Bedfordshire, I am most frequently contacted about the issue of housing. Given that just under 35% of homes in my constituency are privately rented, the issues that tenants are facing in this sector are very familiar to me. Everyone deserves the dignity of a safe, secure and affordable home, but a lack of regulation and protections for tenants in the private rented sector means that this is currently not the reality for many.
Rental discrimination against tenants who are in receipt of benefits or have children is common practice, so I am pleased that this Bill will make it illegal for landlords and letting agents to discriminate on that basis, and give local councils strong enforcement powers to tackle this unlawful practice. Mortgage lenders and insurers will also no longer be able to impose restrictive, discriminatory terms.
A significant rise in section 21 no-fault eviction notices over the past year has further highlighted the precarious situation in which many renters find themselves. Data from the Ministry of Justice indicates that as of June this year there had been 176 repossessions in Luton due to section 21 notices, compared with 112 in 2023. Across the country we see a similar pattern unfolding, with over 32,000 no-fault eviction claims submitted to courts in 2023-24—the highest figure since 2015-16. Those figures highlight just how stark the situation is, so I am pleased that Labour is committed to abolishing section 21 notices once and for all. This legislation will also empower private rented sector tenants to challenge unreasonable rent increases, preventing unscrupulous landlords from using rent increases as a back-door means of eviction.
I am pleased to see many of the other measures set out in the Bill, including ensuring that there is a legal standard for property conditions. As it currently stands, 45% of private renters in England are experiencing damp, mould or excessive cold in their homes. This is completely unacceptable, and I am glad that the extension of Awaab’s law will set clear legal expectations about the timeframes within which landlords in the private rented sector must take action to make homes safe where they contain serious hazards. That goes hand in hand with the creation of a new private rented sector database that private landlords will be required to join, giving tenants, landlords and local authorities access to key information, and giving councils the power to target enforcement where it is most needed.
I know that many councils across the country have faced significant budget cuts, with my own council in Luton having £170 million of funding stripped since 2010. That can constrain its ability to check properties proactively for non-compliance, and places greater reliance on tenants being aware of their rights and reporting problems. Although I am pleased to see plans to tackle these issues, I would encourage Ministers to work in collaboration with local government to ensure that the necessary resources are available for councils to carry out this enforcement and to effectively protect tenants.
Daisy Cooper (St Albans) (LD)
The hon. Member is making an excellent speech, and I am delighted to see that no-fault evictions will finally be banned. On the point about local government, does she agree with my party that it is imperative that local authorities are given the powers to regulate the numbers and locations of Airbnbs? We know that too many properties that are available for rent are taken out of the market for long-term renters and used for Airbnbs, because landlords can raise more money that way, and I think it is important that local authorities should have those powers.
Rachel Hopkins
I thank the hon. Member for that important point. I am sure that when the whole package of measures around housing is taken forward by this Government, that point will be well considered.
This Bill is designed not to villainise good and responsible landlords but to give renters much greater security and stability, so they can stay in their homes for longer, build lives in their communities and avoid the risk of homelessness. I look forward to working with Ministers to deliver this and make the private rented sector safer and more secure for my constituents across Luton South and South Bedfordshire, and indeed across the country.
Carla Denyer (Bristol Central) (Green)
I congratulate the new Members who have made their maiden speeches on the interesting and important points raised. I should declare that I am a member of Acorn Community Union, which campaigns on renters’ rights. Indeed, I have personally campaigned on renters’ rights for a long time now. This welcome Bill is a once-in-a-generation opportunity to recognise the rights of the 11 million people living in the private rented sector to have a safe, decent and secure home. In the words of activist Kwajo Tweneboa, we are facing
“the biggest housing crisis since the Second World War”.
We have a generation who will never be able to earn enough to have a mortgage and cannot even afford their rents now.
The average rent in Bristol Central has hit nearly £1,800 a month, which is more than in several London boroughs, and a huge 47% of households in the constituency are in the private rented sector—that is 18,000 households. As the Secretary of State herself said, good landlords who are already acting fairly have nothing to fear from this Bill, but the rogue ones—like the landlord of my constituent who made countless reports of damp mould and leaks for months with no resolution until the ceiling fell in—need to be held to account.
I really recognise the many good parts of the Bill, but I hope the Government will go further on three key issues: security of tenure, rent affordability and energy efficiency. On security of tenure, the extension of notice periods to four months for landlord sale and moving in is progress, but we must have clear evidence thresholds for those grounds of no-fault eviction and measures to ensure that the 12-month “no re-letting” period is not broken. We also need an automatic right of non-payment of rent in the final two months to compensate a tenant for the disruption of being forced to move home.
The proposal to outlaw bidding wars is okay as far as it goes, but it is not likely to be effective in tackling rising rents. Landlords could still hike rents to kick people out, so we really need a cap on rent increases within tenancies, set at the lowest of either average wage growth or inflation. Rents in advance should be capped to one month—as a Labour Member suggested—to stop discrimination against people on low incomes. But rents are too high in the first place. To illustrate this point, if a 21-year-old living in Bristol rents a single room today at the average rate, they will have put £80,000 into their landlord’s bank account by the time they reach their 30th birthday. We need a system of rent controls, carefully introduced with local flexibility, aimed at bringing rents down relative to incomes, alongside a suite of policies to address the housing crisis, including a major increase in social housing and real support for community-led housing.
Siân Berry (Brighton Pavilion) (Green)
I endorse all my hon. Friend’s comments, particularly on the need for rent controls. In my constituency of Brighton, I have a very high population of renters, including myself. I have only ever been a private renter since leaving home over 30 years ago. My constituency has many young people and students renting, and my local Acorn branch and the National Union of Students have also raised the problems caused by well-off guarantors being required to secure a rented home. I have spoken with the NUS president about this. It fuels discrimination against working-class, estranged and international students, and fuels homelessness among students—
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. I am standing, so you must be seated. I call Carla Denyer.
Carla Denyer
My hon. Friend the Member for Brighton Pavilion (Siân Berry) makes a good point about guarantors, and I would also like to see that issue addressed in this Bill.
Citizens Advice reports that almost half of private renters are living in homes plagued with cold, damp or mould. Winter fuel bills are due to go up by 10%, and the winter fuel allowance is being cut for millions of pensioners. It is good to hear that the Government’s regulations will apply to social housing as well as private housing, but that commitment needs to be explicitly enshrined in this Bill, and let us get going on energy efficiency—there is no time for delay. There was a consultation on energy efficiency in the private rented sector in 2020, so let us not do another; let us just get on with it. We must properly fund our local councils, which will enforce these new rights. Councils that are on the brink of bankruptcy after 14 years of swingeing cuts will obviously struggle to deliver this part of the policy.
We need a shift in how we think about renting. In policy and practice, we should move away from viewing housing as an asset—as an investment for the wealthy— and towards prioritising and valuing the right to a stable home. Almost every point of improvement that I have suggested today has been raised by members and ex-members of the Labour party, so I hope that the Secretary of State and the Minister will give them very serious consideration.
This is such a welcome and important Bill. I hope it can be made even better to become truly transformative. My Green colleagues and I will be voting for the Renters’ Rights Bill tonight.
Helen Hayes (Dulwich and West Norwood) (Lab)
I support this long-overdue Bill. Almost a quarter of households in Dulwich and West Norwood are renting privately, and many of them live with the instability caused by an under-regulated market. I am contacted every week by constituents who are living in unacceptable conditions, facing unaffordable rent increases or threatened with a section 21 no-fault eviction. Private renting is fundamentally unsustainable and unstable.
Too many local renters are living in poor-quality accommodation, suffering with damp and mould, but with limited levers to hold their landlord or letting agency to account. Those who complain risk reprisal evictions, from which they have no protection. Tenants are forced by rent hikes and section 21 notices to move frequently, and they are denied the security of a long-term home. Parents put children into school not knowing whether they will be able to afford to stay in the area for the duration of their education. Increasingly, young families are being priced out of London, and that contributes to a dramatic drop in school rolls, so I warmly welcome this Bill.
Nesil Caliskan
I recognise the crisis that my hon. Friend describes. Does she agree that individuals and families are paying the cost of this crisis, not only with money but with the trauma of being moved from home to home?
Helen Hayes
My hon. Friend makes a good point. This crisis in private renting is taking an unbearable toll on the health and wellbeing, the financial security and the stability of families across the country, which is why this Bill is so welcome.
I will table an amendment to the Bill. Last year, constituents of mine tragically lost their son to suicide. He was in his first year of university and had signed a tenancy for his second-year accommodation shortly before his death. The tenancy, which had not started when this young man died, included a guarantor agreement signed by his parents. After their son’s death, the letting agency insisted that the agreement applied even in the event of a tenant’s death and, shockingly, began pursuing my constituents for rent payments. While facing the unbearable loss of their son, my constituents were forced to find another student to take on his tenancy in order to be relieved of their responsibility for the rent. This type of clause is not in every guarantor agreement, and it is wholly unnecessary. Landlords can insure themselves against loss of rent in the event of the death of a tenant. My amendment would outlaw the pursuit of guarantors for rent owed by a deceased tenant, to protect other families from this cruel treatment while they are grieving.
I am grateful to the Minister for Housing and Planning for his positive engagement on this issue, both in opposition and since he has been appointed to the Department. I hope the Government can accept my amendment, which was drafted with assistance from lawyers at Shelter, as a straightforward solution. I hope Members from across the House can all agree that no one facing bereavement should have to worry that they will be pursued for their loved one’s rent.
Finally, on affordability, rents in Lambeth and Southwark have grown rapidly in recent years. I welcome the measures in the Bill to ensure limits to rent increases under the section 8 process, and to ban landlords from accepting rents from prospective tenants above the asking price. However, the scale of the crisis in London is so significant that there is a need for further action on rent rises. I hope that as the Bill progresses through the House, my hon. Friends will listen to the calls of the Renter’s Reform Coalition and the Mayor of London, and will consider what more can be done to stabilise rents and assist with affordability.
For too long, reform of the private rented sector has been neglected, leaving renters in Dulwich and West Norwood suffering with insecurity, poor accommodation and rising costs. The effect of this crisis in private renting is destabilising for our communities and harmful for health; I see the impact of the crisis every single week in my constituency. The Renters’ Rights Bill will be transformative for my constituents, and I will be proud to support it this evening.
Sarah Olney (Richmond Park) (LD)
During the last Parliament, the Conservative Government betrayed tenants across the country. They committed to giving renters the right to a safe and secure home by abolishing section 21 evictions, and then delayed for five years. In that time, nearly a quarter of a million people had their life turned upside-down by a section 21 eviction notice, and quarter of a million more have not complained about disrepair for fear of having such a notice served on them, so at least half a million people have suffered because the Conservatives did not keep the promise they made in 2019.
As we speak, two of my constituents face the consequences of the Conservatives’ inaction. They came to the UK seeking refuge from Putin and his illegal invasion of Ukraine. One is a full-time carer for his wife, who is physically disabled and suffers from multiple severe mental health difficulties. Over the past year, their landlord has repeatedly threatened them with eviction, leaving the couple in constant uncertainty regarding their housing situation. These threats have been accompanied by surprise increases in rent and verbal abuse so bad that one of my constituents was hospitalised after suffering a major panic attack. Despite paying their rent on time and acting in accordance with their lease, my constituents have been continually threatened with a section 21 notice. Now, they face an appalling Catch-22 situation. If they leave their property, they make themselves intentionally homeless and give up the housing safety net; if they stay, they risk having the life that they have begun to build torn out from under them at a moment’s notice. Their case is just one example of how a bad landlord can dominate their tenants’ lives, and why this legislation must be enacted without any further delay.
I join my Liberal Democrat colleagues in welcoming the Bill, not only for the security and confidence it will bring to our constituents, but for the broader measures it will introduce. I am glad to see proposals to give tenants the right to request a pet—a request that landlords must consider and cannot unreasonably refuse. We are pleased that the Bill contains a presumption in favour of keeping pets, as they are often an integral part of a family. I join colleagues in commending the Government for finally doing what the last Administration could not—banning no-fault evictions, increasing housing security and making the rental market fairer for all.
Alex Sobel (Leeds Central and Headingley) (Lab/Co-op)
The Renters’ Rights Bill will bring much-needed security and safety to renters. I praise the Minister for Housing and Planning and the Secretary of State for bringing forward the Bill, which is much stronger than the previous Government’s Bill.
As the MP for a constituency with one of the largest private rented housing sectors in the UK—it has 17,740 private rental properties, the majority of which are rented to students—I want to use the debate to highlight problems faced by student renters, both in my constituency and across the country. Students are shouldering the burden of 14 years of Tory mismanagement of our economy. The dual housing and cost of living crisis is being compounded by landlords making it increasingly difficult for many students to secure housing. This leaves many in increasingly precarious situations.
Students in my constituency have told me of landlords asking them not just for a UK guarantor—the criterion for which is that the guarantor must own a UK property—but for deposits of up to 100% of annual rent. Such requirements disproportionately affect working-class students, care leavers, and those estranged from their families—groups that are already more vulnerable to poorer economic, educational and health outcomes. International students, too, face significant challenges, as most do not have family members with property in the UK. As one of my constituents, an international postgraduate student at Leeds University, told me:
“My only viable option was using the guarantor service ‘Housing Hand’, which costs me an additional £50 a month on top of rent. I am a PhD student receiving the UKRI minimum stipend…The cost of living for food and rent alone is already difficult on this stipend, and, during the final week before the stipend is paid each month, I often struggle to maintain a healthy and balanced diet due to financial strain.”
Research conducted by students from the Centre for Homelessness Impact found that just 36% of universities provide help with rent guarantors, that even fewer provide a rent guarantor service for students, and that, as universities themselves are facing extreme financial difficulties, such a service will become ever more unlikely.
Renting as a student is already an uphill struggle. We know, for example, that student accommodation prices have increased by 61% since 2012. Information from the National Union of Students shows that two in five students have considered dropping out because of the cost of rent. When we are trying to encourage people to attend our world-leading institutions, which strengthen the skills potential of our country’s workforce, why do we put up so many barriers?
Our universities are the UK’s strongest source of soft power. International students in particular are left with nothing but bad choices: they must either find a UK guarantor or pay six months’ rent, or more, up front to their landlord. As one student told the all-party group for students:
“International students often face more challenges than home students. We have heard stories of students paying months of rent, only to find out that they have been scammed, and that the place they thought they’d secured does not even exist.”
It is for those reasons that I would like the Government to consider banning landlords from demanding either UK rent guarantors or huge up-front payments, and perhaps limiting deposits to just three months’ rent. I would also like them to end the pressure for joint tenancies to be signed too early in the academic year, so that students need not commit to accommodation before they are ready, creating artificial panic in the market. Ultimately, we must remove barriers for care leavers, students and international students. We have heard from students that access to a rent guarantor is often a determining factor in their ability to continue their degree, or even access a university education in the first place.
Everyone deserves the opportunity to succeed in their academic journey without the added stress of housing insecurity. The Government have the opportunity, through this Bill, to break down a major barrier to all students’ right to pursue higher education. I hope that they will work with me on this.
Satvir Kaur (Southampton Test) (Lab)
Let me start by congratulating my hon. Friends on their incredible maiden speeches, particularly my hon. Friend the Member for Swansea West (Torsten Bell), a good friend of mine with whom I have the privilege of sharing my Parliamentary Private Secretary position. It is clear that he will be a great asset to the people of Swansea West, as well to this Chamber.
I am a firm believer that a safe, secure, affordable home should be a basic human right, that it is intrinsically linked to better life outcomes, and that this should be the case whether a person owns or rents their home. For too long, renters in my constituency of Southampton Test have suffered from no-fault evictions, rot, mould, and damp or draughty homes. Parents stay awake at night, anxious as they put their children to sleep in hazardous environments. Some are ignored by their landlords, stuck where they are, with soaring rents and fixed-term tenancies. Others are too worried to raise concerns out of fear that they will be evicted and their children will not have a place to call home.
In Southampton, homelessness soared by more than 70% in the past five years under the previous Government. Two thirds of those who declare themselves homeless in my city do so as a direct result of no-fault evictions and insecure tenancies. Nationally, the charity Shelter warned that 172 families are threatened with homelessness every day for the same reason. That equates to one family every eight minutes—a shameful inheritance from the previous Government.
Renters have long deserved far better. They were failed by the previous Government, who clearly sided with vested interests, rather than keeping their promises. I am proud to be part of this new Labour Government, who will deliver for renters and who are finally consigning no-fault evictions to the dustbin of history, and, in doing so, improving the lives of thousands in Southampton and millions across our country.
I welcome plans to stop needless rental bidding wars and to ensure an end to fixed-term tenancies; so many renters in my constituency find themselves trapped into paying rent for substandard properties. I welcome the extension of the decent homes standard to the private rented sector so that families in Southampton can live without being exposed to issues such as damp and mould, and can sleep at night without worrying about their and their children’s health. As a former leader of a council, I of course welcome greater enforcement powers for local authorities to ensure that rogue landlords are identified and that improvements can be made without delay.
New measures will also save the public purse vital funds—from local councils, which currently spend millions desperately trying to house those made homeless through no-fault evictions, to the NHS, which increasingly helps patients with conditions linked to issues such as damp or mental ill health, as people of all ages struggle with the everyday anxiety of living in an unsafe, insecure home.
In conclusion, for too long renters of all ages and backgrounds across Britain and particularly in Southampton have been at the mercy of rogue landlords. Today, Labour is saying, “No more!” Homes are where we raise our families, put down roots and find a sense of belonging in our communities. That is possible only if we know we are in a safe, secure and affordable home. With this new Labour Government and the Bill, that will finally be possible for renters, who have waited too long already.
Chris Curtis (Milton Keynes North) (Lab)
I echo comments from others about the fantastic maiden speeches that we have heard across the Chamber today. I am proud to rise in support of this landmark legislation—the most significant reform to the private rental sector in more than 40 years. Like many new Members on the Government side of the House, I have seen at first hand the consequences of our broken rental sector. Just days before Christmas, I received an email from my landlord having lived in my home for five years. I was told that he would be “willing” to let me stay if I accepted a 29% rent increase. Meanwhile, we went for days without hot water because of a faulty boiler that repeatedly broke down. My gym membership was not to keep fit but to ensure that I could have a shower each morning before heading into work.
However, the stories I heard from my constituents during the election campaign were so much worse than anything that I have experienced. I have heard of landlords converting homes into houses in multiple occupation, cramming strangers into what used to be families’ living rooms. I have spoken to mothers in tears because they have been forced to uproot their kids once again because landlord decided that it was time to sell. I will not spend too much time dwelling on some of those problems, because other Members have spoken about them, but obviously the effect on families is pretty severe. But there is a much wider effect on our society as well. It affects our economy. A stable and productive workforce depends on individuals having security in their personal lives, which section 21 evictions undermined. We have also heard about the effect that the issue has on the funding of our local councils.
To be clear, the Bill does not seek to stop good landlords removing bad tenants. Tenants must, of course, always pay their rent, look after their properties and respect their neighbours. Under the Bill, all landlords will still be able to end tenancies if there are legitimate reasons, such as wanting to sell the property. However, I urge the Government to consider extending the protected period to two years and providing clear guidance on how landlords will need to prove their intentions on those grounds.
Obviously, I agree with the Bill’s approach in not introducing rent caps, which we know can create unintended consequences, but we must ensure that landlords are not able to exploit that by excessively raising rents mid-tenancy as a back-door way of evicting tenants. It is right that the Bill stops landlords from raising rents above market rates, but I would also like to hear more about how market rates will be determined; I speak from personal experience.
Lola McEvoy (Darlington) (Lab)
Does my hon. Friend agree that the landlord database is a great opportunity for us to avoid clogging up our tribunals? If the landlord database had a tenants’ portal, it could help to aggregate the data so that, at local authority or postcode level, people could see what the average rent really was in their area, thus avoiding more tribunals.
Chris Curtis
I thank my hon. Friend for that intervention, and I agree. In my experience, the 29% rent hike was deemed justified because right down the road there was a property being advertised on Zoopla at that new price—but of course that property was newly furnished and had not been agreed by a landlord yet, so it was likely to be inflated above market value. We should consider using the rental database to track actual agreed rents and give us a more accurate picture of market rents, not just speculative rents.
I have a minute and a half left, so I would like to make one final point—this is my first experience of trying to scribble bits of a speech halfway through. We have heard lots of heartbreaking stories, but I want to bring the House’s attention to Zeke’s story. Zeke was an adorable cat who, just one day shy of his first birthday, ended up in Battersea after his family faced an impossible choice. They loved him dearly but, when it came to finding a rental home that welcomed pets, they hit wall after wall. In the end they had no choice but to give him up. Can you imagine, Madam Deputy Speaker, having to choose between a roof over your head and a loyal companion you had raised as part of your family?
Zeke is not alone. Housing is now the second most common reason animals like Zeke end up in shelters—not because their owners did not care, but because the system failed them. We are a nation of animal lovers and nearly two thirds of tenants would love to own a pet—I know that feeling; I was one of them—but for many families it is simply not possible. Properties that allow pets are few and far between, and when they move, pet owners are often forced to choose between a place to live and keeping their pets. That cruel choice leads to heartbreaking stories such as Zeke’s. I warmly welcome the provisions on pets in this Bill, and the many other provisions that I know will make life better for private renters across my constituency and across the country.
Abtisam Mohamed (Sheffield Central) (Lab)
I congratulate everybody who has made their maiden speech today and made excellent points in this debate. I thank the Secretary of State, Ministers and everybody involved for their hard work in preparing this Bill. They have already demonstrated a greater level of ambition on tackling housing security than the Conservatives showed in 14 years.
I receive a significant amount of correspondence from private renters concerned about high rents, insecurity and poor living conditions. Nearly half of my constituents are private renters, many of them students. I have visited some of their houses and been horrified by the extent of the damp, mould and disrepair that many are forced to live with. Sadly, many have become resigned to accept that this is what they have to deal with. Far too many families live in appalling conditions, which in turn significantly influences their physical and mental health. That should never be acceptable.
I am reassured to hear the Secretary of State talk about safety first. Safety should come first and it will be a relief to many tenants that this Bill will extend Awaab’s law to the private rented sector, to ensure that repairs are undertaken in a timely manner. The Bill will also make homes safer by applying the decent homes standard to the private rented sector for the first time. I welcome that but, as a lawyer who used to practice in social welfare law, I know that many people struggle to navigate the system and will struggle to take on landlords on disrepair cases. I urge the Minister to work with colleagues to look at how we can extend social welfare law legal aid to people who need support to navigate the system.
This legislation is a major step forward and I have no doubt it will help to tackle housing insecurity and affordability in the private rented sector. However, it clearly will not solve all the problems in the sector, because many are due to the wider housing crisis. I call on Ministers to go further and investigate the possibility of introducing legislation to cap in-tenancy rent increases at the lower end of either inflation or wage growth. We must make it a national priority to fix the housing crisis to ensure that everyone can live in affordable, safe and secure homes, so I welcome our Government’s ambition to build more affordable homes. I am delighted that we have already started this process through our plans to reform the planning system and to reinstate home building targets, which the Tories scrapped. However, affordable must really mean affordable—for far too long affordability has come without a definition, and deposits have remained unaffordable for many.
These policies will make a difference in Sheffield Central, as home ownership rates are much lower than the national average and its constituents are among the youngest in the country. We need to build more green, sustainable and genuinely affordable homes so that more of my constituents, especially young people, can leave the private rented sector and get on the housing ladder. I look forward to supporting the Government in this House to deliver their mission of building the homes we need—affordable homes—so that people in Sheffield Central and across the country can benefit.
David Smith (North Northumberland) (Lab)
I would like to begin by warmly welcoming this Bill and declaring that until July I was chief executive of a homelessness charity. It is well known that section 21 evictions are the second highest cause of homelessness, so it is a delight to be able to speak in the debate and to support the Government. This Bill cannot come in soon enough.
I would like to read out a short excerpt from an email I received from a constituent who was recently issued with a section 21 notice:
“We have lived in our home for over four years and were shocked to be told that we need to move out. We have been desperately searching for a new house to call home but due to a housing shortage and extortionate rents, we cannot find anywhere to move to and are facing homelessness. In the time we have lived at our current house, we have made a life in our community. We run a business and teach twice a week at our local hall. We help care for an elderly gentleman in the village to enable him to remain in his own home. The feeling of being powerless is overwhelming. We have been completely consumed by our housing situation for five weeks now. We feel powerless to protect our boys, six and eight years old. It is hard to function and it feels like an impossible situation...Our neighbour advised us last week of the Labour Government’s plan to immediately abolish section 21 notices. We sincerely hope that this happens in the future so that going forward, people never have to feel the way we do now.”
That family wrote to me at the end of August. Sadly, thanks to the inaction of the previous Government this Bill is too late for them, but for many others it is timely. The perilous rental market is an anchor around the necks of many families like these and this excellent Bill is a reminder that Government really can help those in need.
However, I would like to ask the Minister to look at two tweaks to the Bill. First, will he examine whether any new no-fault grounds for eviction could include a provision that exempts tenants from paying their last two months of rent? Research by Generation Rent shows that the average unwanted house move costs a typical two-adult household £1,709. That includes finding the deposit for a new home, covering rent on two properties, taking time off work and a host of other costs. Most people do not have £2,000 lying around, so that insecurity can lead to homelessness. I urge the Government to look at those situations.
Secondly, I ask the Minister to consider whether the permitted 12-monthly rent increases should be capped at the lower level of inflation or wage growth. Character matters, and some landlords—a small proportion—have spent years extorting and squeezing their tenants. An obvious loophole some landlords will exploit to manipulate tenants is to use their annual rent increase to push rent to unexpectedly high levels and create economic evictions by the back door. That is on top of the fact that landlords are clearly increasing rent beyond any sense of the common good, with rent inflation last year outstripping wage growth by 3% and inflation by 5%. I understand that first-tier tribunals are in place for just this scenario, but evidence suggests that these tribunals have not had the overall desired effect of bringing average private rent increases in line with affordability, let alone inflation.
I am proud that this Government are genuinely committed to ensuring that the 4.6 million households renting privately in this country are no longer dependent on the whims of another for their security. That is part of a comprehensive plan, along with nationwide house building and a cross-departmental homelessness strategy, that will transform what it means to have a place of belonging and security in this country.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Chris Ward to make his maiden speech.
Chris Ward (Brighton Kemptown and Peacehaven) (Lab)
Thank you, Madam Deputy Speaker. It is a pleasure to follow my hon. Friend the Member for North Northumberland (David Smith), as well as all the excellent maiden speeches made this afternoon.
I grew up in Brighton, and my parents grew up in Peacehaven, so it is a huge honour and responsibility to represent the great constituency of Brighton Kemptown and Peacehaven. It is also a privilege to speak in this debate, because of all the Bills in the King’s Speech, this one will have the most immediate and far-ranging impact on my constituency. Why? Quite simply, housing is the single biggest issue there. It makes up around two thirds of the casework that I receive and dominates every constituency surgery, from overcrowding—typically a mum, dad and three kids crammed into a two-bedroom flat—to overpricing, with home ownership now beyond the reach of far too many, and landlords charging London prices in a city that does not pay London wages.
In Brighton, there is also a persistent problem of homelessness and temporary accommodation, especially in the western part of my constituency. There are at least 7,500 on the council house waiting list, while 1,600 households, 50% of which have children, are living in temporary accommodation. On top of that, my constituency has the among the highest numbers of high and medium-rise blocks outside London, with people trapped for years in unsellable and unsuitable homes. You can see why, Madam Deputy Speaker, I wanted to make my maiden speech on the issue of housing.
The Bill is a big step in the right direction. Justlife, a wonderful charity operating with people in temporary accommodation in Brighton, tells me that around a quarter of all homelessness applications in the city are a result of section 21 no-fault evictions. The Bill will finally outlaw that. As the Secretary of State said earlier, applying the decent homes standard to the private rented sector will also give renters the safety and security that they need. There will be new powers for renters to challenge the excessive rent rises that we see far too often in Brighton. Given that one in four people in my constituency live in the private rented sector, that is why the Bill will have an immediate and far-reaching impact.
I thank my predecessors. When Dennis Hobden won Brighton Kemptown for Labour in 1964, he did so by seven votes and became the first Labour MP in the whole of Sussex. I am pleased to report that there are now six Labour MPs across Sussex—we are so numerous that we have our own WhatsApp group. I also thank Lloyd Russell-Moyle, who represented Brighton Kemptown for the past seven years. In particular, I thank Lloyd for his work championing LGBTQ rights, an incredibly important issue in Brighton Kemptown, given that it has one of the largest LGBTQ communities in the country. I also praise Lloyd’s campaign to ban the heinous practice of conversion therapy—a ban that I am proud to say this Labour Government will now pick up and take forward.
I am delighted to say that I am the first Member of Parliament for Brighton Kemptown and Peacehaven. Quite right, too, because a third of my constituency extends beyond the boundaries of the city and reaches as far east as Peacehaven. Named at the end of world war one, Peacehaven lies on the Greenwich meridian, perched high above the cliff of the south downs looking out at the English channel. It is a wonderful place—although I am contractually obliged to say that, because it is where both my parents grew up, in neighbouring streets, more years ago than they would like me to admit.
I am sure that many Members will have visited my constituency at some point, whether for a trip to the seaside; to see the bustling shops of Kemptown, the tranquillity of the south downs, Rudyard Kipling’s house in Rottingdean or the wonderfully restored art deco lido in Saltdean; or simply to jet-ski around Brighton marina, as the leader of the Liberal Democrats prefers to do. For those who have not had the pleasure of going, the easiest way to picture my constituency is running from west to east, from Brighton pier to Peacehaven, and from north to south, from the Amex stadium, which is home to my beloved Brighton and Hove Albion—[Interruption.] Thank you very much. And through the south downs to the seafront.
In between, one can see the diversity and beauty of my constituency: the vibrancy of Kemptown, the proud working-class communities of Whitehawk and Moulsecoomb, the small towns known collectively as the Deans—Woodingdean, Bevendean, Ovingdean, Saltdean and Rottingdean—and the beautiful green spaces and sloping streets of Queen’s Park.
But if we look closely, we also see something else: the inequality and injustice that holds back too many lives across my constituency. Behind the picture postcard view—the downs, the pier, the lido—one in four children in my constituency grow up in relative poverty. Whitehawk, a stone’s throw from the bustle of Kemptown, is in the 10% of most deprived wards in the whole country, and Moulsecoomb—within sight of the riches of the Amex and the excellence of Sussex and Brighton universities—is the second most deprived ward in Sussex.
That inequality matters: it thwarts potential and holds back life chances. As the excellent local campaign group Class Divide emphasises, children from the poorest parts of my constituency are twice as likely to be excluded from school, three times more likely to be placed outside mainstream schooling, and half as likely to get good GCSE grades. Life expectancy itself varies by seven years between the poorest wards in my constituency and the rest. The Prime Minister often says that for him, politics is not about left or right; it is about who you have in your mind’s eye when you make a decision. I hope that for the time I have the great honour of representing the constituency and community that I love, I will always have in my mind’s eye those who are at the sharp end of that inequality.
Chris Vince (Harlow) (Lab/Co-op)
Thank you, Madam Deputy Speaker, for allowing me to contribute to this important debate and speak in favour of this Bill. Before I do so, let me take the opportunity to thank my hon. Friend the Member for Brighton Kemptown and Peacehaven (Chris Ward) for his excellent speech. As the Member for Harlow, I live in a town full of Spurs supporters, so he is not overly popular at the moment, but my chief of staff is a fellow Seagull, so he will be pleased to show my hon. Friend support.
This is a really important debate to me, because Harlow constituency has nearly 6,000 households in the private rented sector and suffered from the previous Government’s ill-thought-out permitted development legislation. However, like many people who have already spoken, this debate also has personal resonance for me as somebody who worked for two years at a homelessness charity in Harlow called Streets2Homes. My role was generally to go out, sometimes into woodland and industrial areas, to find reported rough sleepers, get them registered with our charity and help get them off the street and, quite often, into the rented sector. That is why I personally welcome this legislation, which rejects the concept of no-fault evictions, and am looking forward to voting for it later.
The experience of working for a homelessness charity can often be challenging, but sometimes it can be baffling as well. It is unbelievable to me that in my previous role, I found it easier to house someone with an alcohol or drug addiction than someone with a dog. That includes guide dogs—we had one in this Chamber earlier—as well as emotional support dogs and assistance dogs. Those are animals who help people cope with and manage medical conditions, so that is not the kind of barrier that people with those conditions should be facing. It is like saying that we will not allow people with an inhaler for their asthma to have a house. While at conference this year, I had the opportunity to visit the Guide Dogs stall and talk to the wonderful people who support that wonderful charity. They highlighted this issue to me, and I was appalled by the lack of awareness of it. It is an issue faced every day by people who are already at a disadvantage; we should be making their journey into a home easier, not putting up walls and barriers against them.
As a dog owner myself—I am not sure I am going to introduce my dog to Jennie just yet, because he might get a bit carried away—I emphasise how important having a pet is to a family, and the emotional bond that they create. Being pushed to choose between a roof over your head and your family is not a choice anyone should have to make. Here is a statistic—
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
Will my hon. Friend give way?
Johanna Baxter
Does my hon. Friend agree that once consent for a pet is granted, that consent needs to remain for the duration of the tenancy, and that we could strengthen the Bill by making that explicit in it?
Chris Vince
Ultimately, I want to do what I can to support people who have pets in their home, and my hon. Friend is right to say that we do not want people to face the anxiety of potentially being in a situation where a pet could be forced out of their home.
As I was about to say, 62% of homeowners in the UK have a pet, and as was mentioned by my hon. Friend the Member for Milton Keynes North (Chris Curtis), we are a nation of pet lovers. Let us be very clear: this is not about punishing landlords, and never has been; this is about protecting tenants’ basic rights. There needs to be clear guidance on what reasonable pet ownership means, and I am glad that the Bill recognises that.
Furthermore, 57,340 households were threatened with homelessness due to the end of an assured shorthold tenancy, which is an increase of 4.6% on 2022-23. People cannot be treated with such a dismissal. Some 21% of renters live in what we refer to as non-decent homes—homes that are not fit for living in—and this is somehow allowed. Renters are not and should not be treated in a lesser way than homeowners. They should be entitled to the same security in their lives as homeowners.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
I declare an interest in that my husband works for an organisation that has allocated some funding to the Renters Reform Coalition. I would like to associate myself with the remarks by my hon. Friends the Members for Mitcham and Morden (Dame Siobhain McDonagh), for Barking (Nesil Caliskan) and for Vauxhall and Camberwell Green (Florence Eshalomi) about the experience of so many Londoners living in the private rented sector.
I warmly welcome this Bill, which will improve the lives of millions of people. I also commend the ministerial team for the speed with which they have brought it forward after years of prevarication and delay by the Conservatives. I am deeply concerned that the amendment moved by the Opposition reveals no understanding of the state of the private rented sector and thoroughly lacks contrition about the state of the courts that the Conservative Government have left us with. Do they really not understand the impact of their previous decisions?
Across the UK, about 19% of households rent their homes from a private landlord. In the Cities of London and Westminster, that rises to over 45% of households, or over 27,000 people. Many of the renters I have spoken to do live happily in well-maintained and modern buildings, but too many of them live in homes riddled with damp and mould, and face disproportionate and out-of-the-blue rent hikes. That goes to the heart of the matter: the security of your home should not depend on who owns it. This Bill will go a long way to changing that. I welcome the measures on ending section 21 no-fault evictions, bringing an end to bidding wars and strengthening rights for pet owners. I believe these measures really will stabilise the market and reduce homelessness.
I would like to focus on the ombudsman service for the private rented sector. One of the key issues in the private rented sector has been the long-standing imbalance of power that means tenants are unable to secure action from their landlords. The ombudsman will have powers to compel landlords to issue an apology, provide information, take remedial action and pay compensation. It is positive that tenants will be able to access the ombudsman service without the need for a referral. However, there is work to do to ensure that it is clear where the responsibilities lie between the new ombudsman service and other existing bodies. The ombudsman will need to establish itself within a current landscape that is complex, as councils, the police, trading standards and the courts all have a role.
I welcome the wording in clause 104, which establishes the duties of local authorities in enforcing landlord legislation. As the new ombudsman service is set up, information sharing with local authorities will be key to empowering them to enforce its decisions. I believe that the ombudsman service should also be accountable to Parliament and to the public. Almost a third of regulators were not scrutinised by Parliament from 2019 to 2024, which simply is not good enough. A formal timetable should therefore be established for the new ombudsman to be reviewed by the Housing, Communities and Local Government Committee.
Renters should also have clear information on where and how they can seek redress. The Department should publish guidance for renters about lodging complaints, and information on complaints should be shared with other relevant bodies, including the police and councils. The wording of clause 63 is currently open to interpretation as to who will carry out the redress scheme, and I urge the Secretary of State to consider merging this service with the existing housing ombudsman.
The success of this Bill will of course depend on the ability of local authorities to enforce it. Residents of the Cities of London and Westminster, from the west end to Dolphin square, are likely to benefit from this, which I strongly welcome. Burdens should be lowered to enable local authorities to regulate without the interference of national Governments. I know that, along with strong support for the measures in this Bill, many in the House will join me in supporting this Government’s mission to build 1.5 million new homes during this Parliament.
Sally Jameson (Doncaster Central) (Lab/Co-op)
I rise to speak in support of the Bill, which will bring a range of positive and necessary reforms to the private rented sector. I welcome it wholeheartedly. The private rented sector is growing rapidly, and it is imperative that tenants and landlords can operate the system safely and with appropriate protections. I am particularly pleased to see the application of the decent homes standard to the rented sector, which will ensure that tenants have the tools to challenge unsafe housing conditions and hold landlords and letting agents to account. I know that renters in Doncaster Central will be pleased to hear that.
I take this opportunity to ask the Government to address the issues that care leavers face in securing housing in my constituency and across the country. It was welcome to hear the Prime Minister say in his conference speech that we will provide homes for all young care leavers, because that has never been more important. That is a group who continue to face discrimination from some private landlords. A survey by Centrepoint found that one in 10 care leavers have been refused accommodation by private landlords. The same survey revealed that 40% of care leavers have insufficient savings for a deposit. Those factors can often force care leavers into unsafe living situations, such as poor-quality properties or living with other adults who are older and unfamiliar. Ultimately, these barriers lead to a lot of care leavers becoming homeless.
Prior to entering this House, I was a prison officer, and I worked with many care-experienced men, who were there disproportionately, because care leavers represent just under a third of the prison population. Lack of access to safe and affordable housing limits employment and education opportunities and prevents access to financial and health services. This is contributing to the poor outcomes we see with this group, and we must change those outcomes.
It is my hope that the Government will consider taking up some of the recommendations offered in the latest briefing from Barnardo’s to ensure that care leavers have the unique legal protections and resources they need to access housing in the private rented sector. That includes the provision of rent deposit and guarantor schemes across all local authorities and the addition of care leavers to the groups against whom landlords cannot discriminate when letting out property. I also hope that the crucial reforms in the Bill will be accompanied by the accelerated building of more social homes in the UK to ensure greater access to secure housing.
I am glad that this Government are introducing crucial protections for tenants, and my next hope is that their efforts will ensure that all UK residents, including those who have left care, can access the safe accommodation that they need and deserve.
Apsana Begum (Poplar and Limehouse) (Ind)
I welcome this Bill with warmth. It will ban section 21 no-fault evictions for new and existing tenancies and introduce a number of standards for the private rented sector, including—crucially—Awaab’s law. There is no doubt that the no-fault eviction ban is testament to the work of campaigners all over the country, and it has the potential to drastically improve the situation facing private renters.
I would like to probe a little bit more about the balance in the Bill, especially regarding the extended possession grounds for landlords to reclaim their properties. Many of us would like to see the new eviction grounds being more favourable to tenants. Will the Minister elaborate on the evidence that landlords will be expected to provide to prove that they are genuinely moving in or selling, so that the provision is not abused?
It is welcome to see that the Bill will make it illegal for landlords to discriminate against tenants in receipt of benefits or with children. My constituents would also have liked to see the Bill end the immigration right-to-rent rules, which are part of the disgraceful hostile environment. Those rules force landlords and agents to check tenants’ immigration status, disproportionately impacting people of colour.
One might argue that the level of rent itself is the most discriminatory factor. The Chair of the Select Committee, the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi), and others have mentioned that the evidence is overwhelmingly clear that an effective measure to stop renters being evicted would be rent controls. All too often a 20% rent hike is simply a no-fault eviction under a different name.
The availability of housing that people can actually afford is key. It is not just that affordable homes are in short supply; they are also, in fact, not affordable. In east London we know that well. People are also concerned about gentrification. It is my strong view, and that of many constituents who have contacted me over the years, that development should be focused on solving the existing housing crisis and driven in the interests of local people. We really need investment in our communities. We need a mass house building programme.
We need to be honest about what the private sector can deliver. It makes little sense, if the housing crisis is to be effectively tackled, that for every affordable home —which is not, in fact, affordable—two, three or even more luxury flats continue to be built. Building a new generation of social housing, and particularly council housing, is the only true long-term solution to the housing crisis.
Campaigners and tenants’ unions have rightly welcomed the Bill. It is an important positive step, and I look forward to engaging with it constructively during its journey through the Commons, because housing is a right, not a commodity.
Paula Barker (Liverpool Wavertree) (Lab)
Let me start by congratulating the Minister for Housing and Planning, my hon. Friend the Member for Greenwich and Woolwich (Matthew Pennycook), for working relentlessly on these matters in opposition and carrying that momentum into Government. This far-reaching Bill will end section 21 no-fault evictions, which for too long have been a major factor in driving up homelessness. It gives real protections to those who have been left to the whims of the market and have borne the brunt of the housing crisis and a protected period at the beginning of the tenancy, brings an end to discrimination faced by those in receipt of social security, brings an end to the bidding wars, and rolls out the decent homes standard across the private rented sector.
The Government will no doubt face stiff resistance from the usual suspects, who will endeavour to pick away at key aspects of the legislation, not least the four-month notice period that the homelessness sector and charities such as Crisis have welcomed. I urge the Government to stand firm, knowing that they are on the right side of history.
Since 1980, the private rented sector has more than doubled in size, overtaking social housing to become Britain’s second-largest form of housing tenure. The PRS is the most expensive of all forms of housing tenure, and rents are increasing. In 2023 the Centre for Policy Studies noted:
“Since 2010, the cost of renting has gone up by 44.5% according to the Halifax. During this period, wages have risen by 30.4% and inflation has risen by 24%. This is hardly a sign of a functioning market.”
Not only in London but in our great northern cities, including Liverpool and Manchester, the private rented sector has lost all sense of proportion as a cabal of landlords and letting agents has sought to jack up rents again and again. Young adults are particularly affected.
Remaining on rents, the Government must go further. I urge them to look at rent stabilisation methods, including tagging rents to the lowest of local wage growth or inflation to guard against further hardship being faced by our communities. On enforcement of the decent homes standard, I urge the Government to resource local authorities adequately to ensure that that work is carried through effectively. I also raise a small but significant absence in the Bill: reform of the deposit system, which is routinely abused in too many instances. I will look to work with the Minister on a constructive amendment in that regard.
The national database is a game changer with the potential to properly regulate the sector across the piece. I would like to see more information available on the national database, including information on letting agents managing tenancies being tagged to properties. As we move into this new phase to protect the millions living in the private rented sector, education and information being readily available is crucial to tenants knowing and understanding their rights. Maybe we could use the national database as a portal for resources available to tenants.
I end by once again paying tribute to my hon. Friend the Minister. I know that he has a steely determination to see the Bill through. I hope that Members across the House will back him in doing so.
Sam Carling (North West Cambridgeshire) (Lab)
Affordability is a huge issue for private renters. As a nation, we spend more on rent as a proportion of our income than most of Europe. World Health Organisation guidelines state that housing is unaffordable if more than 30% of income is spent on housing costs. Here in the UK, the average renter pays more than that. The private rented sector currently provides the least affordable housing of all tenures, and most renters settle on a place they can just about afford. That is exacerbated by some landlords and agents asking for more than the advertised price, which pits prospective tenants against each other in a bidding war. The tenant who wins out, paying more than expected, then has no way to vet their landlord.
Some 21% of privately rented properties do not meet the decent homes standard—a far higher proportion than in both owner-occupied and socially rented homes. With no landlord register, there is no way of knowing how well a given landlord treats their tenants and properties. Tenants are expected to leap into the unknown and just hope their property is up to scratch.
If they move in and find their property is not up to scratch, the chances are that they would be unlikely to complain because, with section 21 no-fault evictions still in place, they do not have security. They can be kicked out for no reason. The last Government sat idly by on this. Almost a million renters have been given no-fault evictions since the Conservatives first pledged to scrap them. Once they are evicted, the whole frustrating process starts again.
With all this in mind, it is no wonder that housing insecurity in the private rented sector is higher than for other tenures. Renters are more likely to move often, staying in a property for an average of four years, compared with 12 years for those in social housing and 17 for homeowners. That insecurity means a greater risk of homelessness. Nearly a quarter of homeless people, or those most at risk of homelessness, cited the end of a private tenancy as the main cause of their homelessness or risk.
Stress from insecure housing affects job prospects and health outcomes. It can lead to mental health problems and difficulty sleeping, and it can contribute to physical illness, too, particularly in children. It is astonishing how under-regulated the private rented sector is. The decent homes standard is not applied, and neither is Awaab’s law, which sets clear legal expectations about the timeframes within which landlords must take action to make homes safe where they contain serious hazards. By passing this Bill, we will fix both those loopholes.
More than one in five of my constituents in North West Cambridgeshire are private tenants, and the chaos in the sector affects all age groups. The stereotypical renter is often portrayed as younger, but let us not forget the significant proportion of older people and pensioners who rent in the private sector—there are more than 1,000 in North West Cambridgeshire, according to data from the last census.
The Bill will tackle the sector’s problems head on. It means strengthened rights to challenge unreasonable rent increases. It means an end to rental bidding, to landlord anonymity and to frightening, sudden and unjustifiable section 21 evictions. The Conservatives failed to protect private renters despite promising action for so long, so I am particularly pleased that we are introducing the Bill so soon into our time in office.
The Bill’s measures build on the Government’s plan to create a housing sector that works for all, regardless of tenure. Manifesto commitments to make housing more affordable, to support first-time buyers and to prioritise the building of new socially rented homes are exactly what we need, and I look forward to the publication of the Government’s long-term housing strategy, which will set out these objectives in more detail.
I know how important this Bill will be for my constituents in North West Cambridgeshire. They deserve stronger rights and protections and, above all, security of housing, and we will deliver that.
Peter Swallow (Bracknell) (Lab)
The rental sector is not working. Nearly one fifth of households in England are in the private rented sector, and today these 4.6 million renters might be turfed out of house and home with little notice and minimal justification. They are subject to steep rent increases, bidding wars and discrimination for starting a family or being on benefits, and too often they have to choose between giving up a beloved family pet and being turfed out on to the street. Too many live in substandard or even dangerous accommodation, with limited recourse to hold landlords to account.
As rents tick up above inflation like clockwork, saving in any respect for renters has become a Sisyphean task, meaning that home ownership, parenthood and a basic sense of stability become impossible dreams. In the past year, rents in Bracknell Forest have shot up by almost 12% —a figure far higher than for the rest of the south-east and the UK. That is yet another damaging consequence of the Conservative party’s shocking mishandling of the economy, and the inevitable result of 14 years of failure to address the housing crisis. That is why my constituents, including a young couple who reached out to me recently, are keen to see the Bill passed. They have just had their first child, a daughter, and even after years of working, they cannot afford a deposit while paying rising rents and meeting increasing food, energy and fuel bills.
There cannot be a growing future for a country that denies too many of its families the basic right to security and a decent home. The Bill brings forward long-overdue common-sense changes to increase safety and fairness. It asserts the right of tenants to make more decisions about their home, and introduces a fairer arbitration process for disputes and the right to request a pet—a welcome new right for the many animal lovers in my constituency.
The Conservatives said for years that they would end no-fault evictions. That claim was in both the 2019 and 2024 Conservative party manifestos, though the shadow Secretary of State has today disowned those commitments. The Labour party will not just talk about ending no-fault evictions; we will deliver on that. The Bill will also end rental bidding. This desperately needed measure will stop private renters, who already have the shortest notice period in which to find accommodation of any household type, from being undercut at the last minute and left scrambling around for a replacement property, with the risk of having to pay more for something worse. The Bill introduces a mechanism through which renters can challenge unfair rent increases, while ensuring that landlords can increase rents in line with market increases. It prevents tenants from being hit by multiple rent increases in a year.
The Bill will also extend Awaab’s law to the private sector for the first time, requiring private landlords to address issues such as damp and mould swiftly. The Government are bringing in a new decent homes standard, so that no one is forced to live in unsafe accommodation. These measures will save lives and end the discrepancy between the social and private rented sectors. Importantly, they will also level the playing field for the many decent landlords across the country who already do right by their tenants, and who are too often undercut by far less decent landlords.
These issues are found in my constituency and across the country, so it is a shame to see so few Conservative Members standing up for the renters in their constituency. The Bill will make renting easier, more affordable and more secure for tenants, while providing clarity and assurance to landlords. It will reset the balance between tenants and landlords, so that the system is fairer for everyone. After five years of Tory talk about rental reform, Labour is getting on and delivering real change for working people and renters in Bracknell Forest, and real change across England.
Lola McEvoy (Darlington) (Lab)
I draw to the House’s attention to the fact that my lovely husband works for the housing charity Shelter. I pay tribute to everyone who today made their maiden speech, which is nerve-racking. Well done; they have been excellent contributions.
I welcome the Bill and thank the Minister for his diligence and personal determination to bring it to the House. It is a truly transformational piece of legislation that will dramatically improve the lives of nearly 10,000 of my constituents in private rented accommodation in Darlington. The Bill delivers on our mission to break down the barriers to opportunity for everyone. In our manifesto, we pledged to offer families security, and I am proud that three months into our Government, we are already forging ahead with that.
In my constituency, we have really wonderful historical housing, from Georgian mansions created to house the giants of the railway industry, to rows of lovely bungalows built to house retired railway workers. Across the town, people take pride in their houses. The creativity shown in people’s gardens, especially as we approach spooky season, brings joy to many of us who live there. That said, while most people live a decent life in my town, too many renting privately are struggling to get what I believe is a fundamental right—a secure and safe home. This Bill will help them.
I will highlight a couple of stories from my constituency to illustrate why we need this legislation. On a dark and rainy evening, I met a woman who was a carer for a family member. She had paid her deposit, and paid her rent on time every month, yet she was not given a legal tenancy. She knew she was vulnerable, but had nowhere to turn. The Bill will give her the right to contact, for free, a new private rented sector ombudsman, who will help her to sort out her situation. The Bill will give our councils the power to administer fines to landlords who refuse to comply with the law.
Another of my constituents’ stories highlights that the Prime Minister’s support for better veterans’ rights is desperately needed. My constituent, a father and a veteran, has been served a section 21 notice, meaning that he will be evicted without grounds. He already has mental health challenges, and his elderly mother has offered to take him in, but she lives in a small bungalow, and fears that that might jeopardise the agreement that gives him shared custody of his daughter. That is a wholly unacceptable way for anyone to be treated, let alone those who have served our country. The Bill will help this family. Banning section 21 no-fault evictions would give him more security.
While I have chosen to highlight two difficult cases, it is vital that I commend the majority of landlords, who do right by their tenants. The Bill will help them, too. I ask the Minister to use the full potential of the landlord database to support tenants and good landlords alike. The landlord database could have a tenant portal, allowing those who are looking for rented property to see the tenancy advantages of having a good landlord. That would put those who do right by their tenants at a competitive advantage. The landlord database could also show aggregated average rents by postcode and property type, and at local authority level, so that tenants and landlords know what a fair rent rise would be; that would alleviate the pressure on tribunals.
I also want to highlight the provision ending discrimination against those in receipt of housing benefit when it comes to renting certain properties. That is long overdue. Those who have been unfairly banned from renting properties—often working mothers—will be helped by the change. Making that discrimination illegal is necessary, given the hugely depleted social housing stock in constituencies such as mine, but I am proud to say that the Government will rebuild the housing stock. On the discrimination clause, I ask the Minister to give due consideration to indirect forms of discrimination, such as the requirement from some landlords for several months’ rent in advance. That is unaffordable for many working people in my constituency. Anything that can be done to stipulate a maximum of a reasonable number of weeks, such as four, would mitigate that.
Finally, the many pet owners and animal lovers across the House will applaud the Bill. I welcome it, and the right of all tenants to secure tenancy, fair rent and good-quality homes for their family and their furry friends.
Naushabah Khan (Gillingham and Rainham) (Lab)
I thank the Minister for bringing forward this legislation, which will have a significant impact on many of my constituents in Gillingham and Rainham, where the number of people living in the private rented sector has increased by 162% in the last two decades. It is vital that the law catches up with the reality of people’s lives. That is why I am so proud that this Government have brought in the Bill at this point, when the previous Government failed to do so.
The rights of tenants do not have to be pitted against those of landlords. Having a system that is inherently fair, gives renters stability and offers them the right to live in a home of a decent standard should not be seen as an attack on landlords, many of whom are doing the right thing. It should be seen as an opportunity to create a healthy and stable private rented market that plays a fundamental role in tackling the housing crisis, rather than adding to it.
Like many colleagues who have spoken, I find that housing is the No. 1 issue that my constituents contact me about. Some have raised the appalling conditions that they live in but are too scared to raise with their landlord for risk of eviction. Others are concerned about the significant rent hikes that they face, which they cannot afford, while many have received a section 21 notice and have been forced to leave the property that they have lived in for decades, with no alternative.
An insecure rental market places significant pressures on local councils. My local authority, Medway, faces budget pressures when it comes to temporary accommodation—the costs are £3 million above what was forecast—and other authorities are in a similar situation, or much worse. That is an unsustainable position for cash-strapped councils to face year on year. With that in mind, I welcome the strides that the Bill makes in ending rental discrimination; it makes it illegal to discriminate against those on housing benefit, and empowers tenants to challenge unreasonable rent hikes. There is also the much-needed end to section 21 notices. I campaigned for that while working for a homelessness charity, and the sector was deeply disappointed when the previous Government failed to deliver it.
However, further safeguards are required to ensure that protections are robust, and there should be clear evidence thresholds that enable tenants to understand better how they can benefit from the changes in the law. That should also apply to the exemptions that we have specified for landlords. For example, if a landlord chooses to sell their property and, as a result, evict their tenant, the legislation should include a clear evidence baseline, setting out the parameters for what is considered to be a genuine intention to sell. Finally, local authorities will be crucial to the Bill’s success; it places new regulatory and enforcement responsibilities on them, so proper resourcing will be necessary to support that work.
This important, much-needed Bill has the ability to reform the sector robustly, and I hope the Minister will continue to review opportunities to ensure that it is strengthened as it progresses.
Nadia Whittome (Nottingham East) (Lab)
Some 38% of households in my constituency are in the private rented sector. In England, there are 11 million renters, and the number keeps growing. They have been stuck in a failed system for years. About one in three are in poverty once their housing costs are taken into account, while no-fault evictions are a leading cause of homelessness. Renters need greater protections, security and rights, but their voices and their interests have been ignored by previous Governments.
The Conservatives first promised to end no-fault evictions in 2019, but their Renters (Reform) Bill, already much delayed, stalled in the last Parliament—in no small part because of the influence of landlords in their party, some of whom we have heard from today—so this cruel threat of eviction, as the Secretary of State rightly described it, is still hanging over renters. The fact that we are on the precipice of banning no-fault evictions once and for all is a huge cause for celebration. I congratulate the Secretary of State and the Minister on introducing the Bill so swiftly, and I thank all who have campaigned for this change for so many years, from tenants unions to homelessness charities.
The Bill will also extend the decent homes standard and Awaab’s law to the private sector for the first time. It will allow tenants to challenge above-market rent increases, and will give local authorities stronger powers to crack down on unscrupulous landlords. It will create a national landlord register, give tenants more time to find a home if landlords evict them in order to move in or sell, and introduce the right to keep pets. These measures are vital, and the Bill must pass into law, but we need to go further still if we are to fix a system that is broken to its core. We cannot leave it to markets to stop rents being hiked to unaffordable levels, so we should look seriously at rent controls. We must also ensure that landlords cannot get away with ignoring the measures in the Bill. Local authorities need not only the power but the resources to investigate breaches and enforce these measures, and not just the ability but a duty to issue civil penalties to landlords who illegally evict their tenants.
Renters want a home, not just a house in which to live temporarily. They want to build lives in their communities, not feel that they will soon be priced out. Given that one in three disabled renters live in homes that are unsuitable for them, I urge the Minister to make it explicit in law that landlords cannot unreasonably refuse home adaptations. Reforming the private rented sector is not just about doing what is right for tenants; it is about doing what is best for our whole society. We will not tackle homelessness, poverty or inequality without it.
Lauren Edwards (Rochester and Strood) (Lab)
Thank you, Madam Deputy Speaker, for the opportunity to support a Bill that finally ends section 21 no-fault evictions and strengthens the rights of the 20% of households in the Medway towns who are renting privately, and who have experienced rent increases of, on average, 11% in the past year alone. As a number of Labour Members have mentioned, the last Government failed repeatedly to end no-fault evictions, despite that being a manifesto promise. They therefore presided over a situation in which rents skyrocketed, pushing even renting a home, let alone the dream of home ownership, out of many working people’s capacity.
I really welcome this long-overdue rebalancing of the relationship between landlord and tenant. From now on, unscrupulous and exploitative landlords will no longer be able to ignore the concerns of tenants, impose unreasonable rent increases or evict families because they ask for repairs to substandard and often deficient homes, often to remarket at a higher rent. I welcome the Government’s focus on reducing homelessness and the number of households in temporary accommodation. Local authority data shows that about 509 households in Medway are currently living in temporary accommodation, including about 818 children.
There must be greater understanding of the detrimental impact on society of people being stuck in cramped and unsuitable accommodation, and greater recognition of the waste of valuable public resources that councils are forced to spend on temporary accommodation for those who have been made homeless by landlords using section 21 evictions. This is money that we should instead use to build the new, high-quality and sustainable social homes for rent that the country sorely needs.
Our aim must be to protect families from eviction from their homes of many years, and from being uprooted from their local communities and social networks. Anchorage House, in my constituency, is a perfect example of where an east London borough has placed many people who have been evicted in temporary accommodation. The children’s ability to learn and the adults’ ability to work have been disrupted, and the health and wellbeing of entire families has often dramatically worsened. The steep social and financial costs of section 21 evictions are paid by councils, schools, workplaces and the NHS, and this cannot continue. We have to end the unhealthy reliance on a temporary accommodation system that really is not temporary for many people.
The Bill strikes the right balance by still providing landlords with reasonable grounds for possession while ending the constant churn. I have been greatly concerned by the treatment of constituents who have been served with section 21 notices and the huge challenges they face in securing new accommodation, and I really welcome the increase in the notice period for some of the mandatory grounds for possession from two to four months. Members should recognise that losing one’s home creates huge upheaval and that, with high demand for rental properties, it can be very difficult to secure a new home. I can certainly speak to my personal experience of that.
I echo Members’ calls to make sure that local councils have the right resources to enforce some of the new powers, which I greatly welcome. I believe that I heard the Secretary of State indicate in her opening remarks that there would be ringfenced funding for that purpose, and I encourage the Minister and the Secretary of State to ensure that the details come forward before the Bill receives Royal Assent.
My constituents in Rochester and Strood really cannot afford not to have this Bill become law. It will help so many individuals and families, and create a better, fairer private rented sector for tenants and landlords alike.
Ms Stella Creasy (Walthamstow) (Lab/Co-op)
I congratulate all Members who have given their maiden speeches today, and the Minister for Housing and Planning, my hon. Friend the Member for Greenwich and Woolwich (Matthew Pennycook), for all his hard work on this Bill.
If I am honest, I am disappointed that the shadow Secretary of State, the right hon. Member for North West Essex (Mrs Badenoch), is not still with us—looking at the faces of Conservative Members, she appears to be unexpectedly busy—because she seemed to argue that the challenge that the Government are creating is to intervene poorly in a market. In the limited time available to me, I want to take on the challenge that she created, because I am not sure that she actually understands what this market is. That may well show in Conservative members’ voting if they think they are voting for somebody who understand market economics.
Let us look at what we are talking about. In my constituency, we have had the biggest growth in affordable housing in London, yet we have also had a 55% increase in homelessness. This is not a healthy market where there is effective competition, and where every participant has the tools to operate equally. Let me try to explain through some of the stories from my constituency. My constituent Kate, who works in the NHS on a nurse’s salary, has had to move every single year, because landlords are selling properties and putting up prices. That is not healthy—it is an overheated market. It means that the state picks up the pieces, through the salaries we need to pay and to deal with the consequences for her and her family.
My constituent Claire, who is self-employed, started renting her home for £1,750 a month in November 2019, and it had increased by £200 by 2023. She has now been threatened with another £400 a month raise, putting her total rent up to £2,350 for the same property within five years. What powers do my constituents have in that market, apart from to exit? That is not a healthy, functioning market.
We are seeing mould in properties, so the quality of goods in this market is not good enough. Emily, a mum from Walthamstow, was scrubbing mould from the walls of her three-month-old son’s room every single day. She eventually walked out because she found mould on the underside of her son’s cot mattress. But she was afraid to complain because she was afraid of section 21 eviction powers, so she does not even have the voice of exiting the market. Albert Hirschman would be horrified. We have to end the scandal of no-fault evictions, and we have to deal with the mould.
Andrew Rosindell
The hon. Lady is making some excellent and valid points, but does she agree that the London borough of Waltham Forest should ensure that its residents who are homeless—our heart goes out to those people—are cared for and looked after in Waltham Forest? At the moment, her borough council is sending her homeless constituents to the London borough of Havering. They are living in Harefield Manor in Romford. Surely Waltham Forest should look after its homeless people in its own borough.
Ms Creasy
I know that the Conservative party is about to go down a rabbit hole about immigration, but honestly, moving people from Walthamstow to the hon. Gentleman’s constituency is not the challenge here. We have a broken rental market where the rights of renters do not allow them to compete fairly.
Let me give the hon. Gentleman another example so that I can explain the problem. The reason we need to tackle bidding wars is that there is a straight-out conflict of interest affecting the consumer. How can the person who represents them to the landlord also represent them fairly in a rental agreement? It is little wonder that Catherine, one of my constituents, found that she had to offer £300 over the asking price to secure a flat in a bidding auction. That is why people from Walthamstow are being moved out, and the hon. Gentleman would do well to think about sorting that market out, rather than trying to build a blockade on the A406.
Discrimination against single parents is widespread in the market, by definition because of what happens when households need to rent property. Ruth, in my constituency, is a single mum with two young children. She was told by agents, “Don’t even bother applying.” She could pay the rent and she was entitled to housing, but she was not even entitled to compete in this market.
In the final minute I have, I want to make a plea to the Minister about the credit rating of those in our private rented sector. It is not true that renting in the private sector automatically damages someone’s ability to get a mortgage, but if they are having to move time and again, their credit rating clock goes back to the start because lenders look at their addresses, they have to re-register for all their utility bills and they have to keep building up their good record. That gets taken into account by some lenders. People are finding that this affects other forms of credit, including the credit cards that many of them are using to pay their bills. In my constituency, the average percentage of people’s income spent on rent is 44%. If they have kids and are trying to pay for childcare, it does not take a rocket scientist or Ayn Rand to realise that this market is not working for them.
I believe we could do more if we came up with a good credit score passport to help those constituents of mine and others, who are paying their bills but who have been evicted through no fault of their own, not to lose their precious good credit rating. I hope the Minister will be willing to listen to some ideas about how we can do that with the companies.
Thank goodness for this legislation. It is long overdue, because tackling unfair markets is absolutely what good co-operators like myself and good people who care about social justice wish to do, and I shall vote wholeheartedly for it as a result.
Connor Naismith (Crewe and Nantwich) (Lab)
I welcome the new Bill put forward by the Government. I only wish that Conservative Members had expressed as much interest and passion in this subject as they did yesterday when it came to defending tax breaks for private education. Politics, as they say, is about priorities, and the priorities of this Government are clear. In my constituency of Crewe and Nantwich, I have been deeply saddened by the number of constituents I have spoken to who are affected by this policy area, and shocked at some of the individual stories I have heard since taking office.
Being able to rent in comfort and stability is a luxury for many of my constituents, which is why I support the ending of section 21 no-fault evictions. According to reports in Cheshire East, we have seen 74 accelerated repossession orders made this year alone, with 15 having been completed. One of the first cases that I dealt with after becoming an MP related to this matter. My constituent Kerry, a single mother of two young children, had been threatened with no-fault eviction and was on the brink of homelessness. She was able to find accommodation with the support of my office, but this issue is neither isolated nor uncommon, as we have heard from many Members today. These are the real, lived consequences of 14 years of Conservative failure.
I am immensely proud that this Government are willing to take action where the previous Government dithered and delayed. Had the previous Government enacted their proposals rather than bowing to the interests of their lobbyists, many vulnerable people across the country could have been spared both the mental and physical toll.
The Bill also applies Awaab’s law and introduces a decent homes standard for the private sector. In 2022, 32% of private rented sector homes in the north-west would have failed the decent homes standard, the highest proportion of any English region and higher than the English average of 21%. Around 21% of those homes in the north-west contained a category 1 hazard, which is higher than the English average of 12%, and around 6% of rented homes contained damp or mould. This is nothing short of a crisis.
The previous Government completely failed renters in my constituency and across the north-west of England. They failed, and they have left it for this Labour Government to make the right decisions so that we change people’s lives for the better. I believe that all the Government’s proposals—ending no-fault evictions, strengthening tenants’ legal protections, implementing the decent homes standard and establishing a database for the sector—are important and sensible policies. They will be truly lifesaving in some cases, so I will be glad to vote for them.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
Recent statistics show that 50% of the private rented sector in Cornwall does not meet the decent homes standard, way above the average of 21%. Less than 20% of homes in Cornwall were in the private rented sector four years ago, yet a quarter of our children and young people were living in those homes, including a third of our under-fives.
That has been evidenced by the noticeable uptick in recent years of section 21 evictions that affect families with young children. Cornwall now has more than 800 households in emergency or temporary accommodation, and many of them are young families who have struggled to find somewhere else to live because of the cost, their children or even their cats. Because of our geographical spread, many of those families have ended up in holiday parks, caravan sites or hotels up to an hour and a half’s drive from home. With poor rural transport links, this often leaves families completely cut off from jobs, schools and support networks.
In September 2020, Cornwall council’s economic growth committee published an inquiry into the private rented sector in Cornwall and recommended a number of measures to extend licensing powers. It also recommended data gathering on landlords and tenants in the private rented sector, Disclosure and Barring Service checks, longer terms and the limiting of annual rent increases. However, covid happened, further local government cuts affected officers’ capacity and the council changed to a Conservative administration that was wary of upsetting landlords following covid, so none of the recommendations was enacted.
Regardless of the council’s caution, the private rented sector has still been decimated in Cornwall, with many landlords selling up or flipping to lucrative short-term holiday lets. Prices have skyrocketed, and many people are struggling to find a home, which is why I am so pleased and relieved that the Government have prioritised this Bill. It will bring in many of the measures proposed by that Cornish report—at last, we will end no-fault evictions, introduce longer protected terms and limit annual rent rises. Awaab’s law will force landlords to follow strict timescales to inspect and repair homes, including those with damp and mould, and the decent homes standard will apply to the private rented sector for the first time, with local councils given the power to fine landlords who fail to address serious hazards.
Many people are shut out of the market if they have children or pets, or are on benefits. Changes to stop that happening will prevent the most vulnerable in my constituency remaining unhoused, and the heartache as people have to decide to give up treasured pets.
Andrew Rosindell
The hon. Lady is making some compelling points and mention pets. Does she remember the Dogs and Domestic Animals (Accommodation and Protection) Bill of 2020, which I put to the House all those years ago? I am glad that the measures in that Bill now being brought into legislation. Does she agree that this Bill needs to be extended further, so those in social housing, as well as those in freehold accommodation, can have a pet, so everyone can have a pet at home, and not lose their home because they love and care about their cherished animal?
Jayne Kirkham
I was not here when the hon. Gentleman introduced his previous Bill, but I am sure the Minister has considered the importance of pets to people living in all types of housing.
The court system and local authorities will need extra capacity to deal with the extra work created by the legislation. I was pleased to hear the announcements about digitisation and the ombudsman. The proposed changes will support the security of privately renting families in Truro, Falmouth and across Cornwall. As I have said, many people in Cornwall have been evicted from their rented homes with two months’ notice, so they can be used as short-term or holiday lets. We know that Cornwall council is the local authority with the largest supply of short-term lets outside London.
There are 24,300 holiday let properties in Cornwall, up 30% on 2019. Statistics from the council tax base tell us that over 13,000 second homes are registered in Cornwall, which is nearly 5% of the total housing stock and five times higher than the average across England. There are also 27,000 families on the waiting list for social housing, but Cornwall has only 10,000 council houses and 22,000 housing association homes.
I am pleased that the Minister is considering a toolbox of measures that could be made available to local authorities to discourage the further depletion of the private rented sector and full-time residential housing in Cornwall, such as the higher council tax that is coming in, licensing and registration, planning restrictions and closing the business rates council tax loophole.
In conclusion, I very much welcome the Bill. It provides many benefits for the people in Truro and Falmouth who rely on the private rented sector for their home, and certainty for the landlords who provide those homes.
John Slinger (Rugby) (Lab)
I congratulate Members from across the House on their excellent, humorous and moving maiden speeches.
Most landlords are good landlords and play a vital role in the housing market. I am glad that the Secretary of State changed the name of the Bill from the Renters (Reform) Bill to the Renters’ Rights Bill, because decent housing is a human right. However, making that right meaningful to private rentals has been rendered meaningless in recent years. Bizarrely, but perhaps not surprisingly, that is because the rights of those with vested interests have been allowed to trump those of millions of hard-working people, families and, especially, young people.
It is part of what I call “the moon landing paradox”: human beings can land a man on the moon and, here in the UK, we can build the Elizabeth line under London, but we cannot provide decent, affordable private rented accommodation. We can do the spectacular, but not the simple. In previous Parliaments, I imagine constituents who asked their MPs about the issue were often given the answer that providing such accommodation was too difficult. That is why I am delighted that this new Labour Government are simply not accepting that something so fundamental to human dignity is too difficult.
I wish to touch on a couple of areas raised by my constituents in and around the town of Rugby. First, ensuring that rent increases are more controlled and predictable will greatly help my constituents who have suffered from landlords demanding rent increases with as little as 10 days’ notice. That is wrong and this Bill will protect people by reinforcing the rule that rents can be increased only once a year and with at least two months’ notice.
Secondly, abolishing section 21 no-fault evictions will help protect constituents such as mine who have been evicted from their private rented properties at short notice for no other reason. This has left some of them on the street, rendering them homeless, which is shameful. Supporting this Bill will give them greater protection and peace of mind. Preferencing the interests of ordinary working people over the vested interests of others requires that we overcome what I term the “moon-landing paradox” and achieve something that is obviously much needed, that is a right and that should be possible in the year 2024 in a country as rich as ours. I know that this Government can and will do it for the renters of Rugby and across the country.
Finally, when a constituent comes to my next surgery, I am glad that I am one of an intake of MPs who will be able to say, after many decades and thanks to the efforts of my right hon. Friend, the Secretary of State, and her Ministers, that it is not too difficult, that it is doable and that soon it will be done.
Antonia Bance (Tipton and Wednesbury) (Lab)
It is an honour to stand here today. I have worked on these issues for more than 15 years. A decade ago, I ran the “Evict Rogue Landlords” campaign at Shelter. I spent a decade on the board of the Nationwide Foundation, funding renter groups and campaigners such as the Renter’s Reform Coalition, and a happy year on the board of Generation Rent, which was ended only by my election.
There is so much to welcome in this Bill, but I am so sad that the Opposition Benches are so empty and that Conservative Members have wasted so much time. I thought that the shadow Secretary of State’s speech was curious, trampling on previous Conservative promises on section 21, citing stats sourced from landlord lobbyists about landlords leaving the sector, and rewriting history about why the previous Tory Bill failed. It was quite a performance.
Representing Tipton, Wednesbury and Coseley, I stand to speak for those renters who use housing benefit to pay their rent. I am so glad that the Bill will end the disgraceful “no DSS” policy. In the long term, the answer for most of my constituents who rent privately is a social home, and I would like to see the proportion of private rented properties in my constituency reduce as we build the social rented homes that we have promised.
There is so much that is so good in this Bill. I think my second favourite measure is the application of the decent homes standard to private renting. Over the past 15 years, I have met renter after renter living with damp dripping down the walls, infestations, faulty electrics, and landlords who just do not care—they do not fix it, but still take the rent every month—with temporary accommodation landlords often the worst. Bringing in Awaab’s law and decent homes, and supporting councils to enforce the law will make the change and make every home safe.
I wish to associate myself with the comments of my hon. Friend the Member for Mitcham and Morden (Dame Siobhain McDonagh). At Shelter, a decade ago, I worked with the Lullaby Trust to make sure that babies were safe in temporary accommodation and I am sad, angry and shocked to hear of the deaths of 55 babies in temporary accommodation in the years since. But, without doubt, my favourite measure in the Bill is the end of section 21. For once and for all, we will end the ability of landlords to throw people out of their homes “just ’cos”. For 40 years, the cards have been stacked in favour of the landlords. Today, we bring forward plans to rebalance the rules, so landlords can run their businesses, shouldering the appropriate level of risk, and renters know their home is theirs for as long they want it.
Darren Paffey (Southampton Itchen) (Lab)
My hon. Friend makes an incredibly salient point about families losing their homes under section 21. Like other Members, I am sure, I have an inbox full of such cases—for example, a family with two children were chucked out of their home with no other options. Does she agree that this Bill, brought in within the Government’s first 100 days, will give the basic security of a family home to my constituents and others up and down the country?
Antonia Bance
My hon. Friend will not be surprised to hear that I do agree. I have met many of his constituents in Southampton Itchen while campaigning with him over the years. I have seen the conditions that many of them and families in my own constituency live in, and I look forward to the security that the Bill will give them.
I am so pleased and proud that we will bring this Bill forward straight away—no delay, no hold-ups. Loads of renters out there are saving for their next unwanted house move; it takes, on average, £1,700 to move house. They are worried that they may lose their homes and be forced out of the area where their kids go to school. I say to those renters today, “We’ve got your backs. You will be able to stay in your homes—this will be law inside the year. Take heart!” If the landlord tries to raise the rent so high as to amount to a de facto eviction, renters will finally have recourse: they can go to a tribunal and stop a rent rise above market rates.
I gently say to the Minister that it would be good to understand how the tribunal will find out what market rates are; as we all know, looking at Rightmove will not help—that covers only new lets, not all lets in an area. But that detail is for later stages. What matters is this: no more no-fault evictions; security and predictability for renting families; rights rebalanced between renters and landlords; safe homes; and proper action on rogue landlords. This has been a long time coming, and I am so proud.
Joe Powell (Kensington and Bayswater) (Lab)
It is a great privilege to follow that excellent speech. The Renters’ Reform Bill is potentially transformative for Kensington and Bayswater, as it is for the whole country. Nearly 45% of my constituents are now private renters—a huge increase in the last decade and now the biggest tenure type by some distance. Those renters pay the highest rents in the country: an average rent of £1,600 per person. A rental property in my constituency now averages £3,400 a month.
Yet despite the fact that those renters pay an increasing proportion of their take-home pay each month in rent, I have been inundated since the general election with cases of constituents facing the major challenges that colleagues have already highlighted—section 21 evictions, damp and mould, slow repairs, unaffordable rent hikes, bidding wars and a feeling of insecurity and lack of power that never leaves a person under the current rules.
I think of my former constituents Jean and Jack Franco, who lived with their mum in a rental flat in north Kensington. After eight years of never missing a rent payment, they were served a section 21 notice by an anonymous overseas landlord and given just weeks to leave. All their attempts to challenge the decision and engage the landlord failed. Their request for just a few more weeks to find a new home was denied. The council were unable to help them, so Jack and Jean had to leave with their mum for a new part of London as rents in my constituency are so unaffordable.
The letting agent told the Francos that the owner wanted to sell the property, but today that property is still being rented out, but at twice the rent that the previous family were paying—a back-door eviction by an anonymous landlord that this Bill would have stopped. I also think of the constituents who I met, along with the Deputy Prime Minister and the Minister, around the table in north Kensington; they could not even bring themselves to report the challenges with the condition of their flats for fear of a section 21 notice that could leave them on the streets, sofa surfing or scrambling for temporary accommodation. This renters’ Bill is also for them. I want to focus on one critical area of implementation, the landlord register, which is a huge opportunity to give renters, landlords and local authorities the information they need to ensure that standards are upheld and new rights can be enforced. I note here my entry in the Register of Members’ Financial Interests, because I have worked on a number of new government registers in recent years, including the public register of beneficial ownership and the register of overseas entities. It is crucial to design them in a way that is as transparent as possible and does not create loopholes.
I ask the Secretary of State and the Minister to look at the detail of what will be in that register, including landlord and agent contact details, details of past enforcement action, eviction notices, safety information, information about accessibility and the rent being charged. If we include all those things, we will have a genuinely useful register that will promote accountability and genuinely drive up standards.
This game-changing Bill should also not be seen in isolation. The most exciting thing about today is the Government’s commitment to attacking our housing crisis from multiple angles: planning reform to build 1.5 million new homes, including the biggest increase in social housing in a generation; learning from Grenfell, and speeding up the remedial work up and down the country; accelerated implementation of the Social Housing (Regulation) Act 2023, including Awaab’s law; a new decent homes standard for social and private housing; a crackdown on dirty money in luxury property; and an end to the feudal leasehold system. This is a comprehensive—
Madam Deputy Speaker (Caroline Nokes)
Order. The hon. Member will know that there was a time limit, on which he is beginning to stretch my patience.
Kirith Entwistle (Bolton North East) (Lab)
You will be pleased to know that I will keep it short, Madam Deputy Speaker. I join colleagues in saying that this is long-overdue and important piece of legislation. I commend my right hon. and hon. Friends on the Front Bench for bringing it to the House. For too long my constituents have endured insecure and inadequate private rentals and the constant threat of no-fault eviction. Last year alone, Bolton saw the highest rent increase of any area in the UK, at 14.8%, according to Zoopla’s UK rental market report.
However, with the current proposals pegging rent increases to out-of-control market rates, this Bill risks failing to protect lower-income tenants in my constituency, where such rent increases can be an eviction by the back door. The introduction of in-tenancy rent caps, preferably tied to wage growth, would increase security of tenure and keep more tenants in their homes for longer. I urge the Secretary of State and Ministers to take that into consideration.
I conclude by joining colleagues in welcoming the Bill to the House and commending this Government for the steps we are taking to ensure that everyone has a safe and secure roof over their head.
Steve Witherden (Montgomeryshire and Glyndŵr) (Lab)
Thank you for calling me to speak in this important debate, Madam Deputy Speaker. I, too, praise all the brilliant maiden speeches that we have heard today. As I am one of—I believe—only three Welsh MPs in the Chamber at the moment, right hon. and hon. Members will be pleased to know that I do not intend to speak at length on this matter, which is devolved in Wales.
I welcome this transformative Bill, which provides private renters in England with the long-term security and protections already granted to those in Wales. We heard the shadow Secretary of State speak earlier about delivering on manifestos. Well, we have managed that in Wales, which shows that if there is a sincere and genuine will to implement such measures, it can be done.
Abolishing section 21 is crucial to reducing the threat of unfair evictions and the risk of homelessness. However, there are concerns that landlords will still have the power to evict tenants without cause through excessive rent increases. What measures are the Government introducing to safeguard tenants from such processes?
David Simmonds (Ruislip, Northwood and Pinner) (Con)
It is a pleasure to wind up for the Opposition in what has been a comprehensive debate. I add my thanks to all Members who made so many interesting points about different aspects of policy, but I would like to start with the contribution by the hon. Member for Rugby (John Slinger), who said that most landlords are good landlords. The English housing survey’s most recent set of statistics, published on 18 July 2024, sets out that private renters in England are the most satisfied of tenants in all types of tenure, more so than in social rented or any other kind, where the highest levels scored between 51% and 65%. While all Members will see in our constituency casework dozens of examples of people in great difficulty as a result of problems in the private rented sector, on the whole this sector remains one that those who use it find to be valuable and a source of appropriate and affordable housing. Therefore, the spirit in which we approach the Bill is that we need to ensure we put right the more egregious examples of tenants or landlords being abused and their good will or vulnerability being exploited in different ways.
My right hon. Friend the Member for North West Essex (Mrs Badenoch), in her opening speech for the Opposition, set out some robust criticisms of different aspects of the Bill and a strong defence of the previous Government’s position on the implementation of the Renters (Reform) Bill, as was. It is clear that our approach during the passage of this legislation will be to work constructively to address those shortfalls and deficits that we perceive in it, while recognising, as we did in the previous Government and as we have in manifestos—and as I think, from the speeches, has been the case across party—the importance of getting this right for renters.
John Cooper (Dumfries and Galloway) (Con)
I have seen the reality of such measures in Scotland, because these matters are devolved. They have driven up costs for renters, reduced choice, and made it exceptionally difficult to get that first home and almost impossible to get student accommodation in our wonderful university cities. Does my hon. Friend agree that it is important that we get this right, and if we are to do so we are going to need changes?
David Simmonds
My hon. Friend represents Dumfries and Galloway and therefore knows a great deal about the impact that these measures have, because he has seen at first hand the impact on his constituents. I agree with him entirely, and it is important to draw out his point that they will have an impact not simply on those who are private renters in the traditional sense; this is part of a wider rental market, as many Members have noted, which includes everything from temporary accommodation to short-term lets, which is to a degree an unregulated market into which some landlords are moving. There will be a huge impact on students across our university towns. The private rented sector is used by local authorities to find accommodation for those in social housing need, and the social rented sector and our housing associations will be impacted too. Of course, there will be a degree of impact on owner-occupation as well.
Reflecting on the speeches of Members, it is clear, as the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi) said in her contribution, that we are increasingly reaching many of the key milestones in our lives later on, including acquiring our first home as an owner, having our children and getting our settled career. That is one of the reasons why we in the Opposition party, as we did in government previously, recognise the importance of getting things right in the private rented sector, because it will represent an increasing proportion of tenure in our country in future.
I will try to draw together a number of the points made—I appreciate that the Minister will do the same for the points made by his colleagues; I will endeavour to do my best for those on the Opposition side. As well as the points made in the introduction by my right hon. Friend the Member for North West Essex, my hon. Friend the Member for South West Devon (Rebecca Smith) shared the experience of being a local authority cabinet member in a part of our country with a combination of high-density modern housing in cities and surrounding rural areas, something more characteristic in the market of the United Kingdom than is the case in London, where my own constituency is located. Indeed, the hon. Member for Walthamstow (Ms Creasy) spoke of similar experiences.
That illustrated a point that some scoff at: landlords exiting the private rented market means not that the bricks and mortar disappear, but that the home is no longer available to the private rented market. It may be available to owner occupiers, it may be available to short-term lets, and it may be converted into other types of accommodation, but it represents a net reduction in the supply of private rented homes in that location. It is absolutely correct to draw attention to the impact of that on our communities.
Rachel Blake
You make the point that you think the property might change into home ownership or another form of tenure. What evidence do you have that the property would not remain in the private sector under a different type of landlord? The argument that you and other Conservative Members continually make is that—
Madam Deputy Speaker (Caroline Nokes)
Order. I remind the hon. Lady that when she says “you,” she is addressing me. I have not made any points in this debate.
Rachel Blake
The argument that has been made by those on the Opposition Benches is that private rented homes are at risk of being lost to the sector, but that does not really stand up if other landlords purchase those homes.
David Simmonds
In Scotland, where similar regulations have been implemented, there has been an exodus from the market of smaller private landlords in particular, and those properties have fallen into other kinds of tenure. If the supply of homes remained the same and it had a zero-sum impact on the market, there would of course be no requirement for a Renters’ Rights Bill at all, because everybody would find a home on one kind of tenure or another, but we know, because of the increasing proportion of people in the United Kingdom looking to the private rented sector to access the kind of home they need, that this will be incredibly important.
Antonia Bance
Does the hon. Member agree that it is precisely those small individual landlords who struggle to keep up with decent renting regulation, even as minimal as it is now? They make up the majority of the rogue landlords that many of us have heard about in our constituency surgeries. Frankly, it is often a good thing that small landlords who are unable to provide decent properties and keep up with legislation get out of the market in favour of those who can.
David Simmonds
The hon. Member raises a good point about rogue landlords. Let us reflect on some of the complaints that we have heard. Ant infestations, widespread evidence of mould causing health problems, the dilapidation of communal areas, a prohibition on tenants seeking to rent while on benefits and a failure to comply with licensing laws—just some of the complaints made by the tenants of the hon. Member for Ilford South (Jas Athwal), but they are widely represented across the market. They are the reason we need to get enforcement action against rogue landlords such as that Member right.
On enforcement, the Secretary of State said in opening the debate that she is keen to ensure that there is an effective fining regime so that those who breach the rules can be held to account. We in the Opposition have a genuine concern about getting that right. There are a number of different areas of local authority activity in which enforcement is essentially a net cost to the council tax payer, because even when costs are won and fines levied, they are nothing like the cost of carrying out investigations, building the evidence base and taking the required enforcement action. If we are to ensure that rogue landlords acting in breach of existing laws are held to account by local authorities using those powers, we need to ensure, during the passage of the Bill, that the resources that are expected to arrive through the method of enforcement and fining are sufficient to make the process self-sustaining, or that the Government have alternative measures in mind to ensure that local authorities can access those resources by other means.
That is a long-standing issue and has been a factor for Governments of all parties. It was certainly a challenge in my 24 years in local government, under Labour and Conservative Governments. We need to ensure, in the interests of our tenants, that we get this right as far as we can.
Ms Creasy
As the hon. Gentleman will know from his experience in local government, the challenge is that the existing legislation relies on our constituents having the confidence to come forward, whether they are facing mould or unfair practices, and the evidence shows that the threat of a no-fault eviction means that many do not come forward. Does he therefore recognise that simply opposing no-fault evictions and relying on the existing enforcement regime means consigning people in an unfair market to silence and suffering?
David Simmonds
As a constituency Member of Parliament and former councillor, I entirely recognise the hon. Lady’s point, but what the hon. Member for Rugby said was significant because we need to recognise that 76% of tenants in the private rented sector report a high level of satisfaction, a much higher level of satisfaction than is found in other forms of housing tenure. If we are to strike the appropriate balance in this debate in the Parliament of the nation, we have to recognise that the vast majority of landlords provide a good, important and high-quality service, and make sure that the legislation we take through to address the difficulty and challenge that our constituents—citizens—experience is proportionate.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
Will the hon. Gentleman give way?
David Simmonds
I will make some progress and move on to another area that has been debated. I know that the Minister will wish to have time to sum up on many of these points as well.
A number of Members, including my right hon. Friend the Member for New Forest West (Sir Desmond Swayne), highlighted the need for appropriate measures to support students in the rented sector. A good many landlords’ organisations have made the point that the Government’s intention to change the tenant and landlord’s full freedom of contract will have an impact, especially on students who wish to rent a property for the entire duration of their course. We need to ensure that there is appropriate flexibility in respect of student properties, so that students at university can find the housing that they need and landlords are not discouraged from entering that market, and so that the points raised by my right hon. Friend are addressed. We do not want a situation in which a landlord, wary of a two-month notice period, decides to take the property off the student market and put it somewhere else, in a way that perhaps addresses housing need less, and fails to support the local economy in the way that student housing would have.
That leads me to a point that I know we will explore in Committee: how freedom of contract particularly impacts constituents who struggle to pass the kind of credit checks and landlord insurance checks that are common in the private rented sector. We all have examples of people who have faced bankruptcy proceedings and entered into individual voluntary arrangements to address significant financial difficulty, and who then got themselves back on their feet; but who, when facing eviction, have found it impossible to find a landlord willing to rent to them. Those people are not eligible to access social rented housing, because they have a job and an income, but cannot access the kind of housing that locks them into a regular payment contract. However, they may be able to offer a significant up-front payment of rent—potentially many months’ rent, or even a year’s rent—to secure a property. That gives the landlord the certainty they need, and it also gives the person the guarantee of the home they need. We need to address that issue, because the implementation of a number of financial arrangements by previous Governments has created both an opportunity for people to get back on their feet after financial difficulty, and a challenge in accessing a long-term home in the rented sector.
As we proceed with this Bill, it is clearly important that policy is based on evidence. Having spoken to the Minister and many of his colleagues about the Bill, I know that there will be a high degree of cross-party agreement on some of the points that are discussed. However, I would like to bring this debate back to the key concern that we in the Conservative party have, which has been expressed by a number of Members: we need to ensure an appropriate supply of housing in the private rented sector, so that citizens who need to access those homes can do so.
We remain a party that respects and supports the aspiration of home ownership. Just like all other important life stages, our constituents are reaching that life stage later in life than has been the case historically. We are in a world where people do not typically leave school or university and spend 40 years working in the same business and living in the same town. People moving around and moving home to adapt to changing needs is a key issue that we need to address. Even those wishing to downsize and looking for a smaller property later in life—the last-time buyer market, as the industry likes to describe it—have their equivalent in the rental sector: people looking for accommodation that comes with a package that provides sufficient care and support. The choice to move into high-quality accommodation of that nature in the private rented sector can free up family homes that are in short supply. All these things need to be seen in the round.
Of course, most Members of Parliament are tenants—not all of us; those of us who commute are not—and will have experience of the London rental market. Luckily, Members of Parliament in that situation have the Independent Parliamentary Standards Authority to back them up, but that experience highlights the significant differences we see across the regions and geographies of the United Kingdom. My outer London constituency is dominated by owner-occupiers, but has a vibrant rental sector and a significant number of retirement homes. The population and the need are significantly different from the population and need in a university town full of young people looking to secure student accommodation, or looking for a good-quality private rented home for a short period while they get their first job and get their foot on the property ladder. We need to support that market effectively, and to get it right. We need a balance that avoids over-regulation and the unintended consequences about which my right hon. Friend the Member for North West Essex spoke so eloquently.
Regional variation was highlighted by a good many Members. Places being converted into holiday homes does not tend to be a significant issue in the London suburbs. However, we have heard from colleagues in this House, as we did during the last Parliament, about the massive impact that that has in many of our coastal towns and cities. The impact is not just on those in need of social housing, and those struggling to access, through social rent, accommodation in the private rental sector, but on those in other parts of the country where the local economy has been significantly changed as a result of those issues.
No debate about housing can be allowed to pass without mention of the impact of our Home Office contracts to secure accommodation for those in our asylum system. We know from feedback that many Members of Parliament have provided from around the country that in some areas, that has a significant impact. The initial very good intention behind those Home Office contracts was to disperse asylum seekers awaiting a decision to privately rented accommodation in parts of the United Kingdom where there was accommodation surplus to the needs of the community. That was why those contracts—run now by three private organisations, but run previously by the Home Office, and originated by the now Mayor, Andy Burnham, when he was a Home Office Minister—use that supply of accommodation.
However, we are beginning to hear, as we learned in debates about the use of migrant hotels and so on in the past, that the policy has, in some areas, taken a significant share of accommodation that would otherwise be available to the private rented sector. While it is absolutely right that we seek to reduce the cost to the taxpayer of people staying in hotels, we need to ensure that decision making does not simply tick the “out of hotels” box, and respects the needs and expectations of the community. In particular, given that it is always the lowest-cost accommodation that the Home Office will seek to rent, we need to ensure that the policy does not have an inappropriate impact on those awaiting housing through the local authority, or seeking the least expensive accommodation in the private rented sector.
All these different issues—temporary accommodation, short-term lets for students, accommodation for asylum seekers and owner-occupation—are impacted by this debate. I hope that the Minister will accept that we approach this topic in a constructive spirit, and that our challenge, as we go through the next stages of the Bill, aims at addressing the issues to get the Bill right.
My hon. Friend the Member for Romford (Andrew Rosindell), my right hon. Friend the Member for Witham (Priti Patel) and the hon. Member for Boston and Skegness (Richard Tice) all brought their direct personal experience to this debate, and set out why the points raised at the very start of this debate are so significant.
Danny Kruger (East Wiltshire) (Con)
My hon. Friend is making a very important speech. Does he agree that it would be very helpful for the whole House if the Government published an impact assessment on the effects of the Bill, and does he understand why that has not happened?
David Simmonds
I am sure the Minister will have heard that question and will address it, but there is a consistent pattern. A number of Members referenced yesterday’s debate on VAT on school fees, in which that point emerged, too. While we can see, for example, that there is a significantly higher proportion of pupils from ethnic minorities in private schools than in the state sector, the Government cannot supply an equalities impact assessment for their policy on VAT on schools. There seems to be a similar trend emerging with the winter fuel payments, and with the Renters’ Rights Bill; the Government say that it is very important that we get the policy right, but cannot supply evidence that they have properly considered the equalities impacts and the wider impacts, although much of that was enshrined as a legal requirement under the previous Labour Government.
In winding up—[Interruption.] I hear a cheer. That is the first, but I hope not the last, cheer I enjoy in this Chamber in my parliamentary career. This Bill is an opportunity to get things right for renters. We know that is a high priority for all political parties in this Chamber. We can all see the impact that the private rental sector has on housing supply in this country. We want to make sure that the sector continues to be an important, supportive and appropriate source of homes for people, and that it interacts effectively with other sources of accommodation. If we are to do that, we need to get this legislation right. Dare I say that the acid test will be future housing surveys? If the high satisfaction rates remain buoyant, perhaps the legislation has been right. If we fail to get it right, private tenants will be considerably less satisfied, and that will require the House’s attention again.
The Minister for Housing and Planning (Matthew Pennycook)
It is a real pleasure to close this Second Reading debate, and I thank all hon. and right hon. Members who participated in it. Members from all parts of the House have spoken with passion and clarity, and there has been a large number of outstanding contributions. I pay particular tribute to the six Members who made their maiden speeches this afternoon, including my five hon. Friends on the Government Benches. The quality was uniformly high, and I wish each of them well in their parliamentary career.
I am encouraged by the broad support expressed today for the main principles of the Bill. The current system for private renting is broken, and renters have been demanding change for years. That is why, as my right hon. Friend the Deputy Prime Minister made clear in opening the debate, the case for fundamentally reforming England’s insecure and unjust private rented sector, and taking decisive action to drive up standards in it, is as watertight as they come. The experience of renting privately must be improved. It already would have been, to an extent, had the previous Government not buckled under pressure from vested interests in the dying months of the last Parliament.
This Labour Government will succeed where the Conservative Government failed by finally modernising regulation of the sector. In contrast to the previous Government’s attempt, we will do so in a way that truly delivers for renters, as well as for good landlords, by addressing the numerous defects, deficiencies, omissions and, most importantly, fatal loopholes that the previous Government’s legislation contained.
Chris Vince
Does the Minister agree that this legislation will help not only the many people in the private rented sector, but charities, such as the one I worked for in Harlow, which helps people who are homeless to get into the private rented sector? Would he also agree that this legislation could have come much sooner?
Matthew Pennycook
My hon. Friend is absolutely right. We think that the legislation will take the burden off advice charities. The database provisions will ensure that tenants and landlords have access to information, and know better what is required from them under the new system. It is absolutely right that we move at pace to get the legislation through the House.
During the many hours we have debated the Bill, an extremely wide range of issues have been raised, and I will seek to respond to as many as possible in the time available to me. First, I want to address the reasoned amendment tabled by the Opposition. My opposite number, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), struck a constructive tone, but when the shadow Secretary of State, the right hon. Member for North West Essex (Mrs Badenoch), made the case for the reasoned amendment, we were treated to a bizarre spectacle; she chid us for copying and pasting many of the sensible provisions in the previous Government’s Bill, but then told us that those provisions would have “added to the chaos”. The problem is that she supported that legislation at every stage. She voted for its Second Reading; she supported it through Committee; and she voted for the carry-over motion to see it progress. She voted for it on Report and Third Reading, and took it into wash-up. She now asks us to accept that she believed it was flawed all along. Well, party leadership election contests can do funny things. She may not have confidence in her manifesto—which, let me remind her, stated that the Government at that time were committed to passing renters reform along the lines of their previous legislation—but we have confidence in ours and we are determined to deliver it.
Matthew Pennycook
No. The right hon. Member has had her time.
We strongly refute the central contention in the reasoned amendment that the Bill fails to provide security and affordability for private renters or to respect the property rights of landlords and that it
“will reduce the supply of housing in the private rented sector”.
The Bill strikes the right balance between the interests of landlords and tenants. While we acknowledge that it will take time for the sector, including build to rent providers, to adjust to a significant change in regulation, we do not believe that this legislation will have a harmful impact on future rental supply—which, by the way, we are taking steps to boost, not least by providing more opportunities for investment in a growing build to rent sector. The reasoned amendment is weak and disingenuous. I urge colleagues to vote it down when we arrive in the Lobby in a few minutes.
Let me turn to a set of specific issues referred to in the reasoned amendment and raised by a number of hon. Members in the debate: namely, tenancy reform, fixed-term tenancies and court improvements. The move to a new single system of periodic tenancies is at the heart of the Bill. The introduction of the new tenancy regime will see the end of fixed-term tenancies and the long-overdue abolition of section 21 no-fault evictions. As a result, tenants will enjoy greater stability and security, and landlords will benefit from clear and expanded possession grounds to evict tenants in circumstances where that is justified and reasonable.
To avoid confusion and to ensure that renters on existing tenancies do not have to wait even longer for the threat of arbitrary evictions to be lifted, we intend to apply the new system to all tenancies in a single stage. We will appoint the commencement date by regulations at an appropriate interval after Royal Assent. Our intention is to give the sector as much notice as possible.
A number of hon. Members mentioned fixed-term tenancies. I want to be clear that it is the Government’s firm view that there is no place for fixed terms in the future assured tenancy system. Fixed terms mean that renters are obliged to pay rent regardless of whether a property is up to standard, and they reduce renters’ flexibility to move when they need to. It is right that the Bill ensures that all tenancies will be periodic in future, ending the injustice of tenants being trapped paying rent for substandard properties.
Good landlords have nothing to fear from this change, either. Tenants simply do not move houses unless it is absolutely necessary. When they do leave, they will be required to provide two months’ notice, giving landlords sufficient time to find new tenants. Nor will the PRS become an Airbnb-lite, as some have suggested. Tenants will still have to pay up to five weeks’ deposit, complete referencing checks and commit for at least two months. Locking tenants in for longer with fixed-term tenancies would mean people being unable to leave dangerous situations and being trapped in situations, for example, of domestic abuse. We are not prepared to accept that.
Ensuring that the Courts and Tribunals Service is prepared for the implementation of the new system is essential. I take on board the challenge that many hon. Members, including Opposition Front Benchers, put to us in that regard. In considering the potential impact of the Bill on the county courts, it is however important to bear in mind that most tenancies end without court action being needed. It would also plainly be wrong to assume that all evictions that presently occur following a section 21 notice will in future require court proceedings under section 8 grounds.
One of the main effects of the Bill will be to reduce the number of arbitrary evictions that take place. That said, we recognise that landlords need a reliable and efficient county court system to ensure that they can quickly reclaim their properties when appropriate, and that we need a well-functioning tribunal process to resolve disputes in a timely manner. We agree that improvements to the courts and tribunals are needed to ensure that the new system functions effectively. As my right hon. Friend the Deputy Prime Minister said at the outset of the debate, we are working closely with colleagues in the Ministry of Justice to ensure that they are made, and exploring options for improved alternative dispute resolution so that only cases that need a judgment come to court.
Matthew Pennycook
I will bring forward further detail as the Bill progresses, but those conversations with Ministry of Justice colleagues are ongoing, and they are constructive. We want to get to a place where the system is ready to take the new tenancy provisions forward. We will not act precipitously, and what we are not prepared to do—this is the most important point on courts—is make the necessary and long-overdue transformation of the private rented sector contingent on an unspecified degree of future court improvements subjectively determined by Ministers, as the last Government proposed in their Bill. We are determined to move quickly to give renters the long-term security, rights and protections they deserve.
A number of hon. Members raised the issue of standards, and many shared horrific stories of tenants trapped in substandard properties. It is essential, in the Government’s view, that we take decisive action to tackle the blight of poor-quality, privately rented housing and to ensure landlords are required to take swift action to respond to serious hazards.
Gareth Snell
The Minister is giving an excellent speech. Landlords in Stoke-on-Trent have told me that they welcome any move that drives the rogue landlords out of the system. That is because rogue landlords undercut the market and prey on the vulnerable and those locked into low-income jobs by offering relatively low-rent accommodation, safe in the knowledge that if they complain or seek any form of improvement, they are simply out, to be replaced by somebody else who is desperate. While my hon. Friend is talking about improvements to the landlord system, will he say more about how good landlords welcome the Bill?
Matthew Pennycook
My hon. Friend is right. We have engaged constructively and intensively with tenant representative groups and with landlord bodies. Most of them will say that what he describes is part of the problem, because they represent the better end of the market, and that good landlords welcome the new system because it forcefully targets the unscrupulous landlords, mainly at the bottom end of the market, who bring the whole sector into disrepute. That is one reason why the characterisation of this Bill as overly pro-tenant and harmful to, and unwelcomed by, landlords is misplaced. Good landlords should welcome this legislation.
I welcome the support expressed on both sides of the House for the provisions that will see a decent homes standard applied to the private rented sector and Awaab’s law extended to it. It is important that we get the detail right, and I assure the House that we intend to consult on the content of the decent homes standard for both social and privately rented homes, and on how Awaab’s law will apply to the latter, given the obvious differences between the private and social rented sectors.
I want to respond briefly to a question posed by the Liberal Democrat spokesman, the hon. Member for Taunton and Wellington (Mr Amos). I thank him for his kind remarks about me in his speech. The approach we are taking in this Bill to applying and enforcing the decent homes standard to the private rented sector is not, in our view, suitable for the unique and distinct nature of Ministry of Defence accommodation, but I hope he will welcome the fact that the MOD is reviewing its target standards so that we can drive up the quality of that accommodation separately from the Bill.
A large number of hon. Members raised concerns about affordability, and several argued forcefully for rent controls to be incorporated in the Bill. While we recognise the risks posed to tenants by extortionate within-tenancy rent rises, we remain opposed to the introduction of rent controls. We believe they could make life more difficult for private renters, both in incentivising landlords to increase rents routinely up to a cap where they might otherwise not have done, and in pushing many landlords out of the market, thereby making it even harder for renters to find a home they can afford. However, we are introducing a range of measures in the early part of the Bill that will empower renters to challenge unreasonable rent increases and prevent rent hikes from being used as a form of back-door eviction.
Measures in the Bill will prevent unscrupulous landlords from using rent increases in this fashion. All rent increases from private landlords will take place via the existing section 13 process, so the tenant can challenge them if necessary. That will protect landlords’ rights to achieve market rent while preventing abuse. We will also give tenants longer to prepare for rent increases, and allow only one rent increase per year. For too long—this is reflected in the low numbers of tenants going to tribunal —tenants have feared challenging a rent increase at the first-tier tribunal. We will end this situation by ensuring, by contrast to the previous Government’s legislation, that a tenant will not pay more than the landlord asked for in circumstances where a tribunal might determine otherwise.
We are going further: we will end the practice of backdating rent increases, to stop tenants being thrust into debt if they take a case to tribunal. That would have acted as a powerful disincentive for tenants to take such cases to tribunal. Let me be clear: we do not want the tribunal overwhelmed, but we want more tenants to take a challenge against unreasonable rent increases to the tribunal. The tribunal will play an important role in looking at what a reasonable market rent is in their area, and assessing whether a particular rent increase is reasonable. To protect the most vulnerable residents, in cases of undue hardship, the tribunal will be able to delay the start of the rent increase for tenants caught in those particular circumstances.
Amanda Martin (Portsmouth North) (Lab)
I thank the Minister very much for his brilliant synopsis of what has happened today. How will tenants and landlords be able to put their cases to the ombudsman without having to go through the courts? How will that give tenants more reassurance?
Matthew Pennycook
If my hon. Friend will allow me, I am about to come to the ombudsman, but I would like to make a point about affordability. Concern was expressed by several hon. Members about rent in advance. I would like to assure the House that we have long recognised that demands for extortionate rent in advance put financial strain on tenants and can exclude certain groups from renting all together. We think that the Bill as it stands protects renters against requests for large amounts of advanced rent, but I will happily continue to engage with individuals and organisations who have concerns that it does not, and I am entirely open to keeping that under review as the Bill progresses.
My hon. Friend mentioned the ombudsman. The database is also a feature of the Bill, and both are integral to the functioning of the new system. We want the database and the ombudsman to be operational as soon as possible and we think they could be transformative—particularly the database, for the information it can give tenants about landlords’ previous behaviour. All that detail is to come in secondary legislation, and I look forward to engagement from hon. Friends and colleagues across the House about how we should implement both the database and the ombudsman.
My hon. Friend the Member for Vauxhall and Camberwell Green (Florence Eshalomi), Chair-elect of the Housing, Communities and Local Government Committee—I say that carefully as she does not have a Committee yet—asked specifically which organisation will deliver the new PRS ombudsman service. No final decision on a provider has been made, but the Government remain of the view that the housing ombudsman is currently best placed to take on the role, given that it would allow us to move toward a streamlined cross-tenure redress service.
A number of hon. Members raised specific issues relating to the impact of the new tenancy system on the student rental market. The provisions that we ultimately alighted upon enable students to benefit from the new system while protecting the supply of student accommodation. However, this is an area where the judgments are finely balanced. I have heard various concerns, and I look forward to future discussions as the Bill progresses.
Lastly, a large number of hon. Members rightly raised concerns about the ability of local authorities to enforce against landlords and letting agents who flout the new rules. The enforcement of all the measures in the Bill will not begin immediately, but I recognise the resourcing challenges that many local authorities face and the impact that they could have on effective enforcement. We think that these are offset to an extent by the ringfenced civil penalties that councils can levy when landlords do not comply with the new rules, but we accept that those alone will not be sufficient, so in accordance with the new burdens doctrine, we will ensure that additional burdens on local authorities resulting from our reforms are fully funded.
It is now five and a half years since England’s 11 million private renters were first promised the biggest overhaul of the sector for a generation and the abolition of section 21 evictions. Those 11 million private renters were badly let down by the previous Conservative Government, who decided under pressure from their Back Benchers to weaken and delay the introduction of their own legislation before abandoning it all together. They are being badly let down today by the official Opposition, who, in arguing for yet more delay, would see thousands more renters unnecessarily put at risk of homelessness because of an unfair eviction, and would prolong the uncertainty that responsible landlords across the country have experienced in recent years. We will not allow that to happen.
Today, we have the opportunity to progress legislation that will overhaul the private rented sector and level decisively the playing field between landlord and tenant. Our Bill will empower renters by providing them with greater security, rights and protections so that they can stay in their homes for longer, build lives in their communities and avoid the risk of homelessness. Everyone deserves a decent, safe, secure and affordable home in which to live. With a view to taking an important step towards making that a reality, I commend this Bill to the House.
Question put, That the amendment be made.
Renters' Rights Bill (First sitting)
Tuesday 22nd October 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 22 October 2024 - (22 Oct 2024)
The Chair
I welcome everyone to the first sitting of the Renters’ Rights Bill Committee. We will discuss some procedural matters first. We are now sitting in public and being broadcast. I have a few reminders for Members. Hansard asks you to email your speaking notes please, particularly if you speak according to them—that is even more helpful. Please make sure that electronic devices are on silent. Tea and coffee are not allowed in proceedings; please ensure that all evidence of them is removed from the tables. Date Time Witness Tuesday 22 October Until no later than 10.00 am The National Residential Landlords Association; The Lettings Industry Council Until no later than 10.30 am Shelter; Citizens Advice Until no later than 11.00 am The Renters’ Reform Coalition; Generation Rent Until no later than 11.25 am The Housing Ombudsman Service Until no later than 2.40 pm Justin Bates KC; Giles Peaker; Liz Davies KC Until no later than 3.00 pm The Country Land and Business Association Until no later than 3.20 pm Indigo House Group Until no later than 3.40 pm Unipol Until no later than 4.20 pm The British Property Federation; The National Housing Federation; Propertymark Until no later than 4.50 pm The Local government Association; The Chartered Institute of Environmental Health Until no later than 5.10 pm ACORN Until no later than 5.30 pm The Ministry of Housing, Communities and Local Government
Ordered,
That—
1. the Committee shall (in addition to its first meeting at 9.25 am on Tuesday 22 October) meet—
(a) at 2.00 pm on Tuesday 22 October;
(b) at 9.25 am and 2.00 pm on Tuesday 29 October;
(c) at 11.30 am and 2.00 pm on Thursday 31 October;
(d) at 9.25 am and 2.00 pm on Tuesday 5 November;
(e) at 9.25 am and 2.00 pm on Tuesday 12 November;
(f) at 11.30 am and 2.00 pm on Thursday 14 November;
(g) at 9.25 am and 2.00 pm on Tuesday 19 November;
(h) at 11.30 am and 2.00 pm on Thursday 21 November;
(i) at 9.25 am and 2.00 pm on Tuesday 26 November;
(j) at 11.30 am and 2.00 pm on Thursday 28 November.
2. the Committee shall hear oral evidence in accordance with the following Table:
3. proceedings on consideration of the Bill in Committee shall be taken in the following order: Clauses 1 to 4; Schedule 1; Clauses 5 to 28; Schedule 2; Clauses 29 to 71; Schedule 3; Clauses 72 to 98; Schedule 4; Clause 99; Schedule 5; Clauses 100 to 143; Schedule 6; Clauses 144 to 146; new Clauses; new Schedules; remaining proceedings on the Bill;
4. the proceedings shall (so far as not previously concluded) be brought to a conclusion at 5.00 pm on Thursday 28 November. —(Matthew Pennycook.)
Resolved,
That, subject to the discretion of the Chair, any written evidence received by the Committee shall be reported to the House for publication.—(Matthew Pennycook.)
Resolved,
That, at this and any subsequent meeting at which oral evidence is to be heard, the Committee shall sit in private until the witnesses are admitted.—(Matthew Pennycook.)
The Chair
We now have to sit in private simply to discuss the arrangements for this morning—nothing more—and we will then shortly be back in public with our witnesses.
The Chair
We are now sitting in public and will move on to declarations of interest. I am a vice-president of the Local Government Association.
Jerome Mayhew (Broadland and Fakenham) (Con)
I declare an interest as a private landlord.
Mr Gideon Amos (Taunton and Wellington) (LD)
I am a landlord but only of registered social housing.
Carla Denyer (Bristol Central) (Green)
I am a member of the Acorn community union, which is giving evidence today.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
I am a vice-president of the Local Government Association and my husband works for an organisation that has funded the Renters’ Reform Coalition.
Claire Hazelgrove (Filton and Bradley Stoke) (Lab)
I used to work at Shelter, which is giving evidence today.
Lola McEvoy (Darlington) (Lab)
My husband works for Shelter, which is giving evidence today.
The Chair
I welcome both our witnesses to our session to answer questions following their evidence to the Committee on the Renters’ Rights Bill. Please introduce yourself briefly. Members will then ask questions about your evidence.
Ben Beadle: I am Ben Beadle, the chief executive of the National Residential Landlords Association. We have 110,000 members, who provide for nearly a million homes in the private rented sector.
Theresa Wallace: My name is Theresa Wallace and I am chair of the Lettings Industry Council. I think it is the only group that is made up of stakeholders across the property redress scheme, including tenant groups, landlord groups, professional bodies, government bodies and agents large and small.
Jerome Mayhew
Q
Theresa Wallace: I think the Bill has the best intentions, and we support a lot of its changes. However, I believe that as it is currently written there will be unintended consequences, one of which would be more homelessness. It needs some changes. We know that section 21 is going, but we have to accept that it will not solve the issues in the PRS. We have—the English housing survey has quoted this—more than one million tenants in the PRS in receipt of benefit for housing. The majority of those should really be in social housing. If we had those social homes, we would not have the current supply/demand pressures and rent pressures, and we would not have properties lower down in the market that are unfit for purpose and damp and that should not be there in the first place.
One of our problems is that a lot of the Bill will help tenants—renters—once they are in a property, but we have to stop those properties that are not fit for purpose being rented in the first place. I heard a story last week about a lady who is renting further up the country. She is paying £500 a month for a two-bedroom cottage. On the market, it would be worth £750 a month, so she is saving £250. Her property has damp and mould, which she will not be reporting to anybody because that is all she can afford to pay and she has nowhere else to go.
Jerome Mayhew
Q
Theresa Wallace: There are various reasons. We need the private landlord at the moment, no matter what his property is like—a lot of them are in very good condition. Private landlords are very scared about this Bill and a lot of them are exiting. I know some of you might think that there are other places those properties can go, but we need them in the PRS—the tenants need them. We want to keep those landlords. We have institutional investment, but that is a very small percentage—I think it is 2% or 3%—for build-to-rent. Unfortunately, the build-to-rent model does not work financially in the places we need those properties, because of the way their financial model works and margins.
Jerome Mayhew
Q
Theresa Wallace: There is evidence out there. With my agent’s hat on, I can say that we have evidence in the amount of landlords we have lost and the number of people looking at properties compared with before. I gather we have a 12% increase in properties on the market now, which is the highest since 2014, per agent.
Jerome Mayhew
Q
Theresa Wallace: Demand is up and supply is down, so that obviously does have an effect. It is not just an effect on rent: it is also an effect on the tenants who can secure the properties in the first place. The Bill is there help the people who are struggling, and in some places those are the people who will be penalised.
Jerome Mayhew
Q
Ben Beadle: With pleasure. We are largely supportive of many features in the Bill. There is a lot to be welcomed, and the Minister should take great credit for bringing in these reforms so quickly. One thing the industry has suffered with is the hokey-cokey politics of when we will see the abolition of section 21. Our position has been very clear: we do not oppose the abolition of section 21, providing the alternative is workable and fair, but there are two elements that do not quite strike the balance.
The first element is court reform and the need for landlords to have confidence in it. I appreciate that others might have viewed this as a delaying tactic in the past, but the reality is that we are waiting seven months on average to get possession of our homes, and that is for a fast-track situation with almost no proof needed. When we move to a section 8 ground, that will require more resource and more scrutiny, quite rightly, but without investment in the court system we will not deliver what either renters or landlords need.
In a survey of over 1,400 of our members, 60% of landlords said they were less confident or not at all confident that they will remain a landlord without suitable court reform. That declines to 37% if suitable court reforms are enacted. Our argument has always been that this is about confidence, striking the balance and giving support to responsible landlords, as well as delivering for renters.
The other area we have seen is that landlords will be provided with robust grounds for repossession; I may have missed them, but I do not see the doubling of notice for serious rent arrears or increasing the rent arrears threshold from two to three months as sending the right message or as fair and proportionate. Those tenancies will largely fail, whether it is two months, three months or six months, quite frankly.
What we want to do is avoid rent arrears building in the first place, so we are supportive of something like a pre-action protocol where responsible landlords can help to signpost tenants to manage their arrears. We did that during the pandemic. I worry that not addressing that point will send the wrong message. We have an average of 21 people chasing every home, so whatever nip and tuck we make around here, whether landlords are leaving or not, that is only going to worsen as confidence decreases.
Jerome Mayhew
Q
Ben Beadle: If you consider yourself an accidental amateur landlord, that is arguably part of the problem —I do not think we can have amateur landlords. Having a lettings business is a business. Whether you have one or 10 properties, you need to do it properly, and we try to support all our members with that.
We have been tracking sentiment in the sector for the last 12 years, across our membership, and it is at a record low. Only about 10% of our members are looking at actively investing in the sector, and about a third are looking at disposing of one of their properties or exiting the sector completely. I appreciate that that is sentiment rather than actuals, but we also have to point to the fact that we are seeing such a significant number of section 21s being used where a landlord is selling, and that still has not percolated through to some of the statistics. An average of 21 people applying for a rental property is not going to get better.
The Minister for Housing and Planning (Matthew Pennycook)
Q
You mentioned investment, and I wanted to press you on precisely the type of improvements you want to see. You know that, together with colleagues in the Ministry of Justice, we are already taking forward improvements towards digitising the court possession process. What are the metrics you want to see in that process as improvements? On the understanding that —I think you will accept this—not every section 21 notice will read across to a section 8, so there will potentially be a bit of an increase, what do we need to see on the section 8 side and the tribunal side to ensure that the system is fit for purpose at the point that we switch it on?
Ben Beadle: I have a couple of things to say on this, Minister. I agree that court reform has been almost like the Colonel’s secret recipe—nobody quite knows what is in it or what it looks like. It is incumbent on us to define what “the courts are ready” means in practice. For us, there are two or three areas that could be improved. First, we are getting many reports of applications that are made to the court actually running out of time because they have not been processed in time. You have the admin part of the sausage factory at the beginning, because it is not so much about the number of judges. I sit as a magistrate and I often sit around waiting for cases to come to me and to be input into the new common platform. There are delays built into the administrative process that cause frustration.
The other issue we have seen is the wait for a bailiff. Once you have patiently waited for your court hearing date and you have possession, that will be what it will be, but waiting for a bailiff can take months in some areas. Sometimes there are really poor excuses—earlier this year, we saw the stab-proof vests not being available. If it is a high-risk area, you need somebody waiting out in the car and somebody on the door. London is predominantly a high-risk area, which is why we see such slow eviction timescales.
Personally, we want to prevent evictions. Landlords do not go around evicting tenants willy-nilly, but when they have a legitimate case, we do expect it to be dealt with expediently. To me, court reform looks like sifting the cases more appropriately and more speedily; digitising that process so you see the ping and the pong of the evidence going backwards and forwards; and, when you get possession, an automatic link to the bailiff, rather than having to reapply. Those are three tangible things. Ultimately, though, it is seven months at the moment, and it needs to be lower.
Matthew Pennycook
Your point about sifting is well made. We want to see only cases that require a judgment coming to court.
Ben Beadle: Indeed.
Matthew Pennycook
Q
Ben Beadle: One of the things with section 21 is that you have an accelerated process because it is a matter of fact—if you have served all your relevant documents, it is “Tick, tick, tick. Away you go.” I think there is some merit in using that system for undisputed or very hard cases of mandatory grounds, such as where you have significant rent arrears and, although the landlord has tried, there is no chance of recovering that tenancy—hopefully the landlord has followed our pre-action protocol to signpost tenants where they need to go. There are some elements of the system that could be reused.
The other part is away from the court system and into the first-tier tribunal. We have had extensive discussions with the first-tier tribunal. Not many people challenge their rents at the moment; I think we all accept that. We want tenants to be able to challenge their rent, particularly if it is unfair or subject to a significant increase. But the way the Bill is constructed means there is no barrier, or no disincentive, to challenging your rent, and I do not think it quite strikes the balance. First, the tribunal can only award or downgrade the rent so, as a tenant, I have nothing to lose. Secondly, with the way the implementation is being put across, you run the risk of a real deluge on a system that is, frankly, antiquated—you have to fill out a Word document and email it to all parties.
Matthew Pennycook
Q
Ben Beadle: But that rent will not be applied until the date of the hearing, as I understand it, so although I understand the counter-argument, Minister, the point is that you could actually challenge a rent increase. You serve your two months’ notice; you challenge it; you wait for the tribunal to deal with it; you have your hearing cleared; and the landlord either gets it or the amount gets lowered, but that money is then not backdated.
Matthew Pennycook
Q
Ben Beadle: No, no—well, I take issue with it, in that it is not fair and it is not proportionate in the circumstances, and it will do nothing to help on court reform. That is why we have set out a managed implementation for these things. I totally get your point that it was held hostage previously, but there are some really fundamental points around the court system being on its knees, and I think there is a way of implementing regulations so that that is mitigated. The first-tier tribunal is a classic example of where you could make some nips and tucks to what is set out, to protect the first-tier tribunal from a steep rise in cases because it will not be able to cope.
Matthew Pennycook
Q
I have one last general question, which maybe you could come in on, Theresa. There are broad framework powers in the Bill for both the database and the ombudsman. The database will be critical for landlords in understanding their obligations and demonstrating compliance, and the ombudsman will potentially provide routes to landlord-initiated mediation. As we come to flesh out the detail in secondary legislation, what do you want the database and the ombudsman to do? What is the most critical thing, from a landlord point of view?
Theresa Wallace: I am very supportive of both, and I think we definitely need both. My fear is that the database could end up just being a landlord database, with the landlord’s name, the property details and the address, so that the local authorities know where those landlords are. That is part of it—I completely accept that—but I think that we have a huge opportunity with this landlord database, and so much could be done with it. We really could reach a situation where we could stop properties that are not fit for purpose being let, if the database is built with that end in mind and we can digitally upload certificates. I think that we absolutely need central registers for gas and electric, and we need one standard certificate for each so that they can easily be read digitally to see whether they are in date, whether there are any code 1s and all sorts of things. I think that that would be amazing, but I actually think that we should go a step further.
A long time ago, the Lettings Industry Council came up with a model of a property MOT. Think about how you MOT your car, and it is checked in the background that you have got your tax and your insurance. We could do that with properties. We could have very easy and simple pre-let checks, so that a property is viewed visually. You have energy performance certificate providers that go and do their EPC checks, and you could easily have online or face-to-face training for providers to do a visual check so that you can see if you have damp and mould, slips and trips or other things. I think that it could be done very cost-effectively, and I think that the portal would pay for itself as well as providing local authorities with some income for enforcement. Enforcement is something that we absolutely need, and I know there is not the resource for it.
The Chair
Three other Members are indicating that they want to come in. If we bear that in mind, with the time, we can get everybody in.
Carla Denyer
Q
Theresa Wallace: It is a good question. I think that the demand is what has the effect on rents. I really believe that if we had those million social homes—I know we cannot get them overnight, but we should have a long-term strategy working towards that—you would have no pressures on rents because you would not have this imbalance in the demand and the supply, so rents would not be where they are.
Ben Beadle: Yes is the straightforward answer, for me. The rents that we have seen increased by 8.4% in the year to September. That is high by any measure, and I think, as Theresa says, it is entirely down to a lack of social housing and a lack of new stock coming to the market. It cannot be normal that you get 21 people applying to rent a property. I know the Bill deals with advance rent. As a landlord, I never ask for advance rent, but I get people saying, “I will give you 12 months’ rent up front,” before they have even seen the property. I think this mad market is not normal, and obviously it will not be resolved by this Bill. I say that because—though there are a lot of really good things in it, such as the database and the ombudsman, which we are very supportive of—it tinkers around the edges of the fundamental issue here, which is supply.
I know the Government will address social housing and right to buy, and all those things, and they are absolutely right to do so. At the same time, we do need a vibrant private rented sector. We need that vibrant private rented sector now while we work out what to do with social homes, because there is a massive lead time. What I see at the moment is everybody harking back to the wonders of the ’70s, of social housing and council housing, and looking at that as a really great thing, but we see horrible stories of local authority properties in serious disrepair. We have lower satisfaction in the social sector than we do in the private rented sector. At the same time, we are focusing on making life really difficult for responsible landlords who have good quality accommodation to bring to market. We do not want to dissuade those people from bringing it to the market; we want to encourage them. I think the sequence of this needs to be that the Bill must deliver for responsible landlords and renters, and give them security, but it must also address some fundamental issues about supply.
Rachel Blake
Q
Theresa Wallace: At the moment, a very small percentage of landlords actually terminate tenancies and serve section 21 notices. The majority of those landlords are selling, want to move back in or have rent arrears. It all comes down to our lack of supply, and losing more landlords from the sector. I think we will lose more landlords, and we are losing them at the moment—not just because of this Bill, I have to stress; they are leaving for all sorts of reasons. It might be retirement, or it might be the high interest rates that are affecting them. I do not think it is just the Bill, but our biggest issue is landlords leaving the sector when we do not have enough properties for renters.
Rachel Blake
Q
Theresa Wallace: I think there is that, and there is also the matter of introducing this Bill on one date. I think that will cause more homelessness because landlords are panicking, so they will serve their section 21s while they can, to get possession of their properties, and they will come out of the market.
If, rather like with the Tenant Fees Act 2019, all new tenancies had to comply and existing tenancies had 12 months to do so, or until the end of their fixed term—that might be sooner—when the Bill came in and landlords saw it working in practice, they might see that things were not as bad as they had feared. Although I understand the reasons behind not wanting two levels, I think that doing it all on one day will have a knock-on effect for tenants. There are tenants who have long-term rents for two or three years, but once this Bill comes in, if they have already had their 12 months, they could suddenly find they have four months’ notice coming their way because their landlord has decided they want to sell or move back in. I do not think we are giving tenants the protection that they thought they had when they secured their tenancy.
Mr Amos
Q
Theresa Wallace: Often a tenant has put their children into school, and they do not want to have to move within two, three or four years. It might be a fixed-term job contract for two years, or it might be caring for elderly parents—whatever the reason, it is often the tenants that are asking us for fixed terms. It is not us saying, “You have got to take a fixed term.” If they want a fixed term, we understand the need for flexibility, because circumstances can change, so let them still have their two months’ notice. We would prefer to see minimum terms of four months, but that is not for landlords; that is to stop properties going over to the short-let sector.
I spoke to an agent last year who does short lets as part of their business model, and the average short let was 91 days. I can see we are going to lose properties to short lets; they are going to be paying for long-term rentals at short-let prices. I see that as being an issue.
If a landlord is happy to commit to two years and say, “Look, I don’t want to sell and I don’t want to move back in; I can guarantee you two years,” but the tenant still has their notice period for their flexibility, I do not understand why that is not allowed, because that is in the tenant’s best interest. Now, the landlord can say, “I am not going to sell my property. I don’t need to move back into it. You can have two years on a rolling contract,” and he then might change his mind nine months down the line, and there is nothing to stop that.
Ben Beadle: I wonder whether I can comment from a student perspective, which has not been picked up by the Committee yet. One of the areas that we are very worried about is the cyclical nature of the student housing market. I operate in Uxbridge near Brunel University. As Mr Simmonds well knows, tenants coming in want to have the security that the property is going to be available.
Where I do not think the Bill quite strikes the right balance is that I think it needs to maintain the moratorium period that was brought in under the previous Bill, because that did three things. First, it protected set-up costs for landlords. It costs a lot of money to set up a tenancy. I do not think we are going to see a huge change in behaviour in terms of churn, but I am sure we will see some behaviour change where tenants can give two months’ notice. Having a minimum six-month period—four months plus two—is sensible for that. Secondly, it is sensible from the point of view of not turning the private rented sector into Airbnb via the back door. Nobody wants that. Thirdly, it goes some way to protect the student cycle, which is in the interests of both landlords and tenants.
The Chair
For the very last question—a short question and short answer—I call David Simmonds.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
Q
Ben Beadle: Yes. Straightforwardly, yes it is. Landlords will have to act differently under section 13. I would encourage landlords to speak with their tenants. No one wants to get a section 13 notice through their door as a surprise, so landlords do need to have some soft skills about them and have a sensible chat with their tenants, but yes is the straightforward answer.
The Chair
We have to bring things to a close now as the next witnesses are due in. I thank both our witnesses very much for coming and giving evidence this morning.
Examination of Witnesses
Tarun Bhakta and Tom MacInnes gave evidence.
The Chair
Good morning to both our new witnesses. Could you begin by introducing yourselves? Then I will go to Members to ask questions.
Tom MacInnes: Good morning. My name is Tom MacInnes. I am the director of policy at Citizens Advice.
Tarun Bhakta: My name is Tarun Bhakta. I am policy manager at Shelter.
David Simmonds
Q
Tarun Bhakta: First, I would like to thank the Committee for inviting us to give evidence today. To answer your question on how the Bill is different, there are significant changes from the previous version of the Bill. In our view, the previous version was of good intention, but full of aspects that would undermine its core purpose, particularly as the Bill moved forward and changes were introduced, for example to essentially remove periodic tenancies or reintroduce fixed-term tenancies—that minimum period for tenants.
Similarly, there were policies with a lot of shortcomings —ideas such as the no re-letting period after landlords evict a tenant. We have seen in Scotland that one in five landlord sale evictions have not ended up in sale, so there is evidence of abuse in the system. It is really important that there are measures to deter landlords from abusing the new section 8 system, and to catch landlords who are dishonestly evicting tenants. The previous Bill included only a three-month no re-letting period, which would have been much too small a deterrent for landlords seeking to abuse the eviction grounds and evict tenants dishonestly. We are really pleased to see changes in this Bill that go significantly further, such as the 12-month no re-letting period.
There were measures in the previous Bill that we would call half-baked, particularly when it came to notice periods. We know that the most common type of eviction in the new system will be for landlord sale or for landlords moving in. The previous version of the Bill included just two months’ notice, which would have retained and recreated many of the problems that we see in our current private rented sector, where tenants are faced with short notice and unreasoned evictions. We think many of those are avoidable, but we also know that that short notice is not long enough for renters to find a new place to live. There are really positive changes in this Bill in comparison with the previous version. We think it will go a very long way to addressing the needs, but given that we are so early in the Parliament —we welcome the speed at which the Bill is being implemented—it is still important to view this Bill as a work in progress.
In our evidence today, we will pick out two key areas. First, we think the Bill can go further in chapter 3—the discrimination clauses—on improving access to rented homes. Secondly, we think the Government need to take another look at rent increases. Looking at the evidence from tribunal cases, we do not think the current approach in the Bill—to tweak the work of the tribunal, as discussed in the previous panel—will achieve its aim of preventing evictions by the back door, or economic evictions, as they have been called. We think that the evidence that we have heard today on the tribunal today shows that we need to go further there.
Tom MacInnes: We would agree with quite a lot of that. The Bill does improve the position for renters. We agree with the changes around re-letting, but we would say that that is probably only as strong as the enforcement, so we would be interested in looking at that further. We also welcome the longer notice period and the stronger rules on discrimination against families and those receiving benefits. Those are definitely things that we think are improvements.
We may come on to this, but there are other areas in which we might be looking for a couple of improvements. In particular, there was some discussion earlier around the portal and the use of the portal. We think that it could be used for better establishing what the market rent was in an area. If you are talking about in-tenancy rent rises, is that possibly a place where you could agree what actual rents were, rather than past rents? There could be something useful there, but broadly speaking it is a step in the right direction.
David Simmonds
Q
Tarun Bhakta: Yes, I think so. I think you might be referring to talking about the evidence requirements on eviction grounds.
David Simmonds
indicated assent.
Tarun Bhakta: It has long been our call that the Bill should specify and set a higher threshold and make that clear, particularly for the landlord sale and the landlord moving in eviction grounds. We also think that the Bill should introduce a post-eviction proceeding.
There are two really important parts to establishing that clarity in the Bill. First, tenants and landlords need absolute clarity about what constitutes a legitimate eviction. We see through our legal services that the decision on whether to challenge an eviction notice in court is an incredibly complex and difficult one for tenants to make. The process of going through the courts to challenge an eviction is time-consuming, costly and very stressful for tenants, so it is about setting out that clarity, particularly in those landlord sale and landlord moving in eviction grounds. Making that threshold clear would provide clarity for tenants to help to make that decision. We believe that that would also have the effect of supporting tenants to understand where an eviction is legitimate and prevent some of those cases from making it to court.
Secondly, the current wording in the Bill is very open. It goes further in Scotland, in our view, and although it is all very well being confident in setting guidance for the courts and hoping that the judges make the right decision in court, tenants need that clarity before we reach the court stage. Also, judges do need some steer; we see some inconsistency in cases between judges, and it is not the case that they will all interpret the law in exactly the same way, so setting that clarity in the legislation is important. We cannot have a situation in which the landlord states that they intend to sell the property and that is case closed: we need more clarity than that.
Matthew Pennycook
Q
Tarun Bhakta: It is difficult to set that to one side, so you will forgive me if I do not.
Matthew Pennycook
Q
Tarun Bhakta: First, we believe that the Government need to look at the proportions by which rents are increased. Currently, the tribunal is able to access only the eventual rent, whether or not that is a market rent, so in effect it works with a ceiling, rather than looking at the proportions of rent increases. This is really important, because through the tribunal and our services outside the tribunal we see very large proportional rent increases. This is what matters to tenants: they cannot afford large proportional increases in their rent because of that shock, particularly where they are on fixed incomes and receive housing benefit or pensions.
The data at the tribunal is really telling. The average size of a rent increase permitted by the tribunal in the last hundred cases was 23%. The majority of renters tell us that they could not afford a rent increase of more than 10%, yet two thirds of cases in the last 100 cases in the tribunal ended with a rent increase for a tenant of 10% or more.
Matthew Pennycook
Q
Tarun Bhakta: That is exactly right, and 16 of the 100 cases we looked at saw an eventual rent increase of more than 40%. We know, both through our services and through our research, that that is not manageable for tenants. That is the kind of rent increase that pushes tenants out of their homes or into debt. The problem is using a ceiling of market rent to judge the eventual rent increase.
Setting limits on proportional rent increases is commonplace across Europe. I know the Government have said they will not introduce any measure of rent controls, but it is quite unhelpful to lump all rent controls together when there is such a range. Rent controls is not a policy, but a category of policies. It is common across Europe to limit the proportion by which rent can increase during tenancies. The purpose of that is not to bring down rent or tackle affordability in any major way, but to protect people from those disproportionate rent increases that force them out of their homes.
In the tribunal there is evidence of landlords, where they are not able to secure section 21 eviction for whatever reason, turning to rent increases. There are at least four cases in that 100—this is only where the tribunal have provided background notes, which is not very common—where a landlord has clearly sought to evict the tenant and has not been able to, so has turned to a very large rent increase, and all the tribunal has been able to do is permit a large rent increase. In many of those cases we assume the tenants will have had to leave the property.
Matthew Pennycook
Q
You heard the concerns from the previous witnesses about how that would operate and the unfairness of that. With your experience, how would you say the new system would operate? We have been very clear that we want more tenants to take challenges to tribunal, though we do not want the tribunal overwhelmed. What would you say to the charge that the decision the Government have made, to put the point of payment when the tribunal makes its determination, will see a flood of cases come in and all advice groups will tell tenants to take every single rent increase to tribunal?
Tarun Bhakta: We are often accused of plotting to tell everyone to take things to court. We do not think that would be the case. As you say, we want more tenants to be able to challenge their rent increase at tribunal because, particularly in the last couple of years, we have seen extremely large rent increases for tenants during tenancies. The reason we do not think there will be a flood of cases to the tribunal and the reason we would not advise tenants to do that is that, if you look at this evidence, there is very little that the tribunal is able to do at present to address those large rent increases. We would not advise tenants to simply delay the inevitable, because, looking at the data, a large rent increase is somewhat inevitable—it might not be the exact rent increase the landlord asked for in the section 13 notice, but there is strong evidence that the tribunal will permit a very large rent increase.
Matthew Pennycook
Q
Tarun Bhakta: Yes, absolutely. Before I talk about what the process looks like for tenants, which Tom can maybe add to, we need to understand that, for tenants who do not interact with courts or tribunals or anything like that in their daily lives, going through one of these processes, whether we know it to be arduous or not, sounds and feels scary to tenants. That is really important to understand. The vast majority of tenants do not want to go through these processes. It is not fun—it never has been fun—but there is also the fear of what might happen and of how it might damage the relationship with the landlord. All those things weigh heavy on tenants’ minds. That is a really important factor to consider. The proposals that we have for limiting rent increases would, in effect, do away with the need for tribunal decisions, but for a very rare and small amount of cases.
When it comes to the actual process of tribunal, there is such poor data out there about rents in the wider sector that it is very difficult for tenants to gather that evidence. It is somewhat on them; it is also on the landlord, but it is somewhat on them to gather and provide that evidence. The tribunal will do some of that work, but tenants are expected to, or generally do, provide evidence at the start.
Tom MacInnes: From our perspective, it is basically exactly that: people do not have the time or, really, the capacity to take these things to tribunal, and they often decide that it is not worth it.
To the point about the data available out there about what a reasonable or market rent is, there are so many different sources. Even at an Office for National Statistics level, there is not complete agreement. We really welcome the end to bidding wars, for instance, for new tenancies, but our concern is that an unintended consequence might be that a landlord would put in a very high price to start with and then bring it down, and it is that high price that gets logged and sets the market rate.
For us, the role of the portal is to establish what the actual rents are—a basis that everyone can proceed on together, rather than it being some debated fact. There is a real role there for making that stuff public and known. Then you get two well-informed sides of an argument.
Matthew Pennycook
Q
Tom MacInnes: I do not know whether it is about expertise, but it is simply an observation of what always happens—it tends to end up on the high side. What the rates are is just so contested.
The Chair
Quite a number of Members want to come in, so it would be helpful to have quick questions and answers.
Carla Denyer
Q
We all know that rents have been increasing out of proportion to incomes over the last few years, creating this growing gap where one or, at this rate, two generations of people risk never being able to afford to get out of the private rented sector. I am really worried about that, especially as that group ages. Do you think the Bill does enough to address the issue of affordability of rents and the long-term and growing problem of those generations of people, moving into old age, permanently trapped in the private rented sector?
Tom MacInnes: We will not go back to the bit about rent rises, but we will talk about some other aspects. The thing that concerns us is asking for enormous amounts of rent up front, so what we want is to have that limited to a month’s rent up front. There are also other issues around guarantors and asking for guarantors, in the next stage along the process. We think that has discriminatory consequences against people who actually can afford it, but cannot point to the evidence of it—people who could afford the rent but do not have anyone in their social circle, if you like, who could back them up for a year or whatever. We would like the instances of relying on guarantors to be reduced. If the issue of perceived affordability changes, the choice for those groups grows; we are looking for that kind of support.
We welcome the end of “No DSS, no benefits”, but we are worried about that coming in in other ways, such as someone not having rich enough friends to back them up. We would like to see that being addressed.
Carla Denyer
Q
Tarun Bhakta: We really agree with those points about rent in advance and guarantors, which are particular priorities for Shelter. Particularly through our legal services, we have been one of the foremost organisations supporting tenants to challenge DSS or housing benefit discrimination. We see how slippery that discrimination is. It is very difficult for tenants to understand whether they have experienced it.
To add to what Tom said, we have some evidence that rent-in-advance requests are disproportionately made to housing benefit claimants, but that also applies to older renters, as do guarantor requests. Rent-in-advance and guarantor requests often come together or are linked. A lot of older renters do not have someone in their support network who is willing or able to offer to be a guarantor. The effect of these requests that landlords introduce is to lock people out of the rented sector. Tom said that they are perceived affordability issues. It is that first step into housing, and affordability is strongly relevant to that, but we find that people who can afford the rent are prevented from renting properties because of arbitrary barriers such as rent-in-advance and guarantor requests.
To answer your question more directly, it is fair to say that the Bill does not introduce measures to address affordability in the sector. We think the Government should take a longer look at that and, to go back to my previous answer, take a more reasoned approach to rent controls. Essentially, they should explore the options, particularly where rent increases for sitting tenants are forcing them out of their homes. That undermines the core purpose of this Bill, which is to provide greater security for tenants and help them to avoid homelessness. Beyond that, it is clear that we need much greater provision of social housing and much more adequate housing benefit in order to tackle some of the affordability issues in the private rented sector.
Michael Wheeler (Worsley and Eccles) (Lab)
Q
Tom MacInnes: I do not think we would agree with that, no. By way of background, the number of people that Citizens Advice is helping with homelessness has never been higher—we hit a record this summer—so the number of people who are homeless is already incredibly high. The Bill gives more power back to the tenant, so we think it redresses a power balance.
One of the things that we would like to think about to reduce homelessness is the bit that happens at the end of the tenancy. The landlord has to give a four-month notice period, but within that the tenant has to give two—two months within that four. So the tenant is given a deadline, which is shortened, to find another place, and it is often difficult to find another home. We have talked about the affordability issues. There is an issue about potential homelessness at the end of a tenancy that everyone knows is going to end in any case. We would like to see that period reduced, ideally to zero but certainly to one month.
There is also a really good case for a rental waiver—a rent-free period—within the last two months of the four so that people can afford to move out. They must be able to afford the fairly substantial initial costs of moving, and not pay two months’ rent, because there is a homelessness risk right there. No, I do not think the Bill will increase homelessness.
Tarun Bhakta: I have a simple answer followed by a less simple one. No, the Bill will not increase homelessness. We have already heard that the end of assured shorthold tenancies is the leading cause of homelessness. The Bill will eradicate short-notice and no-reason evictions, which many believe are not legitimate and would not meet the bar for eviction under the new system. We are supportive of the way that section 21 and fixed-term tenancies are being abolished and of the implementation approach set out by the Government. We think the Bill will reduce homelessness. I very much agree with Tom that, if and when tenants are served with an eviction notice, the Bill could go further in supporting tenants in access to finding a new rental home. I will come back to the point about rent in advance and guarantors.
Housing benefit claimants are disproportionately at risk of homelessness if they are served with an eviction and they face these additional barriers disproportionately. According to Acorn research, one in five renters claiming housing benefit had been asked for 12 months’ rent in advance in the last three years compared with just 6% of renters not in receipt of housing benefit, which shows how disproportionately the barrier is applied to housing benefit claimants, who are in turn themselves, being on lower income, more at risk of facing homelessness once they are served with an eviction notice. That is one area where we would say the Bill is a work in progress. We could improve that access to new rented homes where tenants are served with an eviction, and that would help people to avoid homelessness if and when they are served an eviction.
The Chair
Gideon Amos and then Jacob Collier—if you both ask quick questions, we can get you both in.
Mr Amos
Q
Tarun Bhakta: First, the evidence is that section 21 evictions are increasing. We do not have evidence that that is because the Bill is coming. We heard in the evidence that many landlords will wait and see, and find that being a landlord in the new system is not so bad. That is what the evidence of tenancy reform in Scotland in 2017 showed. The evidence we have does not point to that.
Can you remind me what your second question was?
Mr Amos
It was about retaining the option of fixed-term tenancies to two or three years if it were agreed between landlord and tenant.
Tarun Bhakta: No, we would not support that at all. It is an illusion that a fixed-term tenancy is a mutual agreement between tenant and landlord. Tenants expect that that is what they have to do. Tenants most commonly sign—the majority sign—12-month contracts, yet we know that tenants want longer than that. It is just that tenants do not feel that they have the power in the sector to ask for a different length of fixed-term tenancy.
In our services, we see fixed-term tenancies locking tenants into unsuitable properties; maybe repairs were promised and not done, or the property has deteriorated, their circumstances have changed, or the rent has increased and tenants are locked in and liable for the rent during that period—
Jacob Collier (Burton and Uttoxeter) (Lab)
Q
Tom MacInnes: We welcome it as an organisation. We think it improves renters’ stability. It gives a bit more power to the renters. There is more that could be done—for example, there is stuff around the two months’ notice only being required after a four-month period. To repeat some previous points, there is a bit about landlords selling their properties and the evidence required. If the evidence landlords needed to provide was increased, we think that there would be a reduction in the misuse of that ground and an increase in stability for renters. We do think the Bill makes a difference and increases stability, and if a change could be made in enforcement, it could do even more.
The Chair
That brings us to the end of that session. Thank you very much indeed. We will move on to our next witnesses.
Examination of Witnesses
Tom Darling and Ben Twomey gave evidence.
The Chair
Could the panel begin by introducing themselves?
Tom Darling: I am Tom Darling, director of the Renters’ Reform Coalition, which is a group of 21 leading housing organisations that have been campaigning for progressive reform of the private rented sector.
Ben Twomey: Good morning. I am Ben Twomey. I am a private renter myself. I am also chief executive of Generation Rent, the voice of private renters across the UK.
David Simmonds
Q
Tom Darling: I think you are asking about affordability assessments and the role they play in tenants being able to access rented housing. Is that right?
David Simmonds
Q
Tom Darling: As regards the Bill, we think that those sorts of affordability checks are acceptable, but we think that measures—as you have heard from previous witnesses—that go beyond that can be discriminatory, and often look to punish tenants and discriminate against tenants on the basis of their income. You heard about rent in advance and guarantors. We would like to see a limit to guarantors that says that, if you pass an affordability check, you should not be asked for a guarantor in addition.
Ben Twomey: We are in an interesting situation where someone could be working in a key worker or essential worker role but there are parts of the country in which it is unaffordable from them to live. They probably would not be able to pass some of these affordability checks to rent privately. That would be fine if there were other options available, but most private renters cannot afford to become a homeowner if we want to and cannot wait the 10-plus years to access social housing if we need to, so the only option is to find a way into private renting—otherwise we find ourselves in temporary accommodation. There are 150,000 children living in temporary accommodation right now. The Bill needs to go further to try to address that, because it speaks to some of the wider Government ambitions around making work pay. It does not really help us if our income increases but it is taken off us by our landlords before it reaches our pocket. Wider affordability questions, which I am sure we will come to, are relevant to the credit checks and the ability to rent privately.
David Simmonds
Q
Tom Darling: We think that local authorities should be funded on a per privately rented property basis. We have heard that the Government will set out new burdens funding, but we think that the funding should be allocated according to the size of the private rented sector in that area. I want to be really clear that we support selective licensing and would like to see it enhanced and deepened alongside the new database, and we think that a number of changes made by previous Administrations to the way selective licensing worked made it harder for local authorities to apply for selective licensing schemes. There are some straightforward changes that this Government could make: removing the Secretary of State’s veto over the schemes; allowing local authorities to refer to housing conditions when they are applying for selective licensing; and extending the schemes from five years to 10 years. We think that would work well alongside the database and not in lieu of the database.
Ben Twomey: If I could take the resourcing point and slightly widen it, there was a cost of £1.7 billion in the last year to local authorities for temporary accommodation —for housing people who are no longer in their homes. This Bill will end section 21, which is really welcome, because that is the leading cause of homelessness and ending it will hopefully make some savings for local authorities, as well as bring enormous benefits for tenants, who will be better protected.
There is also a Government cost of local housing allowance, which has been in the billions in the last few years. That is to give benefits to people so that they can afford to privately rent. This Bill could go further with affordability not only to protect people in their own homes but to make the Government change the way they resource the support they provide for people in their homes—moving some of that burden of cost away from the need to pay so much for private renting and towards a better-regulated market, which would put limits on the ability of landlords to raise rents.
David Simmonds
Q
Ben Twomey: I do not have any with me, but I can take a look at that and write to the Committee.
Matthew Pennycook
Q
It would not be a Bill Committee evidence session if every interest group was not telling us that it had a way to improve the Bill in some way and from different perspectives. We have heard a lot this morning about the various concerns and how they are being addressed. In general terms, however, particularly given your concerns about the previous Government’s Renters (Reform) Bill, do you think this Bill strikes the right balance and levels the playing field between landlord and tenant?
Tom Darling: I will start by introducing the situation in the private rented sector as it is today. The Resolution Foundation said this year that
“the UK’s expensive, cramped and ageing housing stock offers the worst value for money of any advanced economy.”
The private rented sector is the worst of our ageing housing stock; in fact, it is the worst of the worst. It is the least secure, the worst quality and the most expensive of the housing tenures in this country, and we have the worst of any major country in the world. That is embarrassing and that is what we are talking about here. We need root and branch reform. We are happy that the Government have acknowledged that more significant reforms are required than those that the previous Government put forward, but we still need to see some changes to the Bill to go even further and deal with the scale of the crisis we are dealing with.
Ben Twomey: We are delighted that the Government are pressing on with this work very quickly, and there is a promise in the manifesto to end section 21 immediately—as quickly as we can get this law passed. That is really welcome, as it will protect people from homelessness.
There are also lots of things in the Bill that I have no notes on. For example, the bidding wars legislation seems well-written; it seems like it will make a genuine difference to people like me, who have experienced being invited to bid on homes just because we reached the front of a queue and the landlord realised that they could up the rent. Some of the provisions—including the introduction of Awaab’s law into private renting—are beginning to create more of an even playing field, as you say, for renters compared with other tenures.
I want to take a moment to talk about someone I will call Ayesha from Hertfordshire. She is a schoolteacher and a single parent, and she has been struggling to keep up with the relentless rises in rent that she has faced in recent years. She says, “There are moments when I feel so overwhelmed and exhausted, like I’m carrying the weight of the world on my shoulders. I try to stay strong for my children, but the stress and anxiety are always there, lingering in the background. I just want to provide them with the life they deserve, but with the way things are going I fear that I might not be able to. It’s a lonely, terrifying feeling, and it’s hard not to feel defeated by this constant struggle.”
It is important for people like Ayesha—given what is being said in this Committee, this Government and this Parliament as a whole; every MP in this room promised to end section 21 and, in more words or less, promised a fairer deal for renters—that this Bill takes the opportunity to resolve these issues. Maybe we will come to this, but we believe that that will involve limiting the ability for landlords to raise rents—not raising them to the market rate, but instead limiting them to the level of inflation or wage growth, so that rents begins to match the real, lived experience of people who are renting.
Matthew Pennycook
Q
On rent increases, Ben, I understood that you were effectively talking about a cap—to the level of inflation or wage growth. A previous witness rightly drew our attention to the nuances around different forms of rent control. Given the evidence out there across the world, which I have looked at in great detail, do you not have any concerns about the potential negative impact on supply discouraging investment into the sector? We have heard about the supply challenges, impact on property standards and the very practical concern that if we implement an inflation-linked or wage growth cap, every single landlord in the country will raise rents every year to that cap, whether they would have done so under the current system or the system we propose or not. You must engage with the challenges on the other side from the measures you propose.
Ben Twomey: I am very happy to. The idea of raising to the cap just does not happen in many countries; landlords do not do that. When you have a sitting tenant, I guess there are elements of the risk being reduced once you know that person, and that is not really accounted for when you take on the market rate. There is also an element of knowing the human being in the home, which changes the behaviour of landlords to some extent.
The use of the market rate is flawed, to say the least. It is not real; it is a made-up number. It is not the actual rent, it is not a transaction, and it is not even an agreed rental price, but the advertised price that a landlord has put out there. More than one in five homes advertised on Rightmove in the last year had to be re-advertised at a lower rent before they were actually let. That really skews the figures, because landlords will seek higher rents to begin with, and what is actually agreed by the tenant is very different. Looking at actual rents would be useful, and that should be recorded on the property database.
There is the matter of linkage as well, which relates to the first-tier tribunal if that is going to be used as the mechanism to challenge rent increases. At the moment, if you were looking at the market rate, you would have a lot of confusion. As a tenant or a landlord, you would not necessarily know where you were going to place the rent rise or whether you would come out the other end of the tribunal happy with the result, whereas if you link to inflation or wage growth—whichever is lower—you can place a number on that every year or every month, if you want to. With that number, all renters would be empowered to know their rights. Landlords would not risk going to court, because they would know that they were within the safe amount that they could raise the rent by, and it would become a much clearer process for everybody, rather than an obscure, complex and financially burdensome process for tenants and landlords, and for the Government to implement.
Tom Darling: Can I briefly answer the point around supply? You heard my analysis of the situation in the private rented sector earlier. It is worth saying that since the year 2000, the private rented sector has doubled in size. Those are the outcomes that we are dealing with now. It is the worst tenure in the worst advanced economy, and that is after 20-plus years of investment ploughing into the sector and it growing massively. Right now, we are living the experiment of what happens if you try to cannibalise the existing housing stock and turn it into an ever-increasing private rented sector.
Matthew Pennycook
That was under the old system, and we want to transform the system, but I take your point.
Tom Darling: Of course.
Matthew Pennycook
Q
Tom Darling: I am happy to answer that. We were very supportive of the expanded use of rent repayment orders when we worked on the previous Government’s Bill. They are a great opportunity for tenants to avail themselves of the possibility for compensation. Some of the awards that have been increased by the Government would potentially be life-changing amounts of money for most renters. Half of renters have no savings; as a renter and someone who is very much not on the frontlines of this crisis, I try to keep that in mind the whole time. If you are getting a big award in terms of compensation of one or two years of rent repayment, because your landlord has done wrong, that is a potentially life-changing sum of money, so we are very supportive of that.
I think you are right to identify that enforcement works best when the tenant is incentivised to work with the landlord. That works best when the problem is ongoing and the tenant is in situ in the tenancy. One of the problems we have with the new eviction grounds—we have seen this with the poor enforcement of the new tenancy regime in Scotland—is that when the tenant moves on from the tenancy it is hard to motivate them to follow up and check that the eviction was legitimate.
Our concern is that to properly enforce the system, tenants almost need to be motivated by a sort of righteous anger to get back at their landlord. That is one of the reasons why we think post-eviction evidence should be required from the landlord, and potentially no-fault eviction compensation too, where the tenant does not have to pay the last two months of rent before they leave. That way, there will be a broader-based disincentive for landlords to use those grounds. For the vast majority of tenants, after they have been evicted, they just want to move on with their lives, and they are not thinking about their previous landlord or previous home, or checking Rightmove to see whether the landlord has re-let the property and fraudulently used that eviction ground.
Ben Twomey: I completely support the call from Tom for no-fault eviction compensation. That would recognise the harm of no-fault evictions to tenants, which I think every MP here has recognised, and try to disincentive the use of any new grounds of no-fault eviction.
On the rent repayment orders, I will quote the late, great Simon Mullings, a housing expert who gave evidence to the Renters (Reform) Bill Committee, and who would have been here had he not sadly passed away very recently. He talked about an “army” of tenants who could be ready to enforce the legislation. That only works if it is really clear what their rights are and the route to achieving the compensation or repayment of rent is straightforward.
There is another area that could be strengthened. At the moment, if a landlord is not registered with the database or the ombudsman—the redress scheme—they need to have repeat offences before a rent repayment order is available. If I, as a tenant, found that my landlord was not registered, I would have to challenge that, wait for the local authority to make warnings based on what I had said, and then continue to live in the home, feeling probably much less secure than I previously did, without receiving a rent repayment order.
If we want to make sure that landlords are not punished because they were not aware of their obligations, perhaps a smaller rent repayment order would at least give some incentive to a tenant to raise the issue on that first offence. More thought needs to be given to how to stop rent-hike evictions that could happen later, because a rent hike, being an eviction by the back door, could be another way in which I as a tenant or someone else pursuing that would feel insecure, were we to come into conflict with the landlord.
Lola McEvoy
Q
Ben Twomey: Relating the database to rent repayment orders would be useful. If there is a way in which tenants or tenant groups can access the database to make sure that landlords are compliant with the database, it would be helpful. Adding the actual rents to that database would be useful, because we would finally get an honest and clear picture of what people are paying in rent. That would start to change the inflated idea that a landlord can stick their finger in the air and charge whatever they like just because it is a new tenancy. We would start to see the patterns appear for when people are in tenancies.
We should also have certain restrictions for evictions. We think eviction notices should be logged on the database. That would give a clearer picture of why people are being evicted, so that measures later down the line can be taken to reduce the number of evictions. It is helpful that in the Bill they will now have to have a reason for eviction, because currently we do not know why landlords are evicting. We know that it coincides far too often with complaints made by a tenant, but we could continue to track that through the database. We think that landlords should be restricted from making evictions or even rent hikes if they have not registered with the database and the redress scheme.
Tom Darling: I would agree with all that. I know that the Government intend to set out what will be on the database in secondary legislation, but I think it would be helpful to have a steer from Ministers throughout this process on what they intend to be on the database.
Sam Carling (North West Cambridgeshire) (Lab)
Q
On your point about the idea of limiting rent increases to wage growth or inflation, how would you respond to the counter-argument that it might lead to landlords setting a much higher baseline rent between tenancies, knowing that they would not necessarily be able to increase the rent as much within a tenancy?
Tom Darling: To take the first point about the lessening of security, similar reforms in Scotland led to an increase in average tenancy length. The idea that abolishing fixed-term tenancies will lead to Airbnb-lite, as we heard earlier, is ridiculous. Clearly, the people proposing that have not been through joining a tenancy recently, because it is an incredibly stressful experience. That is the last thing people would think of to do to go on holiday or to stay for only two months. There has been no evidence of that in Scotland, despite similar reforms in place there, so I would dismiss the idea.
The ability to leave the tenancy to be used in very rare circumstances—for example, where you realise there is some black mould that you did not see, which was being hidden from you when you viewed the property, or you have a serious change in personal circumstances—is an essential protection. It is to be used by tenants in very rare circumstances. Actually, the arguments about that are more about landlords: they would prefer to have the certainty of six months’ rent up front—I am sure they would. We think the Government have the balance right on that particular point at the moment.
Ben Twomey: To add to that quickly, the point made by the letting agents about someone on a two-year fixed-term contract who might find themselves at risk of a form of no-fault eviction by the end of one year is a valid concern. We would welcome support in calling for a longer protective period from no-fault evictions in that case. At the moment, one year is in the Bill, which we welcome as security for renters, but doubling that to two years would be very welcome to make sure that people on such contracts do not find themselves disadvantaged.
To address the point about rent-stabilisation measures, it is important that the vast benefit to potentially millions of private renters is weighed against any potential disadvantages. Millions of renters finding themselves better protected from arbitrary evictions through a rent hike, and from being driven into debt, poverty or homelessness, is an enormous success.
In Scotland, which introduced such measures recently, there has not been an enormous increase in market rents disproportionate to what has happened in England, Wales or indeed Northern Ireland. It was similar tracking of rent inflation with new tenancies. While doing that, we have protected all those people, yet what is happening in the market is similar. One of the ways to solve part of that market problem and to begin to drive down rents is, as has already been said, to build lots of homes at the same time. Some of the most successful rent-cap regimes across Europe are in places with lots of social housing, which takes some of the pressure off the private rented sector.
Claire Hazelgrove
Q
Tom Darling: Simply put, yes. We will be pushing in a number of places where we think the Bill should go further and where we do not think the Government have quite got the balance right, but the groups in our coalition have been campaigning for this change since the promise was first made nearly six years ago. We think it will be an important change to our housing system.
Ben Twomey: Yes. Our homes are the foundations of our lives. The Bill will give us some much-needed security and should drive up standards and quality. As I say, we are worried about affordability within that, but the main reason why you as politicians have probably not heard from renters so much as is in the past year or two is that things have got so desperate. We are worried that if there are some improvements to renting, suddenly we will lose our ability to have spaces like this where we can begin to make change. If this is to be a once-in-a-generation opportunity to make that change, we think you should cover all bases and make sure that no one finds themselves homeless, in poverty or in debt because of the fact that they have been forced into private renting.
Carla Denyer
Q
Tom Darling: I think Ben touched on it. The literature shows that different types of rent control have worked best in combination with a bunch of other policy levers, and particularly the supply of social housing. If the Government are continuing to set out that affordability is not the thing they are going to deal with in this Bill, we think it would be sensible to have a national rental affordability commission that could look at all these issues in the round—including all the different policy levers such as local housing allowance, housing benefit, the supply of social housing and different forms of rent controls—to bring down rents relative to wages and make renting more affordable. That feels like a pipe dream at the moment, but it should not be. That should be our aim. If the Government are not going to take forward affordability in this Bill, that sort of commission might be a place where they could look at all the different policy levers which, it should be said, cut across different Departments, and it might be a way to take that forward.
Ben Twomey: On that point, the idea of rent regulation being a scary thing is not new, and it is something that is hammed up by the landlord groups. They obviously want to make as much as profit as they can, but they do not have a right to make profit; they have a right to seek it. In this market, it is so broken because, unlike lots of other types of markets, the landlords can just click their fingers and say, “I’m short £100 this month. I’ll get it off my tenant.” A tenant will usually be forced to pay or have no other options unless they want to leave the home or even become homeless.
It is a very broken market. We used to have regulation in many ways in the country more than 30 years ago. Things have not got better since then, so the trial we have had of not using these measures has not really worked for people. These are all things that a commission could look at, or on which the Bill could take some quite straightforward measures. Similar to the energy price cap, with which we recognise that energy is essential for our homes, our homes are also essential for our homes. We should probably think about some common-sense solutions to that.
Matthew Pennycook
Q
Tom Darling: I am happy to answer that. Obviously, we have been talking a lot about Scotland, and you will hear later about the “Rent Better” report, which has essentially written the book on it.
Matthew Pennycook
That issue is highlighted in the report.
Tom Darling: Yes. Our view would be that where these systems have worked, they have been part of a broader strategy that sets a clear direction for both tenants and landlords. I am sure you will have other landlord organisations here today that will talk about the need for certainty. There definitely has not been that in Scotland. There has been political instability and the chopping and changing of policy every couple of years, essentially—from the 2017 reforms to the pandemic freeze, the rent cap and now moving to a system of between-tenancy rent controls, and the latest political instability. I am sure landlord organisations will tell you that that makes it very difficult to have any certainty about what you are doing with rent levels in the future.
We would argue that if a Government with a big majority early on in their term set a clear direction on what the policy would be, landlords would be able to deal with that. You see that in European countries where there are big landlords who do just fine under systems where there are rent caps.
Matthew Pennycook
But you do not dispute that rents have risen faster in Scotland than anywhere else in the UK since those rent controls were introduced—
The Chair
Order. Sorry, but we have hit the deadline for this session. I thank the witnesses very much for coming. We now move on to our final witness.
Examination of Witness
Richard Blakeway gave evidence.
The Chair
This is our final witness; please introduce yourself for the benefit of Members.
Richard Blakeway: Thank you very much. I am Richard Blakeway, the housing ombudsman for England.
David Simmonds
Q
Richard Blakeway: That was not the first question I was expecting, but thank you very much. One of the requirements the Bill introduces is for landlords to be on the landlord database, with the checks required on that database, and then for them to join the ombudsman service. Whether or not there is a requirement around that as part of the criteria to be eligible to let properties is a consideration, and then that depends on whether or not they would join the ombudsman service.
In terms of the decisions that any ombudsman in the future might make, if there were issues around insurance—typically those are matters that tend to sit with the courts—or a landlord not facilitating claims around insurance, there might be an issue around whether or not insurance is in place, and that might be something that we then highlight in our decisions, which might be information we should share with the lead enforcement agency under the duty set out in clause 109. You may feel I have not fully answered your question.
David Simmonds
Q
Richard Blakeway: The Bill is obviously quite comprehensive and will make a significant difference as a piece of legislation, but a considerable amount of information will be set out in statutory instruments after the Bill. There are, then, some answers in the Bill and some that will come in future regulations.
Your point about the clarity of jurisdiction between an ombudsman and other actors is fundamental. One of the most important elements to clarify the role of the ombudsman service will be the ombudsman’s scheme. Clause 63 sets out requirements around what should be in the scheme—what must be in the scheme and what could be in the scheme. I would probably encourage there to be more in the choices for Ministers as to what could be in the scheme than in the list of what must be in the scheme, because there will need to be agility, as the ombudsman—whoever is appointed as the ombudsman service—and the other actors start to come together.
The importance of clarity is obviously for individuals to know what route to take if they are seeking redress, and it is also important to make sure that there is real coherence in terms of raising standards and promoting good practice in the rental sector.
I can give a specific example where I think there would be nuance between the ombudsman service and the tribunal, which is around changes to rent. If a section 13 notice were issued, the decision on the rent would be a matter for the courts, and the Bill seeks to change the role of the courts, or the tribunal, in relation to that. But we or whoever was appointed as the ombudsman service could potentially play a role to decide whether a fair process had been gone through rather than the actual level of the rent. That is very similar to what we have today on the social rented sector and service charges, and our role as an ombudsman in the social rented sector and the role of the tribunal.
David Simmonds
Q
Richard Blakeway: If you look at our current powers, role and approach around charges, we are very clear that we will consider transparency around why those charges are being made and their purpose, we will consider whether the service has been provided and the quality of that service, and we will consider whether an appropriate process was gone through. For example, at the moment we would consider section 20, where significant charges have to go through a process, and ask whether that process was followed. Those are decisions that we make and we can therefore very clearly consider what the requirements are, either set out in statute or under the provider’s own policy. That is the basis on which we would make a judgment.
I think that is a parallel that is relevant in your example in this space. Clearly, if we were seeing evidence that another mechanism was being used to increase the charges on a tenant and that was unclear and potentially unjustified, that could be a point of maladministration where we would uphold a complaint.
Matthew Pennycook
Q
I have a follow-up question; I will ask them in one go, Mr Betts, and leave more time for others. We have been very clear already that the new ombudsman will need to work collaboratively with others to resolve complaints and that will be set out in statutory guidance. What do you think needs to be included in that guidance to ensure, in particular, that the ombudsman is working effectively with local authorities?
Richard Blakeway: Those are really important questions. The Bill introduces a new framework of rights and responsibilities for both landlords and tenants and, as you set out, the ombudsman service—whoever is appointed as the ombudsman—plays a part in that. I would say as an aside very early on that I welcome the Government’s recognition of the strategic benefits of bringing together the social rented sector and the private rented sector, particularly given the common body of existing and new legislation that is tenure blind and speaks to both the private and rented sector, whether that is the existing Landlord and Tenant Act or the potential to extend Awaab’s law and the decent homes standard. I think there is a real benefit to system coherence and the right relationships, as you highlight, and also to making sure that benefits do not unintentionally fall in the wrong place, by appointing the housing ombudsman as the provider of redress.
I think there are three key relationships. There is the lead enforcement body, and working out the role of that body. In particular, looking at clause 109, information sharing between the ombudsman service and the lead enforcement body will be vital, so codifying that role will be important.
There is the tribunal, which we have alluded to. One of the really important pieces of work is to develop, very early on—I would have thought in advance of any statutory instruments—a draft scheme for the ombudsman service, and to collaborate with a number of bodies, including the courts, on what is in the scheme and therefore the decisions that the ombudsman might take, and what is outside it and clearly rests with the courts. I have given the example of section 13. The ombudsman could potentially play a role in looking at aspects of section 13, which might relieve pressure on the courts.
There is then the relationship with local authorities and enforcement. On the database itself, I think there has to be a decision about who owns the database and is going to provide it—whether it sits with the Department or the lead enforcement agency, for example—and the pace at which it could be developed to support the introduction of the redress service.
One of the other areas to consider, where there may be a pressure that emerges in the system—a pressure that I think the legislation recognises but could go further to address and relieve—is enforcement. The Government have rightly indicated that there is concern around compliance with ombudsman remedies. There was a survey in, I think, 2018 that showed 46% of private landlords not complying. At the moment, the Bill includes a kind of last resort to try to enforce compliance, which would be introduced later through statutory instruments. I wonder whether consideration should be given to bringing that forward, so that compliance issues are not having to be directed towards local authorities, and creating pressures there.
I also wonder whether the legislation could go further by, for example, amending clauses 66 and 96 to include rent repayment orders as part of non-compliance with ombudsman decisions. The Bill is rightly clear that if a landlord does not sign up to the ombudsman service then it could be subject to a rent repayment order, but it is silent on whether a landlord that is non-compliant with the ombudsman’s decisions should also be subject to a rent repayment order. I think that if you were to introduce that, that would strengthen compliance and reduce the need to direct things around the system to try to address them.
Harpreet Uppal (Huddersfield) (Lab)
Q
Richard Blakeway: That is a really important question. It is one thing having an ombudsman service; it is another people being aware of it and being able to access it. We have certainly been on a journey within our current jurisdiction to think about how we interface with the public and become more accessible to them, and we have obviously seen the benefits of that.
A number of initiatives have been required to bring about a change, but the Department has done a number of surveys of social tenants to understand awareness levels. Awareness is now at around 70% among social tenants, according to two surveys that were done in the last three years, compared with probably sub-50% previously. There is a playbook there, if you like, for how you create awareness of access to an ombudsman. We have sought to use our existing service and be very open and visible. For example, in the 2023-24 financial year, about 6,000 residents engaged in open forums that we hosted around the country where they could come along and ask any questions. That is really important.
I have two brief thoughts. First, the complaints process does not start with the ombudsman service; it starts with the landlord. A very important thing to do very early on is make sure that there is a robust framework to support landlords to handle and resolve complaints, but that includes signposting to an ombudsman service so that there is clear awareness at a local level. That work is really important to do in advance of any ombudsman service going live.
The second thing that I think is important is how you stitch the ombudsman service into other bodies and advice agencies—Shelter, Citizens Advice and so on—which, again, is something that we have at the moment. One of the benefits of having a single front door through the housing ombudsman for both social and private tenants is that you can effectively introduce no wrong door for people. Once a tenant reaches someone, to be told “Actually we can’t help you” and be sent somewhere else is probably the last thing they want, but that is what they hear currently. About one in five inquiries that we get from the public at the moment are from people who we cannot help because they are outside our jurisdiction. We could effectively provide a single front door and prevent that, building on the awareness activities that we have at the moment. Again, it is really important to introduce that early on. Were the housing ombudsman to be designated as the redress provider, that is something that I would want to be able to introduce through our existing inquiries service immediately, even in advance of us being able to handle cases, so that we could provide effective advice to residents so that they understand their rights and where to go.
Claire Hazelgrove
Q
Richard Blakeway: First, thank you for recognising that previous work. There are specific things in the Bill that increase the protections for renters and the security of tenure for renters. Those are welcome and important and would prevent the risk of homelessness for some individuals. It also changes the relationship between the resident and the landlord, and addresses an imbalance of power that exists at the moment. In changing the relationship, the importance of redress is fundamental, to ensure that there is not a breakdown in that relationship and that a tenant does not end up living in conditions that are not acceptable. We must also recognise that the role of a redress provider is also to share the experience and the learning that we have through our casework to ensure that landlords can effectively fulfil their obligations and raise standards.
This Bill is not only about increasing security for individuals; it is about a wider shift and change in the role of the private rented sector in this country—a sector that is completely different from the one that was envisaged and started to emerge decades ago. It is different in scale, different in the types of properties, and different in the range of providers. So the real impact of this Bill over time will be a real shift in the landscape of the private rented sector and a raising of standards. It is important that landlords are part of that journey and can affect that in their own actions, and that an ombudsman service is there to help individuals exercise their rights, but also to provide the insight and intelligence to landlords to ensure that they prevent problems that need to go to an ombudsman from occurring.
Carla Denyer
Q
Richard Blakeway: On licensing, yes.
On the deterrent, yes and no. You have to recognise that the penalties have increased in this Bill, and that is important, but I emphasise my point about the scope and whether, for example, non-compliance with ombudsman decisions should be brought into the scope of that.
On energy efficiency, obviously there are significant measures in here, but it will be important to see what the decent homes standard—I think it is in clause 98—contains in order to judge what the standard of accommodation will look like in the future.
The Chair
I have no Members indicating to me that they have further questions, so that brings us to the end of the morning session. The Committee will meet again at 2 pm this afternoon in this room.
Ordered, That further consideration be now adjourned. —(Gen Kitchen.)
Renters' Rights Bill (Second sitting)
Tuesday 22nd October 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 22 October 2024 - (22 Oct 2024)
The Chair
Good afternoon and thank you for coming along. As this session has to end at 2.40 pm, with no Chair’s discretion in relation to that, I suggest that we get started straight away. May I ask you to introduce yourselves briefly?
Justin Bates KC: I am Justin Bates, a barrister and King’s counsel at Landmark Chambers here in London, and I am the editor of the “Encyclopedia of Housing Law and Practice”.
Giles Peaker: I am Giles Peaker, a solicitor at Anthony Gold Solicitors and a partner in the housing law team.
Liz Davies KC: I am Liz Davies, a barrister and King’s counsel at Garden Court Chambers, and I write about homelessness and for Legal Action magazine on housing.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
Q
Justin Bates KC: Obviously, the best people to ask about the FTT’s resources and whether it is ready will be the FTT staff, the president and so on. I simply note that Parliament has given the first-tier tribunal a lot of new powers over the last few years, and I am sure it would welcome additional funding to enforce all these things. My impression, as a practising barrister, is that the FTT works better than the county court system; my experience is that it is generally faster and more responsive. But you are giving it a lot of new work to do, and I am sure it would be grateful for any money you can send its way.
Giles Peaker: The ombudsman would have to answer the question on the ombudsman. My impression is that the ombudsman—the social housing ombudsman as it is—is currently receiving a lot of complaints and there is some impact on the timescale in which they deal with matters. Clearly, if there were an extension or a new ombudsman, the resourcing of that would have to be looked at. I do not think any of us could say that the county courts are not under strain at present—they are, across the board. How much of an increased workload there would actually be as a result of the Bill, though, is more of an open question.
Liz Davies KC: I just add, in respect of the county court, that part of the problem with litigation at the moment is litigants in person. There are new rights in the Bill that tenants will want to rely on. Housing legal aid is in crisis, there are what are called housing deserts across the country, and frankly, it is more efficient for tenants to be able to receive early legal advice so that they know whether there is or is not a point to take to the county court. I suppose one message to you, although it is beyond your remit, would be to try to increase legal aid as well. It would make litigation more efficient.
David Simmonds
Q
Liz Davies KC: I am concerned about mandatory grounds 1 and 1A. Clearly, they bring an end to no-reason evictions, with the end of section 21, but they are still no-fault evictions as far as the tenant is concerned. It is helpful that the period will be one year and that there is four months’ notice, rather than the two months’ notice in the previous version of this Bill, the Renters (Reform) Bill. But I am concerned that the balance is not right.
Mainly, I am concerned about the idea of a court being faced with mandatory grounds when the tenant has done nothing wrong, and there may be incredibly compelling circumstances about the tenant but the court cannot look at them; it has absolutely no remit and no jurisdiction. So the tenant might say—I am sorry to have to say this—“Myself or a member of the household has a very serious terminal illness. To ask me to move within four weeks or two weeks, or what have you, is going to have an appalling effect on that.” They might say, “We have a very severe disability and so it will take us longer than other people to find somewhere to live.”
My preference would be to make all grounds discretionary, because I think that does provide the balance. But even if Parliament were to reject that view, it seems to me that courts ought to have the opportunity, in exceptional circumstances, to look at the tenant circumstances and to either reject a possession order, or have the flexibility to make a possession order that is suspended for a certain period of time—postponed for a certain period of time. It seems to me wrong in principle that a court cannot consider any circumstances of the tenant, whatever they are. That is my concern on 1 and 1A, and I think Justin will speak about 6A.
Justin Bates KC: Can I ask you to also look very carefully at ground 6A when it comes to scrutiny? Ground 6A is the new ground for possession, where the landlord needs possession, because they are on the banned landlord database or because they are operating an overcrowded house in multiple occupation—the landlord is effectively a criminal landlord and needs possession to deal with the consequences of their criminality. Presently, that is a mandatory ground for possession. I understand why, because I can see that there is a difficulty with one arm of the state saying, “You are breaking the law and you will keep breaking the law if we don’t act, and we won’t allow you to get people out.”
Can I flag two concerns? First, there is a concern among those in frontline tenant services that it will act as a disincentive to people reporting their rogue landlords, because if you report your rogue landlord to the local authority and it then puts them on the banning order list, you face a mandatory ground for possession.
Secondly, it strikes me as odd that a tenant who has done nothing wrong—save had the misfortune to have a criminal landlord—is required to move with no compensation and no provision of suitable alternative accommodation and so on. I can understand why we need 6A. I understand that we do not want to leave people committing crimes because a judge will not give a possession order, but it strikes me that you could look at some sort of compensation scheme. If you were minded to do so, the model is section 34 of the Housing Act 2004, which already gives the tribunal the power to order compensation when people have to leave because of prohibition orders. You could steal lots of the language from section 34, put it into ground 6A, and you would have much less scope for the unfairness that seems to me to be evident.
Giles Peaker: On the broader question of whether a balance is struck, I think it is a political decision as to where the balance falls, but broadly there is one. I do have specific concerns about 1 and 1A, as well as those raised by Liz, which are in terms of the evidencing of a mandatory ground. If the ground is the landlord wants to sell, or the landlord wants to move in or move in a family member, what standard of evidence is required for them to demonstrate that? In terms of the current wording, it would probably be enough to simply express an intention to do so. My sense is that there needs to be at least a level of formality—a signed declaration of truth on a statement or a particulars claim signed by the landlord—in terms of bringing possession proceedings on the back of that.
But there is also what follows on from that, and I think this issue has come up in Scotland, where there is a similar sort of provision. If a landlord re-lets a property within the 12 months proposed, the potential enforcement is great: it is a criminal breach, with a prospective civil penalty, and a prospective rent repayment order application by the former tenants. That is all great. The question is how you get from the possession order being made to action on the breach. As it stands, it appears that the only way in which that could possibly happen is if the ex-tenants realise that the property has been re-let—heaven knows how, and heaven knows where they will be in the country by that point—and then notify the local authority, which can take enforcement action. It strikes me that there should be some kind of recording that that ground has been used—a landlord database might be a place for that. The local authority can be aware that that ground has been used, and if it becomes aware of a re-letting, the full enforcement apparatus can kick in.
The Minister for Housing and Planning (Matthew Pennycook)
Q
Could I ask you to draw out a bit further how you expect this to work? In a sense, when we talk about discretionary grounds, we are always told, “Let’s trust judges”—that was certainly the case with the previous Bill. In a sense, what we intend to do here is trust judges’ judgment on whether those grounds have been used appropriately, and we would expect the type of evidence that they look at to include things like a letter instructing solicitors or an affidavit. But do you not expect the courts to operate in that way on the basis of the Bill? Do you expect them to act in a more light-touch way, as you have suggested? It is not usual practice for Governments to force the courts to consider certain types of evidence, and if that is the case—if you accept that—where do we go to try to influence the courts to look at certain categories of evidence, to ensure that these grounds are being used appropriately?
Giles Peaker: In terms of how you can specify things, to some degree, it is a question of wording. Grounds 1 and 1A are expressed as an intention, and if the intention is there, the ground is made out. If a landlord has written to the court to say, “I intend to sell”, it seems quite difficult for the court to go behind that, unless the tenant has evidence to the contrary. So partly it is around language. Intention—settled intention—needs looking at. But with different wording, a different evidential requirement may well follow—so potentially, as you say, the landlord would have to evidence engagement with an estate agent or a solicitor on a sale, or would need evidence from the relative who was intending to move in, to the same effect.
Matthew Pennycook
Q
Giles Peaker: Yes, hence my talking earlier about the reason to fill in the gap between the notice seeking possession or the court order, and potential enforcement, which is a bit of a lacuna at the moment.
Matthew Pennycook
Q
Justin Bates KC: I will go first, because this is what we spend our time talking about. Clause 30 is wholly defective and should not be allowed to stay in this form after the Bill Committee. It is a loophole. Clause 30 presently says that something will not be an assured tenancy under your new regime if it is for a tenancy of more than seven years. So I will grant you a tenancy of seven years and one day, and I will reserve to myself, as landlord, a landlord-only right to break, exercisable after six months on two months’ rolling notice. There you go: I have just recreated section 21 and there is nothing you can do about it.
You need to look at clause 30 very carefully. The reason it is in there is to fix a different problem. It is there because certain shared ownership leases and certain long leases have accidentally ended up being treated as assured shorthold tenancies, so that is what you are trying to close. The better way to solve that problem is to amend schedule 1 to the Housing Act 1988, which is the main Act you are grappling with, to say that shared ownership leases cannot be assured tenancies, and that long leases for terms of more than 21 years—which is the normal definition of a long lease—cannot be assured tenancies. And then take clause 30 out, because what will happen—as sure as night follows day, and as the entire history of housing law since 1915 shows you—is that landlords will offer seven years plus a day with a landlord-only break, because this is not an area where there is equal bargaining power. It will be, “Take it or leave it, and I’ve just brought section 21 back in through the back door.” So please look very carefully at clause 30.
Matthew Pennycook
Q
The other point is smaller and more technical, and is on the subject of homelessness. Because you are taking out assured shorthold tenancies from the homelessness regime, which allows local authorities to find people private rented sector tenancies, and you have done a lot of drafting amendments to take out the words “assured shorthold”, you have also taken out a mechanism in the Housing Act 1996 that currently allows a homeless family—where they are given an assured shorthold tenancy and that ends within two years—to reapply as homeless and where they do not have to show a priority need. It helps to deal with the revolving door of homelessness, potentially in the private rented sector. You have abolished that—I imagine inadvertently, because you are taking out the words relating to assured shortholds. However, I would suggest that you try to get that back in, so that in the more unusual cases—once this Bill has gone through—if a homeless person is given an assured tenancy in the private rented sector and it comes to an end within two years, they will be able to come back to the homelessness authority. It is section 195A of the Housing Act 1996.
Mr Gideon Amos (Taunton and Wellington) (LD)
Q
Justin Bates KC: I want to be careful not to speak for the first-tier tribunal judges. Parliament has provided additional funding for the FTT in anticipation, not of this Bill, but of other areas. Those of you who worked on the Building Safety Act 2022 will know that you gave new powers to the FTT over unsafe buildings. Funding came along with that, because new building safety judges have been appointed. For obvious reasons, I am not privy to all the spending decisions, but as a regular attendee of the tribunal, I can see that money must have been provided. Whether you provide more money for this Bill is, frankly, miles above my pay grade.
On the increased workload, it is very difficult to say. It is plausible that there may not be that much of an increase in workload, because people can still agree what the new rent will be. If they agree it, there is no need to go anywhere near the tribunal. If I were pushed, my informed guess would be that there will be an increase in the first few years, because there always is whenever the law changes, and that it will settle down after a while, but I cannot properly comment on the minutiae of how you fund the FTT.
Jerome Mayhew (Broadland and Fakenham) (Con)
Q
Justin Bates KC: But what I am saying is that I do not know whether it will be that long. There is an assumption in the questions, which may or may not be correct, that all these cases will need a hearing. Most of the section 13 cases that the tribunal already deals with are done on the papers. It rattles through 10 of them a day because, unless there is something specific about the property—unless you need to see it to understand the condition of disrepair, or whatever—there is no reason why you cannot do rent-based determinations on the basis of written materials: the Rightmove print-offs, the price and so on.
Jerome Mayhew
Q
Justin Bates KC: The tribunal’s KPI internal target is all decisions within six weeks.
Jerome Mayhew
Q
Justin Bates KC: It broadly keeps to that. The FTT is pretty good at keeping to its standards. You can safely assume that we are looking at three months. Those are the figures you are throwing at me, and I can see that being realistic.
Jerome Mayhew
Q
Justin Bates KC: I do not know, is the answer. That is not a cop-out; it is recognising the limits of what lawyers should safely talk about.
Jerome Mayhew
Q
Justin Bates KC: Broadly, yes.
Jerome Mayhew
Q
Justin Bates KC: Yes.
Liz Davies KC: Of those where the landlord increases the rent. You are assuming an annual increase.
Jerome Mayhew
Q
Justin Bates KC: There is a famous housing benefit case, which the Commission on Social Security likes to remind us of, that says that Rachman is not the only model of landlord. It is entirely possible not to do that, or to agree sub-ones. Remember that the private rented sector is so difficult to pin down as a single, homogeneous beast. A landlord who lets to someone who is predominantly reliant on welfare benefits to pay their rent will not hike it beyond the inflation rate of the benefit, because all they would be doing is creating a situation in which the tenant cannot pay.
I do not think you are wrong to raise that spectre; I just struggle with how we identify how likely that is to play out, and what the numbers will be in any given period. I do not think, for my part, that we can safely assume that every landlord will go as high as humanly possible, or that everyone will be defended, but on your broad point that there will be a delay, yes, that must be right.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Q
Giles Peaker: What is envisaged is it being enforced by local authorities, and the powers of the local authorities appear to be great. The question, as with existing powers for local authority housing enforcement, is the very variable performance—or the extremely variable performance—between local authorities. Whether one wants to impose a duty on local authorities, rather than a power, would be an interesting question; I strongly suspect that funding demands would follow on from that. But the powers are there and could be very effective; it is a question of the will to utilise them.
We do not yet know what the contents of the proposed decent homes standard will be. It would be good to see a unified standard across social and private tenancies—there is no reason why there should be any distinction between the two kinds of accommodation. The social housing side, as I understand it, will be enforced by the social housing regulator, which is a slightly different situation, but the same standard would apply. Tenants, as it stands, will not be able to enforce the specific standard except by complaint to the local authority.
Rachel Blake
Q
Giles Peaker: Tenants will have their existing rights under the Homes (Fitness for Human Habitation) Act 2019 amendments to the Landlord and Tenant Act 1985. Quite how far that will overlap with the decent homes standard—well, we will have to see what is in the decent homes standard. There will certainly be some degree of overlap, I imagine, through the presence of housing, health and safety rating system hazards, so there would still be a route for tenants to take action on specific hazards, but it will not necessarily enforce decent homes, full stop.
Justin Bates KC: For my part, I think that by far the better tenant-empowerment repairing provisions of this legislation are the extension of Awaab’s law to the private sector. If you get the details of secondary legislation right, that could be a real game changer, because that will be enforceable by tenants through private law proceedings in the county court. If you set sufficiently robust—fair, but robust—timescales, you will do a lot of lawyers out of work, which would be an excellent thing. Look at that.
Carla Denyer (Bristol Central) (Green)
This is my first time on a Public Bill Committee, Sir Christopher, so I might make a mistake with process. May I briefly point Jerome at the answers provided in written evidence and in earlier verbal evidence, which I felt answered the question already? In terms of, “Surely, won’t all tenants do it?”, I think we heard a clear answer that, for the vast majority of the population, anything to do with courts is a terrifying and bureaucratically faffy process that they will not want to engage with. On “Won’t landlords just max it out”—
The Chair
Order. I am going to stop you there, because this is an opportunity for Committee members to ask questions of the people who have come along as witnesses. We have limited time and once we start opening up a debate with other Committee members, it will be at the expense of being able to hear what we hope is, and is likely to be, very valuable evidence. If you have a question for any of the members of the panel, I shall be happy to take it, but if not, I suggest that you have your arguments with other Members when we get into full line-by-line consideration, when there will be plenty of opportunity for you to intervene on another Member with whom you disagree.
David Simmonds
Q
I know there is some pressure around issues such as tenants with pets and making sure that they have a right to occupy. A landlord may discover that the cost of insurance is significantly higher because of the pet or because of some other circumstance relating to the tenant —for example, they might have a poor credit history and are therefore not insurable for failing to pay the rent via the landlord’s normal insurance company. I am interested in how you see the Bill dealing with that issue and ensuring that tenants are not effectively barred from applying to rent particular properties because of those insurance issues and also that landlords do not find that the insurance they must have is so expensive as to effectively make their business as a landlord impossible.
Giles Peaker: My understanding was that the tenant could be required to have pet insurance. It is a permitted payment.
Liz Davies KC: Or the landlord has the insurance and the tenant refunds them. You have made a broader point, but just looking at clause 11 on pet insurance, the tenant will refund the landlord, so it becomes an exempted permitted payment under the Tenant Fees Act 2019. On the cost of insurance, I am sorry, but that is certainly beyond my legal expertise.
Giles Peaker: In terms of that situation, it is hard to see an impact on building or contents insurance. For insurance for unpaid rent, you would have to ask the insurers, but my immediate sense would be to ask why it would be different from now, when the tenant will face possession proceedings for rent arrears if the rent is not paid. But that would have to be one for the insurers.
David Simmonds
Q
Giles Peaker: Deposits are already capped.
Justin Bates KC: You cannot do it through deposits, because paragraph 2 of schedule 1 to the Tenant Fees Act 2019 will stop you doing that. You can presently do it through rent in advance, because the Bill does not prevent that, although I query whether it should. You could not do it by increasing the rent above market value, but you cannot do that anyway because section 13 as it stands would kick in.
Liz Davies KC: Is Giles’s point not right that this is a current problem in any event? Sorry to be asking you questions, but he is suggesting that it is alleviated because of the mechanism of section 21.
David Simmonds
Q
Liz Davies KC: So it is the rent-in-advance point. We would have to look at what the Bill says about guarantors. I am sure the Minister knows, but that would be the answer—something around advance rent or guarantors. It negates the point earlier, I accept that. This needs some thought.
Lola McEvoy (Darlington) (Lab)
Q
Liz Davies KC: The fact that landlords are required to be registered will raise the bar for good landlords. We do not yet know what information should be on the database. I cannot remember whether it is in the Bill or the explanatory notes, but it is assumed that any enforcement action or rent repayment orders they have had to make—anything that affects their quality as a landlord—will be there. That must raise the bar and set a minimum standard for landlords, which we currently do not have. Tenants, frequently those at the bottom of the market, are then subject to the consequences and disadvantages of that, so having that bar is really important.
The other thing is that making the information, when we know what it is, publicly available is extremely important because it holds landlords to account. Finally, it also affects the local authority’s ability to bring the various enforcement measures they have under both the Housing Act 2004 and the Bill.
Justin Bates KC: I did not hear Ben Beadle’s evidence this morning, but if you get the right details on the database—so that it is a publicly searchable database that shows you whether your landlord has done anything in a list of prohibited things and so that it has details about the safety of the building, for example whether the gas safety certificate has been uploaded or not—I would have thought that he and the NRLA would have been crying out for something like the landlord database. It gives them what they have always wanted: a way of differentiating the good landlord from the bad landlord and a simple way for a tenant to identify the good landlord and the bad landlord. If I put your name in and it comes up on the database that you are subject to a banning order, I probably should not rent from you. If I put the property address in and discover a prohibition order—those are registered on the database—I probably should not live there. That is what you should be able to do if you can get the database to work properly.
The way you have done it, for obvious reasons, it is all at the level of principle. The critical information is what you will do in secondary legislation about what is accessible. But if you get the database right, you go a really long way towards helping tenants to make informed decisions and helping good landlords to drive bad landlords out.
Mr Amos
Q
Liz Davies KC: Currently, Home Office accommodation for asylum seekers is not in the Bill. I am pretty sure, off the top of my head, that temporary accommodation under homelessness is, but if I am wrong about that—Justin and Giles are nodding, so it is. Temporary accommodation for asylum seekers should be there; we know that has problems with conditions.
I am sorry—I am embarrassed about this—but I should have said right at the beginning that I have acted as a consultant for the Renters’ Reform Coalition. I am not here today in that capacity, but I need to put that on the record.
Justin Bates KC: I would need to really check the detail, but housing provided by local social services authorities—Children Act 1989 accommodation rather than Housing Act accommodation—may not be covered. That might be another area of exemption. But the big one will be Crown properties: MOD, Home Office and so on. If you want to bring them in, you will need to expressly say so because, as I am sure you all know, the rule is that it does not bind the Crown unless you expressly say so.
The Chair
That brings to an end this evidence session. I thank the witnesses for their contributions.
Examination of Witness
Judicaelle Hammond gave evidence.
The Chair
Welcome; please introduce yourself.
Judicaelle Hammond: I am Judicaelle Hammond, director of policy and advice at the Country Land and Business Association. We represent 26,000 members in England and Wales who own and run land-based properties. We estimate that our members account for about a third of properties in the rural private rented sector.
David Simmonds
Q
Judicaelle Hammond: Unfortunately I do not think the Bill is going to make it much better in the sense that the main issue is the availability of housing full stop, and particularly the availability of affordable housing. Our members are doing a great deal already to provide that. We reckon that 23% of our members’ properties are let out at less than 80% of market rates, but at the end of the day there probably is not enough to go round and therefore we see the changes to the planning sector as the key. What the Bill might do, particularly with the demise of section 21, is to make it more difficult for people to enter or want to stay in the private rented sector, which is an issue. Again, as I said, it is by no means the only issue. I think the real key is supply.
David Simmonds
Q
Judicaelle Hammond: Yes. The main issue is the ability of the courts to deal with the extra cases that might be coming their way. One of the solutions, perhaps, is to look at some of the mandatory grounds and make them paper-based. That might improve things.
In terms of section 21, I should make it clear that among our membership the average time that the tenancy lasts is 7.5 years, which is nearly twice as long as the national average. Our members are responsible landlords; many of them will have had tenants who have been there for decades. We are not in the business of evictions or fast turnaround. We are not using section 21 very much, but when it has been used—it has included, for example, issues about antisocial behaviours—we have had some horror stories of members waiting for 12 to 18 months to get their properties back.
Without section 21, in the courts I think it takes at the moment 24 weeks from application for possession to actual possession, and some members are taking far longer than that with county courts that have closed. Digitisation might be a good thing, but how long will that take? There is an issue for us about reducing, unwittingly perhaps, the supply of private rented sector properties in rural areas as a result of the Bill.
David Simmonds
Q
Judicaelle Hammond: We are grateful to the Government for the new ground 5A, which deals with incoming agricultural workers. That will help—no question about that. And we are grateful for the new ground 5C, which is a ground to get property back because a job has ended, where the property was limited to the employment.
There are a couple of other grounds that are not covered at the moment and would be needed for rural businesses. The vast majority of rural businesses are not linked to farming or agriculture, but there might still be times when—we hear this from our members all the time—the provision of accommodation is necessary to attract or retain people, particularly when there is nothing else around. They could be in a really remote rural area or it could be because, for example, the person in that job needs to be on call, which would apply to security, caretakers or vets. Or it could be for people working antisocial hours in hospitality, for example, or at a wedding venue, where there is no longer public transport available at the time they are meant to finish or they need to start really early to set up before the wave of tourists come—and so on.
Increasing and expanding ground 5A to include service occupancies in very defined circumstances would be really helpful. To avoid abuse, there are definitions of what that could cover in other legislation that could be referred to. That is the main ground.
The second ground that is needed for agricultural workers is a new ground for what is known as suitable alternative accommodation. Some categories of agricultural workers have protected tenancies under existing legislation—the Rent (Agriculture) Act 1976—and assured agricultural occupants are also protected under the Housing Act 1988. For example, you might have a retired dairyman or indeed their widow who is still in the main dairy. You need to recruit somebody to replace that dairyman. If you have more than one property, it would be useful to have a ground to get it back, in order to then move the retired dairyman or the widow in that property. Obviously, if you have only one property, it is game over, but in the case that you have a small portfolio, it would be really useful to have that, because you have a legal obligation to rehome that person but you need the property in which they currently are.
Matthew Pennycook
Q
Judicaelle Hammond: Yes, sure. I think it needs updating because it was designed for problems in the social sector. It might or might not be applicable to the private rented sector. It also does not deal very well with older properties, which is the vast bulk of what our members have. To judge the private rented sector against the decent homes standard as it currently is would be, I think, misleading, and it would have all sorts of unintended consequences. For example, in small cottages in rural areas, there are typically very small kitchens and so on. They would not necessarily fit, and it would destroy the character if you were to change that—
Matthew Pennycook
Q
Judicaelle Hammond: No, it is not the principle. The issue at the moment is that what we have got, which is the decent homes standard that applies to the social sector, would not work in the private rented sector in the rural context. The other thing that we do have, however, is the housing health and safety rating system and, indeed, the minimum energy efficiency standards. We reckon that that probably covers the ground, but it absolutely needs to be enforced. I think you have already got levers there. That is what we would say.
Mr Amos
Q
Judicaelle Hammond: We recognise that is an issue in some areas of the country that are honeypots. If the proposals that were consulted on are implemented effectively, we see a need for them.
On your question about whether some properties would become holiday lets, I think if you had asked me a year ago, I might have said yes. There are other pressures on the holiday let market that make this increasingly unlikely. We hear from members that they are planning on selling full stop, which would probably be selling to people who want to be on the housing ladder rather than to people who want to take over their business of being private rented sector housing providers. That is a real issue and concern for us.
Jerome Mayhew
Q
On one side of the argument you could say, “Rents will go up as supply decreases.” Do you think that will be an unintended consequence of the proposed legislation? On the other side, which I invite you also to consider, is the question of whether, if you increase foregone earnings—that is, increase the losses associated with being a tenant—because the time required by court processes will be extended because of increased demand, that increased loss will filter into increased rents in the long run.
Judicaelle Hammond: I think the answer to both of your questions is that there is a risk. If demand and supply work in the way they are intended to, unless you increase the supply there is a risk that the rent would go up—to do exactly the two things you suggested.
What we see is broader than just renters’ rights reform, though: we are seeing, for example, the move towards minimum energy efficiency standards, and I totally understand why that is needed. At the same time, it is quite difficult for landlords to deal with some of the costs. Again, we are mostly talking about older properties in rural areas. The cost of maintenance and improvement, particularly since the Ukraine war and the surge in the cost of building materials, has not come down. It has stopped growing at the same rate, but the prices have not come down to where they were pre-pandemic, pre-Ukraine.
As a result of that, you will first have to wait for a void in your properties, in all likelihood, in order to do the kinds of work that will be needed. Those voids do not happen very often. Secondly, you need to get your hands on tradespeople, who might actually prefer to stick to their local areas, because they are within 30 minutes’ driving time and not an hour and a half’s driving time. That is something else that we hear quite a bit about. All that is bringing pressure on to the private tenanted sector.
Jerome Mayhew
Q
Judicaelle Hammond: It was proposed to be £10,000 in the last consultation. It is every five years.
Jerome Mayhew
Q
Judicaelle Hammond: I am afraid that the answer, which is probably for another day, is that it depends. For example, it depends where you are in the country and what kind of rents you are going to be able to charge. I was talking to a member this morning who said, “There is no way I can put the rents up. The people who are paying for it will not be able to cope with an increase in order to recoup that.” We need to look at that carefully and have either a ramp-up system or a different system for exemption, or indeed better or more suitable technology, which might well be coming. My plea on that would be: let us use the time we have before the standards are tightened to improve things like the energy performance certificate methodology and look at alternative technologies as well.
Rachel Blake
Q
Judicaelle Hammond: It is a question of finding ways quickly to improve things, and using the current regulations. Again, I am not here to ask you questions, but I am really curious about the barriers that you see. If this was enforced properly, you would find ways of doing it. For us, it is a question of asking, “Well, there is legislation already. Why don’t we use it?”
On the decent homes standard, it is less an objection in principle. It is more about taking what we have at the moment and applying it without thought or adaptation to the private rented sector, where some of the conditions might be different. For example—going back to my argument about the availability of trades, maintenance staff, and so on—if you have a large portfolio, that might be doable, but if you do not, you really are in a different position.
The Chair
Order. I am going to bring in Jacob Collier because we are running out of time.
Jacob Collier (Burton and Uttoxeter) (Lab)
Q
Judicaelle Hammond: It might help. We see that database as a way of increasing transparency for both tenants and landlords. Our plea would be: let us do it effectively, and let us ensure that we have an IT system that works and is not basically a massive white elephant. An awful lot of that data is already available in other places. Can that system be built using the available data, rather than having a completely different program that requires quite a lot of time and money?
Rachel Blake
Q
Judicaelle Hammond: Sorry, I really cannot give you a proper answer because it would depend on the circumstances.
The Chair
Thank you, everybody. Thank you for coming along and giving us a bit of your experience and knowledge. We will move on to the next panel.
Examination of Witness
Anna Evans gave evidence.
The Chair
Straighten your ties, because we are now going to be on Zoom. We have until 3.20 pm. Please can you introduce yourself?
Anna Evans: I am Anna Evans, director of Indigo House. We are a housing consultancy based in Scotland, but we cover the UK in terms of affordable housing research and consultancy.
David Simmonds
Q
Anna Evans: I am here as an expert on the Scottish private rented tenancy and the reforms that have happened in Scotland, so I do not think I could necessarily answer the question about what the Bill could do. So far, the legislation in Scotland, through the private residential tenancy, has failed to address anything on affordability. It brought in rent adjudication and what were called rent pressure zones, which local authorities had the power to determine. Those failed due to a lack of data, and the rent adjudication system has been effective for only about 230 tenants out of the 300,000-odd households in the private rented sector. The Scottish Government are looking to address that through the current Housing (Scotland) Bill, rent regulation and rent control, but to date, the legislation has done nothing for affordability.
David Simmonds
Q
Anna Evans: We have not examined that particular question, but in terms of supply, new build in the private rented sector in Scotland has probably stabilised rather than grown. Most of the growth in the private rented sector has been through the existing stock, and of course, there is growth in purpose-built student accommodation. There has not been a huge amount of new build and regeneration in the private rented sector, certainly over the last five years, but I do not think you could necessarily attribute that lack of growth solely to new tenancy. A huge number of other things have been happening in regulation in Scotland, and there is obviously the wider tax regime, too.
David Simmonds
Q
Anna Evans: For tenants, the positives are a new foundation of rights and there should be more legal security. Tenants in Scotland enjoy open-ended tenancy and specific grounds for eviction, and there are longer notice periods. It is gradually moving to more of a contractual, rather than a subjective, relationship.
I should say, though, that there are very considerable differences in satisfaction between the general population of private rented tenants and the lower end, where lower income tenants or those who are more vulnerable are still disadvantaged. That is because of the overriding demand-supply imbalance. There is a fear among tenants about challenging, if they know that there are very few affordable alternatives on the market.
For landlords, I would say that they are generally settled with the private residential tenancy now—it has been in place for over five years, and they can see the consistency in practice and greater clarity in rights and responsibilities. Clearly, it is less flexible, but the difficulties that landlords have in Scotland are to do with subsequent legislation, and in particular, rent control.
Matthew Pennycook
Q
Anna Evans: Yes.
Matthew Pennycook
Q
Anna Evans: I will take the rent control issue first. This was nothing to do with private residential tenancy; it was the result of emergency legislation on the cost of living, which was brought in in 2021-22. That brought in a rent increase freeze and then rent increase caps. If we look at the data following that on rent increases, there are arguments around this, but basically average rent increases have not frozen or been curtailed. Some would certainly argue that rent increases in Scotland have been greater than what you could see across the UK.
We should remember—I was looking at evidence on this earlier—that landlords, certainly in Scotland, usually increase rents at a change of tenancy, not on an annual basis. What happened when rent control came in, with a range of other pieces of legislation and regulation, was that it became more of a hostile environment—that is what landlords are saying—and so as a result, they tended to hike rents up more at a change of tenancy. But we have found that most landlords want good, stable tenants for a long time. Most actually do not increase rents during a tenancy, but only take the opportunity to increase rents at a change of tenancy, and because of the environment and the hostility that they were feeling, they thought they had better increase rents at change of tenancy. Does that answer your question on rent control?
Matthew Pennycook
Yes, that is very useful. Thank you.
Anna Evans: In terms of the differences between your Bill and the private residential tenancy, I have to confess that I am not an expert on your Bill, so I cannot answer that in detail, but I can say that the PRT is an open-ended tenancy. It has no fixed-term period. There is the eradication of eviction with no grounds. Eviction proceedings are simplified to 18 statutory grounds and there has to be a reason—what are the grounds for eviction? There are extended notice periods and also a phased implementation. I think that is a key point. A lesson that the current Housing (Scotland) Bill is looking at is whether short assured and assured tenancies should actually just be terminated now because there has been long enough. There is still a good proportion of assured tenancies in existence—we estimate probably about 20%. Short assured tenancies are certainly less secure, so one lesson would be that if you are changing, do not do it over seven years; do not delay.
Carla Denyer
Q
Anna Evans: I think what we have concluded from all of the evidence is that the rent control has to be very carefully designed to avoid unintended consequences. It is above my pay grade to say what that design might be, but there could be a range of ways in which landlords try to get around rent control. We have seen examples of offers from tenants—I understand that your Bill will avoid wars between tenants, in terms of rent levels, but because of demand-supply imbalance, tenants do offer landlords higher rents to get properties. Evidence across different states shows that rent control efficacy is variable, so it has to be very carefully designed.
Jerome Mayhew
Q
Anna Evans: We show in the report that the rents increased at a similar rate to the rest of the UK until ’22. If you were trying to isolate why there was a more considerable increase since that time, you could probably fairly conclude that it was because of the 2022 legislation, but it is very difficult to isolate out. The range of legislation that has been implemented in Scotland is significant, but there was a tipping point in ’22 when rents in Scotland appear to have increased at a greater rate than in the UK. The key point was the 2022 legislation.
I should also caveat all of that—as we have in our report—by saying that the Scottish rent data is not as good. It is based on advertised rents rather than any survey of in-tenancy rents. The published data on rent levels and the hike in Scotland will be for new tenancies, and therefore, that will naturally be inflated compared with most tenancies, because we know that landlords do not tend to increase rents in tenancy. They prefer to keep them at a level that keeps tenants content and therefore they have a longer rental period. That evidence has to be considered with caution, because it is based on advertised rents.
Lola McEvoy
Q
Anna Evans: As I said, I do not think it is possible to absolutely isolate this out, but on advertised rents—new advertised rents—there was an increase post 2022 when that legislation came in. But you must remember that that does not include evidence of in-tenancy rents, which would be lower. So we cannot say that all average rents have increased as a result of that—we cannot say that at all.
Lola McEvoy
Q
Anna Evans: Yes.
Rebecca Smith (South West Devon) (Con)
Q
Anna Evans: Not through this research, sorry; no.
The Chair
Thank you very much indeed for your evidence, and I hope the weather is good in Scotland.
Anna Evans: It is a beautiful day today.
Examination of Witness
Victoria Tolmie-Loverseed gave evidence.
The Chair
Good afternoon. Thank you very much for coming along. Would you like to introduce yourself, please?
Victoria Tolmie-Loverseed: My name is Victoria Tolmie-Loverseed. I am deputy chief executive at the student housing charity Unipol Student Homes.
The Chair
The acoustics in this room are notoriously bad, so it would help us all if you were able to keep your voice up, please.
Victoria Tolmie-Loverseed: I will do.
David Simmonds
Q
Victoria Tolmie-Loverseed: I agree with that exemption. Purpose-built student accommodation exists for a very specific purpose. Therefore, operators of that kind of accommodation need to ensure that they are renting only to tenants—they need to have the means to regain possession. Often, they have planning obligations linked to the fact that they should only house students in that type of housing, so if they had a situation where students were able to stay for an indefinite period, they might start to have non-students living in the accommodation, which would be problematic for the ongoing management of the property.
David Simmonds
Q
Victoria Tolmie-Loverseed: Yes, that is problematic. Every year, about 700,000 students live in the kind of housing that you describe, which I will call off-street housing. I hope everybody knows what I mean by that: a shared student house or flat that is not in purpose-built accommodation. About 700,000 students rely on that type of housing every year. It is more affordable, and it is available when students need it, which is at the start of their academic cycle. We are concerned about the potential loss of that housing, and we are concerned that because of elements of the Bill, it could become more expensive over time. It is an affordable part of the student housing sector at the moment. Rents are generally much lower than for other types of student housing—about £130 a week, on average—so it supports students with lower budgets to live at university in a more affordable way. We are concerned about the loss of that type of housing.
David Simmonds
Q
Victoria Tolmie-Loverseed: In principle, I support the idea that landlords who are part of some sort of accreditation or recognised scheme should have an exemption for their accommodation in the same way as PBSA does. There are other ways of doing that. We at Unipol submitted some evidence with a suggestion that there should be a student tenancy for use in the off-street housing sector, which offers a fixed term with some other elements to it that would be very advantageous to students. Student housing is niche—it is very specific and has a very specific function—and certain practices and elements in there we think need special attention.
A fixed-term tenancy for students would allow landlords to regain possession but provide the security of a fixed term to students, as well as benefits to them that speak to their specific needs. For example, people should not be able to use guarantors for students—that is restrictive and difficult for students from low-income backgrounds —and students should be able to give notice in certain circumstances, such as if they have left their course. If they are no longer at university, it would be very handy if they could give two months’ notice and that is that. We think that would be right.
We also think that there is a real problem of early renting in the world of student housing—students who might need a tenancy from July end up renting places in September and October, because of pressure in the market. There is a shortage of student housing, and that is a real issue, so students rent earlier and earlier to get ahead of the market. We think that a cooling-off period should be attached to a student tenancy.
Those are real pressures and difficulties that students experience, so we think that they need special treatment in the Bill. As I said, there are 700,000 students, which is not an inconsiderable number. They should have special treatment.
Matthew Pennycook
Q
If we were looking to take action on sign-ups in advance, what is a reasonable period when landlords should be able to ask students to sign up in advance that does not, as you say, force them all to sign up far too early and in ways they may regret or have to re-examine? What is an appropriate period in which a sign-up would be reasonable? Lastly, do you understand why the sign-up arms race, as I might put it, has developed? It is hard to find an explanation for why all landlords are locked into a cycle of earlier and earlier sign-ups; it seems to have developed organically. Could you outline why you think that problem has arisen in the first place?
Victoria Tolmie-Loverseed: To take the first point, in the Bill you have proposed ground 4A for possession of student tenancies. That is definitely a helpful addition and we were glad to see it brought forward. However, at the moment it is just for HMOs, which we assume is deliberate wording, so it is for properties with larger groups of three or more people living in them, and you have excluded one and two-bedroom properties. We think that will result in a loss of smaller properties from the student housing sector.
The sector is quite particular. These properties have been set up close to universities, and the businesses are run in a particular way. I can understand why you might think that one and two-bedroom properties would perhaps have more mature students or students with families living in them. Often they do, but the reason why all students rent all properties in the student market is to do with them being at university. Generally, they are in that city and living in that housing only because they are at a university nearby.
We think that excluding one and two-bedroom properties is problematic, because they are quite a big part of the market—more than you would think; it is not just mature students or students with families. A national advertising platform called Accommodation for Students has given us some data on this, and 31% of the properties listed on its website nationally are one and two-bedroom off-street houses. If you were to lose that amount of property from the student market, that would be problematic. I think that is likely, because if you are in a one or two-bedroom property and you can have an indeterminate tenancy and give notice at any point, you may give notice in January when there is no demand for students, and that property will end up leaving the cycle of the student market and going into the professional market.
The average is 31% across the Accommodation for Students website, but in some locations it is even higher. In Newcastle and Preston, over 50% of the properties advertised are one and two beds, so it is not just mature students; it is younger undergraduates who are living in those types of houses because they suit their needs and they are available. Losing them would be very problematic over time and would reduce the supply of housing available to students.
The second part of your question was about cooling-off periods and early renting. Why does it happen? I think it is a mixture of things. Students want to secure a nice house, so they go out early and try to beat the rest of the market. In some cities, there are shortages of accommodation because student numbers have increased considerably over recent years, and there is a cap on the amount of off-street housing that there can be because of planning—article 4 direction—so we are not making any more shared student housing.
Students are aware that there is a shortage, and if they want to get the house that they want, they will try to get out there earlier and earlier to beat the market. That is why it happens, but it is really problematic, so we would like it to not happen. We have suggested that if you could say to students that they could cancel that agreement up to four months before the tenancy was due to begin, it would stop early renting. There would be nothing in it for landlords to try to get properties signed earlier and earlier, because students would be able to drop out. We do not think that would be problematic. It will not be an issue for landlords as the properties will still be let, but hopefully it would stop the silliness.
Matthew Pennycook
Q
Victoria Tolmie-Loverseed: No, they do not at all. It is not a problem. No-fault evictions are very rarely, if ever, used in the student housing market, because the need is cyclical, and generally most students will very happily move out when their tenancy is finished. I think it would be used very rarely, but it sends a useful signal that it is time to think about leaving.
The real issue for me, and the more problematic thing that will stop the cyclical nature of student housing, is the ability of students to give two months’ notice. I understand not wanting to treat students differently from the rest of the market, but the need for housing is so tied to the particular reason of being at university. Most landlords deal with their tenancies on the basis of 12 months, and they set their rents on an annual basis. If you say, “Your tenant is able to give notice, and they might choose to leave in April or May,” those landlords will respond to that and think, “I will have to increase my rent, because I have an annual rental figure that I need.”
Matthew Pennycook
Q
Victoria Tolmie-Loverseed: I do not have a tiny violin for landlords, but I am just saying what we think is likely to happen. It is a commercial operation and landlords need to cover their costs, and we think that if landlords perceive more risk they will seek to put up rents.
Your previous witness talked about the situation in Scotland. One of the things we would really like the Government to do before going much further is an impact assessment on the student market, particularly looking at Scotland, because the evidence there about student homelessness as a result of the tenure changes is compelling. The Government in Scotland have a committee looking at how they can tackle the issue of student homelessness, and I think that is a bit of a warning for us all that we could very well be in that place in a couple of years’ time if we do not think about the student market, its particular characteristics and what it needs.
Mr Amos
Q
Victoria Tolmie-Loverseed: I think there are alternative options. There was discussion on the previous Bill about creating an accreditation scheme or some sort of certification for landlords in the off-street sector. That is worth considering if a landlord is part of a quality mark and might be able to offer fixed-term tenancies similar to PBSA. There would certainly be some benefits to that, and you would offer students a quality product with landlords who are accountable to somebody but can have certainty in their business planning, which would be beneficial. I also think that ground 4A should be amended and extended to all student properties.
Mr Amos
Q
Victoria Tolmie-Loverseed: We think that the definition of a student property in the Bill is fine; it is just the restriction to HMOs, which are three-bedroom properties. We think the definition of the type of property, or the size of the property, should be changed.
Sam Carling (North West Cambridgeshire) (Lab)
Q
Victoria Tolmie-Loverseed: The joint tenancy issue is problematic, and there is no way to get around it. If you are in a joint tenancy, all the tenants are essentially treated as one. If one tenant gives notice, all the other tenants, in theory, could be asked to leave at the same time. I think landlords will be pragmatic about it and seek to manage that process actively. Unless it is in their interests to regain possession of the whole property, I think most landlords will try to smooth things out and find a resolution.
Typically, the remaining tenants are liable for the rent on the room that has been vacated, and I think it would be very difficult for landlords to backfill, so the remaining tenants may find that the rent increases. That is going to cause quite a lot of rupture and disruption in the student market. We think about half of tenancies are on a joint basis at the moment, and that is going to be really disruptive. I cannot think of a way around it. Unless there was some sort of ability to have a fixed term, I think it is going to be really difficult. Sorry; I have forgotten the second bit of the question.
Sam Carling
Q
Victoria Tolmie-Loverseed: Yes. I think a lot of landlords release tenants, certainly in the PBSA sector. If somebody leaves university or their circumstances change, I think a lot of landlords release tenants. I think it is right that if somebody leaves university, a landlord should seriously consider releasing them, perhaps with two months’ notice, and letting them leave. I think that would be a very good element of a student tenancy. Unipol is a landlord, and we release tenants if their circumstances have changed. It is a relatively small number of students who require that, but it is difficult. That would undoubtedly be an advantage to the students who need it.
Carla Denyer
Q
Victoria Tolmie-Loverseed: There are significant numbers of students—I do not know the exact numbers, but more and more are starting with January start dates. Some universities have five points in the year when you can start a degree or a Masters. It is problematic for Masters students whose course goes on until September or October, when they are having to write up, or PhD students. That can be difficult. I think there should be more flexibility in the current timetable of June to September, and perhaps in the ability to give notice at different points in the year for student properties.
The Chair
I am afraid we do not have the flexibility to allow this question session to go on any further. Thank you very much for your attendance.
Examination of Witnesses
Melanie Leech, Suzannah Young and Timothy Douglas gave evidence.
The Chair
Q
Timothy Douglas: Good afternoon, and thank you very much for the opportunity to give evidence today. I am Timothy Douglas, the head of policy and campaigns at Propertymark, which is the UK’s leading professional membership body for property agents. We have 18,000 members working across the UK in lettings, sales, commercial property, as valuers, auctioneers and inventory service providers in commercial property.
Melanie Leech: Thank you very much for the opportunity to give evidence this afternoon. My name is Melanie Leech. I am the chief executive of the British Property Federation, which represents institutional investment into the private rented market, which is everything from student accommodation to the build-to-rent sector to co-living and senior living.
The Chair
And Suzannah Young, who is joining us on Zoom.
Suzannah Young: Thank you, Chair. I am Suzannah Young, a policy officer at the National Housing Federation. We represent housing associations in England—social landlords providing 2.7 million homes to 6 million people. I will say a word about housing associations, if I may, because the Bill will have implications for them, as they offer assured tenancies. As they are not for profit, housing associations invest any income back into the development and maintenance of homes and into supporting residents and communities. They seek to provide tenants with long-term stability and security of tenure in good-quality, safe and affordable homes. We are a sector that has always offered assured tenancies and lower rents, and that delivers housing types unlikely to be found in the private rented sector, including three quarters of supported housing for people on low incomes with care and support needs. We therefore support the Bill’s aims to give greater rights and protections to renters.
David Simmonds
Q
Melanie Leech: Shall I kick off? Thank you for the question. The first thing to say is that we support the aims of the Bill and the drive to raise standards in the private rented sector. In particular, I would highlight measures such as the compulsory ombudsman—of course, many institutional landlords are already voluntarily members of the housing ombudsman service—along with the landlord database, which we have been calling for since 2008, the application of the decent homes standards and Awaab’s law to the sector, and recognition of the particular nature of the purpose-built student accommodation sector, which of course you have just been talking about.
Our major concern with the Bill is that the courts will not be ready for the abolition of section 21. A cross-party consensus that a better functioning court system is an essential part of the reforms has been a significant factor in maintaining landlord support for rental reform. Its importance has consistently been recognised in the political debate—by the Select Committee on Housing, Communities and Local Government in the last Parliament, which looked at the previous Government’s reforms, and by the Mayor of London in his work on a London model. However, despite serious discussions starting on rental reform in 2017, we have made almost no progress on court reform, which leaves landlords with little confidence that sufficient improvements will be made to make these reforms work well. That, of course, should be the objective: not just to pass these reforms, but to ensure they work well for both landlords and tenants.
One way of improving the court process is to digitalise both the process and the interface with claimants and defendants. We are really pleased that the Housing Minister is committed to continuing with the digitalisation project, but that is not going to deliver improvements any time soon. We are therefore heartened to hear the Housing Minister also talking about additional resource. This is essential because with section 21 gone, the courts will need to consider and process possession cases under section 8. Government data suggests that it currently takes just over seven months to process section 8 possession cases, including cases related to antisocial behaviour and rent arrears. It is worth stressing that that is an average. It is not uncommon to hear of cases taking more than a year.
There is also a huge shortage of court bailiffs in parts of the country. For example, in some London boroughs it can take five months to secure the services of a court bailiff, even when your claim has been vindicated. That also, of course, has consequences for people who cannot access those homes that would be freed up, for example in cases of poor behaviour and rent arrears.
While we recognise that improving the courts will not be a precondition of section 21 ending, at the very least we can call on the Government to outline what the justice system being ready means, both for tenants and responsible landlords; to commit to bringing waiting times down when it comes to the courts considering and processing legitimate possession cases; to ensure that the courts have clear and commonly agreed key performance indicators, which the Select Committee in the last Parliament recommended; and to improve staffing of the courts and tribunals, including recruiting more bailiffs.
We would also urge this Committee to scrutinise that aspect of the Bill in detail, and to consider calling for evidence from the Ministry of Justice—so far as we are aware, we have never actually heard directly from the Ministry of Justice, which is best placed to explain what procedures will be in place to make sure the courts are strengthened to deal with these cases—and to ask what progress is being made on digitalisation. We urge the Committee to scrutinise the justice impact test shared between the Ministry of Housing, Communities and Local Government and the Ministry of Justice—which will contain the projections on which the impact for this part of the Bill is based—so that we can all see that those have been properly scrutinised and that the court reforms that we need can be delivered.
Timothy Douglas: At Propertymark, we recognise that there is an ongoing cost of living crisis and there is huge demand for private rented property. We also recognise the manifesto commitments from this Government and the other parties to the changes contained in the legislation. We certainly acknowledge a drive towards improved standards, but we all have to recognise the unintended consequences and the impact of the changes on landlords, agents and the supply of property.
Certainly, our members are left wondering how this Bill will help to meet the huge demand for private rented property. Our data shows that on average there are almost 10 new applicants registered for each available property. One member in the west midlands, who has 13 offices across the region, has seen their lets—the number of properties—reduced from 5,348 to 5,006 since the start of the year, so we cannot underestimate the incentives for landlords or the investor appetite. These are significant changes. As has been said, we must get a commitment to reform the courts, the grounds have to be robust, and we must see enforcement of the existing rules by local authorities, never mind the raft of additional heavy-handed measures included in this legislation. We must retain fixed-term tenancies as an option where mutually beneficial for all parties, to retain flexibility and choice in the market.
The Chair
Suzannah Young, do you wish to add to your initial remarks?
Suzannah Young: In response to the specific question on the private rented sector, it is not an area where I have the most evidence to give, as my main area is the impact on housing associations. However, one thing I can say specifically is that we think that the proposed private rented sector housing ombudsman is absolutely right. Residents in the private rented sector should have access to an ombudsman. It is important that access is clear and easy to navigate for tenants, and that they have routes to redress where things have gone wrong.
From that perspective, and from the perspective of housing associations, we would like to ensure clarity about the remit of the new ombudsman. There is already an ombudsman service for social housing. However, some housing associations also provide market rent homes. It will therefore need to be clear what the expectations on housing associations are, in terms of reporting on their market rent homes, and it should also be clear to tenants which ombudsman they should go to. For example, sometimes there will be social and market rent tenants in the same building with the same landlord. We need clarity on remits so that there is no confusion.
I would like to comment on the points that Melanie Leech made about the readiness of the courts. Housing associations have experience of the impact of delays in the courts and the fast-tracking of possession cases during lockdown. Our members have experience that could be of use in the future. Our members report to us that there are already delays in the court system, which we heard earlier. It can take many months to get a possession hearing. That is a particular problem where possession is being sought, for example, for serious antisocial behaviour or domestic abuse, where delays to possession can increase the risk to tenants from perpetrators.
If the Government wish to implement, for example, a system of fast-tracking of serious cases, there will need to be a robust mechanism. If all cases are fast-tracked, we will be in the same position as if no cases are fast-tracked. We had some feedback from our members about how the courts could have helped with improving their capacity, such as increasing bailiff availability, increasing clerk availability to help to deal with the paperwork and logging of cases on the new online portal, ensuring training for district judges, and addressing the health and safety concerns of bailiffs. If the Committee wishes, I can also give some evidence, either now or later, on the impact on housing associations.
David Simmonds
Q
Timothy Douglas: I think more clarity is needed in the letting agent space. Letting agents are already required to sign up to one of the two Government-approved redress schemes, but those two schemes do not adjudicate in the same way. The property ombudsman will work to a code of practice, and the property redress scheme would work to that code of practice or common law in order to make the adjudication. We are adding an additional layer to that through a landlord ombudsman. Our recommendation would be that those landlords who are fully managing property should sign up to a redress scheme, but we realise that that argument is not necessarily in the legislation and has not been won.
We must look at the myriad management practices—let and rent collection, or fully managed. As a tenant, working with both a landlord and an agent, we have to get adjudication of this new scheme and the existing schemes, and get a code of practice in place for the sector, so that we are all working to the same standards and the same adjudication. Are we also expecting landlords, like agents, to have a complaints procedure that tenants have to work through? We need that parity before we even talk about tribunals and the other things.
We must use the existing schemes and that expertise in the sector. There are 19,000 letting agents in England, and roughly 50% of landlords use an agent, so 50% of landlords are already plugged into those schemes. They have knowledge and experience. Let us get a code of practice built in, so that we are all adjudicating on the same level. Let us get some sort of housing complaints portal across tenures, so that the tenant can make a complaint that is filtered to the relevant ombudsman. We must help the consumer. We are adding a layer of complexity and we need to iron out some of those issues first.
Melanie Leech: I will build on that, but by standing back slightly from the question, because I think this is a subset of a much broader set of issues around transition. This will be hugely complex. We have 4.6 million tenants who will need new leases. Some of them are sub-letting and so on. We have all those new agreements to draft. We are going to need lots of training for the professionals who are managing this. We will need new processes and guidance for agents and local authorities. We will need adjustments to insurance and mortgage policies. The lesson from Wales and Scotland is that a big bang approach does not necessarily work because you cannot get all of that right in one go. We are keen to work with the Government to start thinking now about the implementation strategy. Clarity for tenants and landlords about how the new system will work, where to go and so on is critical to that, but we need to start thinking about that now and to create an implementation framework, because if we do not, these new reforms will not work well.
Timothy Douglas: Scotland has been talked about as an example, but of course, it has phased in private residential tenancies—there still are assured tenancies working in Scotland. But Scotland has a long-standing landlord register, and it has letting agent registration and regulation. There is a tribunal that is free to use for both landlords and tenants. Scotland definitely had a 12 to 15-month phase-in approach for the PRT to kick in. From what we are hearing, we will have Royal Assent, three months and a commencement, and then all these tenancies will switch over. That is an issue for all agents, but certainly for our larger agents, who are managing thousands of tenancies up and down the country. A consideration of the impacts of the transition and extending that would be welcome before the implementation of this legislation.
David Simmonds
Q
Timothy Douglas: From Propertymark’s point of view, we want to see warm, decent homes. The agent can actually be a layer of enforcement, whether they instruct the landlord to take on that property or not, as well as mortgage providers. Unlike social housing, which is designed to specific specifications, the property redress scheme comprises a range of property without specification. The decent homes standard was argued about in the previous Session. It was consulted on by the last Government. There were numerous working groups with the last Government and, yes, it is going to be consulted on again.
From Propertymark’s point of view for the private rented sector, we have to link up with local authority assessments. We have to focus on fit-for-purpose. I know that local authorities—certainly a local authority in the midlands—will, without fail, change all the boilers every five years in their housing stock. I am sorry, but private rented landlords do not have the money to do that, and the social rented sector has received billions of pounds in eco funding as well. If we are to get that parity between the private and social rented sector, the private rented sector needs to see that funding come forward, certainly in the thermal comfort space—cool in the summer, warm in the winter. Why, for the 18 different archetypes of property across the country, are we going for a one-size-fits-all energy efficiency target? That is going to nullify older properties in England and Wales where the regulations extend and rural properties. Let us simplify the HHSRS as well. There are existing levers that we need.
Finally, on this point about extending decent homes and Awaab’s law, we welcome these steps as long as we get them right for the uniqueness of the private rented sector. In the Social Housing (Regulation) Act 2023, which was passed in the last Parliament, there is a requirement for all property managers in the social rented sector to be qualified. We think that should be extended to the private rented sector to all letting agents as well. If we can get that code of practice in place through adjudication and redress, we can qualify our letting agents. We get parity, drive up standards and help enforcement. That would certainly go a long way towards the decent homes standard and Awaab’s law being implemented in this sector.
Matthew Pennycook
Q
Melanie Leech: The first thing to say, as you know, is that institutional investment into the build-to-rent sector specifically is a growing part of the housing supply mix. It is bringing in genuinely additional investment, because it is the type of investment that does not typically invest in build to sell—you have people wanting to use large amounts of capital to generate secure income streams so that they can match against pension liabilities, insurance liabilities and so on. Probably the key word in that is “secure”. Anything that damages investors’ confidence that the income they will get from their investment is at risk will undermine our potential to unlock investment into homes and the rental sector. Currently, the peak year for build-to-rent delivery was 15,000 homes. We think that you can double that to 30,000 homes, with the right conditions, and some of my members would go further and say that you can double that again. We are looking at an investment stream that could be a very significant part of helping to deliver the Government’s aspirations to build more homes.
What I have already talked about, in terms of the ability of the courts to cope with the reforms, is an important indicator of confidence. Investors will look at that and think, “This changes the basis on which I have invested. It makes it more difficult for me to manage the property efficiently.” I think the issues around rent determination also have that potential, so there is nervousness around needing to use section 13 and rent increases. There is a suspicion that tenants have nothing to lose by challenging any rent increase, so it is about getting the framework right around how we define what an unreasonable rent increase might be and how we manage those cases that might come before tribunals. There are some issues around that that we would like to see more clarity around and redressed.
In general, we are really supportive, because in the part of the market that I represent the decent homes standard already would not cause us an issue in terms of implementation and so on. We are trying to raise standards in the private rented sector, and we are raising standards in the private rented sector, but the key thing is to implement the reforms in a way that does not undermine investor confidence, so that we do not inhibit the supply of homes.
Matthew Pennycook
Q
Melanie Leech: This is pure speculation, because I have not asked members this question. History suggests that once legislation is passed, those affected by it figure out the best way to protect their interests in the light of the new framework, so I would broadly expect that to happen. But if we are asking ourselves how we get back to a position where investors can have confidence, we should probably ask ourselves why we are asking that question in the first place. We should be creating a framework within which investors can have that confidence.
For example, some of the nervousness will be around the fact that, if you have a litigious tenant who takes you to the tribunal and ultimately to the courts over a rent increase, and the decision goes in the landlord’s favour, you have still lost several months. You cannot backdate the reasonable rent increase for which you have just won the court’s authority, so you have lost a lot of money in terms of both the rent accruing and the amount of time you have to spend going through that process. Let us just remind ourselves that when I talk about landlords here, I am primarily talking about pension funds and insurance funds, so it is our money.
Timothy Douglas: I think that is the point. While we need supply—and we need supply from all sources—landlords in the private sector are a broad community. The bulk of private rented sector landlords have one, two or three properties. What is disincentivising investor confidence is not necessarily the competence of this Bill, but the sector would welcome a review of all taxes and costs that have impacted private landlords in the past five years. We have seen the reduction in mortgage interest relief, the 3% additional surcharge when you buy a rented property, tinkering with capital gains tax—some are taxed as businesses while some are not—and changes to the wear and tear allowance. If we really focus and want to be sensible about incentivising landlords and the investment community, we have to shine a spotlight on taxes and costs.
Alongside this legislation, we need to enact the registration requirements in the Levelling-up and Regeneration Act 2023 on short-term lets as well. Otherwise, we are going to see a further exodus of landlords to the short-term lets market, which is less regulated and has fewer controls in place.
We need to build more social homes. Ultimately, as you will know, Minister, our argument remains that we need to retain fixed-term tenancies as an option. They give the landlord and the tenant a guarantee of the length of time they will be there and the rent that they will pay. Families renting with children near schools, as well as nurses who have placements, are coming to our agents saying that they want to know how long they are going to be in situ. As I say, we need to provide long-term tenancy options for those who want them and ensure that people do not go to the unregulated short-term lets market.
Matthew Pennycook
Q
Timothy Douglas: We have just been talking about the other side of the coin, which is investors.
Matthew Pennycook
No, not investors. You made a point about tenants.
Timothy Douglas: Yes, but that is the crux of it. Unfortunately, if you push too far on the fixed-term tenancy option, the grounds are not robust enough for landlords. Unfortunately, they do not know how long the tenant is going to be in situ. They cannot plan their investment, and they do not know the return on their rent. It is a mutual agreement. We are not saying that it is one or the other. We are saying retain it as an option. Why are we legislating to reduce choice and flexibility?
Agents are telling me up and down the country that that is what tenants want. The leading letting agent in London, which manages 65,000 tenancies, says that fixed-term contracts are popular within the private-rented sector. Many tenants opted for tenancies between one and three years, with the average first term lasting 23 months. At the end of the initial term, 65% of tenants choose to renew. Only 1% of tenancies are ended early by landlords; 5% are ended by tenants. People know where they stand and where they are going to be. It is an option that should be included in the legislation. We have talked today about students as well. It would solve all the problems in the student market.
We are tinkering there with issues that just do not exist. Retain fixed-term tenancies for all, or at least within the student market, or extend ground 4A to one or more sharers. You are tying yourselves in knots in so many ways.
Mr Amos
Q
Timothy Douglas: I was actually saying that fixed terms should be retained regardless of landlords.
Mr Amos
Q
Melanie Leech: A minimum tenancy would certainly help with investor confidence.
Mr Amos
Q
Melanie Leech: Ideally, we would want a year—perhaps six months.
On the impact, to answer the Minister’s point, it is not that families cannot stay for as long as they want to. This is a high-quality product—I am talking particularly about the build-to-rent sector. The risk for build-to-rent providers is that people will treat build to rent more like an Airbnb-type product. That could transform what should be rental products for families to move into for the long term. That is what we want—we want people to stay somewhere to make it their home. But this proposal will inhibit the supply of those products to long-term tenants, because we are vulnerable to short-term tenancies flipping all the time. That is the concern. It is not that people cannot stay for long if they want to; it is that those products will be easier for people to treat more like a short let—an Airbnb-style product.
Timothy Douglas: We need build to rent, but let us not forget that in build to rent, on average, the rents are a lot higher, because people are paying for a concierge and the other services, so it is not the ultimate answer for all parts of the sector. We are not going to support everyone. I do not think that there should be a timeframe on the fixed term, but we can make use of grounds that landlords cannot use as levers, and you could put break clauses in as well.
Connor Naismith (Crewe and Nantwich) (Lab)
Q
Suzannah Young: We believe that everyone has the right to a warm, dry, safe, secure and affordable home, and social housing has a greater proportion of decent homes than housing of any other tenure. That could suggest that having a decent homes standard helps to bring up standards in housing. We also recognise that housing associations exist to fulfil a social purpose, and we are rightly held to a higher standard. We welcome the Government’s commitment to reviewing the decent homes standard. We are pleased to continue to work with the Ministry of Housing, Communities and Local Government as this develops.
In terms of some feedback for the private rented sector, we agree that it is important to have a clear, modern and meaningful standard that reflects what residents would expect a decent home to be. It is also important that all landlords should have a clear understanding of the condition of all their homes. In the social sector, we are doing work to develop a more consistent approach in that area, as part of our response to “The Better Social Housing Review”. It would need to be something that private landlords were able to do as well to bring up standards.
Specifically—this has been mentioned in terms of the private sector—it is important to recognise that the housing association sector faces multiple and competing pressures, with budgets that are already stretched. We would like to see investment in existing homes at the same time as development of the desperately needed new and affordable homes in the Government’s long-term housing strategy. I suggest that similar attention would be needed for the private sector.
Timothy Douglas: May I pick up on that point? That argument was used in Scotland on the Cost of Living (Tenant Protection) (Scotland) Act 2022. I gave evidence on that legislation two or three times to the Committee up there. In the end, the argument was that the cap was lifted for the social rented sector because it needs to plan for its investment. That is the crux, and it goes back to my previous points—there is no parity here with the incentives, the business planning and the costs that private landlords are facing. We have to have that parity. If the legislation is extending across, the funding needs to be the same. We have to have parity in the investment, the caps and everything else—that needs to be the same. We need that review into all the taxes and costs impacting private landlords, because, quite frankly, we are not getting legislation from either Government Department—the Treasury or MHCLG—that understands the investor appetite for the private rented sector. This legislation is not helping.
Rebecca Smith
Q
Timothy Douglas: It is difficult to say. We know anecdotally that if you are in an agent branch and a landlord wants to sell, the branch would try to push that property towards a bigger landlord who could perhaps take it on before it goes on to the open market. We know that that happens in order to retain property. Anecdotally, we know that, because of legislative uncertainty and costs of legislation, as well as the cost of living, which has also hit landlords with their costs, landlords have left the sector—I gave the example of the agent in the west midlands previously. However, it is difficult to ascertain hard data across the board. That could be another recommendation to the Government: to come back with an annual review to Parliament on the state of the private rented sector.
Suzannah Young: May I come in on that?
The Chair
We are going to have to go on to the next question, because we are running short of time. I call Michael Wheeler, who has been waiting.
Michael Wheeler (Worsley and Eccles) (Lab)
Q
Suzannah Young: Thank you for your question. As I said, we welcome the Bill, and we support the Government’s ambition to give greater rights and protections to people renting their homes, and to value the contributions made by responsible landlords who provide quality homes. We do think it is crucial that the details of the legislation do not have unintended consequences for housing associations and for people living in social housing. We would like to ensure that the changes do not impact housing associations’ ability to provide decent, safe, secure and affordable homes for people who need them most. It is clear that care has been taken in drafting the Bill to minimise the impacts on social housing and tenants of social housing, and we are grateful for the engagement on these issues from MHCLG so far.
However, there remain a few areas that we feel need ironing out to avoid impacting the ability of our housing association members to deliver housing in what is a challenging environment, while still keeping rents affordable. Those specifically relate to the changes to rent increases, with ground 1 being the rent to buy ground and ground 6 being the redevelopment ground. First, we would like to see the proposals around rent increases made clearer or changed to make absolutely certain that they retain social landlords’ ability to increase rent in a harmonised way, which is to avoid impacts on the supply of social housing and to ensure fair rent levels for neighbours and the ability to deliver repairs, maintenance and services to tenants. That is because, as I mentioned earlier, all rental income is reinvested into providing those services. So any loss of rent would have an impact on tenants who receive those services, and repairs and maintenance.
We would also like to see ground 1B extended to apply when the home is converted to another rental product, which is not currently in the ground. That would be in order to help housing associations to meet local housing need where there is no demand for rent to buy or purchase. We would like housing associations to have access to ground 6 in all cases, so that they can carry out essential works that are of benefit to tenants.
We will follow up with more detail in our written evidence, and we would be happy to meet any members of the Committee if they would like to discuss any of these points in more detail.
The Chair
Thank you very much, and I thank all the panel for the evidence that they have provided to us. I am sorry that we do not have any discretion, but we now have to move on to the next panel.
Examination of Witnesses
Councillor Adam Hug and Dr Henry Dawson gave evidence.
The Chair
We have Dr Dawson here physically and Councillor Hug on Zoom. Could you please introduce yourselves briefly?
Dr Henry Dawson: Good afternoon. My name is Dr Henry Dawson. I work as a lecturer at Cardiff Metropolitan University and I am a member of the Chartered Institute of Environmental Health’s housing advisory panel. I am here today to represent the Chartered Institute of Environmental Health.
Cllr Adam Hug: I am Councillor Adam Hug. I am the Local Government Association’s chair for local infrastructure and net zero, which basically means its housing spokesman, among other things, and I am the leader of Westminster City Council. I am here at the LGA conference in Harrogate; apologies for that.
David Simmonds
Q
Dr Henry Dawson: Councillor Hug, shall I start and then pass on to you?
Cllr Adam Hug: Okay.
Dr Henry Dawson: At the moment, we have quite considerable extra burdens being placed on local authorities. The two major areas for that would be in the enforcement around the database and in managing the landlords who have either been rejected from or refused to join the ombudsman’s scheme.
In both cases, the fees that are available to be charged for the schemes will generate some revenue. However, national schemes, by their very nature, will have to be relatively low cost. Rent Smart Wales is a good example. It has an application fee that is little more than £100, so that allows for some intervention. However, the majority of the burden for the enforcement side of things under this new Bill will be placed on local authorities. If just 5% of a sector was to refuse to engage with one scheme or the other, a typical local authority would have around 700 properties that it had to carry out formal enforcement work on, and an awful lot of those would require civil penalty notices or prosecutions.
The CIEH is very keen to see that the funding for local authorities is linked directly to the fees for these schemes and represents the cost proportionately, with the additional burden being placed on the enforcement bodies for the private rented sector—environmental health and private housing enforcement teams.
The notable exception in the Bill is that the ombudsman fees are permitted to cover the cost for the ombudsman to enforce its statutory functions, but there is nothing specific in there, as there is for the database, for those funds to be passed on directly to a local authority.
The other thing we have found with previous legislation is that there is usually short-term additional funding from the Secretary of State’s general budget to support local authorities in introducing these new burdens, but then that sort of tails off. It is replaced with a whole miscellany of short periods of funding, which makes it impossible for local authorities to manage staffing and attract and train up new staff. We are therefore ending up with a situation where approximately half the posts we have for local authority enforcement teams in environmental health are going unfilled for more than six months. It has been a real hand-to-mouth existence for local government enforcement teams. If we could have funding proportionate to the size of the sector in a particular area coming directly from the fees for these national schemes, it would be very gratefully received by local authorities.
David Simmonds
Q
Cllr Adam Hug: To echo that, I think it is important to understand where we are starting from. We have seen environmental health teams in councils cut over the last 14 years, because of the financial situations councils find themselves in. Environmental health officer posts are one of the top three most challenging roles for councils to fill at the moment. It is really important that the new burdens doctrine is applied properly, with up-front funding to make sure that councils can build teams to deliver this as quickly as possible.
We welcome the proposed fine retention, but we think there may be a case for raising the upper limit for the most egregious cases from the current £7,000 up to about £30,000 to fully capture the impacts of some of the worst properties, but also to ensure that revenue can fund council services that are enforcing this. We welcome this, but we must make sure that local councils are properly resourced to deliver it.
Dr Henry Dawson: May I make one additional comment, please? At the moment, the Bill makes substantial use of civil penalty notices. We welcome the use of them. It is very welcome to see funding coming directly into local authority enforcement coffers, as it is something we do not get through prosecutions that are carried out through the courts. It is, however, worth pointing out that they represent the very thinnest end of the wedge for the enforcement activity of local authorities. We only use them where all the informal approaches—service of legal notices and so on—have been unsuccessful, and we are forced to resort to taking more punitive action.
In the majority of cases, we can resolve things informally with landlords, and the majority of landlords are good providers. It is just worth noting that while the penalties are a source of income, they are not predictable or particularly sustainable. Only around 50% of what we charge in penalties at the moment is collected, because of the difficulties in trying to capture the money at the other end of the process. I would just caution against assuming that they are a very reliable source that will keep us going. There are an awful lot of other things we have to pay for.
David Simmonds
Q
Under the Homelessness Reduction Act 2017, local authorities are significant users of the private rented sector for people who would otherwise be at risk of homelessness. It is common for local authorities to pay rent-in-advance deposits and use various other guarantee schemes to secure private rented sector homes for people who would otherwise not be able to access a home. Councillor Hug, I am interested in how you think the Bill would impact on the performance of that duty.
Cllr Adam Hug: In terms of the ability for councils to procure accommodation, having stability in the rental market will help us in managing demand pressures. We are conscious that there is an interaction with the Housing Act 2004 requirements around the prevention duty. That is one of the major challenges created by this Bill, so we want to ensure that local authorities are properly resourced to cover the potential additional time beyond the current 56 days, where we are having to provide prevention support to people while enforcement happens—[Interruption.]
David Simmonds
Q
Cllr Adam Hug: Apologies; I was just saying that the biggest area of concern about our homelessness duties is ensuring that the increased costs to councils of providing the additional prevention duty over the length of time for which the section 8 notices are going through the court are properly captured. That, on the interaction with housing, is the area we are most concerned about, but it is all perfectly solvable.
David Simmonds
Q
Cllr Adam Hug: We are not aware that this Bill creates a particular problem in that regard. We can come back to you in writing if there is anything further, but it is not an area of particular concern to us at the moment.
David Simmonds
Q
Cllr Adam Hug: No, we do not think it does. The key thing for us is that you have the current selective licensing mechanisms, but councils face bureaucratic hurdles in terms of getting the Secretary of State’s sign-off for large schemes that wish to go down that route. In terms of ensuring decisions are made at the right level, in line with the Government’s commitment to devolution, we think that for selective licensing to really fulfil its potential we must ensure there is no longer a need for the Secretary of State’s sign-off.
Obviously, that sort of licensing can improve standards in the sector, help councils to recruit environmental health officers, beef up the function and make sure we are playing a proactive role in helping manage the private rented sector in a local area. Different councils have used it, but at the moment it is hamstrung by the bureaucratic hurdle of getting it up to the Secretary of State. Obviously, we have a Secretary of State who is probably more minded to support the use of such schemes than was the case in the past, but it still creates an unnecessary hurdle and a delay when councils could just get on and use these licensing schemes that are desperately needed.
Dr Henry Dawson: May I add some responses? At the moment, we have a maximum five-year duration for discretionary licensing schemes. Once the schemes have been brought into force, it takes a certain amount of time to create the partnerships with other organisations, such as waste and street scene departments, police and antisocial behaviour teams, and antisocial behaviour schemes within the council, other charities and NHS-related bodies. They usually take between one and three years to mature.
Local authorities are also required to entice enough staff to be able to immediately provide a strong inspectorate to run these schemes. That can be anything from five to 50 staff, depending on the size of the scheme. We find that the five-year duration of schemes is a significant impediment, so it would be much more welcome to see something like a 10-year timeframe. That would permit us to train up new staff through the existing one or three-year qualifications. It would also allow these partnerships to mature so we see some of the true benefits of the schemes.
The other thing is that a large private rented sector is required; that is a point that a local authority has to prove when it is setting up one of these selective licensing schemes. We see that as an unnecessary hurdle to their introduction. They are part of a package of measures to address a range of problems associated with housing conditions, crime and antisocial behaviour across an area, and we see that as being an unnecessary impediment to their execution. It is one more thing that the local authority has to prove.
Finally, discretionary schemes, and particularly selective licensing, are one of the few things that provide access to properties. Even though the legislation has been changed, with some regulations to expand the use of selective licensing to include dealing with poor housing conditions, under the Housing Act 2004 we are unable to enforce conditions relating to the condition and contents of a property. We can only change those in HMO licensing conditions; we cannot change them in selective licensing conditions. Therefore, this is the first opportunity that we have really had, with a piece of primary legislation, to amend the Housing Act 2004 to provide parity in what local authority environmental health officers can require in the conditions and contents of properties through selective licensing, in addition to HMO licensing.
Matthew Pennycook
Q
You mentioned the fines—£7,000 for first or minor compliance issues, and £40,000 for more serious ones— and they can be levied repeatedly. I just want to get a sense of how much of the cost of enforcement you think those fines can account for. We recognise that it will not be enough, and that the new burdens principle will have to operate, but have you got a sense of it in terms of, as you say, how many cases are resolved before it reaches that point? What will be the willingness under the new system to levy these kinds of fines, and what proportion of the enforcement costs do you think, on average, local authorities might see those fines account for?
Dr Henry Dawson: Thank you for your question, Minister. At the moment, we have the use of civil penalty notices, and I would defer to a report by the National Residential Landlords Association to provide a summary of their use over the period between 2001 and 2003. We see that approximately £12 million was given in penalties over that period, and around £6 million of that was recorded as collected through penalties over that period.
It is also worth noting that these civil penalty notices are intended to be an alternative to a prosecution through the courts; they are not intended to be a revenue generator. The licensing fees, the ombudsman fee and the database fees are where we can generate the revenue at the front end. These civil penalty notices are being used as a final, ultimate punishment for some of the worst offenders. Yes, we can administer £7,000 for the initial offence and £40,000 for ongoing offenders, but they really are intended to be a deterrent, as opposed to a source of revenue.
The majority—maybe 90%—of a local authority’s work is carried out through informal advice giving, with people ringing up and asking for guidance in what is a very complex legislative environment. That is certainly something that landlords and letting agents would like to have more of. We serve formal legal notices, but it is only when we have gone through a whole series of informal approaches that we move to a formal approach through a legal notice and, ultimately, a prosecution or penalty notice. Therefore, really, we are looking at maybe 5%—to pluck a figure out of the air—which is a tiny proportion of what we have got across the country, and probably the only national figures we have on this are those that have been pulled together by the NRLA.
Matthew Pennycook
Q
Cllr Adam Hug: indicated assent.
Matthew Pennycook
You are nodding vigorously, which is a good indicator, but have you got views more widely about the changes that we have made on antisocial behaviour—about being able to take action immediately, for example, or considering the implications on other people in a household, as well as that switch back to “likely”, rather than “capable of”, which we felt was too broad under the previous legislation?
Cllr Adam Hug: Absolutely. We agree that the previous legislation was too broad to be meaningful. I think the key thing for us is supporting where we are now, in terms of reverting to “likely”, but, also, there needs to be clear guidance given by the Department—obviously, building on existing case law—with clear definitions from your team about what constitutes antisocial behaviour, both so that landlords know and so that councils can know regarding enforcement. I am sure that there are teams at the LGA, and others, that are happy to work with you on the development of that, but giving clear guidance to the sector is going to be essential to ensuring that the powers are used effectively.
Matthew Pennycook
Q
Dr Henry Dawson: The CIEH would be keen to be part of discussions with the Ministry of Housing, Communities and Local Government about the operation of that database. I note that quite a lot of the content in the Bill is to be delivered through secondary legislation, and if we could be part of the shaping of that legislation, it would be very welcome. Things that would make it more effective include ensuring local authorities’ ease of access to the records on the database; providing local authorities with broad enforcement powers that would allow things such as the provision of information from any person; and the ability readily to access records of other local authorities’ enforcement activities. These sorts of records make it much easier for us to co-ordinate our activity across different areas of the country.
Having a single database operator, providing, as one of its functions, a source of advice in the industry would also provide us with a single point of information to refer people to when they come to us asking for support. That would alleviate a lot of the burden and the time our officers spend managing these requests for information. Therefore, we would not be relying on what are often chat forums and other informal information sources for our landlord operators to address problems on what is usually a responsive and as-and-when-they-occur basis.
Eighty-five per cent of landlords in the sector own one to three properties. That is roughly half the sector’s total housing stock, so those are the landlords we need to focus on trying to support. Providing advice and guidance will be an invaluable function of the database operator.
Rebecca Smith
Q
Dr Henry Dawson: Councillor Hug, would you like to start?
Cllr Adam Hug: As much support as possible in training up the next generation of environmental health officers is essential. There is a whole raft of skills shortages across the housing sector that you touched upon. Obviously, we want to make sure that people are considering this line of work as a career they want to go into rather than leave. There is a pipeline problem in terms of people coming into environmental health as a workstream, but I do not think that should necessarily delay what we are doing with the Bill. Ultimately, it has been talked around for some time; we need to crack on and get it done. It is absolutely the case that getting that local funding piece is right. Then we can join up with skills and training by making sure that local authorities have a pathway to recruit people into their teams. It is about getting the funding piece right alongside the direction of travel.
Dr Henry Dawson: We face some barriers to bringing people into the profession. For example, we have some more sustainable sources of income with things like licensing legislation, where we can charge a fee; at the moment, my own research finds that only about half those schemes charge enough in fees to cover the full costs of management and enforcement. The Lawrence and Wilson review of selective licensing has shown that if we do not charge enough, it ends up reducing the exercise into a sort of glorified paperwork, so we have to charge enough to make it meaningful.
I would argue that staffing is probably one of the most fundamental issues when it comes to the effectiveness of the interventions proposed in the Bill. At the moment, the predominantly hand-to-mouth existence with local authorities, which we have had for quite a long time now, has been predicated on the fact that we are relying on the council tax payer to fund the enforcement of the private rented sector. That is quite peculiar compared with other industries such as building control or planning, which are able to levy up-front fees that do not have to go through a test of political will—which a lot of local authority managers have to navigate to try to predict what the market within their local political support will accept. It takes a lot out on the guesswork and acceptability side.
The ability to charge a fee also provides us with a sustainable and predictable source of income, and that has been lacking for a long time in local government. If you are never sure of whether you will have funding beyond one or possibly three years, with short-term pots of money that are provided often based on a competitive approach—it is about winning them—then you get a member of staff, but you have to train them once you have got them in. Being optimistic, we can train them through an apprenticeship scheme lasting a year to do just housing work, or if we are training them as an environmental health officer, it is three years for the traditional degree route or five years for an apprenticeship.
Having some form of ringfencing of the funding, which allows local authorities to dedicate resources to attract people into the profession, would be very helpful, as the report that I have pretty much every time I speak to a local authority about recruitment for my programme at the university is, “We don’t have the resources to send people to these events to raise awareness about the profession.” A lot of people are just not aware of what we do; once they find out, it is something that sells itself.
Fire and police are comparable bodies, and they tend to have much more success because they have the resources to devote to this. It comes down to sustainable and predictable funding. That allows us to train and retain, and attract new staff.
Naushabah Khan (Gillingham and Rainham) (Lab)
Q
Cllr Adam Hug: I think the provision will help; the whole point is that we are desperate for this. It has been talked about for a long time and as soon as it can be brought in to provide security in the market, it will be extremely helpful to help stabilise a lot of tenancies where there is still uncertainty. The quicker it can come in, the more helpful it will be.
The Bill will not be a magic bullet that will solve the homelessness problems that councils are facing. I pointed out earlier one of the small technical challenges: the duties that local government will be dealing with will be extended in time and go up, we think, from 56 days to 21 weeks on average under the prevention duty. That is a small price to pay, but ultimately, we would like some help paying for that price.
In terms of stability in the private rented sector, this measure is long overdue and will hopefully take some heat out of the sector, but there are all sorts of things going on that mean that it is going to take a long time to turn around the wider issues of local government finance for temporary accommodation, because that is one of the biggest pressures; there are so many councils at the moment that are working hard to procure as much temporary accommodation as possible.
Claire Hazelgrove (Filton and Bradley Stoke) (Lab)
Q
You both have a wealth of experience and expertise; thank you for what you have shared already. I want to follow on from the last question and open the floor a bit more to see whether you had any additional thoughts about the Bill’s strengths or any areas where you feel it could be further strengthened—points that our questions so far have not let you speak to.
Dr Henry Dawson: Councillor Hug, would you like to go first?
Cllr Adam Hug: I think we have identified the key thing for us. Dr Dawson explained some of the challenges around funding stability, and we think that on many different levels it would be extremely helpful if the Bill made it easier to apply selective licensing schemes. Making it easier to use that existing tool would help to provide stability, but ultimately we are just very keen for this legislation to be passed through Parliament so that tenants get the extra protection and councils have certainty about what will be expected of them. We want to ensure that we are properly funded to help us to deliver this important task, but we are keen to get it right.
The Chair
That brings us perfectly to our finishing time. May I thank both witnesses for their evidence? We will move on to the next panel.
Examination of Witness
Anny Cullum gave evidence.
The Chair
Anny Cullum, would you like to introduce yourself?
Anny Cullum: I am Anny Cullum, and I am the policy officer at and a founding member of Acorn, an organisation that has been running for the last 10 years. It has been operating like a trade union but on community issues, so we have lots of members who campaign on housing issues and operate effectively as a tenants’ union in around 27 places across England and Wales.
David Simmonds
Q
Anny Cullum: We are pleased to see stricter measures and penalties for landlords laid out in the Bill, and we are particularly happy that new burdens funding will be available to councils to enact them. However, our experience as a tenants’ union is that often councils are so overstretched trying to do the things that they already have to do that tenants are waiting months before getting the support they need. Often their landlords have been given very informal notices and long timescales to get things done, which is no good for a tenant living in a dangerous home.
A great thing about this Bill is that section 21s will be banned. Something that we have seen a lot—we had a member in Sheffield go through this recently—is a local authority coming in and investigating poor conditions in a home, giving an informal notice to the landlord, and the landlord then issuing a section 21; the tenant basically has to pay for the fact that they dared to complain. We are really pleased that that will end, but we think there should be more funding for local authorities, not just extra burden funding for the new things, but for the stuff that they already have to do.
Our union really supports landlord licensing. We have done campaigns in this area in 11 different places around the country. It is incredibly popular with our members; it came out as one of our top motions at our recent conference. If done well, landlord licensing can be self-funding, and—this is a great thing to think about—it gives councils the ability to inspect homes without the tenant having to raise the issue themselves, so you can find out about bad practice and malpractice without the tenant feeling at risk of complaining. Obviously, they will have fewer risks once this legislation comes through, but it will take a long time for tenants to feel comfortable raising their voices, which our organisation tries to help them to do.
We really support the points made by colleagues in the Chartered Institute of Environmental Health. We have campaigned in a lot of places for city-wide landlord licensing, as it is something that our members really care about, but a lot of councils have told us that they are not willing to take the risk of trying to implement wider licensing schemes, because they can be turned down by the Secretary of State. They have said that the work you need to do to put that application in is quite labour-intensive, and they do not want to risk doing all that work for it not to come to fruition. In the spirit of devolution and supporting local authorities to do the job they should be doing, give them back powers to license as much of the city as they want, increase the term to up to 10 years, and do away with the bureaucratic hurdles and the evidence gathering they need to do to get the wider licensing schemes.
Matthew Pennycook
Q
Anny Cullum: One area our Members feel particularly strongly about that could be strengthened in the Bill to ensure that it delivers the change we all want to see is measures against illegal evictions. It will be wonderful when section 21 is banned, but we know that there are lots of landlords who issue section 21 eviction notices in response to tenants complaining, because they do not want to maintain their properties. For that unscrupulous group, we are worried that illegal evictions might take the place of section 21 evictions once section 21s are banned. We feel that the Bill could go further to make sure that this is not an easy option for them to take.
Hardly any cases of illegal eviction ever make it to court. Safer Renting data showed that there were 26 prosecutions in 2022—the year we have the most recent data for—but it knew about 9,000 cases of illegal eviction. Even when illegal evictions get to court, the fines are £1,000. That is less than my monthly rent. It is not a deterrent for the average landlord. We would like to suggest some changes to make sure that this is not used as a back door to get around the legislation.
We would like to see local councils given a statutory duty and the funding to investigate all cases of illegal eviction. Recently we had a member in Leeds whose landlord kept issuing false eviction notices—ones that he could not go to his local council to ask for support with, so he stayed there. The landlord used many different underhand ways to try to force him out, including sending men with knives to cut the wires in his house so that he did not have any electricity. He has been on the phone for hours to his council and the police, and they have not been very helpful. We want to see those bodies empowered with both the duties and the money to act for tenants.
Police forces need more training. I have supported tenants who landlords have tried to intimidate out of their house. The police do not seem to know that this is a criminal offence or that they have the ability to act on it, so it would be good if there was training on that. We would also like it to be made easier for people and councils to take these criminal cases forward. It can be quite hard to meet the evidence threshold needed to get a rent repayment order, so we would like to see changes there, which I have laid out in our written evidence. We would also like the civil penalty notices that councils can use to be raised to up to £60,000. I know that sounds high, but being forced out of your home with your family is a horrendous thing to happen to anyone. We want to ensure that this is treated with the seriousness that it deserves.
Illegals eviction is one area that my members asked me to speak about. I have also spoken about landlord licensing. A further issue is rent in advance. We are overjoyed that this Bill will end bidding wars, which is something we have campaigned for in different places across the country. We have tried to get agents themselves to pledge not to do it and then mystery shopped them to make sure that they are not. But if you allow agents and landlords at the start of a tenancy to ask, “How many months up front can you give me? Someone else said they could give me a year”, that is another form of bidding war, just at a different point of the process.
We conducted some research at the start of this month and found that benefit claimants were three times more likely to be asked for a year’s rent up front than people not claiming benefits. We are pleased that the Government are keen to crack down on discrimination in the private rented sector against people on low incomes, but this is one way that it is happening and we feel that the Bill could do more on that issue. I have two more areas that my members want me to speak to, if that is okay.
The Chair
Let some other people ask questions and perhaps you will have the opportunity to include those points in your answers.
Mr Amos
Q
Anny Cullum: We would like to see letting agents regulated. Especially with the issues around bidding wars and discrimination when you enter a new home or the private sector for the first time, in the majority of cases that will be about your experience with your letting agency. We as Acorn suggest mystery shopping, like when Trading Standards sends kids into shops to mystery shop and sees whether they will sell them alcohol. Maybe we should be sending people into letting agencies and seeing whether they are being discriminated against on the basis of any protected characteristic, but particularly on the basis of being benefit claimants. That part could be strengthened in the Bill.
Sam Carling
Q
Anny Cullum: I think the landlord database will be excellent. It is important from our point of view that the landlord database includes information for tenants on previous enforcement action that has been taken against landlords, because you can then make an informed choice as a tenant about where you would like to rent. That will be another way to deter landlords from behaving illegally because they know they will have a mark against their name on the register. We hope the register will mean that, rather than tenants trying to compete for homes at the moment, landlords are competing for tenants by behaving in a good way and providing a good service. Having that sort of information on the database would be incredibly helpful.
Carla Denyer
Q
Anny Cullum: On withholding rent for serious disrepair, there are much-improved schemes and action within the Bill around the decent homes standard and improving standards for tenants, but a lot of the action set out to be taken if tenants are experiencing disrepair is retroactive or down the line. We know that councils can take a long time to act and that lots of tenants will not pursue things like rent repayment orders because they just do not have the time and energy. But if someone is living with serious disrepair—things like the damp and mould laid out in Awaab’s law, which we are pleased to see moving over to the private rented sector—we think there could be a mechanism whereby, if it is not fixed within the timescale set out by Awaab’s law, they could withhold their rent and pay it to a third party, which could then give the landlord another timescale within which to solve it. If they did not solve it, the tenant would get the rent paid back. If they did, the landlord would get the rent.
That would be an immediate incentive to do the work and stop leaving people in the dangerous conditions we see all the time. Landlords are not necessarily going to worry in the moment about a rent repayment order that a tenant may or may not put in for, which would take ages to go through a court—landlords sometimes do not even pay them anyway—whereas, if you can withhold the rent, that will speed along the process of sorting out mouldy and unsafe homes. So that is the mechanism we would think of. There are lots of considerations as to how it could work. If you consult on bringing Awaab’s law into the private rented sector, that will be a good place to think about the best mechanism to do it.
I think your second question was about rent hikes—rent rises.
Carla Denyer
Q
Anny Cullum: Unfortunately, no. We as an organisation at the moment would never recommend that anyone go to the rent tribunal, because we have seen tenants go there and have more rent—a higher percentage—awarded than the landlord was asking for in the first place. We are pleased to see that you are going to get rid of that, but we would like to see rent rises capped at the lower of median wage growth over the last three years or inflation. From my experience, I know most tenants are not going to go to the tribunal. It is brilliant if they do, but a lot of people will accept the rise, or have to move out because they cannot afford it, or get into debt. This means that the people who do go to the tribunal will still be judged against market rents that are way more unaffordable than the one at which they went into their contract. Does that make sense? We are not going to bring rents down just by tinkering with the tribunal.
This is mainly about making sure that people can stay in their homes and it does not undermine the Government’s efforts to prevent no-fault evictions. This could easily be used as a no-fault eviction by the back door. You could just put the rent up to a level that you know your tenant cannot afford. We do not think comparing what is affordable with new prices is the best way, so we would advocate for that cap on how much rent could be increased by.
Connor Naismith
Q
Anny Cullum: As I said, the five areas that I wanted to cover were illegal evictions, landlord licensing, capping rent up front to one month, withholding rent for disrepair and making renting more affordable. We see even the cap on in-tenancy rent rises as not really about affordability, but mainly about preventing back-door economic evictions or section 21s. We feel that, while this Bill goes far on improving security for renters, it is not going to do enough to address one of the No. 1 problems our tenants and members are coming to us with every day, which is affordability. Rents are outstripping wages all the time. We would like to see the Government set up a commission to look into ways we can bring rents down and keep them affordable once and for all. That is something that we would like to see.
Lola McEvoy
Q
Anny Cullum: It might have a small impact, but I think that the reality is that most landlords will expect most tenants not to make use of that scheme.
Lola McEvoy
Q
Anny Cullum: The problem with this is that it is going to be judged by the market rates—what the going amount for other-sized homes in your local area is for new tenancies—and those are going up all the time. Unless we do something to stop those rates going up all the time, you as my landlord could say, “I want to put your rent up by 50%”, and if I challenge it at the tribunal, if I have been there for three years, for example, I suspect that could be what the going market rent now is in my local area, because the system, as Ben Beadle said earlier today, is absolutely mad and out of control.
We need more drastic action to bring down rents, because it is unreasonable to ask someone to pay 50% more than they are paying at the moment, but in some places—
The Chair
Order. Thank you very much. I am afraid I have to interrupt, because otherwise we will not have time to listen to the Minister. Thank you for your evidence.
Examination of Witness
The Chair
Minister, would you introduce yourself very briefly, please?
Matthew Pennycook: Yes. I am Matthew Pennycook and I am the Minister of State for Housing and Planning.
David Simmonds
Q
The first question is simply this: what advice have you received so far and what are the plans in respect of the interaction with the Homelessness Reduction Act 2017? That is the point I was asking Councillor Hug about—the Homelessness Reduction Act creating that opportunity for local authorities to act as a guarantor to pay deposits, including rent in advance, to secure a property that would not otherwise be available to that tenant. I ask that question in the light of some of the evidence that we have heard about the impact of guarantors and deposits within the Bill, which I appreciate is not yet a settled matter.
Secondly, I invite you to share your thoughts on enforcement authorities, which my hon. Friend the Member for South West Devon highlighted, which are referred to in chapter two. I have an idea why this might be the case, but the Bill creates a specific measure, in clause 104(4), that says:
“A county council in England which is not a local housing authority may—
(a) enforce the landlord legislation;”—
The joy of local government: the Minister will know that county councils are not housing authorities, so it would perhaps be helpful if you could set out the Government’s thinking around that, and say how any advice or engagement may have taken place already with local Government to determine the way forward on that.
Matthew Pennycook: Did you say three or two questions?
David Simmonds
There are three questions, but I have forgotten the third one, so I will ask you those two questions and then find the third question and come back with it, if I may.
Matthew Pennycook: Let me take those two questions forward.
The point that I took from Councillor Hug was a very specific one about the trigger for homelessness prevention duties under the Bill. Currently the trigger is a section 21 notice; once the new system is in place, it will be a section 8 notice. In theory, that broadens the scope of the duty, if you like, and therefore we will consider new burdens funding for local authorities as a result, because it could increase the costs to them.
On the specific point about county courts, I want to make sure that I have understood the hon. Gentleman properly. I think it might be better if I write to him with the specifics, but I would assume that his question is linked to the fact that in many cases we need to look to assign a lead enforcement authority in particular parts of the country, because of the specific arrangements of governance in particular areas. However, I am more than happy to write to him with further detail on the point about counties.
David Simmonds
Q
I have a final point. A number of the witnesses today have made a point that clarity about what is permissive versus what is required is a significant issue for their organisations. In particular, we heard about that in respect of the ombudsman, the tribunal and the courts.
I am interested in hearing your thoughts about how this process evolves, and your degree of openness about bringing a higher degree of clarity, either through a greater degree of transparency about what may well find its way into the guidance given to those different organisations, or through those areas that you feel are more appropriate to becoming part of the Bill and then the Act itself.
Matthew Pennycook: On the database and the ombudsman, through this Bill we broadly mirror the provisions in the previous Government’s Bill, in the sense that the powers in the Bill are broad framework powers. A lot of the detail will come forward in secondary legislation.
There was a debate when we considered the previous Bill, which I think we will return to because it is a worthwhile one, about what prescriptive requirements, if any, you put in the Bill for either the database or the ombudsman. In general, my sense is there is a lot of value in putting most, if not all, of that detail into secondary legislation in a way that allows us to ensure over time that the database and the ombudsman evolve properly with changes to the sector, so you would not want to get too prescriptive. But we can tease out in the debates—I hope we do; we have today—the type of thing we expect the ombudsman to do, and the full range. The Housing Ombudsman made clear that there is a “must” and a “could” on the ombudsman side. Similarly, there is a skimmed and a full-fat version of what you might include on the database.
As I have said, some of my contributions indicate that I think the database in particular could be an incredibly powerful tool. We should therefore be thinking through what we might include on it that would help tenants to assess who is a good landlord and who they should be comfortable signing a tenancy agreement with, and give local authorities the relevant information they need to bear down properly on disreputable and particularly criminal landlords. I am happy to be relatively open about that. We can be, and I hope are, fairly open in some of the debates about the type of things we and our constituents might like to see in secondary legislation.
Jacob Collier
Q
Matthew Pennycook: That is a good question. Like a lot of the debates we have had today, it is slightly out of the scope of the Bill, but you are right to ask it in the sense that the Bill is one part of the Government’s agenda for changing the housing system. There are lots of things we have to do on the home ownership side. You will know from our manifesto that we are committed to a permanent and more comprehensive mortgage guarantee scheme and a first dibs for first-time buyers scheme. In general, the Bill will hopefully empower renters by giving them greater protections, rights and security so that they can stay in their homes longer, build lives in their communities, avoid the risk of homelessness and, in many cases, by bearing down on unreasonable within-tenancy rent hikes, have the opportunity to save, which many do not have at the moment.
In answer to your question very specifically, the Bill is part of a wider agenda and touches on the supply issues we have debated. The Bill is not our answer to affordability in the private rented sector, and it cannot be. There are things that go beyond the scope of the Bill. However, in terms of the security, stability and certainty it provides for private renters, who are mainly at the top end of the market but would have, under better circumstances, the chance to save and buy a first home, the Bill will help in a number of ways.
Mr Amos
Q
On service personnel housing, I think the Minister’s position from the debate on Second Reading was that the Ministry of Defence is looking at it and different circumstances may apply, which would mean that a different form of decent homes standard would be needed. If the decent homes standard is yet to be published, and could potentially be less onerous than the one for the social housing sector, could it not also be applied to MOD housing so that our serving personnel get decent housing?
Matthew Pennycook: I do not think there is a huge amount I could add to what I said on Second Reading. We think there are particular characteristics of MOD accommodation that make it difficult to translate the approach we have in mind for driving up standards in the private rented sector and to align that with a wider push on the social housing sector. The MOD are taking forward that work. Yes, there are conversations between officials and Ministers about the crossover, how we might align standards and what the difference is, but I think it is for MOD to take that forward. We think there are good reasons to treat it slightly separately. I can address the short-term lets point, if you would like.
Mr Amos
Q
Matthew Pennycook: If I have understood you correctly, you are putting to me: why is MOD accommodation not coming within the consultation on a new decent homes standard for both sectors?
Mr Amos
I am putting to you that the MOD could have its own decent homes standards.
Matthew Pennycook: The MOD is taking forward standards for its accommodation, and it will do that as the Department responsible for that accommodation. It sits outside this legislation, and we had the same debate on the previous Bill. It is an important issue, but it sits outside the scope of this legislation.
Claire Hazelgrove
Q
Matthew Pennycook: It is a very good question, and we have touched on this issue, as well as guarantors. I am happy to give the Committee a sense of my thinking, because I have reflected further on the matter in the light of concerns that have been put to us by not only external stakeholders but several hon. Members in the Second Reading debate on 9 October.
As I made clear in that debate, the Government have long recognised that demands for extortionate rent in advance place a considerable financial strain on tenants and can exclude certain groups from renting altogether. We are very clear that the practice of landlords demanding large amounts of rent in advance must be prohibited. Although it might be argued that the interaction of the new rent periods in clause 1, which are a month or 28 days, and the existing provisions of the Tenant Fees Act 2019, relating to prohibited payments, provide a measure of protection against requests for large amounts of advance rent, I am increasingly of the view, speaking candidly, that there is a strong case for putting this matter beyond doubt. I am giving careful consideration as to how best that might be achieved in the course of the Bill’s passage.
Carla Denyer
Q
Matthew Pennycook: That is not correct.
Carla Denyer
Okay, then this is an invitation for you to talk us through your rationale, because that was my understanding. While I am at it, if there is anything where your mind has changed since the previous Bill, could you briefly talk us through why?
Matthew Pennycook: It is important to give context for the debates on the previous Bill and why, in certain circumstances, we were probing the Minister on making grounds discretionary rather than mandatory, and whether we were pressing the then Minister on additional protections for tenants relating to some of those grounds. The rationale for that was ensuring that the grounds, if they were mandatory, would not be abused. I suppose where my thinking has changed on many of them—I will continue to think on whether we have done enough on specific grounds for possession to protect tenants against abuse—is that the other actions we have taken in the Bill provide the protection we need.
I will give an example. On grounds 1 and 1A, where the previous protected period was smaller and the previous re-let period was much smaller—three months, not the 12 that we are proposing—in our view there was clear scope for abuse there. In many parts of the country, particularly hot rental markets—including London, and I am sure it is the same in Bristol—landlords are quite willing to suffer three-month void periods because the rents are so high. In a sense, if that is your re-let period on those mandatory grounds, you can get rid of what you consider a problem tenant, such as one who has complained perhaps entirely appropriately about damp, mould and other hazards. If you wait the three-month void period, then re-let, you have effectively recreated section 21 by the back door.
I think we have dealt with the abuse, which is from memory where we were probing the Minister about the discretionary or mandatory distinction. We have provided protections in other ways in the majority of cases. I am giving consideration, as I say, to some of the grounds and whether we have quite got sufficient protections in place. I think Justin Bates KC, for example, raised ground 6A, where action is rightly taken against the landlord whose practices need bearing down on, but the tenant should not suffer in that regard.
Michael Wheeler
Q
Matthew Pennycook: I welcome that question; it is an open one, and I will have to think on my feet in my response. I think a number of the debates will run through the Bill. Supply is one of those. I am clear that we do not want an exodus of landlords from the sector, but I have seen absolutely no evidence of that. It is a threat that has been bandied about for many years now, ever since the previous Government announced their intention to abolish section 21 no-fault notices.
The size of the private rented sector has doubled since the early 2000s. There has been an outflux of smaller landlords, particularly overgeared buy-to-let landlords, which is mainly a result of the section 24 tax changes that George Osborne introduced in 2015, explicitly to slow the growth of the private rented sector. So there has been an exit of certain types of landlord from the sector, but we have certainly not seen an exodus.
The feedback I have had from landlords over recent months and in the previous Parliament is that the most damaging thing for many was the uncertainty about whether reform was coming through in any form. That is why we felt we needed to act quickly. In general, good landlords have absolutely nothing to fear from the new system. We think it provides a framework in which they can continue to invest and operate.
Another point that has been prevalent in the debate is protections for renters against unreasonable within-tenancy rent hikes. In designing the Bill, I have been clear where we have overhauled and strengthened its provisions to strike that balance. We do not want to do anything that could potentially make things much more difficult for tenants, which is why the Government are not advocating rent controls in the Bill. The Scottish experience is instructive of what can happen as an unintended consequence, and we think there would be an impact on supply, quality and standards, as evidence around the world shows.
In many cases there is a judgment call on students and other possession grounds, and it is is a fine balance as to whether we have got it right in the Bill. But there are competing pressures and disincentives in a system—I am being incredibly candid with the Committee here—that has not been overhauled for 30 years. Lots of the speculation about how the tribunal will operate, and how many section 8 cases will go there, is in some ways all completely speculative. We have a sense of what we want to see and how to address the risks, but until the system is properly bedded in, I do not think anyone will know what we have to do in the design to ensure that we have the balance right and will not therefore see the tribunal overwhelmed.
We want to see more people to go to the tribunal. We want section 8 cases to go through the courts more efficiently. We absolutely concede the need for court improvements, and we are working closely with the MOJ on those—I have given some examples in response to the question about what we are taking forward. There is a balance that needs to be struck, and I think we struck the right balance in overhauling the Bill in the specific ways we have, while keeping—I gave the Conservative party the credit for this at the time—the sensible provisions that were in the previous Bill, which we think need to remain at the core of the legislation.
Rebecca Smith
Q
Matthew Pennycook: Specifically on rural housing, we have to think through how the decent homes standard will deal with particular challenges in certain types of stock in certain parts of the country. As a point of principle, what we will try to do in the decent homes standard consultation is to take a view on how that should apply across both sectors. Broadly, that is my instinct across the board.
It is the same with regards to the ombudsman. There is a strong case—our preferred option as things stand, although no final decision has been made—for the Housing Ombudsman Service to take on the role of the PRS ombudsman. There is a good case for a streamlined cross-tenure service. Broadly, we want the same standards to apply across the board.
Funding is another example of where there are things that the Bill touches on, but that are not within the scope of the Bill—the minimum energy efficiency standard, for example, has been mentioned a couple of times. That, however, is a Department for Energy Security and Net Zero consultation, which we launched this year. There is also a wider package around the warm homes plan, further details of which will come forward in due course, but that does not sit within my Department either. It is not necessarily part of the Bill, although decent homes will have to account for those changes, such as those on the MEES front.
The Chair
Thank you, Minister. That brings us to the end of the evidence session. I thank all Members for participating in what has been a very constructive exchange of views.
Ordered, That further consideration be now adjourned. —(Gen Kitchen.)
Renters' Rights Bill (Third sitting)
Tuesday 29th October 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 29 October 2024 - (29 Oct 2024)
The Chair
Welcome, everybody, to the first sitting of the Committee in which we consider the Bill’s content in detail. The only announcement that I will make at the beginning is that it is very helpful to Hansard if people hand over or email any notes they may have.
I recognise that this will be the first time that some Committee members have served on a Public Bill Committee. My view is that the best way to learn and understand the procedure is to listen to what is going on rather than looking at your phones and emails. On that basis, I am not going to make massive announcements at the beginning about the rules of procedure, because I assume that people will be able to pick them up pretty quickly.
Clause 1
Assured tenancies to be periodic with rent period not exceeding a month
David Simmonds (Ruislip, Northwood and Pinner) (Con)
I beg to move amendment 48, in clause 1, page 1, line 13, at end insert—
“unless the tenant meets the student test where the tenancy is entered into.
(1A) For the purposes of this section, a tenant who meets the student test when a tenancy is entered into has the same meaning as in Ground 4A.”
The Chair
With this it will be convenient to discuss the following:
Amendment 54, in clause 1, page 1, line 13, at end insert—
“, unless the landlord and the tenant mutually agree to have a fixed term during which period the landlord agrees to suspend the ability to seek possession under Ground 1 (Occupation by landlord or family), Ground 1A (Sale of dwelling-house) or Ground 6 (Redevelopment) of Schedule 2.
(1A) During a fixed term tenancy agreed under subsection (1) the landlord shall not be entitled to increase the rent as provided for by section 13.”
Clause stand part.
Clause 2 stand part.
David Simmonds
It is a pleasure to serve under your chairmanship, Sir Christopher. I hope the Committee will forgive me; this is the first time I have served on a Public Bill Committee as a shadow Minister. I think it is the Minister’s first time as well. I am sure we will crave your indulgence as we go forward to make sure that the Committee runs efficiently and effectively.
Amendments 48 and 54 aim to address a number of issues, relating to the situation students face when securing appropriate accommodation, that were raised both in our oral evidence sessions and in evidence that several organisations submitted to the Committee for consideration. In summary, the amendments aim to ensure a carve-out— as previously considered in deliberations on the Renters (Reform) Bill—so that not just purpose-built student accommodation but student lets more generally fall outside the direct scope of the measures in the legislation.
There are in the evidence a number of examples of how the Bill will affect the ability of students to access the accommodation that they require while they are at their place of study. International students are a significant part of our UK university financial infrastructure, and the ability for them to secure, often from another country, appropriate accommodation in advance, for a fixed period of time, and sometimes for groups of students, is extremely important, not only to them, to meet their housing needs, but to the university because of the fees they contribute.
We heard representations about the impact on students of the need to take properties off the market to make them available to rent again, which occurs largely around the time of examinations, because of the annual cycle of student accommodation. Student organisations expressed a deal of concern, particularly in the context of student mental health—a significant issue that universities are concerned about—that the pressure created would be considerable if people are required to seek new accommodation at the same time as studying for examinations. We need to ensure that the student market retains the degree of flexibility that enables student landlords to address that issue.
The Bill has a broader interaction with areas where there are student communities. Most of us will know, either from our constituencies or nearby, that where there are universities, student communities have grown up and become established and there are landlords that specifically serve that market. Accommodation that may historically have been family homes has been converted specifically for student use, with landlords who specialise in that market.
We would not wish to see that supply of student accommodation significantly diminished because, given the changes in the Bill, it may become more profitable for a landlord to make a property available to the local authority for temporary accommodation, or simply to move it entirely into a different area of the private rented market. Where there is an established market for student accommodation that is vital for the local economy and for the university, we want to make sure that that is preserved.
Finally, there is the article 4 direction issue. Because of the proliferation of houses in multiple occupation in areas proximate to universities, many local authorities have introduced controls with a view to ensuring that an appropriate supply of student accommodation remains, without other types of houses in multiple occupation springing up. That is despite the fact that the physical nature of the accommodation would lend itself to a number of different uses in that market. Ensuring a carve-out would help to guarantee the long-term supply of student accommodation, so that young people who study can secure the accommodation they need at an affordable price.
I hope I have summarised the Opposition’s thinking in tabling the amendments and look forward to hearing what the Minister has to say.
The Minister for Housing and Planning (Matthew Pennycook)
It is a pleasure to serve with you in the Chair, Sir Christopher. Before I respond to amendments 48 and 54, tabled in the name of the shadow Minister, I put on the record my thanks to the witnesses who gave up their time last week to give evidence to the Committee and inform our deliberations.
It is agreeable to serve opposite the shadow Minister. He and I are of different political persuasions and, although I hope to persuade him otherwise, I fear we may not be of the same mind regarding some aspects of this legislation. He is, however, a sincere and thoughtful individual, and I know that, even when we disagree strongly in the sittings ahead, the debate will be measured and reasonable. The same applies to other Opposition spokespeople.
As the shadow Minister clearly set out, amendment 48 seeks to amend the new section 4A that clause 1 inserts into the Housing Act 1988, to provide an exemption from the single system of periodic tenancies for those who meet the student test in new ground 4A, set out in schedule 1—that is, all full-time students, irrespective of their living arrangements. The effect would be to require such students—even those who may be the sole occupant of a rented property—to continue to have fixed terms, denying them the benefits of the new tenancy system introduced by the Bill.
The shadow Minister made the case for the amendment on the basis that we require a carve-out for the student sector. I would argue that we have introduced in the Bill a limited carve-out in the form of ground 4A ground for possession. That will ensure that non-typical students can enjoy the benefits of the new tenancy system, as well as typical students, within the limited confines of that ground for possession. It should ensure that landlords can maintain the cyclical nature of that market. As I said in the evidence sessions, I suspect that that ground for possession may be used only in limited circumstances. There is no evidence to suggest that tenants overstay their tenancies en masse. We think that limited carve-out provides what is needed to maintain the unique business model in the student sector.
Amendment 54 would have the same effect for all tenants, ostensibly on a voluntary basis, providing as it does for fixed terms in circumstances where a landlord and a tenant mutually agree to them, on the basis of possession grounds 1, 1A and 6, and rent increases under section 13 are suspended for the duration.
I am afraid I cannot accept either amendment. The Government have been clear that there is no place for fixed terms of any kind in the new tenancy regime that the Bill introduces. Fixed terms mean that tenants are locked into tenancy agreements and do not have the freedom to move should their personal circumstances require that—for example, if they want to take up a job in another part of the country or if a relationship breaks down. Fixed terms also mean that tenants must pay rent regardless of whether the property is fit to live in, reducing the incentive for unscrupulous landlords to complete repairs. As a point of principle, the Government will not deny any type of tenant, including full-time students, the rights and protections afforded to them under the new tenancy system the Bill introduces.
I also find the argument that fixed-term tenancies are more beneficial to both parties than rolling periodic tenancies utterly unconvincing. In circumstances where a responsible landlord and a good tenant have a mutual wish to sustain a tenancy over a defined period without a rent increase—the conditions that underpin the rationale for amendment 54—fixed-term tenancies would provide no clear advantages beyond those that both parties will already enjoy under periodic tenancies, as introduced by the Bill.
If the shadow Minister’s argument is instead that the benefit of fixed terms is that they ensure that a tenancy is sustained, even in the event of either party having good reason to end it—for example, if the landlord wanted to sell the property, or if a tenant wanted to buy and move into a first home—that simply exposes the unnecessary restrictions that fixed terms would impose in those circumstances, locking in either party against their interests.
Finally, I want to make it clear that amendment 54 would leave the new tenancy system open to abuse. In my view, it overlooks the power imbalance between landlords and tenants. In hot rental markets across the country the mismatch between supply and demand is acute, and one could easily imagine circumstances in which a disreputable landlord says to a tenant that the only way they are going to get the tenancy, which they may be desperately in need of, is if they take on a fixed-term tenancy. Tenants could feel forced to take on a fixed-term tenancy, perhaps without even knowing the condition of the property. I accept that the two sides of the Committee may have a legitimate and sincerely held difference of opinion on fixed-term tenancies, but I urge the shadow Minister to withdraw the amendment.
On the purpose and effect of clauses 1 and 2, the single system of periodic tenancies is at the heart of the legislation, and these clauses are key to its operation. Clause 1 provides that in future all assured tenancies will be periodic and can no longer have fixed terms. Any terms of an assured tenancy providing for the duration of the periodic tenancy to be different to the rent period—in other words, fixed terms—will be prohibited and legally unenforceable, and the tenancy will instead be a periodic tenancy. The clause also ensures that the tenancy’s periods will be the same duration as the period for which the rent is paid. Terms of a tenancy that state that the duration of the tenancy is different from the rent period will have no legal effect.
Clause 1 also limits the length of the rent period of an assured tenancy, stipulating that it must either be monthly or no more than 28 days long. Terms in a tenancy agreement that try to create a longer tenancy period will, again, be of no legal effect. Instead, the tenancy has effect as if it provided for monthly periods, with rent payable on the first day of each period. It is important to note that tenancies will be able to have periods of less than a month—which is an important feature for the social sector, where rent is more likely to be paid weekly or fortnightly—but it will not be possible to have a tenancy period of longer than one month, ensuring that disreputable or rogue landlords cannot seek to abuse the clause by demanding long rent periods to recreate fixed terms.
The new tenancy system introduced by clauses 1 and 2 —and others in chapter 1 of part 1 of the Bill—will provide tenants with greater security and stability and empower them to challenge bad practice without fear of retaliatory eviction. As long as they provide the required notice, they will be able to end the tenancy at any point. Landlords will also benefit, through more straightforward regulation, clearer and expanded possession grounds, and the requirement for tenants to provide two months’ notice, which will ensure that landlords can recoup the cost of finding a new tenant and avoid lengthy void periods.
I appreciate that some landlords and groups are concerned that tenants will misuse rolling periodic tenancies as short-term or holiday lets. That concern was expressed on Second Reading and that also arose in the oral evidence. Although I understand the general apprehension and anxiety that surrounds such a significant change to the regulation of the private rented sector, those concerns are unfounded. The notion that tenants will routinely pay up to five weeks’ deposit, complete referencing checks and commit for at least two months, simply to secure a short-term or holiday let, has always struck me as improbable to say the least. As I argued on Second Reading, tenants simply do not move home unless it is absolutely necessary. Under the new tenancy system, when they do leave, they will be required to provide two months’ notice, giving landlords sufficient time to find new tenants.
Clause 2 removes the provisions of the Housing Act 1988 that established assured shorthold tenancies, so that such tenancies cannot be created in the future. The clause also removes section 21 of the 1988 Act. In addition, it removes section 6A of that Act, which provided the mechanism by which private registered providers of social housing could apply to a court to demote tenants from an assured to an assured shorthold tenancy if they committed antisocial behaviour. The change is being made because ASTs will no longer exist once the new single system of periodic tenancies has come into force.
As a result of the assured shorthold tenancy regime, and the ever-present threat of arbitrary eviction via a section 21 notice, millions of people in England live day in, day out with the knowledge that they and their families could be uprooted from their home with little notice and minimal justification. We know that a significant minority of them are forced to live in substandard properties for fear that a complaint would lead to a retaliatory eviction.
The insecurity embedded in the current system fails both tenants looking for a stable home for their families and responsible landlords who are undercut by the minority of unscrupulous landlords willing to exploit and mistreat them. A single system of periodic tenancies will provide greater security for tenants, while retaining the important flexibility that privately rented accommodation offers. It will mean that tenants can stay in their homes for longer, build lives in their communities, save—with fewer unwanted moves—and avoid the risk of homelessness.
Removing section 21 will level the playing field between landlord and tenant, empowering tenants to challenge poor practice and unjustified rent increases. It will also incentivise landlords to engage and resolve legitimate issues of concern, given that they will be able to regain possession of a property only where there is good reason, using the clear and expanded possession grounds set out in schedule 1. With a single tenancy structure, both parties will also better understand their rights and responsibilities.
Far too many tenants are evicted from a private tenancy each year without due cause, which is why so-called no-fault section 21 notices are a leading cause of homelessness in England. As I argued on Second Reading, this broken system can no longer be tolerated, not least because the private rented sector now houses not just the young and mobile, but growing numbers of older people and families with children, for whom greater security and certainty is essential for a flourishing life. To ensure that private renters get a fair deal, we need to transform how the sector is regulated and level the playing field between landlord and tenant.
This Government will succeed where the previous Government failed, by finally modernising regulation of the sector and abolishing arbitrary evictions. I commend both clauses to the Committee.
The Chair
I assume that no one wishes to participate in the debate on clauses 1 and 2 and the amendments. Unlike in the informal hearing in which we took evidence, if people wish to participate in the debate, they must rise in their places so that I can see they wish to speak. In the absence of anyone wishing to participate in the debate, I call the shadow Minister.
David Simmonds
I thank the Minister for his comprehensive response. When we consider the history of this sector of our housing supply, it is clear that there have been many attempts by Governments over many years to address the challenges that reflect different eras. Having sought the advice of the former Member for Henley, who was the Secretary of State who introduced the assured shorthold tenancy, I know that it was originally conceived as a means of increasing supply and reducing cost, so that tenants could more easily access accommodation of the necessary quality at an affordable price. There is no doubt that it achieved that end, but we also recognise that, although according to the Government’s own figures tenants in the private rented sector expressed the highest level of satisfaction with their accommodation, compared with occupants in any housing sector, there continue to be issues that partly reflect supply but also reflect the presence of some of the unscrupulous landlords the Minister referred to.
Clearly, there is a degree of philosophical and political difference, in that we on the Opposition Benches are strongly committed to the concept of freedom of contract. We can identify many examples, including those I mentioned, where people wish—for example, because they have a fixed-term contract with particular employment —to secure accommodation for a specific period. People coming for a course of study also may wish to secure accommodation for a fixed period, especially international students who are here for a period and then wish to leave the UK to return to their families elsewhere. In such cases the opportunity to have such arrangements is significant, and it is in the interests both of the landlords who specialise in providing that type of accommodation and of the tenant themselves that freedom of contract continues to be available.
Amendment 54 explores the issue that was raised previously in Parliament by the former Member for Totnes—the Mangnall amendment. Given that, as the Minister said, the Government are not minded to accept it, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 ordered to stand part of the Bill.
Clause 2 ordered to stand part of the Bill.
Clause 3
Sections 1 and 2: effect of superior leases
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
I will be brief, as this clause is simple and straightforward. It ensures that leaseholders can continue to sub-let under the new regime where they currently have permission to do so.
Leaseholder arrangements may currently require any sub-let to be on an assured shorthold or an assured tenancy with a fixed or minimum term. The clause will enable existing sub-leases to continue under the new tenancy system once assured shorthold tenancies and fixed terms are abolished. This will ensure that leaseholders and their superior landlords are not unduly affected by the reforms and that previously agreed arrangements can continue. It will not grant rights to leaseholders to sub-let for holiday or rental accommodation unless they were able to do so before the Bill took effect. I commend the clause to the Committee.
Question put and agreed to.
Clause 3 accordingly ordered to stand part of the Bill.
Clause 4
Changes to grounds for possession
Mr Gideon Amos (Taunton and Wellington) (LD)
I beg to move amendment 77, in schedule 1, page 155, line 6, at end insert—
“(1A) In the heading of Part 1, omit ‘must’ and insert ‘may’.
(1B) Omit the heading of Part II.”
This amendment would make all grounds for repossession discretionary.
The Chair
With this it will be convenient to discuss the following:
Amendment 73, in clause 4, page 4, leave out lines 35 to 37 and insert—
“(a) omit subsection (3);
(b) in subsection (4)—
(i) omit ‘Part II of’; and
(ii) omit ‘, subject to subsections (5A) and (6) below,’”.
This amendment would make all grounds for repossession discretionary.
Amendment 74, in schedule 2, page 175, line 40, leave out from “claims),” to the end of line 41 and insert “omit subsection (6)”.
This amendment would make all grounds for repossession discretionary.
Mr Amos
It is a pleasure to serve under your chairmanship, Sir Christopher. The intention of this amendment is to make all grounds for eviction discretionary for the court. As the Committee heard from experts during oral evidence, many in the sector are concerned that none of the grounds will be discretionary.
There are a range of circumstances in which discretion would be advisable in deciding eviction cases. The tenant may be terminally ill—a cancer patient, for example—and I understand that that example was considered during the last Parliament in relation to the previous Bill. The court would have no discretion to enable a stay of eviction in that case. The tenant could have caring responsibilities, perhaps for a disabled person. Again, there would be no discretion to vary the terms of the eviction.
There could be undue hardship caused if the tenant was unable to stay for a given period. Perhaps the tenant had already arranged to move and arranged new accommodation, but that was not available on the timescale in the Bill; in that case, there would again be no discretion. The tenant might have an impending examination to sit or a work commitment that was vital to their career. Again, there would be no discretion for the courts. The tenant may be a disabled person and need extra time or support to arrange the physical burden of moving home.
In a previous discussion, the Minister talked about the importance of taking the personal circumstances of tenants into account, and that is the intent behind this amendment. The courts will not be able to take personal circumstances into account because there will be no discretion on the terms of eviction.
Parties are especially concerned about this issue in relation to grounds 1 and 1A, which concern eviction for repossession by the landlord or their family or for the sale of the property. We heard from Liz Davies KC during oral evidence that, in many cases, a tenant could have done nothing wrong but would still be subject to eviction without any discretion for the courts to vary the terms of that.
Even if the Government do not accept the amendment, I argue that there should be discretion for the courts, if not in every case of eviction, at least in exceptional circumstances. I urge the Government to take that on board in the spirit in which I have moved this amendment.
Matthew Pennycook
I thank the hon. Gentleman for tabling these amendments, which allow us to have this debate. In my view—I think this is shared across the House —landlords must have robust and clear grounds for possession where there is good reason for them to take their property back. I hope that he will appreciate the steps the Government have already taken to ensure that the grounds are fair to both parties. We have overhauled the previous Government’s Renters (Reform) Bill to provide additional protections for tenants, including longer notice periods, a longer protected period and a higher rent arrears threshold. We have also scrapped the previous Government’s harmful proposals to introduce a new ground for repeat rent arrears, and we have reduced the discretionary antisocial behaviour threshold to behaviour “capable” of causing nuisance or annoyance.
However, amendments 73, 74 and 77, which would make all grounds discretionary, are a step too far. Indeed, I never argued for all grounds to be discretionary when we considered the previous Government’s Bill. Making all grounds discretionary would mean that landlords have no certainty that they would be awarded possession even if the grounds were otherwise met. That includes in situations of serious antisocial behaviour—where the tenant has been convinced of a serious criminal offence or has broken an injunction put in place to stop their behaviour. Landlords wanting to sell or move into their property could be prevented from doing so, and specialist sectors, such as temporary and supported accommodation, would not be able to guarantee regaining possession in order to house new individuals who require their support.
I assure the hon. Member that there are still many discretionary grounds in the Bill and that judges will have discretion in less clear cases or where possession may not always be reasonable, despite the ground having been met. It is absolutely right that judges have discretion where possession takes place in those circumstances, and that includes smaller breaches of a tenancy agreement or low levels of rent arrears. I believe the steps that we have taken to protect tenants provide sufficient protections against unfair evictions. On that basis, I ask the hon. Member not to press his amendments.
Carla Denyer (Bristol Central) (Green)
I would like to speak in favour of the amendment and to bring the Minister’s attention to the evidence we received from experts, which highlighted the fact that discretionary grounds do not make it impossible for the court to award possession. In fact, in many cases, especially ones involving antisocial behaviour, it is reasonable to assume that the courts would apply a high threshold for where to exercise discretion. Nevertheless, that does not negate the principle that there may be extremely exceptional circumstances in which discretion is needed. The Government completely tying the hands of the courts so that they are unable to consider those extenuating circumstances is counterproductive.
Mr Amos
I accept what the Minister says about the Bill’s intent and that there are very limited circumstances in which discretion would be available. It is disappointing, though, that it is not recognised that courts require more discretion than is given. The Bill would provide discretion only in those very limited circumstances.
Matthew Pennycook
Perhaps I can reassure the hon. Gentleman. The mandatory grounds for possession are very limited and specific—for example, grounds 1 and 1A, where the landlord has a clear intention to move back into the property or move a family member in or to sell the property, and they have to evidence that with the court. I ask hon. Members to consider—this was put to me many times in the evidence sessions—the challenges that our courts face and the burden that this legislation places on them. Making every ground discretionary, irrespective of how reasonable it is for a landlord in those grounds 1 and 1A circumstances, for example, to take back their property quickly, risks overburdening the courts. As I say, many of the grounds remain discretionary. However, we think that there is a good reason why a certain number of mandatory grounds are in a different bracket from the discretionary one.
Mr Amos
I hear what the Minister says. The case was made forcefully by witnesses in oral evidence that the discretionary grounds for eviction are far too limited and that we need to see further discretion given to the courts. This would not prevent evictions continuing or the courts from making the decisions in accordance with the Bill’s provisions, and it would provide discretion to the courts. I urge the Government to consider widening the categories of discretion for the courts in evictions. I hope that the Government will consider that issue during the passage of the Bill, and I am happy to withdraw the amendment on that basis.
David Simmonds
I certainly do not want to imply that there would be any degree of political love-in, but on this matter, I agree with the Minister. It is worth saying for the record that we in the Opposition understand that when the courts are considering this matter, the first issue will be an evidential test: has the necessary threshold for the mandatory ground to be triggered been met? If the court’s opinion is that there is some doubt about that, clearly it has the discretion to act differently because it considers through an evidential test that the threshold has not been met.
In practice, courts deal with this matter with a high degree of discretion, as they do with all other matters that are alike. As Members of Parliament, we will be aware of situations where constituents have been victims of serious, persistent, long-term antisocial behaviour. The grounds outlined are examples where evidence has been accumulated and a court can swiftly make a decision to grant possession in order for the situation to be resolved for the wider benefit of other people affected.
We therefore support the Government’s position that the mandatory grounds should be framed in this way and that moving to make all grounds discretionary would add an element of doubt over and above the evidential test. That would, in turn, enable those who wish to perpetrate long-term antisocial behaviour to get away with it for a longer period of time.
Mr Amos
I beg to move amendment 68, in clause 4, page 5, line 40, at end insert—
“(fa) after subsection (5A), insert—
‘(5B) Where the court makes an order for possession on grounds 1 or 1A in Schedule 2 to this Act (whether with or without other grounds), the order shall include a requirement on the landlord to file and serve evidence no later than sixteen weeks from the date of the order.
(5C) Evidence provided under subsection (5B) must—
(a) provide details of—
(i) the state of occupation of the dwelling-house since the date of the order, and
(ii) the progress of any sale of the dwelling-house, and
(b) be accompanied by a statement of truth signed by the landlord.’”
The Chair
With this it will be convenient to discuss amendment 69, in clause 4, page 5, line 41, at end insert—
“(2A) After section 7, insert—
‘7A Evidential requirements for Grounds 1 and 1A
(1) The court shall not make an order for possession on grounds 1 or 1A in Schedule 2 to this Act unless the landlord has complied with subsections (2) to (4) below.
(2) Where the landlord has served a notice for possession on grounds 1 or 1A, the court must be provided with evidence verified by a statement of truth signed by the landlord.
(3) Where the landlord has served a notice for possession on ground 1 and the dwelling house is required by a member of the landlord’s family as defined in paragraphs 2(b) to (d) of that ground, the court must be provided with evidence verified by a statement of truth signed by that family member.
(4) Where the landlord has served a notice for possession on ground 1A, the evidence referred to in sub-section (2) must include a letter of engagement from a solicitor or estate agent concerning the sale of the dwelling house.’”
Mr Amos
The amendment’s purpose is to require the evidence to be provided by landlords on grounds 1 and 1A, in the case of occupying the home or selling the property, to be clearly stated in the Bill, so that it is clear what evidence needs to be provided and the test is clearly stated. The Government have indicated that the evidence required will be contained in guidance, but it would significantly reassure Members in this House and in the other place if we could see the evidential test for landlords to gain possession. The amendment sets out the need for a statement of truth and suggests that a letter of engagement from a solicitor in the sale of a property is the kind of evidence that should be in the Bill. I believe the amendment is self-explanatory in that regard.
Matthew Pennycook
While I appreciate the sentiments behind the amendments—indeed, as a shadow Minister, I probed the previous Government on this point when discussing the previous Bill—on reflection, I do not think they are the right approach for the following reason, which relates to the previous debate. We have overhauled the Bill in a number of ways to strengthen protections for tenants, and we must be careful about tipping the balance too far the other way and penalising good landlords, who, in certain circumstances, have a right to certainty that they will get their property back and that this will move through the courts in an orderly fashion.
Amendment 68 is an attempt to deter abuse of grounds 1 and 1A, which is an honourable intention. It seeks to require landlords to present further evidence that they have fulfilled the grounds after the possession order has been granted. It does not detail what should happen if a landlord does not present the evidence. Furthermore, it will have no impact on cases that do not make it to court. Where a landlord has obtained a possession order through the courts, they will already have presented evidence to a court to satisfy a judge of their intent to meet the grounds. The amendment would also place an additional burden on courts, which would need to set up new processes to deal with the evidence, taking time away from progressing possession claims.
The hon. Member for Taunton and Wellington asked me to consider whether grounds that are currently mandatory should be discretionary, and I thought very carefully about which grounds should be discretionary and which mandatory when developing and overhauling this piece of legislation over recent months. On the basis of that reflection, I have concluded that increasing the prohibition on remarketing and reletting a property after using these grounds, including in cases that do not reach court, is a better mechanism for preventing abuse than adding requirements for evidence. This will allow a tenant to take action if they see, for example, their property advertised online following eviction.
Amendment 69 seeks to put into legislation prescribed evidential requirements for grounds 1 and 1A. We just had a discussion about how we should trust judges and their judgment on these matters. I believe that judges are best placed to consider and determine the evidence before them on these mandatory grounds. Setting an enhanced evidence threshold may mean that judges are less likely to consider wider evidence, and it could inadvertently lower the threshold where an eviction is ordered. It is right that judges have the discretion to respond to the evidence provided on a case-by-case basis. That is what the Bill provides for, and I therefore ask the hon. Member to withdraw his amendment.
Mr Amos
The Minister says that the amendment does not include what would happen if the evidence was not provided—clearly, the evidence would not be there and the case would be weakened on that basis. I contest the idea that this is an onerous or burdensome requirement. The statement of truth is an extremely simple document—many on the Committee will have seen them—that can be produced easily and at little expense. I also contest the idea that courts need separate processes to look at statements of truth. They look at statements of truth all day, every day; new processes are not required.
The engagement of a solicitor in the sale of a property is not a particularly onerous requirement on someone selling their property. I assume that the person selling the property would, in any event, have to engage a solicitor, and would therefore need a letter of engagement. It is not an onerous requirement in any shape or form. The Minister said that judges would have less discretion. Again, I contest that, because judges would simply have more evidence in front of them; it would not have any effect on the amount of discretion that judges have. I urge the Minister to continue considering the issue, but I can do the maths, so I am happy to withdraw the amendment.
David Simmonds
Again, I agree with the Government on this matter. A lot of residential property transactions are undertaken by licensed conveyancers rather than by solicitors. That is a much more affordable and efficient option, often done on a fixed-fee basis, and that is particularly relevant to smaller landlords. Introducing a requirement that a solicitor must be used would be unduly onerous and would inhibit the number of transactions in the market.
Matthew Pennycook
I wish to provide further reassurance to the hon. Member for Taunton and Wellington, because I fear that we are dancing on the head of a pin here. Under the provisions in the Bill, judges will have to consider evidence to justify the use of mandatory grounds 1 and 1A. When I gave evidence to the Committee, I provided examples of the types of evidence that judges may require. It is up to individual judges to ask for that evidence and to make a decision on the basis of what is put in front of them. We trust judges to do that. With regard to the hon. Gentleman’s amendment, I do not accept the idea that judges are not looking at evidence and not ensuring that the use of these grounds is properly justified. That is misplaced, so I am glad he has indicated that he will withdraw the amendment.
David Simmonds
I beg to move amendment 56, in clause 4, page 6, line 14, leave out “1A,”.
The Chair
With this it will be convenient to discuss the following:
Amendment 70, in clause 4, page 6, line 15, leave out “4A,”.
Amendment 57, in clause 4, page 6, line 16, at beginning insert “1A,”.
Amendment 71, in clause 4, page 6, line 20, after “4,” insert “4A,”.
David Simmonds
These amendments relate similarly to the issue of notice periods for grounds for sale. It is important to recognise that a very significant part of our housing supply continues to come from the private rented sector—in particular, from the buy-to-let market. Drawing on my experience as a financial adviser, one of the key issues for lenders in advancing buy-to-let mortgages arises because of the risks associated with them—in essence, people are much more likely to pay their mortgage payments on their own home than when they are borrowing to secure a home for investment purposes—so there is a risk premium, or a rating, on the mortgage interest. Consequently, a significant supply of finance is required to support the development of the buy-to-let market.
The introduction of significant restrictions on the length of notice periods will mean that when there is a default on those payments and they are not being made, it will be more difficult for the possession for the purposes of sale and the settlement of the outstanding debt to the bank to be progressed. That could have a chilling effect on the ability to secure finance and, in turn, an impact on the supply of properties available to those needing to secure a home in the private rented sector.
Once again, it is part of a broader, small “p”, philosophical and political argument. We are very much of the view that securing the maximum possible supply is very important, and we need to strike the correct balance so that we do not see a chilling effect having the unintended consequence of a reduction in supply.
Matthew Pennycook
As the hon. Gentleman has just made clear, amendments 56 and 57 seek to reduce the notice period for the selling ground 1A from four months to two months. The Government believe that the notice period for tenants being evicted through no fault of their own should be four months, to give them adequate time to find new accommodation. An eviction notice can turn a family’s life upside down, and four months means they will not be forced to move during a school term. I draw the Committee’s attention to the remarks I made previously about the changing nature of the private rented system and the fact that more older people and families now live in it compared with the situation in the late ’80s, when the system was introduced.
Selling a property is often a long-term decision that involves significant planning on the part of landlords. We do not believe that landlords are likely to need to evict tenants with only two months’ notice, given the time it takes to secure a sale. They also have the option of selling with tenants in situ.
Amendments 70 and 71 were tabled by the hon. Member for Taunton and Wellington. They would make an extreme change that would reduce the notice period for the new student ground 4A to a mere two weeks from the current four months.
The Government believe that students are just as deserving of adequate notice as other tenants. The purpose of the student ground is to try to balance security of tenure with the need to preserve the annual cycle of typical student tenancies. These amendments do not assist the ground in that purpose at all. Student landlords plan their business models long term around the academic year, and after our reforms will factor the four-month notice into their planning.
There is no circumstance where a competent student landlord would suddenly need to evict tenants in line with the academic year with only two weeks’ notice. Indeed, currently they have to give two months’ notice under section 21. The hon. Gentleman’s amendment is a retrograde step vis-à-vis the current iniquitous arrangements that we are trying to undo.
Students often lack the capital to organise a move at short notice. A two-week notice period means it is likely they are given notice to leave during the summer break when they might be working, or even during their exams. We believe that it is right that they have four months’ notice to organise their move.
I therefore ask the hon. Members not to press their amendments.
Mr Amos
Amendments 70 and 71 would align the two weeks’ notice for students in HMOs with the two weeks’ notice that the Bill provides that students would have in purpose-built student accommodation. All the points that the Minister has made in relation to the short-term notice period apply to the Bill because that is the Government’s intent in relation to purpose-built student accommodation. The amendments would simply align those properties under HMO ownership with those that are university or purpose-built student accommodation.
Landlords of HMO accommodation are likely to be smaller businesses than universities. Under the provisions in the Bill, universities would enjoy much greater flexibility on eviction than much smaller landlords, who would suffer as a result.
My concern is that there would be a reduction in the amount of student accommodation because of those very different terms on which HMO landlords would be able to let their properties to students compared with other tenants. Any reduction in the availability of supply of student accommodation, particularly in university towns, would have a serious impact on family housing, which is of course often occupied by students, much to the chagrin of residents who are looking for family homes.
It is vitally important that an unintended consequence of the Bill is not the reduction in supply of student accommodation. That is why we seek alignment with what the Bill provides for purpose-built student accommodation.
I urge the Government to consider reducing, if not to two weeks, then to two months, the grounds for eviction in other student accommodation, so that it is more closely aligned with the provisions that the Bill makes for the majority of student accommodation. I urge the Government to consider that and I will not press the amendment.
Matthew Pennycook
I will consider that matter further. To be candid with the Committee, some judgments on provisions relating to student accommodation are finely balanced. We are trying to strike a balance between giving student tenants the right level of security while maintaining that annual cyclical nature of student accommodation.
As the hon. Gentleman knows, we are treating purpose-built student accommodation differently from that of students living in the general PRS. We recognise the limited market for such accommodation. Regarding students in the general PRS, I am reluctant to accept the hon. Gentleman’s advice. Student landlords will adapt to the system and factor the four-month notice period into their business models. I am happy, however, to reflect further on the arguments he made.
David Simmonds
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Matthew Pennycook
I beg to move amendment 1, in clause 4, page 7, line 6, at end insert—
“(5) After section 11 of the 1988 Act insert—
‘11A Possession on ground 6A: compensation of tenant
(1) This section applies where a court makes an order for possession of a dwelling-house let on an assured tenancy on Ground 6A in Schedule 2 to this Act (whether or not the order is also made on any other ground).
(2) The court may order the landlord to pay to the tenant such sum as appears sufficient as compensation for damage or loss sustained by that tenant as a result of the order for possession.
(3) In deciding whether to make an order under this section, and what compensation to order, the court must (in particular) take into account the circumstances which led to Ground 6A being available as a ground for making an order for possession (including any conduct by the tenant which caused or contributed to Ground 6A being available).’”
This gives the court power to order the landlord to pay compensation to the tenant where possession is obtained on Ground 6A (failure of premises to comply with planning requirements etc).
Matthew Pennycook
Without the threat of arbitrary section 21 evictions, tenants will be evicted only when landlords have reasonable grounds for doing so. Clause 4 amends the grounds for possession in schedule 2 of the Housing Act 1988. The grounds themselves are amended by schedule 1 of the Bill, which we will debate shortly. Most crucially, clause 4 sets out the notice periods for the grounds for possession. It extends notice periods for the main grounds where the tenant is not at fault, including where a landlord wishes to move in or sell the property.
In the current system, tenants can be evicted with as little as two months’ notice, even when they have done absolutely nothing wrong. In future, landlords will usually need to provide four months’ notice when the tenant is not at fault, such as when a landlord wants to sell or move in. Longer notice periods are critical to ensure that tenants have time to find alternative housing.
The previous Government’s Renters (Reform) Bill did not propose longer notice periods, maintaining the two months’ notice tenants face under existing section 21 arrangements. That was one of the main concerns expressed by the Opposition at the time, as well as by groups such as Shelter and Generation Rent. I am pleased to say we have addressed their concerns here. Crucially, four-month notice periods will also mean that families with children will never be forced to move during school term time when they are not at fault. That is fundamentally a matter of fairness from the Government’s point of view. Children’s education should not be disrupted simply to allow for the quicker sale of property, or to have another individual move in. Correcting that is at the heart of the Government’s opportunity mission.
The notice periods for the rent arrears ground will be increased from two weeks to four weeks. That will give vulnerable tenants who are struggling to pay their rent longer to find funds or alternative accommodation. I am confident that that will not burden landlords unfairly, and will give a little more time to tenants to find new accommodation if necessary, or to repay their arrears.
When landlords and communities are faced with antisocial behaviour, landlords will be able to make a possession claim to the court immediately. That will ensure that poor behaviour can be dealt with swiftly. That is currently only the case for the discretionary ASB ground 14, but we are expanding it to the mandatory ASB ground 7A, for which very serious behaviour must have occurred. It is a peculiar quirk of the current legislation that the discretionary ground allows landlords to take action more swiftly than the mandatory ground where tenants have committed very serious crimes. The clause would end that anomaly.
We acknowledge that permitting landlords to seek possession immediately, although appropriate, will not give tenants long to seek legal advice on their situation, or find a new home. The court will therefore not be able to make an order for possession that takes effect within 14 days from when the landlord serves notice on the tenant. In addition to notice periods, clause 4 would make provision for specific circumstances of possession. For example, the clause would ensure that superior landlords can continue possession claims made by an intermediate landlord, even after the head tenancy has expired. That will ensue that superior landlords requiring vacant possession will not have to begin a new claim when the intermediate landlord has already done so.
Finally, clause 4 would make further and consequential changes to the Housing Act 1988, to reflect wider changes made by the Bill, including the abolition of fixed-term tenancies and the introduction of new grounds for possession. That includes ensuring that protections for Case A tenants under the Agricultural Holdings Act 1986 continue in the new system.
Members of the Committee might wonder what the wording in subsection (4),
“Disapplication of conditions where notice dispensed with”,
is designed to achieve. The use of certain grounds, including ground 4A, 5G and 6, hinges on the serving of valid notice. However, section 8 of the Housing Act 1988 permits a court to dispense with a notice requirement when it is reasonable to do so. This change will ensure that the grounds continue to work when this dispensation has occurred. The changes we are making in clause 4 will give tenants more time to find a place to live while ensuring that landlords can recover possession in a timely way when they have a legitimate reason to seek possession. That will ensure that the system works as intended.
David Simmonds
The Opposition supports the vast majority of these measures. We all recognise situations where a landlord is in breach of planning regulations, resulting in a property being overcrowded and potentially being turned into an HMO without the appropriate licence and so on, which can bedevil our constituents. It seems appropriate to take these steps to raise the stakes for landlords who seek to behave in that manner and drive them out of the market.
Matthew Pennycook
I do not have much to add to what I have already said. I commend the clause to the Committee.
Amendment 1 agreed to.
Clause 4, as amended, ordered to stand part of the Bill.
Schedule 1
Changes to grounds for possession
Carla Denyer
I beg to move amendment 42, in schedule 1, page 155, line 9, leave out “1 year” and insert “2 years”.
This amendment would increase the minimum period before a landlord can use certain grounds for possession from 12 months to 2 years.
The Chair
With this it will be convenient to discuss the following:
Amendment 58, in schedule 1, page 156, leave out lines 14 to 16.
Amendment 43, in schedule 1, page 156, line 15, leave out “1 year” and insert “2 years”.
This amendment would increase the minimum period before a landlord can use certain grounds for possession from 12 months to 2 years.
Carla Denyer
The Bill rightly seeks to address the fact that tenants do not have security in their homes. Amendments 42 and 43 would amend schedule 1 to lengthen the proposed period of protection against eviction under grounds 1 and 1A from one year to two years. This would be just one measure to start to address insecurity of tenure. It is worth recalling that the King’s Speech background briefing notes explain that one of the primary aims of the Bill is to increase tenant security and stability.
Private renting does not have to be insecure. The median length of tenancy in the UK is just under three years, while the average in Germany is 11 years. Insecurity erodes renters’ sense of belonging, and constant moving has a heavy financial cost. For children who are in privately rented homes—the Minister pointed out that they make up an increasing proportion of private renters—this insecurity takes a wider toll. Each school move at a non-standard time of year reduces expected GCSE grades by 0.5. Shelter has found that 13% of tenants with children in their household said that their last house move was stressful or upsetting for their child.
The Committee will no doubt be aware that constant moving is a major problem for private renters. Research by Shelter in 2022 found that a quarter of all private renters had lived in three or more privately rented homes in the previous five years—three different homes in five years. Amendments 42 and 43 are part of an effort to urgently change the renting culture and our ideas about what is acceptable when a property is rented out as someone’s home. I hope the Minister will look at them, not least because a central aim of the Bill is about addressing the deep unfairness of private tenant insecurity.
That unfairness is a massive problem in my constituency of Bristol Central, where a huge 47% of households are in the private rented sector. It affects many people. To give just two examples, a constituent I spoke to had to move six times in six years, and another constituent literally received her notice as she was moving her possessions into her new flat. That is unacceptable. Security is vital to allow renters to put down roots in their community and plan for the future. It is clear from the evidence gathered by the Renters’ Reform Coalition that the vast majority of tenants want security and the power to decide when to move on. They do not want the anxiety, discomfort and expense of being forced to move by a distorted, malfunctioning market.
Unwanted, unexpected home moves are stressful and costly. Generation Rent estimated in its evidence that an unwanted move costs a typical two-adult renting household more than £2,000. Almost half of renters have no savings at all. Moving frequently or a short period of time after the previous move impacts tenants’ financial resilience. For many, those costs are prohibitive and will push them into homelessness, not least because finding somewhere new can often prove impossible or mean accepting dangerous, substandard accommodation. To give one example among many from my constituents, after months of searching with no luck, a constituent and her partner had to settle for a grim place with an “unshakeable smell of damp” that made almost everything she owned “fuzzy with mould”.
Competition for properties in the private rented sector is fierce. Tenants often have little time in which to find a new home and little power to influence the terms of their tenancy agreements. They often sign 12 or six-month contracts under the current regime simply because that is the only option available to them, not because they actively prefer to be protected for only one year. Many tenants would prefer long-term security in their home. The proposed two-year protected period in amendment 42, coupled with rolling tenancies, would allow tenants a combination of flexibility and security.
We should reflect that the two-year protected period I am proposing is not radical or new—far from it. It was what was initially proposed in the former Conservative Government’s 2019 consultation, “A new deal for renting”, to ensure that security of tenure for tenants would not be undermined once fixed-term tenancies come to an end. However, when legislation was eventually brought forward, that Government watered down the protected period to just six months. The current Minister, then a shadow Minister, rightly supported a two-year protected period with regards to grounds 1 and 1A in the Renters (Reform) Bill Committee.
As well understanding its history, it is important to reflect on the fact that a longer protected period has the potential to drive professionalism in the sector. As ever, good landlords have nothing to fear from this provision. A two-year measure of security at the beginning of a tenancy is needed to create a disincentive for any abuse of the exemptions to no-fault eviction, and it would be a triple win: better for renters, for the local communities they move into, and for homelessness reduction.
The Renters’ Rights Bill is a once-in-a-generation opportunity to set out clear principles for the roles of both landlord and tenant and to develop a regulatory regime that reflects and incentivises that vision. While some landlords will have to make changes to their business plans, a two-year protected period should not amount to a significant change for many landlords or interfere with their business model. In the Renters (Reform) Bill Committee, when speaking to his amendment to create a two-year protected period, the hon. Member for Greenwich and Woolwich rightly said:
“We believe that any landlord likely to use ground 1 or 1A in good faith will have some prior awareness that they or a family member may need the property for use at some point in the coming years, or that they may wish to sell it in the near future.”––[Official Report, Renters (Reform) Public Bill Committee, 21 November 2023; c. 173.]
Buy-to-let mortgages are often made available at fixed rates for two years or longer and, currently, the average tenancy in the private rented sector is longer than two years. This should not be overly disruptive, and it can provide much-needed stability for those in most need of it.
To conclude, the change to a two-year protected period would be one of the most important things the Government could implement in the Bill to more fully deliver on their ambition to decisively rebalance renting in favour of renters. The amendment seeks to understand the reasoning behind the proposal for a protected period of one year rather than two years, as was the Minister’s position previously. While 12 months is obviously an improvement on six, we can do better to improve the security of private renting, which has such a big impact on tenants’ health, wellbeing and life choices.
David Simmonds
I rise to speak to amendment 58. In general terms, I am very sympathetic to the points made by the hon. Member for Bristol Central. In comparison with the UK housing market, most European countries have a much higher degree of long-term rental as part of their housing supply. The UK has a more mixed supply with a more significant owner-occupation sector. That is a challenge for the new Government, as it was for previous Governments, as we see overall demographic change bringing us a bit more in line with the housing markets of other countries. The UK, however, still remains significantly adrift of that position, which is why I am concerned that the hon. Lady’s amendments would potentially have, as with mortgage finance, a chilling effect on supply.
Carla Denyer
Would the hon. Gentleman be able to speak slightly louder? It is difficult to hear down here.
The Chair
Was the hon. Gentleman able to hear what the hon. Member for Bristol Central said?
David Simmonds
I shall do my best. It may be that, although seeking to comply with the rule of speaking to the Chair, I need to turn around more regularly to address the Committee. The point I was making is that while we have a lot of sympathy with the points made by the hon. Member for Bristol Central, given that the changing nature of the UK rental market will result in these becoming more significant issues, we believe the issue of notice periods needs to be addressed through amendment 58.
Matthew Pennycook
As the hon. Member for Bristol Central has set out, amendments 42 and 43 seek to extend the protected period for the moving in and selling grounds to two years. Amendment 58, in contrast, seeks to remove the protected period for the selling ground entirely. We believe that the Bill strikes the right balance in this area.
The hon. Member for Bristol Central is right that during debate on the Renters (Reform) Bill, I probed the then-Government on increasing protections for tenants beyond the six months they had proposed. I did so given the relative lack of security that that Bill afforded to tenants, which we have improved on. I reflected very carefully on this point in the development of the Bill. Viewed in the context of the many strengths and protections that we have introduced to benefit tenants, I feel that a one-year protection period against the main landlord circumstances ground—this is not a general period of protection that applies to any arbitrary eviction, but is specific to grounds 1 and 1A—strikes the right balance between tenant security and ensuring that landlords can respond to genuine changes in their circumstances.
The shadow Minister highlighted the thinking that has led to me coming down to one year, instead of remaining with two. A two-year protected period for the moving and selling grounds is, I fear, too long. It would prevent landlords from being able to respond to changes in circumstances, and therefore harm confidence in the sector and risk decreasing supply. In some circumstances, landlords may only be able to let their property for a year—for example, if they temporarily moved abroad—and a longer period may therefore remove valuable supply from the market.
Most importantly, I was convinced that a one-year protected period would deter abuse from disreputable landlords seeking to circumvent the protections in place. The one-year protected period mirrors the typical one-year fixed-term tenancy. We think it strikes the right balance, but I am more than happy to give further consideration to the points made by the hon. Member for Bristol Central. I sympathise with and understand the significant costs borne by tenants from repeated moves. I understand, as I hope I have made clear in the debate so far, the need for stability and security, but we think that in this particular area, the one-year protected period is appropriate.
Carla Denyer
I thank the Minister for his response. I, too, have spent a lot of time reflecting on the potential effects of the amendment, including thinking about potential edge cases, exactly as he described.
Imagine someone who became an unintentional landlord, perhaps because after buying their home, they got seconded to another country for work for a year or two. While I recognise that it might be inconvenient for a landlord to have a two-year limit, it is also inconvenient for a tenant to have instability of tenure. If someone is, for example, seconded to work abroad for a year or two, with a fixed date of return to be back in their own property, they have to consider their responsibility to provide stable housing for their tenants. If they are not able to do that for a long enough time for the tenant not to be subjected to undue costs and effects on their health, stability, education and so on, maybe the landlord needs to look into short-term lets, rather than creating a situation where somebody believes they are making a permanent home. Say that person was going abroad for a year and a half, and the limit is two years—they might have to find somewhere else to live for a few months before moving back in. Yes, that would be an inconvenience, but we have to weigh that against the huge inconvenience for tenants who have their only home constantly disrupted and moved around.
I ask the Minister to look at this again, and to think about the edge cases, as well as where the greatest inconvenience and injustice really lies between the landlord and the tenant. I would be happy to have a chat with him. I will not press the amendment to a vote this morning.
Matthew Pennycook
I thank the hon. Lady for her further contribution. I have weighed very carefully in the balance, and looking at the Bill in the round, whether a two-year protected period would be appropriate. I concluded it would not be, taking into account those edge cases, for the following reasons.
While I sympathise with the point the hon. Lady made about the very significant costs that tenants face with moves, and while we obviously need to ensure that tenants under the new system have the requisite amount of stability and security, she too readily dismisses the potential impact on supply in the sector. It would be inconvenient for landlords; it would be inconvenient for tenants more widely if we saw a subsection of landlords that feel that they may need to use ground 1A and would not put their property on the rental market because of the possibility that they will need to use it.
As we heard in the evidence sessions, such is the acute nature of particularly hot rental markets across the country—hers will be one; mine is another—that if we lose a chunk of supply because we say to landlords, “It is too costly, too risky for you to put your property on the market if you may need to go abroad and work for a year,” that would be to the detriment of tenants in the round.
I think the one-year period strikes the right balance. It mirrors the sort of typical fixed-term, one-year tenancy. I urge the hon. Lady to go away and think about whether, in the round, with all of the protections we have introduced vis-à-vis the previous Government’s Bill, the one-year protected period does not do enough. We will not accept the amendment. I will, however, further reflect on the points she made because, as I have said, I am sympathetic to them and had weighed up two-year protected tenancies in the context of the previous Government’s Bill, but I think, looking at this Bill in the round, one year is the appropriate period.
Carla Denyer
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Matthew Pennycook
I beg to move amendment 2, in schedule 1, page 157, leave out line 13.
This allows Ground 1B to be used to obtain possession whenever the landlord intends to grant an assured tenancy to another person (whether or not it is to be granted pursuant to a rent-to-buy agreement).
Matthew Pennycook
I will begin by discussing Government amendments 2, 3, 4, 5 and 9. Rent-to-buy tenancies help prospective homeowners to get on the housing ladder. New possession ground 1B will allow social landlords to take possession in specified circumstances, to ensure that rent-to-buy schemes can continue to function in the future assured regime. Landlords must be able to take possession in all the necessary circumstances. The amendments therefore widen ground 1B, so that landlords can simply grant another assured tenancy, without its having to be on a rent-to-buy scheme. That will ensure maximum flexibility for social landlords to meet the demands of local housing markets. However, the period of the existing rent-to-buy tenancy will need to have expired and the sitting tenant must have been offered the opportunity to purchase the property, in line with the contract. This means that it will never be a surprise for the rent-to-buy tenant if the tenancy is ended. The amendments also clarify the definition of “market rent” in possession grounds 1B and 5H, to ensure clarity and consistency.
I will now discuss Government amendments 6 to 8. New ground 6A will allow landlords to evict their tenants when eviction is necessary to comply with enforcement action. We have already debated this matter in relation to a previous Government amendment. For example, if a property were overcrowded or the landlord had received a banning order, new ground 6A would apply. The amendments ensure that the new ground also covers situations in which a tenant’s occupation needs to be brought to an end in order to comply with planning enforcement action. For example, where an industrial unit has been converted to residential use without planning permission, a local planning authority may issue an enforcement notice requiring the residential use to cease.
If planning enforcement were not included in ground 6A, there would be no guarantee that the landlord could evict the tenant in those circumstances. That would risk undermining the planning system’s ability to enforce effectively against unauthorised development. That could result in poor outcomes for residents, the community and surrounding businesses. This measure will ensure that landlords are not left in legal limbo, where the only way to comply with planning enforcement action is for a tenant to cease to occupy a dwelling, and ensures that the tenancy itself can be brought to an end appropriately. We are also bringing forward an amendment to ensure that tenants are fairly compensated when they are evicted under ground 6A, ensuring that the measures are balanced.
Amendment 2 agreed to.
Amendments made: 3, in schedule 1, page 157, leave out line 30.
This leaves the definition of “market rent” out of Ground 1B, as it is superseded by Amendment 4.
Amendment 4, in schedule 1, page 157, line 33, after “rent” insert
“(and here “rent” and “market rent” include any amount payable by way of service charge)”.
This ensures that any service charge is taken into account in both the rent and the market rent (when determining whether the rent is higher than 80% of the market rent).
Amendment 5, in schedule 1, page 165, line 18, leave out from “than” to “, and” in line 22 and insert
“80% of market rent (and here “rent” and “market rent” include any amount payable by way of service charge)”.—(Matthew Pennycook.)
This replaces the term “affordable rent” with a reference to rent that is no more than 80% of the market rent.
David Simmonds
I beg to move amendment 60, in schedule 1, page 168, line 26, at end insert—
“20A After Ground 6 insert—
“Ground 6ZA
The landlord or superior landlord who is seeking possession intends to undertake such works as are necessary to ensure that the property meets the standards set out by regulations under section 2A of the Housing Act 2004 and the intended work cannot reasonably be carried out without the tenant giving up possession of the dwelling-house because—
(a) the tenant is not willing to agree to such a variation of the terms of the tenancy as would give such access and other facilities as would permit the intended work to be carried out, or
(b) the nature of the intended work is such that no such variation is practicable, or
(c) the tenant is not willing to accept an assured tenancy of such part only of the dwelling-house (in this sub-paragraph referred to as “the reduced part”) as would leave in the possession of his landlord so much of the dwelling-house as would be reasonable to enable the intended work to be carried out and, where appropriate, as would give such access and other facilities over the reduced part as would permit the intended work to be carried out, or
(d) the nature of the intended work is such that such a tenancy is not practicable.””
I have realised, in the course of debate, that the Minister has the benefit of being a bit closer to the overhead microphones than I am, so I will do my best to direct my remarks in a skywards manner, Sir Christopher.
The amendment seeks to bring in additional grounds for possession, and it is partly on the basis of evidence that we are aware of as a Committee and which stems from the social sector, where we know that there are many examples of landlords, including local authorities, that have to go to enormous lengths to access a property to carry out basic maintenance—often, in the case of local authorities, at no cost to the tenant, who is a council tenant—and to ensure that minimum safety standards, for example gas inspections, electrical safety inspections and remedial works to deal with issues such as damp and mould, are applied. We know that there has been extensive debate and consideration of evidence in relation to Awaab’s law and the need to ensure that properties meet the decent homes standard. Therefore the aim of this proposal is to ensure, where it is necessary for a landlord to recover the property in order for those works to be carried out and the tenant does not wish to co-operate, that there is provision in the Bill to achieve that.
Matthew Pennycook
As the shadow Minister just made clear, amendment 60 would introduce a new mandatory ground for possession—6ZA—into schedule 2 of the Housing Act 1988. It would allow landlords to evict when they need to undertake works to meet the decent homes standard introduced by the Bill and those works cannot be completed without evicting the tenant. The objective that the hon. Gentleman seeks is reasonable and appropriate, but the Government do not believe that the ground is needed. I expect that the vast majority of works to meet decency requirements could be completed with the tenant in situ. Landlords may also undertake more substantial works between tenancies.
The proposed new ground is also unnecessary in the light of ground 6. The Bill’s revised ground 6 already permits a landlord to evict a tenant when they wish to undertake substantial redevelopment work that cannot be done with the tenant in situ. I am therefore reluctant to introduce a new ground that is not strictly needed, given what is in place in the Bill. However, I hope I have provided the Committee with sufficient reassurance that landlords will not be left unable to comply with the new decency requirements, as I say, in circumstances where the tenant must move out.
David Simmonds
I want to probe the Minister a bit on the point about substantial redevelopment. We are aware that to remedy issues of damp, for example, it is not uncommon for a landlord to need to remove all the plaster and potentially take out the flooring or ceiling for a lengthy period of dehumidification. Following that, extensive works would need to be undertaken to ensure that the damp does not reoccur. Those works being completed does not represent redevelopment of the property by, for example, building an extension or adding an additional floor, but leave the property substantially the same as before. It therefore does not seem to us that it would meet the test of redevelopment envisaged in the Bill.
The argument we are advancing is that in examples that may represent a significant risk to the health or safety of the tenant but the tenant does not wish to move, we need those additional grounds to be absolutely clear that that is a reasonable basis on which a landlord can seek to regain their property, so that they can carry out those works.
Matthew Pennycook
I thank the shadow Minister for that intervention, and I understand the point he makes. If it is acceptable to him, I will write to him with the technical detail about what substantial development entails. As I say, in most cases where substantial development is not taking place, works to ensure that homes come up to the new decent homes standard will be able to take place in situ. On the specific hard-edged case he mentions—that is, where the health and safety of a tenant is put at risk by the works required to take place or the conditions that the works are intended to remedy—I point him to provisions in the Bill like the extension of Awaab’s law, which will ensure that landlords have to respond to such hazards in a defined timescale and make accommodation for the tenant to move out in such circumstances. What I am reluctant to do here is to introduce a new ground that would have a substantial impact on tenants. They would have to leave the property and find new accommodation, and they might be owed a homelessness duty in those circumstances. That is a huge amount of disruption.
As I say, we think the existing provisions in the Bill do the job, but on the point he makes, which is a well-made one, as to precisely what the definition is and where the boundary lies between substantial and non-substantial redevelopment works, I will write to him with some more technical detail. I therefore ask the hon. Member to withdraw his amendment.
David Simmonds
On the basis of those assurances, I will withdraw the amendment. Clearly, we will have the opportunity to return to this debate later on. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendments made: 6, in schedule 1, page 168, line 30, leave out “situations has occurred” and insert “applies”.
This changes the opening wording so that it works better with the provision which follows.
Amendment 7, in schedule 1, page 169, line 30, at end insert—
“(g) compliance with a planning enforcement notice or injunction would be, or is, incompatible with continued occupation of the dwelling-house by the tenant.”
This enables the landlord to obtain possession where planning enforcement action has been taken and compliance with that action would be incompatible with continued occupation under the tenancy.
Amendment 8, in schedule 1, page 169, line 37, at end insert—
““planning enforcement notice or injunction” means—
(a) an enforcement notice issued under section 172 or 182 of the TCPA 1990 that has taken effect,
(b) a breach of condition notice served under section 187A of the TCPA 1990,
(c) an injunction granted under section 187B of the TCPA 1990,
(d) a listed building enforcement notice issued under section 38, 45 or 46 of the P(LBCA)A 1990 that has taken effect, or
(e) an injunction granted under section 44A of the P(LBCA)A 1990;
“P(LBCA)A 1990” means the Planning (Listed Building and Conservation Areas) Act 1990;
“TCPA 1990” means the Town and Country Planning Act 1990;” .—(Matthew Pennycook.)
This defines the term “planning enforcement notice or injunction” which is used in Amendment 7.
David Simmonds
I beg to move amendment 62, in schedule 1, page 170, line 3, at end insert—
“(za) for the first unnumbered paragraph, substitute—
‘At the date of the service of the notice under section 8 of this Act relating to the proceedings for possession—’”.
The Chair
With this it will be convenient to discuss amendment 63, in schedule 1, page 170, line 6, at end insert—
“(ba) in paragraph (b), at end insert ‘and at the date of the hearing any rent is unpaid.’”
David Simmonds
Amendments 62 and 63 also deal with grounds for possession. Amendment 62 is intended to address situations where possession of a property may be required for persons on whom the landlord may rely in order to carry on living their lives, such as a carer. We heard evidence from organisations representing landlords in the more rural parts of our country on situations where grounds for possession may be necessary to enable a person with caring responsibilities to occupy the property.
Amendment 63 deals with a similar process in respect of antisocial behaviour. We have already debated the issue extensively, so I will not speak further to that amendment now.
Matthew Pennycook
Taken together, amendments 62 and 63 seek to remove the requirement for a tenant to meet the arrears threshold for mandatory eviction at the date of hearing. Instead, they would allow a tenant to be evicted only if they met the threshold at the date of the notice and had any arrears at all remaining at the date of their hearing. I am sure we all agree we should encourage tenants in financial difficulty to pay off their arrears, but we believe the amendments would act as a significant disincentive to even try to do so, as it would mandate eviction of a tenant who has done the right thing and tried to pay off their arrears.
I understand that, with the amendments, the hon. Gentleman is most likely trying to address the perceived problem of tenants gaming the system by paying off a nominal amount of arrears, placing them just below the threshold at the date of hearing, and thus frustrating a landlord’s attempt to evict the tenants. That was the rationale that underpinned new ground 8A in the previous Government’s legislation. However, this is not a problem recognised as occurring frequently, if at all, by me or by those who advise tenants going through the eviction process—in fact, it is hard to find cases of people trying to extensively game that system.
The previous Government’s solution to this problem was ground 8A, which we consider to be punitive. Similarly to these amendments, ground 8A would have punished tenants who did the right thing in trying to pay off their arrears. While we understand how frustrating rent arrears can be for landlords, we have to accept that most tenants act in good faith when trying to pay off their arrears, and they should be encouraged to do so. I hope hon. Members agree that we should encourage the right behaviour in tenants who are trying to bring down their rent arrears.
The amendments would therefore be fundamentally unfair and, most importantly, create the wrong incentives. I therefore ask the shadow Minister to withdraw amendment 62.
David Simmonds
I managed to make the dubious mistake of making the wrong points when I moved the amendment, but the Minister has brought us back to exactly the points I omitted to make. Concerns remain, particularly where there may be delays in accessing the courts to get a decision, either because of a lack of capacity—as we know, that remains a problem—or because of future resourcing issues in the new world that this Bill seeks to introduce, in which a number of routes will be open in the event of a dispute.
The Opposition remain concerned about the risk that those who wished to could seek to game the system. Most Members of Parliament will have had constituents who have been affected by tenants who failed to pay the rent. Those constituents may be accidental landlords renting out the property of a deceased relative while waiting for probate, and they may find that someone is occupying their property and perhaps sub-letting it for cash without passing that money on, leaving them in an incredibly difficult position. We want to ensure that people who behave in that way cannot continue to game the system. Having acknowledged the Minister’s points, however, I am happy to withdraw the amendment.
Matthew Pennycook
In addition to the points I made previously, I briefly draw the shadow Minister’s attention to the fact that ground 8 will remain mandatory, and discretionary grounds will also be available when arrears do not meet the mandatory threshold, such as in cases of repeated late payment. We think the courts have the necessary provisions to be able to take action on rent arrears. What we find particularly objectionable in the amendment is that it would mean that anyone with any amount of arrears at the hearing would be subject to mandatory eviction. We think that that goes too far, so I am glad that the shadow Minister has agreed to withdraw the amendment.
David Simmonds
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
David Simmonds
I beg to move amendment 59, in schedule 1, page 170, line 13, at end insert—
“23A After Ground 8 insert—
‘Ground 8A
The landlord who is seeking possession, or, in the case of joint landlords seeking possession for at least one of them, requires the dwelling-house for the purposes of providing care to—
(a) a person under the age of 18;
(b) a person who has a disability under section 6 of the Equality Act 2010; or
(c) a person who requires personal care on the grounds of age, illness or injury.’”
I will not repeat at length the comments I made when I previously introduced amendment 59 in error. The amendment relates to the grounds for use when a landlord needs to put a carer into a property. It seeks to ensure that the required flexibility is available where the needs of a cared-for person must be put first.
Matthew Pennycook
As the shadow Minister has just made clear, amendment 59 seeks to introduce a new ground for possession into schedule 2 of the 1988 Act to allow landlords to evict tenants when they wish to use the property for the purposes of providing care. Although I appreciate the sentiment behind the shadow Minister’s proposals, I do not believe that this ground is needed. Ground 1, which is a mandatory ground, allows a landlord to move in close family members. That includes children, grandchildren, parents, grandparents and siblings. It could be used if the landlord wished to obtain possession to provide care for close family members.
This relates to a point that we have just discussed. We think that a two-year protected period might lead to such cases being prohibitive for landlords who need to make use of the grounds. We think the existing ground 1 is likely to cover the vast majority of cases of the kind that the shadow Minister seeks to help, without increasing the complexity in the system. I therefore ask him to withdraw the amendment.
David Simmonds
Each new Bill is an opportunity to consider as widely as possible the issues that our constituents may face. A property that has been adapted for occupation by someone with care needs may have been rented out by, for example, a military family who need to move to a placement abroad. They may find that they cannot access the property on their return, when it is essential that they are able to do so in order for those facilities to be available. We think it is reasonable to raise such situations.
Recognising the points that have been made, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
David Simmonds
I beg to move amendment 61, in schedule 1, page 170, line 13, at end insert—
“23A In Ground 14, in each of paragraphs (a) and (aa), for ‘likely to cause’ substitute ‘capable of causing’”.
Amendment 61 seeks to broaden out the debate on the opportunity for a landlord to seek possession on grounds where antisocial behaviour on the part of the occupant is a factor. We have considered this quite extensively in Committee, but it is clear that it remains a significant issue in some cases. As I have said, most of us will have had experience, as constituency Members of Parliament, of matters arising from the antisocial behaviour of tenants. We will be aware of the enormous frustration, at both the landlord and the community level, at the inability to tackle that effectively under the current system. We want to ensure that those powers are as strong and as flexible as possible.
Matthew Pennycook
Amendment 61 seeks to expand the discretionary antisocial behaviour ground to include behaviour “capable” of causing nuisance or annoyance. Members may recall that this was proposed in the previous Government’s Renters (Reform) Bill. When in Opposition, we strongly opposed the change, because it had the potential to significantly reduce security of tenure and, most importantly, put vulnerable tenants at risk of eviction. I remain concerned that it would leave tenants open to eviction, even when their behaviour was not causing any problems.
A huge range of behaviours are “capable” of causing a nuisance or annoyance. I was tempted to say that some of the behaviour of my children, on occasion, is more than capable of causing nuisance or annoyance. We can all agree that such a subjective term potentially includes a huge range of behaviours, and it would not be fair for someone to lose their home on the basis of some of them. For example, a baby crying frequently is capable of causing another tenant annoyance. In those cases, and there are many others that I could cite, it would be fundamentally wrong to put a family at risk of eviction because of that. Worse still—this is a point I recall very clearly from the discussions I had with domestic violence charities at the time of the previous legislation—we heard from many organisations that represent victims of domestic abuse that sometimes such abuse can be mistaken for antisocial behaviour, because of loud noises, banging or disruption in the property next door. The amendment increases the risk that tenants in such a situation could be evicted.
I understand that the shadow Minister wants to ensure that landlords have confidence that they can evict tenants who engage in genuine antisocial behaviour. That is an honourable aim, but there are already measures in the Bill to address that, including reducing notice periods so that landlords can make a claim to the court immediately when using the antisocial behaviour grounds, as we have discussed. We have also made changes to section 9A of the Housing Act 1988 to include amendments to ensure that the court considers the particular impact of antisocial behaviour on victims living with perpetrators in HMOs, which was a specific concern raised by the sector. We will also encourage the use of mediation and other tools by ensuring that judges take into account whether a tenant has engaged with attempts to resolve their behaviour, making it easier to evict perpetrators who do not engage.
For the reasons that I have set out, we believe that lowering the threshold from “likely” to “capable of” causing nuisance or annoyance could have extremely damaging consequences, and I do not believe it is in the spirit of what the Bill is trying to achieve. I therefore ask the hon. Member to withdraw his amendment.
Mr Amos
I rise to support the Government on this issue, as Liberal Democrats did in the context of the Renters (Reform) Bill in the previous Parliament. To my mind, introducing a definition of antisocial behaviour that is simply about what is “capable” of causing annoyance and disturbance is tantamount to an authoritarian approach. When the Minister talks about crying babies, I cannot help being reminded that my own crying baby was complained about by the next-door neighbour when I was in rented accommodation. She does not cry so much now—she is 32. The very idea that anything capable of causing annoyance should be regarded as formally antisocial behaviour in law is an extreme concept, and it is an extremely good thing that this new Bill has left such thinking behind. This amendment should not be accepted.
David Simmonds
I will withdraw the amendment, because again the numbers are against me. It is important to recognise as we consider it, however, that there are examples—loud music is one—that might not within the definition of “likely” to cause nuisance or annoyance, but potentially would fall within our proposed definition.
I hope that the Minister and the Government will consider this issue. We know that a children’s party—I speak as a guilty individual in this regard—can be a very noisy occasion that generally takes place in the middle of the day for a brief period of time, whereas playing loud music for one’s own freedom of enjoyment all day and night may cause significant issues. Most of us, as Members of Parliament, have seen examples of behaviour that of itself and on an individual, case-by-case basis would not cause a nuisance, but that can cause significant upset to neighbours when repeated. That can range from the environmental impact of an activity such as servicing cars or maintaining vehicles to things such as loud music, and people can do those things at times of the day and night that are antisocial in the context in which the home is located. It is important that the Government give further consideration to the matter, but I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment made: 9, in schedule 1, page 172, leave out lines 29 to 32.—(Matthew Pennycook.)
This is in consequence of Amendment 5.
Question proposed, That the schedule, as amended, be the First schedule to the Bill.
Matthew Pennycook
I beg the indulgence of the Committee to spend a little time setting out the Government’s position on this schedule, because it is a key part of the Bill. As we have discussed, the Bill reforms the grounds for possession to ensure that tenants have greater security in their homes and, importantly, that good landlords can regain a property when necessary. Without section 21 and the threat of arbitrary evictions, tenants will have that greater security in their homes. Landlords will have to use one of the defined grounds for possession in schedule 2 to the Housing Act 1988, as amended, when they need to evict a tenant. They will be able to repossess their property only when it is reasonable to do so.
Schedule 1 inserts new grounds and amends existing ones, ensuring that landlords have robust grounds for possession when there is good reason to take their property back. As we have discussed, that includes repossessing to sell, to move in or if their tenant engages in antisocial behaviour or falls into rent arrears. Although many of the grounds are broadly similar to those in the previous Government’s Bill, we have made some important changes that we believe ensure a fairer balance in the sector. There are three main types of ground: those relating to a change in the landlord’s circumstances, those to allow specialist sectors to operate and those where the tenant has not met their obligations. I will not cover each in detail here, but I will give a brief overview of some of the key provisions.
Mr Amos
I rise to ask the Minister to clarify something for my benefit, and possibly that of other people. The Liberal Democrats support the omission in paragraph 8 of the grounds for eviction for the purposes of creating holiday accommodation, but what will prevent a landlord from evicting to move in their own family, or purportedly for sale and then changing their mind and letting the property out as an Airbnb or holiday accommodation? There has been a massive rise in that type of accommodation; it is not scaremongering to suggest that there might be another increase. It is already a significant factor in the rental market, and it really hits some communities. I know we are debating this issue at a later stage, but I would be interested to hear what the Minister says about the schedule.
Matthew Pennycook
I thank the hon. Gentleman for that reasonable question. He and many others in the House have significant concerns about the impact of excessive concentrations of short-term and holiday lets in particular parts of the country. A landlord who has moved a family member back in under the mandatory grounds that he cites would not be able to re-let the property for 12 months and would be penalised if they attempted to do so. It was a three-month void period in the previous Government’s Bill, and we thought that it would not have acted as a serious disincentive. I frequently encounter landlords who can comfortably wear a three-month void because of the levels of rent that they charge, and I am sure that is the case in many other parts of the country. We think that a 12-month no re-let period will provide the necessary protection to ensure landlords are not incentivised, and do not feel able, to abuse the mandatory grounds for possession.
David Simmonds
The Minister has given a helpful and comprehensive overview of the matters that we have debated so far. Although we clearly have a different opinion about how to strike the correct balance, I accept that he is acting in good faith and, to a great degree, in line with the points previously made and the content of the Renters (Reform) Bill. The key issue we remain concerned about is the impact that all these regulations will have on supply. We all know that we have a constrained private rented sector, with areas in which significant numbers of people are chasing properties. We need to ensure that properties remain of a decent standard, at an affordable price, and in sufficiently ample supply. We have debated those concerns, and I hope that we can continue to deal with this Bill in the same co-operative and constructive spirit.
Schedule 1, as amended, agreed to.
Clause 5
Possession for anti-social behaviour: relevant factors
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
It is always better to resolve issues without resorting to eviction, but we recognise that when tenants are committing antisocial behaviour and it is impacting on neighbours, housemates and communities, it is sometimes necessary. In these cases, landlords need to have confidence that they can gain possession of their property quickly. The clause expands the matters that judges are directed to consider when deciding whether to award possession under the discretionary antisocial behaviour ground. We are making the change because we recognised landlords’ concerns about evicting antisocial tenants without section 21, and it is important that judges consider pertinent factors to ensure eviction can happen when it is right to do that.
Judges will take all relevant factors into account when determining whether to evict under these grounds, because they are discretionary, but under the current legislation, they are also guided to explicitly consider the impact of antisocial behaviour on victims. Clause 5 ensures that judges must also have regard to the question of whether the perpetrator has engaged with measures to resolve their behaviour. This will serve two purposes: making it more likely that landlords work with tenants to resolve poor behaviour, and making it easier to evict those tenants who do not engage. The change will contribute towards increasing the amount of dispute resolutions short of eviction in the private rented sector.
The clause also asks judges to give regard to the impact of antisocial behaviour on other tenants within houses of multiple occupation. Antisocial behaviour within house-shares can have a severe impact on those who live in close proximity. The clause will make it easier to evict perpetrators, which was a specific concern raised with us by a number of external stakeholders. Fellow tenants are the worst-affected victims of antisocial behaviour within HMOs, and landlords were concerned about their ability to evict perpetrators without section 21 notices. The clause ensures that courts can consider these factors.
David Simmonds
The Opposition welcome the points made in this debate. We want the following issue to be addressed. If it is expected that a dispute resolution process will be undertaken or that some form of external mediation will be accessed, there needs to be sufficient capacity to ensure that that happens in a timely manner. We do not have an example of a case in which someone who is evicted on grounds of antisocial behaviour is expected to endure a considerable period of time in order for mediation to take place, following which grounds for possession might then be sought. We need to make sure that the process is done swiftly and effectively, but we support the concept behind it.
Question put and agreed to.
Clause 5 accordingly ordered to stand part of the Bill.
Clause 6
Form of notice of proceedings for possession
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
Clause 6 provides for regulations that will allow the Secretary of State to publish the form to be used when landlords serve notice of intention to begin possession proceedings. It is crucial that the information landlords are required to provide reflects current law. This gives tenants the best opportunity to enforce their rights and seek appropriate support. The clause will allow regulations to be made so that we can update the forms at speed and respond to changing circumstances. It is a simple and straightforward clause.
Question put and agreed to.
Clause 6 accordingly ordered to stand part of the Bill.
Clause 7
Statutory procedure for increases of rent
Mr Amos
I beg to move amendment 76, in clause 7, page 8, line 31, leave out from “determination” to the end of line 36 and insert—
“(4AA) Where the rent for a particular period of the tenancy is to be greater than the rent for the previous period by virtue of a notice, determination or agreement mentioned in subsection (4A), the rent may not be greater than the rent for the previous period increased by the Bank of England Base Rate.
(4AB) Any provision relating to an assured tenancy to which this section applies is of no effect so far as it provides—
(a) that the rent for a particular period of the tenancy must or may be greater than the rent for the previous period otherwise than by virtue of a notice, determination or agreement mentioned in subsection (4A), or
(b) that the rent for a particular period of the tenancy, where greater than the rent for the previous period by virtue of a notice, determination or agreement mentioned in subsection (4A), must or may be greater than the rent for the previous period increased by the Bank of England Base Rate.”
This amendment would mean that the maximum rent increase can only be an increase in line with the Bank of England Base Rate.
Mr Amos
At the beginning of today’s sitting, the Minister and the shadow Minister asked the Committee to bear with them, because it was their first time leading the Committee stage of a Bill in their respective positions. I ask the Committee to spare a thought for the hon. Member for Bristol Central and me, as it is our first time being elected an MP, our first time in a Committee and our first time dealing with this Bill. There are a number of amendments that we would introduced but which have not yet made it through to the amendment paper.
Matthew Pennycook
The Bill will empower private rented sector tenants to challenge unreasonable rent increases. This will prevent unscrupulous landlords using rent increases to evict their tenants—a form of section 21 by the back door. Clause 7 amends section 13 of the Housing Act 1988 to achieve this. It provides that all rent increases for private landlords will take place via the existing section 13 process. That will ensure that tenants always have the right to challenge an unfair rent increase. Any rent increase outside this process, including rent review clauses, will be outlawed and invalid.
We will also give tenants longer to prepare for rent increases, with landlords having to provide two months’ notice to tenants. Landlords will still be able to raise rents in line with market rents once a year. These changes will not level the playing field for tenants if they are unable or do not feel confident to enforce their rights. That is why we are reforming how the tribunal will work. I will turn to that in clause 8.
Clause 7 exempts “relevant low-cost tenancies” from the rent-increase changes that the Bill is making. That means that current rent-increase provisions will be retained for social tenants who have an assured tenancy of social housing within the meaning of part 2 of the Housing and Regeneration Act 2008, where the landlord is a private registered provider of social housing.
As the hon. Member for Taunton and Wellington made clear, amendment 76 seeks to limit rent increases to no greater than the Bank of England base rate, and it retains provisions in the Bill that set out how rent increases can occur. I am grateful to the hon. Member for bringing this issue to the Commons. Several witnesses in evidence sessions also made the case for greater regulation of rents, and others contributed written evidence on these points. I would like to expand on the Government’s approach before turning to the detail of the amendment.
The debate around rent controls can quickly become complex regarding both the definition and the evidence available. What is agreed is that there is a broad spectrum of possible regulation, and different approaches have been tried around the world—and, indeed, within the UK. Perhaps the better question to ask is how we should regulate the private rented sector to achieve the best outcomes possible for tenants. That leads us to look at how the regulation of rents fits within the broader context of the entire system, including security of tenure, quality standards and better enforcement.
The Government have taken that wider approach by placing protections against excessive rent increases within an overarching set of reforms to the private rented sector. The interaction between security of tenure and rent regulation is therefore critical; if rents are too strictly controlled but evictions are too easy, tenants are left at the mercy of landlords’ whims, even if they pay the rent. If tenants have legal security from arbitrary eviction but there is no limit on rent increases, they can effectively be evicted by excessive economic rent hikes.
Many international comparisons can be cited. All should come with a health warning, but I think it is instructive to look at the experience of Sweden. The result of harder rent caps has seen the emergence of a huge, unregulated sub-letting market, which, in many ways, is the worst of all worlds, as it leaves the most vulnerable groups exposed to high costs and minimal protections.
The principle of some form of regulation of rents is already established in England. Rents for certain assured periodic tenancies are already subject to some form of regulation, as the tribunal system is there to prevent excessive increases, but as we heard in last week’s evidence sessions, it has been weakened to the point that it does not provide enough protection for tenants. That is why we have taken steps to strengthen the rent determination system and empower tenants.
In Scotland, we have seen over recent years the temporary introduction of stronger rent controls—rent freezes followed by rent caps. Anna Evans, who led the research into the Scottish experience, noted in her evidence last week that once rent freezes were introduced in Scotland, landlords were more inclined to increase rents when tenancies changed. Good landlords want stable and long tenancies but, when a new tenancy begins, landlords are strongly incentivised to set rents at, or close to, the cap, which may be at a higher level than they would have chosen in the absence of such regulation. We also heard, regarding new-build investment in the Scottish PRS, that there has been stagnation rather than growth over recent years.
As the hon. Member for Taunton and Wellington made clear, his amendment seeks to limit a rent increase to no greater than the Bank of England base rate, which is currently 5%. We believe that any attempt to use a simple metric on rent increases risks unintended consequences. Let us take an example: limiting rent increases to inflation might sound fair, but it would have resulted in rent rocketing when inflation spiked following the mini-Budget in 2022. I acknowledge that the hon. Member referred to the base rate, but others have argued for inflation-linked rent increases in the past, so my point is that there is always a price to be paid. That price can also be paid in the supply of new homes and the development of the build-to-rent sector, where we believe that these types of direct interventions discourage investment, limiting supply and leading to declining property standards.
Instead, our Bill works to strengthen tenants’ rights as a whole, with the ending of no-fault section 21 evictions being the key change. Our proposed changes— giving tenants the power to challenge excessive in-tenancy rent increases—are designed to fit with that increase in security of tenure. With every change to one part of this complex set of regulations, we must be mindful of the interactions with other parts, and the combined impacts on the system as whole. We believe that the Renters’ Rights Bill strikes the right balance. It introduces a series of powerful changes that will improve the PRS overall, including protections against unfair rent increases. We are confident that this will make a material difference to the lives of tenants. I therefore ask the hon. Gentleman to withdraw his amendment.
Mr Amos
I thank the Minister for his response on those points. We would argue that the current metric for market rents is actually more closely linked to inflation, and more likely to be affected by inflation, than would be the Bank of England base rate, which is obviously a separate—
Renters' Rights Bill (Fourth sitting)
Tuesday 29th October 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 29 October 2024 - (29 Oct 2024)
Mr Gideon Amos (Taunton and Wellington) (LD)
It is a pleasure to serve under your chairmanship, Dame Caroline—as it was to serve under Sir Christopher’s chairmanship until I was somewhat surprised to be interrupted by the clock. But it reminded me to get a very good lunch, including excellent apple crumble.
As I was saying, the logic of the amendment is to attach the maximum rent increase to the Bank of England base rate. We do not accept that that is capping in any other way than in the Bill, which would cap the rent increase at what is considered the market rent through recourse to the courts. In the same way, our application of the amendment would limit it to the Bank of England base rate, which is, as I said, a much better measure of the costs that landlords actually face than market rents, which are susceptible to the effects of price inflation.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Does the hon. Member agree that further work might come through on the way the tribunal operates and how it could operate in future under the Bill, and that the changes to how the tribunal functions might help to deal with the issues addressed by the amendment?
Mr Amos
I would be delighted if that were the case. We would welcome anything that reduced the risk of extremely steep rent increases for tenants—I think Members on both sides of the Committee would want to see that. This amendment would limit increases to the Bank of England base rate. I stress that this would apply to within-tenancy increases only. However, I accept the points that the Government have made and I am willing to withdraw the amendment.
The Minister for Housing and Planning (Matthew Pennycook)
It is a pleasure to serve with you in the Chair, Dame Caroline. I just thought I would offer a few more thoughts to try to further reassure the hon. Gentleman. As I made clear, we absolutely share his objective of limiting unreasonable within-tenancy rent increases, not least given the potential for that type of rent hike to act as an effective section 21 by the back door. On his specific point, the Government’s view is that linking rents to the Bank of England’s base rate would constitute a form of rent control. We may have a principled disagreement about whether rent controls are appropriate, but we are not convinced that they should be introduced, given the risks that I have set out.
I thought it would be helpful to touch on how the tribunal determines market rents, because I got the sense from the hon. Gentleman previously that he expected the tribunal to look purely at advertised rents. The tribunal has a high degree of expertise. It is composed of judges and industry experts. To determine the market rate, the first-tier tribunal can consider a wide range of evidence, such as the price of similar properties being advertised online, as he said, and also evidence submitted from both parties justifying or arguing against the rent increase. This could include statistics on changes to local rents and examples of the rent achieved by other properties—for example, the rent that neighbours are paying. The tribunal will be able to use its local expertise, including visiting a property if necessary. We think that the tribunal has the necessary expertise and understanding to take into account different factors that are forming market rates and to determine whether the rent that is being proposed reflects that.
To touch on the point made by my hon. Friend the Member for Cities of London and Westminster, the Government are exploring whether the database could play a role in providing data on rents. That would be in addition to data about the ownership and standard of private rented sector properties. We are considering the feasibility of recording a wider range of data to support more informed rental experiences.
Our approach will take into account the balance of benefits and burdens for different users, and we will look at how data can best be collected to minimise requirements for private landlords to submit information. We will stipulate those requirements in the regulations, but I hope that that gives the hon. Gentleman a bit more reassurance that the tribunal is not simply looking at advertised rents in making its determinations.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
It is a pleasure to serve under your chairmanship this afternoon, Dame Caroline. The Opposition agree with the Government’s position on amendment 76. It is clear that interest rates set by the Bank of England are not a suitable proxy or measure to be used when setting a reasonable level of rent. If we look at examples in recent history, we see that we have gone through a period of sustained very low interest rates, followed by a rise prompted by the decision of the United States Federal Reserve, which sets the baseline for the rest of the world, to raise interest rates, so they sit at today’s present rate. Of course, inflation throughout that period was very much determined by Russia’s invasion of Ukraine and the consequent increase in energy costs in particular, and also in basic foodstuffs. All those things do not amount to an effective basket of measures that can be used. What the Minister has said on that point is important.
Mr Amos
Would the hon. Gentleman accept that the main costs landlords face are not from the price of goods in the shops, but the price of borrowing—the price of the loans with which they have acquired their properties—and, therefore, it is about the logic of the increasing costs to landlords being passed on through a relationship to the base rate of interest?
David Simmonds
No, I do not entirely accept that. For a start, we need to recognise that the costs landlords face when looking at purchasing a property will be based on the commercial cost of borrowing, rather than the Bank of England base rate. A landlord who is considering, for example, refurbishment or investment in a property is considering the rising cost of maintenance and servicing the property to the appropriate standard. The costs driving that, and the inflation behind them, are related not to the Bank of England base rate, but to what is going on in the market for those particular goods and services. It is important that we recognise that.
I hope the Government will acknowledge that it is particularly important to recognise that bringing in investment to create more private rented homes depends on the build to rent sector and on investors, including investment funds, that may specifically choose to come to this market on the basis of a reasonable, if modest, rate of return. If the investors considering creating new homes are deterred because the Government are fixing the available return on rent at a low level compared with alternative investments, that will lead to an exodus of investment from the private rented sector, which will be deeply harmful to the needs of renters.
David Simmonds
I beg to move amendment 52, in clause 8, page 11, line 38, leave out from “date” to end of the line and insert—
“of the application under section 14(A1)”.
The Chair
With this it will be convenient to discuss the following:
Amendment 50, in clause 8, page 11, line 39, leave out from “is” to “the tenancy rent” in line 2 on page 12.
Amendment 53, in clause 8, page 12, line 24, leave out from “13A(2)” to the end of line 32 and insert—
“or
(b) a date that the appropriate tribunal directs, if it appears to the tribunal that applying paragraph (a) would cause undue hardship to the tenant.”
Amendment 51, in clause 8, page 12, line 35, leave out from “is” to “the proposed rent” in line 37.
David Simmonds
The amendments relate to the role of the tribunal and the tribunal process. One of the concerns that was extensively aired in debate, and about which we have heard a great deal of evidence, is the impact of a process whereby from a tenant’s point of view, going to tribunal is a no-lose situation because the only possible decision the tribunal can take is to reduce the rent they would pay. That would mean that it would essentially always be in the tenant’s interests to go to the tribunal, because it would at worst defer the point at which any higher rent took effect. We have very significant concerns about the tribunal’s capacity to absorb that level of work and about the fact that to be fair to landlords as well, we should not have a situation where a tribunal can operate in only one direction. By proposing these amendments, we seek to make it possible for changes in rent to be backdated.
Jerome Mayhew (Broadland and Fakenham) (Con)
We are talking about perverse incentives here. One way to tackle that would be through a costs regime associated with the tribunal. Is it my hon. Friend’s understanding that the current intention is that there would be no adverse costs orders awarded against a tenant, should they go through a tribunal process and not be successful in reducing the level of rent?
David Simmonds
My hon. Friend raises an extremely good point. As he outlined, this is very much about perverse incentives. We do not want to create a situation in the market where it is always in the interests of the tenant to push this to the tribunal. We need to make sure that that point is effectively addressed, and the amendments seek to do that.
Matthew Pennycook
Clause 8 amends section 14 of the Housing Act 1988, and the amended sections set out the circumstances in which a tenant can submit an application to the tribunal to challenge the rent amount either in the first six months of a tenancy or following a section 13 rent increase notice. Amendments 50 to 53 seek to alter the process for challenging initial rents and rent increases at the tribunal.
I must stress that, in the first instance, under this new system, the Government strongly encourage landlords and tenants to communicate early about what adjustments to rent are sustainable for both parties. Where an agreement cannot be reached, the Government are clear that tenants should submit an application to the tribunal only where they believe that a rent increase is above market rates. Such rises may represent an attempt by the landlord to exploit a tenant who simply wishes to remain in their home, or they may be an underhanded attempt to remove a tenant without pursuing the very clear possession grounds laid out in schedule 1. That is why we think clause 8 is so important.
Jerome Mayhew
I understand that the Government’s intention is that tenants should not go to the tribunal unless they are clear that the asked-for rent is too high, but what prevents them from gaming the system, as we discussed?
Matthew Pennycook
What I would say to the hon. Gentleman—I will expand upon my argument in due course—is that I think he underestimates how difficult it is to take a case to the tribunal. That is why we are seeing such low numbers of tenants going to the tribunal. It is an onerous process; we need to provide support and guidance about how to do it. I do not take his point that we will see a flood of tenants taking rent increase cases to tribunal.
To be very clear—I have said this on previous occasions—the Government want more tenants to take their cases to tribunal. We think the tribunal has an important role to play in setting the effective market rate for any given area, so we want to see a proportionate number of cases go through it—we obviously do not want to see it overwhelmed. However, I think the hon. Gentleman underestimates the onerous nature of taking a case to tribunal. It will not be as simple as the tenant deciding on a whim one day that they can do that, and that it is a no-lose situation, but I recognise the incentives at play on both sides. I will expand upon what I mean and why we have come to this decision in relation to this particular clause.
The shadow Minister proposes in his amendments that rent increases, where they are challenged at the tribunal, should be backdated to the date the landlord first proposed. That would mean tenants possibly facing significant arrears immediately after the tribunal hearing. That is an incentive in the other direction, which we fear would, if introduced, see no tenants taking their case to tribunal. We have just had an extensive discussion about the need to address the affordability pressures to ensure that landlords are not exploiting the system with large, completely unreasonable within-tenancy increases. We have to take that into account as well.
Tenants should not be thrust into debt simply for enforcing their rights. As such, the Bill proposes that rent increases should apply only at the beginning of the next period after the tribunal determination, or up to two months later, in limited cases of undue hardship.
Matthew Pennycook
If the hon. Gentleman would allow me to develop my argument after his intervention, I am sure I will get to his points.
Jerome Mayhew
I am grateful—I am not intervening for the sake of it; there is an important point here. The Minister says that it would be unfair on the tenant to have a significant increase in rent and a backlog after the determination of the tribunal, but that is rent that ought properly to have belonged to the landlord and has been unjustifiably denied them for the period of the process. Why is it fair for the landlord to be denied a just rent as a result of the delay in the process, yet it is for some reason not fair for the tenant?
Matthew Pennycook
I completely understand the hon. Gentleman’s point, but let me give him a bit more insight into my thinking. I recognise his point that there are incentives that operate in both directions. There is no wholly perfect, win-win solution. We have taken this decision partly because it was in our manifesto to protect renters from unreasonable within-tenancy rent rises, and also because we believe that landlords will adjust around the point in the annual cycle when they serve the section 13 notice to account for the period of time it will take for the tribunal to make a determination.
The hon. Gentleman is right that if the tribunal determines that the rent increase is reasonable, a landlord may have missed out on a short period of the rent increase—not the whole rent, but the rent increase. We want to bring down the time of tribunal determinations so that it is a very short process. I will be very clear about this: we took the view that it was better that tenants were not, by facing the prospect of significant arrears, disincentivised from taking any cases to tribunal to challenge what could be, on a number of occasions, completely unreasonable within-tenancy rent increases. We felt that that is of more benefit than ensuring that they would face significant arrears at every point, which would be too harmful to their ability to challenge, given that we have not introduced rent controls—rent stabilisation—of the kind that other parties are calling for. To address the hon. Gentleman’s point specifically, my expectation is that landlords will adjust around the point that the section 13 notice is served.
The whole system should operate in a way that, hopefully, incentivises landlords not to propose unreasonable rent hikes that might be challenged. There is a clear incentive for landlords and tenants to come to an agreement—we know this will happen in a good number of cases—on what a sustainable rent increase is that reflects the market conditions. The hon. Gentleman is more than welcome to intervene on me again if he wants, but I will just develop my argument a bit further in relation to some of the amendments.
The shadow Minister proposes that a tribunal should be able to increase the rent above the current rent payable if the rent is challenged in the first six months of the tenancy and, where a later rent increase is challenged, that the tribunal should be able to set the rent higher than what the landlord asked for. We believe that these amendments would exacerbate the worry that tenants already face in going to a tribunal to challenge their landlord. Tenants will not challenge rents if they risk being in an even worse position following a tribunal ruling. That is the sort of perverse incentive that we believe would pertain on the part of tenants if the amendment was taken forward.
As a slight challenge to Conservative Members opposite, the shadow Minister and the hon. Member for Broadland and Fakenham, their party once recognised this point. The proposed approach in the previous Government’s White Paper, “A fairer private rented sector”, is the one that we have taken in this Bill—namely, that the tribunal cannot increase the rent beyond what the landlord asked for. It is slightly disappointing to see hon. Members rescind that previous approach, which we think is appropriate.
The Bill encourages tenants to engage with the tribunal when they have legitimate concerns. By reinforcing the rights of tenants to do so, we are disincentivising the minority of landlords who may be tempted to hike rents beyond what is reasonable. The shadow Minister’s amendments not only remove these important measures but put tenants at real risk of losing their home, undermining security of tenure, which is obviously a key principle of the Bill. I therefore ask the shadow Minister to withdraw his amendment.
David Simmonds
I am grateful to the Minister for talking through the Government’s thinking, and for his points about the debates on the previous Bill. The Opposition remain concerned that the envisaged process, whereby there will be an online application for a modest fee, will make it almost invariably in the interest of the tenant to challenge, because there is no negative outcome for them regardless. A great deal will rest on an issue we will deal with later on: the capacity of tribunals to make decisions quickly. I am mindful, however, of the numbers on the Committee, so I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
David Simmonds
I beg to move amendment 47, in clause 8, page 13, line 6, at end insert—
“(12) The Secretary of State must—
(a) conduct a review of—
(i) the impact of this section on the tribunals responsible for the determination of rent, and
(ii) the ability of tribunals to manage an increase in applications for a review of a proposed rent increase; and
(b) consult with the Competition and Markets Authority on any measures necessary to ensure that tribunals are able to assess market rents without having a distorting effect on the market.
(13) The Secretary of State must lay the review made under subsection (12) and the Government’s response to the review before Parliament.”
The Chair
With this it will be convenient to discuss the following:
Amendment 75, in clause 8, page 13, line 6, at end insert—
“(12) The Secretary of State must consult on—
(a) the adequacy of the existing resources of the tribunals responsible for the determination of rent;
(b) the need of the tribunals for further resources to manage an increase in applications for a review of a proposed rent increase.”
This amendment would require the Secretary of State to consult on whether tribunals responsible for the determination of rents are appropriately resourced to manage any additional workload arising from this Bill.
Clause stand part.
Amendment 46, in clause 142, page 150, line 26, leave out from “subject to” to end of line 27 and insert—
“—
(a) the publication of a review under section 8 on the impact of that section on the tribunals responsible for the determination of rent; and
(b) subsections (2) to (6).”
David Simmonds
Amendment 47 relates to an issue that was briefly aired in the previous debate: the capacity and ability of tribunals to deal effectively with the workload that is likely to come their way once the Bill has made its passage through Parliament.
I understand that for a new Government there is a great deal of desire to bring forward legislation to address things that may be manifesto issues, but there has also been criticism of the risk. We have seen a lack of impact assessments that would enable us as Members of Parliament to consider properly the likely impacts of the legislation, and what resources will be required to mitigate those impacts. That issue ran through the previous debate on the ability of tribunals to make timely and efficient decisions so that both landlords and tenants are treated justly. It will also run through other debates, such as that on local authorities’ capacity to enforce effectively so that both tenants’ and landlords’ rights are protected in practice, notwithstanding what the legislation says.
Amendment 47 is designed to address the issue and ensure that the Competition and Markets Authority, which has a much wider remit in looking at how regulators and markets interact, can examine this issue and, having considered the impact of the legislation, provide us with some evidence that would then inform our thinking about the timing and operation of these facets of the Bill.
Matthew Pennycook
Before I speak to clause 8 and respond to the amendments, it might be worth my making it clear to the shadow Minister that the Government submitted an impact assessment for the Bill to the Regulatory Policy Committee on 16 September 2024, and we will publish that in due course. In line with usual practice, the Government will always consider the impact of any policies when taking legislation through Parliament.
As I set out in the debate on the previous group of amendments, clause 8 amends section 14 of the Housing Act 1988. It stipulates when a tenant can submit an application to the first-tier tribunal. They may do so to challenge the rent amount in the first six months of a tenancy or following a section 13 rent increase. When a tenant brings an application to the tribunal, the tribunal will both assess what the landlord could expect to receive if the property was re-let on the open market and determine the rent. The tribunal has, as I have noted, experts who are experienced in understanding the different factors that influence the market rate, which include the rent for similar properties in the area, the quality of fixings or the proximity to amenities.
For too long tenants have feared challenging a rent increase at the first-tier tribunal. We will end that by ensuring that the tenant will not pay more than what the landlord asks for following a tribunal determination. We are going further: we will end the practice of backdating rent increases, to stop tenants being thrust into debt. To protect the most vulnerable tenants, in cases of undue hardship the tribunal will be able to delay the start of the rent increase for up to two months from the date of determination. That puts tenants in a stronger position to challenge rents through the first-tier tribunal.
It is important to note that tenants are often scared to engage with the judicial process, so we hope that the measures I have outlined will give them more confidence to do so. Although we anticipate that there will be an increase in cases, we do not accept the frankly scaremongering assertions we have heard about the tribunal being completely overwhelmed, or about tenants risking a deterioration in the critical relationship with their landlord by challenging every single rent increase that is given to them. Nor did we hear, when they gave evidence to the Committee last week, that the groups that support tenants would recommend such action. Engaging the tribunal requires effort and time, and we believe that tenants will do so only where they have legitimate concerns, such as when a within-tenancy rent increase is unreasonable. We will continue to work with the Ministry of Justice, His Majesty’s Courts and Tribunals Service and the judiciary to ensure that the tribunal has the capacity to deal with any increase in cases.
Taken together with the measures in clause 7, the provisions in clause 8 will ensure that tenants always have a right of appeal and will prevent rent increases from being used to evict them. Rent increases outside the statutory process, such as in rent review clauses, will be outlawed. We believe the measures will ensure that all parties are clearer on their rights and responsibilities and will empower private rented sector tenants to challenge unreasonable rent increases.
Amendment 46 is drafted to prevent the Bill from coming into force until a review is published on the impact of clause 8 on the tribunals responsible for the determination of rent. The review would be provided for by amendment 47. The Government are committed to ending the scourge of section 21 as quickly as possible and have also committed to empowering private rented sector tenants to challenge unreasonable rent increases, thereby stopping unscrupulous landlords from using them as a back-door means of eviction. The sector has waited far too long for these changes, so we will not tie implementation to any arbitrary requirements, as the previous Government determined to do in the previous Parliament. As I said, we are working closely with the Ministry of Justice and HMTCS to make sure that the justice system is prepared for any changes to case load and the procedures that will be required for our reforms.
Amendment 47 would introduce a legal requirement for the Government to publish a review of the impact of the reforms to rents in clause 8 on tribunals and their ability to manage any increase in the volume of applications that challenge the amount of rent payable. As I have made clear—I will put it on the record again—we are working closely with colleagues in the Ministry of Justice and HMTCS to make sure that the justice system is prepared for the Bill’s implementation, which will come at a single point at the point of commencement. In Committee last week, we heard of the growing role of the first-tier tribunals and we heard—it is important to note this—praise for their handling of cases. We seek to build on that good practice.
We currently have no plans to consult the Competition and Markets Authority on whether any action is necessary to ensure that our reforms in clause 8 do not have a distorting effect on the market. I say respectfully to the shadow Minister that I have seen no credible evidence of that and, to be candid, I think the CMA has far better things to do with its time. The tribunal’s decision reflects market conditions rather than distorting them, so we do not think it realistic that the tribunal could affect market prices. The tribunal is also likely to determine rents for an extremely small proportion of the total rental market. We will of course continue to monitor the impact of the reforms on the market in the normal way.
Finally, amendment 75 would require the Secretary of State to launch a consultation to seek views on whether tribunals that are responsible for the determination of rent currently have adequate resource, and whether they will require further resources due to the rent reforms in the Bill. Given the ongoing work I have outlined, we do not think that launching a consultation at this time is required, and making a commitment to do so on the face of the Bill would be wholly unnecessary. I therefore ask Members not to press their amendments to a vote.
Mr Amos
I rise to speak to amendment 75 which, as the Minister said, would require the Secretary of State to consult on the adequacy of the existing resources for the tribunal system and on any further need for resources to deal with rent reviews established in the Bill. It is the same for the courts: sufficient judges and resources to ensure that the justice system works and does not seize up are vital to the supply of landlords bringing properties on to the rental market.
The Liberal Democrats know that most landlords and tenants are not going to rush to the courts unreasonably, and we do not support the use of court funding as a reason to delay the ending of no-fault evictions and the introduction of the Bill, as happened in the previous Parliament. As I have made clear several times, it is urgent that no-fault evictions are brought to an end. However, that does not mean that the courts and tribunal system is not seriously underfunded; it clearly is. I know the Minister is concerned about this—he mentioned some ongoing review work, and also spoke about it on Second Reading in response to my intervention—but we really need to go further. We need to come up with something concrete that is clear that putting resources into the courts and tribunals system will be taken seriously and will happen.
The mutually-owned Nationwide building society, which funds much of the accommodation we are talking about, has made its support for the Bill conditional on increased funding for the courts and tribunals. It says:
“In these situations, good landlords need to be confident they are able to gain possession of the property”—
I appreciate this relates more to courts than tribunals—and that once
“the situation has reached a point where a court is involved it is reasonable to expect that this process should be as quick and efficient as possible. This is not the case with the current…system which needs additional funding and resources to operate effectively”.
David Simmonds
One of the benefits of having been in government is that I have had the opportunity to consider many of these issues from the inside. We on the Opposition Benches remain concerned that it will be challenging to deliver the necessary level of capacity to provide the efficient service that tribunals need, and are expected, to provide for the benefit of both tenants and landlords. However, recognising that it is a game of numbers, I am happy to withdraw amendment 47.
Matthew Pennycook
Briefly, on the capacity of the Courts and Tribunals Service to effectively implement the new system, at the risk of repeating my extensive comments on Second Reading, it is worth trying to provide Committee members with some reassurance. First, at the risk of injecting a somewhat partisan note into the Committee, I agree entirely that our courts are in a terrible state after 14 years—I say 14 years because I am afraid the coalition Government had a hand in it—and we absolutely believe that improvements to HMCTS are needed to ensure that the new systems function effectively.
As I said, we are working closely with colleagues in government to ensure that improvements are made, as well as the exploring options for, for example, improved alternative dispute resolution so that only those cases that need a judgment come to court. There are a number of improvements we might make to take some strain off the courts, and those are the ones we are exploring.
Mr Amos
Will the Minister let me put on the record the fact that during the coalition Government from 2010 to 2015, whole Government Departments, including the Education and Health Departments, were protected and ringfenced against cuts? That bears absolutely no relation to what happened after the cuts were let loose in 2015.
Matthew Pennycook
But not the Ministry of Justice, I say gently to the hon. Gentleman.
Nevertheless, I want to reassure colleagues on the substantive point. We have chosen to implement the new tenancy system in a single stage. The commencement date will be made clear in due course, but we will ensure that the Courts and Tribunals Service is prepared for the implementation of the new system. That is essential, and a huge amount of work is going on to ensure that that will be the case.
David Simmonds
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 8 ordered to stand part of the Bill.
Clause 9
Repayment of rent paid in advance
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss new clause 6—Limit on rent to be requested in advance of tenancy—
“In the 1988 Act, after section 14ZB (inserted by section 8 of this Act) insert—
‘14ZBA Maximum rent to be paid in advance
No rent may be requested or received in advance of any period of the tenancy which exceeds the rent for one month of the tenancy.’”
This amendment would impose a limit of one month’s rent on the amount of rent which can be asked for or paid in advance of a tenancy.
Matthew Pennycook
I will be relatively brief because this clause serves a specific function, but I will focus on what it achieves. I am aware that the wider issue of rent in advance concerns a number of hon. Members—indeed, it featured in our discussions during the oral evidence sessions last week, on which I will say more shortly.
The clause will require landlords to refund a tenant for any rent they have paid in advance, where the tenancy has ended earlier than the period for which a tenant has paid. That serves a practical purpose—for example, if the tenant has paid for the month that they are in occupation and the tenancy is ended by the landlord two weeks into that month, the clause allows the tenant to reclaim the additional two weeks’ rent.
On the issue of rent in advance more broadly—which also pertains to new clause 6, to which I think the hon. Member for Taunton and Wellington will speak shortly—as I stated when I gave evidence to the Committee on Tuesday, Government Members have long recognised that demands for extortionate amounts of rent in advance put financial strain on tenants and can exclude certain groups from renting altogether. We are clear that the practice of landlords requesting large amounts of rent in advance must be prohibited.
Although it might be argued that the interaction of the new rent periods provided for by clause 1 and the existing provisions of the Tenant Fees Act 2019 relating to prohibited payments provide a measure of protection against requests for large amounts of advance rent, I accept that there is a strong case for putting the matter beyond doubt. As I made clear to the Committee, I am giving careful consideration as to how best that might be achieved.
Let me briefly address new clause 6, which seeks to limit the amount of rent in advance that can be paid prior to a tenancy period to no more than one month’s rent. Many of us will have heard anecdotal stories of the pressures placed on renters through demands for rent in advance, and it is for similar reasons that we have taken steps in the Bill to tackle rental bidding. I heard the evidence from last week, and we are looking at the matter carefully to ensure that we put the matter beyond doubt on the face of the Bill.
David Simmonds
I am grateful to the Minister for what he said about looking at this area in detail. We raised, and discussed in some detail, the issue of how those with a poor credit history, or people who wish to secure a property for a fixed period—for example, international students—would be dealt with under the measures. We know that there are already limitations on the level of deposit that can be requested, but, particularly for those with a poor credit history, the ability to offer a larger sum of rent in advance can be a means of accessing a home in the private rented sector when they would otherwise not be able to access a home at all.
I am grateful to the Government for considering that particular group of people, who are in many cases extremely vulnerable tenants and often fall outside eligibility for support from the local authority under homeless duties, particularly if they have a job and an income. We need to make sure that we do not create a situation in which, inadvertently, a particular group of prospective tenants is effectively pushed out of the market. I am glad that the Government are taking that issue on board and considering how best it can work.
The Chair
Does the hon. Member for Taunton and Wellington wish to comment on new clause 6?
Mr Amos
Briefly, Dame Caroline. I am still getting used to the intricacies of the order of the agenda.
The new clause would limit rent in advance to sums of one month’s rent. The argument was well made in the oral evidence session, when we heard about the importance of rent-in-advance bidding and the need to reduce the risk of bidding up the amount that needs to be deposited in advance. One month’s rent is quite often the norm as a reasonable amount of rent to be provided in advance. Many years ago, when I was a student and renting, one month in advance was a reasonable amount. Bidding up that amount has a detrimental effect on tenants; hence the rationale for new clause 6.
Question put and agreed to.
Clause 9 accordingly ordered to stand part of the Bill.
The Chair
That will come later, when we reach that point.
Clause 10
Right to request permission to keep a pet
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Amendment 55, in clause 11, page 16, line 13, at end insert—
“(4) The Secretary of State must consult with representatives of the insurance sector before this section comes into effect to ensure that appropriate insurance products are available for tenants whose landlords have required insurance as a condition for consenting to the keeping of a pet.”
Clause 11 stand part.
Matthew Pennycook
Many of the 11 million people living in the private rented sector would love to own a pet but have difficulty finding a property that allows them to do so. We want tenants in the private rented sector to enjoy the joys of pet ownership, just as homeowners do. We know the benefits of pet ownership for mental and physical wellbeing. I declare an interest: I have a dog named Clem, who I referenced in the debate on the previous Government’s Bill, and he is, as I know to be the case for many pets across the country, a valued member of the family.
We have heard the calls from animal groups for more protection for pets living in rented homes. In its written evidence to the Committee, the Royal Society for the Prevention of Cruelty to Animals highlighted the plight of renters forced to give up their pets because they cannot find a home that will allow pets. I am delighted that the RSPCA, as well as the Dogs Trust, Battersea, and Cats Protection, support the action the Bill takes in this area.
On how we support pet ownership in the private rented sector, clause 10 introduces a new implied term that allows tenants to make a request to keep a pet, which landlords cannot unreasonably refuse. That stops landlords utilising a blanket “no pets” approach and ensures that each request is considered on its merits. We understand that not all properties or situations will be appropriate for pets. Landlords will not have to accept their tenant’s request where it is unreasonable, such as where housemates have allergies and might be detrimentally affected by pet ownership.
The clause makes it clear that landlords will always be justified in refusing a request if their own superior tenancy agreement prohibits pets. That will ensure that the law is consistent and that landlords will not be put in a position where they are forced to breach the terms of their own superior lease. However, to ensure that the provisions have teeth, tenants will have the right to challenge refusals they think are unreasonable via the new private rented sector landlord ombudsman or in court. The ombudsman or court will be able to take an unbiased view on whether the landlord has reasonably refused a request.
Clause 10 also gives landlords an ample 28 days to respond to requests, with an additional seven-day window if the landlord requests more information from the tenant within the initial 28-day timeframe. I make that point because the previous Government’s Renters (Reform) Bill proposed a 42-day response window. The animal welfare charities I mentioned were concerned about that duration, especially as it would mean tenants finding it hard to adopt a pet or the charities needing to keep animals for a long time while landlords made a decision. I share those concerns and I am pleased to say that we have made an improvement by bringing down the timeframe in this Bill.
Finally, clause 10 provides reassurance to landlords by allowing them to require pet damage insurance, either by charging the tenant for it or by asking the tenant to take out an appropriate insurance policy. These measures encourage responsible pet ownership in the private rented sector while providing landlords with assurance.
Turning to clause 11, although it is right that tenants can make the house they rent their home by having a pet, I understand that some landlords will be concerned by potential damage caused by pets to their property. The Committee has discussed the joys of pet ownership, but we all know that many pets can be active and at times destructive. That is one of the joys of pet ownership, but also one of the realities, particularly when it comes to some types of animals.
Clause 11 builds on changes made by clause 10 and amends the Tenant Fees Act 2019 to permit landlords to require tenants to take out an insurance policy to cover any potential damage caused by a pet or to charge the tenant the cost of such a policy. When granting consent, the landlord will be able to decide which insurance option best meets their needs. That underscores our commitment to ensuring that the private rented sector provides secure and stable housing. We recognise that pet ownership plays a crucial role in achieving that mission.
I thank the hon. Member for Ruislip, Northwood and Pinner for amendment 55, which seeks to ensure that suitable insurance products are available before landlords are allowed to mandate that their tenants purchase them to cover pet damage. We know that one of the reasons landlords are hesitant to take on tenants with pets is a fear that those pets could cause damage to their properties, which the tenants’ deposits might not be sufficient to cover.
I recognise that not a lot of insurance companies currently offer products designed to cover damage from pets. It is understandable that in the current climate, in which landlords have discretion over whether to accept or refuse pets, there is no demand for insurance and therefore the market is limited. We believe, however, that by creating an enabling environment for the industry, the Bill will cause the insurance market to adapt. I am sure that, as firm believers in the free market, the hon. Members for Ruislip, Northwood and Pinner and for Broadland and Fakenham share that view.
I hope the hon. Member for Ruislip, Northwood and Pinner will also be reassured that my Department has already had discussions with the insurance industry regarding such products. The discussions have been promising and I am aware that there are products in development to meet his concerns.
Jerome Mayhew
The Minister is quite right; I am a believer in the free market and I am sure the market will respond. Does he have an indication from his discussions with the insurance industry of the kind of price and the surcharge that will be required to fit the need?
Matthew Pennycook
We have not considered extensively the range of prices in the Department’s discussions, but I am sure the market will respond. I do not see any particular concern that companies will charge excessive rates for pet insurance, but that is something we will monitor as we bring the relevant parts of the Bill into force.
In the light of those points, I hope the shadow Minister will consider not pressing amendment 55 to a vote.
David Simmonds
Clearly, there are a number of ways in which this issue may be addressed, and adding a third-party liability element to domestic insurance, contents insurance or building insurance would be one means of doing that. We know that the industry is likely to respond, as we have just heard from the Minister. I congratulate him on his choice of dog name; Clem sounds like the kind of animal that a future leader of the Labour party would like to have when profiled. Had the dog been called Jeremy or Karl, it might not have been quite as popular.
As we have just heard in some detail, the Government have been looking at this issue and engaging with the market to ensure that insurance providers understand the upcoming demand. I recognise the publicity that many pet and animal charities have brought to the issue, which I think will help to create a climate in which those businesses are more likely to bring forward these products. In the light of those points, and on the understanding that we are making serious progress on this matter, I am happy not to press amendment 55 to a vote.
Rebecca Smith (South West Devon) (Con)
I wonder—forgive me, because this is also my first Public Bill Committee—how this will work in a house in multiple occupation compared with a dwelling house, and who will have to have the insurance. If a HMO is operated on a joint-licence basis, who is responsible for the insurance and the indemnity that goes with it?
On another point, what safeguards are we putting in place to ensure that any noise issues arising from pet ownership can be tackled, and where does responsibility for that sit? I appreciate that, where someone owns their home or rents a home that allows them to have a pet, it is probably done through the local authority, but I am conscious, particularly in the HMO setting, of how we would mitigate against that and ensure that we do not end up in a situation where neighbours do not know who to approach to ensure that either the insurance or the antisocial behaviour is acted upon.
Matthew Pennycook
The hon. Lady rightly challenges us on some of the finer points of how the provisions will be implemented. If she is amenable, I will happily write to her with further detail on precisely how we see them working in particular circumstances. Her point on HMOs is well made, and I will take it away and come back to her as soon as I can.
Question put and agreed to.
Clause 10 accordingly ordered to stand part of the Bill.
Clause 11 ordered to stand part of the Bill.
Clause 12
Duty of landlord and contractor to give statement of terms etc
Matthew Pennycook
I beg to move amendment 10, in clause 12, page 17, line 7, leave out “subsection (5)” and insert “subsections (5) and (5A)”.
This amendment is consequential on Amendment 11.
The Chair
With this it will be convenient to discuss the following:
Government amendment 11.
Clause stand part.
Clauses 13 and 14 stand part.
Matthew Pennycook
We believe the rental market works better when all tenants are clear on their rights and obligations. That prevents misunderstandings and means that both parties know what to expect. Without clarity about their rights, tenants may be unable to take advantage of the new rights that the Bill will give them. That is why it is critical that tenants understand what they are signing up to from the outset. Landlords benefit from clarity too. By being clear on rights and responsibilities at the beginning of a tenancy, responsible landlords can more easily comply with the new rules and ensure that they are providing a good service to their tenants.
That is why clause 12 requires landlords to provide tenants with a written statement setting out the terms of the tenancy. This includes a requirement to state where the landlord might wish to recover possession on certain prior-notice grounds. We will set out in secondary legislation details of what must be included in the written statement, but we expect that it might include details such as the rent, contact details for the landlord, and basic rights and responsibilities that apply to both parties. It is worth pointing out that most landlords already do that, and this requirement will ensure that good practice is extended across the sector. In time, this will lead to fewer disputes and help ensure that both parties comply with the law.
Turning to clause 13, the Government will have zero tolerance for any attempts by unscrupulous landlords to evade the new tenancy system. While the majority of landlords are good and do right by their tenants, we know that there are some who will seek to evade the new laws. That is why we are strengthening the enforcement regime to identify and fine unscrupulous landlords, drive out bad actors from the sector, and protect tenants from back-door evictions. Driving out bad actors is to the benefit of good landlords and tenants alike.
All landlords must be aware of their legal obligations and operate accordingly. I know that landlords can fall into the practice of renting out a property through many different—sometimes sad—circumstances. That is, of course, where the term “accidental landlord” comes from. Many of those landlords are good people doing their best, but that cannot be an excuse for the tenant suffering, and it is not an excuse for landlords not to understand their legal obligations. If a tenant is renting a home, it should not make a difference who their landlord is. Everyone has the right to a safe, decent and secure home.
Let me be clear: the law is not accidental and must be followed. If it is not, then the Bill sets out a robust enforcement framework. With a new tenancy system coming into force, we must ensure that landlords always use the correct procedures when gaining possession and evicting a tenant. The prohibited behaviours outlined in clause 13—for example, purporting to bring a tenancy to an end by service of a notice to quit or orally, by phoning a tenant to tell them that they need to leave the property by a certain date—reflect this responsibility.
In opposition, I was clear that we had a number of reservations about the enforcement measures in the previous Government’s Renters (Reform) Bill. As a result, we have worked hard to close any potential loopholes that a small minority of unscrupulous landlords may seek to exploit. We have taken action in a number of areas. For example, we have increased the restriction on re-marketing or re-letting the property after the use of grounds 1 or 1A to 12 months. That is a significant increase, and is necessary to avoid the grounds being used to effect back-door eviction. It will make it unprofitable to evict a tenant simply to increase the rent, and will stop landlords using the grounds as a back-door section 21. It will allow tenants to enjoy protection from no-fault eviction, while ensuring that there are comprehensive possession grounds in place so that a landlord can get their property back.
Clause 14 clarifies that the duties of landlords set out in new sections 16D and 16E of the Housing Act 1988 can be fulfilled or contravened by someone acting on their behalf. Many landlords will use the services of a letting agent, for example, and that is a sensible means of meeting their obligations, such as to provide a written statement of terms. For most landlords, the clause will make compliance easier. For example, if someone acting on behalf of the landlord issued a written statement of terms to the tenant, that would meet the landlord’s duty to provide the statement. However, landlords should not be able to absolve themselves of legal responsibility for providing a safe and secure home simply by appointing an agent. The clause ensures that landlords retain overall responsibility for complying with the law.
Government amendments 10 and 11 are merely consequential provisions. They qualify the new duty to provide a written statement of terms where a demoted tenancy is transferred to a new landlord. In such circumstances, the new landlord will have 28 days from the date that they become the landlord to comply with the requirement to provide a written statement of terms, instead of having to do so before the tenancy was entered into, which they obviously would not be able to do. We do not expect that circumstance to arise often in practice, but the amendments ensure that the law will operate effectively if the situation occurs.
David Simmonds
The Opposition broadly welcome the work the Government are doing in this area. Bringing clarity to the process is very important. In our work as constituency Members of Parliament, we will all have seen many cases where a lack of clarity on whether a notice has been properly served, or on whether a tenant or landlord fully understands their responsibilities and duties, is at the heart of a dispute or difficult situation. I have a brief question for the Minister, but I wanted to be clear on the record that bringing this level of clarity is important.
The enforcement process that the Minister referred to rests on a number of different organisations. Principally, the Bill envisages local authorities as the agent of enforcement. The fire brigades are a significant part of determining the suitability and safety of properties, and they bring prosecutions in the magistrates court when they find properties that have been occupied and rented to tenants but are clearly not safe on grounds that give them the power to prosecute. What consultations has the Minister undertaken with fire brigades about those prosecutions and the evidence that emerges from them about the circumstances of tenants found in such conditions? Those tenants are often among the most vulnerable, and they may not even have a written tenancy agreement, never mind a good understanding of their rights or a landlord who understands their duties and responsibilities.
Matthew Pennycook
I thank the shadow Minister for that question. On the general point about local authority enforcement, he is absolutely right. Landlords who fail to issue a written statement of terms on or before the first day of a tenancy will face enforcement action. They risk a fine of up to £7,000 from the local authority, the proceeds of which will be ringfenced to further enforcement work in that authority.
The shadow Minister made a specific point about fire brigades. To be honest with him, I do not have the answer to hand. I am happy to engage with officials to see what conversations the Department has had with the fire service, so that I can address his points. I will come back to him in writing as soon as I possibly can.
Amendment 10 agreed to.
Amendment made: 11, in clause 12, page 17, line 16, at end insert—
“(5A) Where a tenancy becomes a tenancy to which this section applies by virtue of section 143C(3) of the Housing Act 1996 (demoted tenancies: change of landlord), the statement under subsection (2) must be given within the period of 28 days beginning with the date on which the new landlord becomes the landlord under the tenancy.”—(Matthew Pennycook.)
This creates an exception from the new duty, inserted by clause 12 of the Bill into the Housing Act 1988, for a landlord to provide a written statement of certain matters before entering into an assured tenancy, so that the landlord of a tenancy which becomes an assured tenancy following the transfer of a demoted tenancy under the Housing Act 1996 has 28 days from becoming the landlord of the tenancy to fulfil those duties.
Clause 12, as amended, ordered to stand part of the Bill.
Clauses 13 and 14 ordered to stand part of the Bill.
Clause 15
Landlords etc: financial penalties and offences
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
We pick up a point we have just debated, which is the enforcement framework that the Bill provides for. The reforms we are putting in place will be underpinned by an effective, consistent and proportionate enforcement framework. In the Government’s view, serious breaches of the law should entail serious consequences, and we are clear that we will take action where it is needed to prevent abuse of the new system. To that end, clause 15 extends councils’ powers to issue financial penalties against landlords who flout the rules. The clause allows councils to penalise initial or minor non-compliance with a fine of up to £7,000—for example, for failing to provide a written statement of terms, such as we have just discussed, or for purporting to bring a tenancy to an end orally.
Serious, persistent or repeat non-compliance will be met with a fine of up to £40,000, with the alternative being criminal prosecution. That includes knowingly or recklessly misusing a ground for eviction, and re-letting or re-marketing a property within 12 months of using the moving in or selling grounds. Local authorities will be able to take robust action against the landlord who decides they will routinely evict tenants under a false claim to be moving a family member into a property or planning to sell it. That will act as a powerful deterrent and—although this is not the original purpose of the sanction—fines will provide valuable funding for local authority enforcement activity.
Clause 16 sets out the process that local housing authorities must follow when issuing financial penalties. That includes the appeals process, recovery of unpaid penalties and how local authorities may use the proceeds of the financial penalties. It includes the stipulation that proceeds of the financial penalties should be used to fund future enforcement activity. The clause provides clarity to local housing authorities on the process they must follow when issuing financial penalties to unscrupulous landlords.
I reassure the Committee that this clause also protects good landlords. The process allows landlords to make representations to local housing authorities for consideration when issued with a notice of intent, as well as appealing a final notice to the first-tier tribunal.
Clause 17 provides definitions for terms used in sections 16D to 16L and schedule 2ZA—for example, “local housing authority” and “relevant person”. That is simple and straightforward, and it requires no further elaboration.
Clause 18 provides that criminal offences contained within section 16J do not bind the Crown, which means that the Crown cannot be found criminally liable for these offenses. However, should the Crown break the rules, it is possible for a council to issue a fine in the same way as with private landlords. The Government believe that this is a reasonable approach and one that maintains precedent established in previous legislation, such as the Tenant Fees Act 2019. However, those acting in the service of the Crown will not be exempt from criminal liability. It is only fair that they are subject to the same financial penalties and criminal offences that apply to other individuals. I commend clauses 15 to 18 to the Committee.
David Simmonds
In practice, the measures contained in this section of the Bill will probably be the most important for our constituents who are tenants. Their ability to secure enforcement, where there is a breach of the legislation, will be critical. The Minister will know that the Opposition have shared concerns about ensuring that the resource from the enforcement regime will be sufficient to be self-sustaining. It strikes me that the enforcement regime, as set out, is very similar to that which already exists for local authorities in respect of environmental crime, such as fly-tipping, where it is assumed that the proceeds from fines and costs will be sufficient. Most of us will recognise that, in reality, that is rarely the case—carrying out that enforcement action always represents a cost to the council tax payer. Although it is not a matter for legislation, it would be helpful to understand how the Government intend to engage with local authorities to understand the cost of these new burdens fully and use the new burdens doctrine to ensure that they are appropriately resourced.
As the Minister has said, there is a point at which enforcement action outside criminal prosecution is taken, and there is a stage at which criminal prosecution may be the only available option. With other types of enforcement, many local authorities find that the push towards criminal prosecution is necessary to bring an end to the antisocial behaviour that is causing the problem in the first place. The challenge is that the proceeds of any fine resulting from criminal prosecution go into the consolidated fund of central Government expenditure, rather than accruing to the local authority. Even if there is not an award of costs, the largest part of that resource, which in theory is available to sustain the system, in fact goes into a different Government pot for other uses. It would be helpful if the Minister indicated what process of engagement and consultation the Government envisage they will take with local authorities. That must be designed to ensure that the resources derived from enforcement find their way to the sharp end of it, so that in practice, in the real world, it makes the difference that we hope it will.
Matthew Pennycook
I completely agree with the shadow Minister that many of the provisions in the Bill will not work as intended without robust local authority enforcement. We have increased the fines from the levels in the previous Government’s Bill to £7,000 and £40,000. It is also worth noting that those fines can be issued repeatedly—they are not a one-off—if landlords continue to breach the relevant provisions.
More generally on local authority resourcing, I make two points. First, it is important to note that many of the provisions in the Bill will not need to be enforced immediately. They will come into play one or two years down the line, so not every measure in the Bill that needs enforcement will require it from the date of Royal Assent. We have made it clear in previous debates that although we think that fines are part of the answer—we want the “polluter pays” principle to be at the heart of the Bill—we recognise that in many cases, they alone will not be enough. That is why I have set out that in accordance with the new burdens doctrine, we will ensure that additional burdens on local authorities that result from our reforms are fully funded.
The shadow Minister made an interesting point, as he has done several times today, that challenges me to go away and think about the final destination of fines from criminal prosecutions. I will take that away and give it serious consideration. We are in agreement that we need to ensure that where local authorities enforce breaches of the provisions set out in this Bill, those funds should come to local authorities. I will come back to him on the point he raises about the consolidated fund, if he is amenable to me doing so.
David Simmonds
The Minister’s response prompts me to ask a further question. I am grateful to him for undertaking to write back on the consolidated fund. In other enforcement regimes modelled on this system that provide scope to issue significant fines, there is a common pattern of local authorities outsourcing the responsibility to third-party enforcement agencies. We see that with littering, environmental crime and all manner of areas of local authority duty. Essentially, business makes a pitch, and if they receive the delegated authority to act on behalf of the council in the performance of its duties, they will enter into a profit share agreement. In the case of parking regimes, historically, for each parking ticket that was issued, some money went to the company and some money to the local authority.
That creates a risk—this was mirrored in the earlier debate—of perverse incentives. At local authority level, the incentive could be to pursue the landlords who are easiest to deal with and most likely to yield financial restitution to contribute to the bottom line of the business undertaking the work. That could result in a scarcity of resources to deal with the more difficult and intractable cases, and the most vulnerable tenants.
Have the Government thought about how, in their engagement with local authorities, they will seek to ensure that the regime is enforced equally? Local authorities have an understandable desire to outsource. Particularly in built-up urban areas where there may be a high density of rogue landlords, how can we ensure that the process will not result in extremely vulnerable people falling outside the enforcement regime because it simply is not profitable to pursue it in other parts of the country?
Matthew Pennycook
I thank the shadow Minister for that thoughtful point. To be entirely open, it is not one that I have considered. I think it is a fair challenge, and I will go away and give some thought to how we can ensure that local authorities look at all breaches in the round and apply the same approach to each, rather than targeting the low-hanging fruit. To provide reassurance on the concern about good landlords being caught up in the process, I repeat that the process allows landlords to make representations to local housing authorities and the first-tier tribunal if they think that that has happened.
The other point, which we will debate in quite extensive detail, is that enforcement by local authorities is not the only means that the Bill provides of tackling rogue landlords and breaches. I draw the shadow Minister’s attention to the significant strengthening of rent repayment orders, which offers an alternative, tenant-led enforcement mechanism. As I think I said in my evidence to the Committee last week, across the country—in local authority terms, enforcement is a real postcode lottery—the most effective thing I have seen is where well-resourced and effective local authority enforcement is complemented by tenants taking action with rent repayment orders. When the two work in tandem, it can be of real benefit in driving bad landlords out of the sector. I will give further consideration to the shadow Minister’s specific, well-made point.
Rebecca Smith
I want to build on the point that my hon. Friend the Member for Ruislip, Northwood and Pinner has just made. It may not quite fit at this point in the consideration of the Bill, but it has come to mind while we have been talking about this. I am sure that we all have been contacted by a tenant and then found out that they are one of five or six tenants, all with the same rogue landlord. What can we do in the Bill to enable the trigger point for one tenancy to be used as an opportunity to explore other tenancies with the same landlord? I have dealt with such a case, where I encountered a landlord with five or six tenants across a city, managing properties with appalling conditions and treatment of tenants. We do not want to have to repeat the exercise six times.
Is there anything in the Bill that would enable the local authority to see whether there are any other tenants in the same situation, or is that a bit too Big Brother—would it be pursuing it too far? The whole Bill is aimed at tackling rogue landlords. Are we slowing down that process by taking each property individually? Is there a mechanism whereby we could collect them all together?
Matthew Pennycook
If I have understood the hon. Lady correctly, and if she is amenable to it, I will fold this point into the written response that I have already promised her, but multiple fines can be levied for breaches. If a landlord in a particular part of the country with multiple properties is in repeated breach over that portfolio of properties, local authorities will be able to levy fines on more than one occasion, so it is not a £7,000 limit in the first instance, or £40,000 for more serious cases, per landlord. Again, I will expand on it in a written response, but I think the database can do some work here in terms of landlords in a particular area registering all their properties. I think it will become apparent quite quickly—it depends on how we use the database—if particular landlords show a pattern of behaviour whereby they are not treating their tenants appropriately. Let me come back to the hon. Lady in more detail as part of the response that I have already committed to.
Question put and agreed to.
Clause 15 accordingly ordered to stand part of the Bill.
Clauses 16 to 18 ordered to stand part of the Bill.
Clause 19
Notices to quit by tenants under assured tenancies: timing
David Simmonds
I beg to move amendment 49, in clause 19, page 31, line 19, leave out from “substitute–” to end of line 34 and insert—
“‘(b) it satisfies—
(i) subsection (1ZA), if it is given by a tenant in relation to premises let under an assured tenancy, or
(ii) subsection (1ZC) in any other case; but in relation to landlords under assured tenancies see section 5(1) of the Housing Act 1988 (notice to quit by landlord is of no effect).’
(3) After subsection (1) insert—
‘(1ZA) A notice to quit satisfies this subsection if—
(a) it is given not less than—
(i) any length of time before the date on which the notice is to take effect, not exceeding two months, that the landlord has agreed to in writing, or
(ii) in the absence of agreement under sub-paragraph (i), two months before the date on which the notice is to take effect, and
(b) it is in relation to premises let under a repeat tenancy or, if it is in relation to premises let under any other assured tenancy, it is to take effect—
(i) no earlier than any time, within the period of six months beginning with the day on which the terms of the tenancy provide for the tenancy to begin, that the landlord has agreed to in writing, or
(ii) in the absence of agreement under sub-paragraph (i), on or after the last day of the period mentioned in that sub-paragraph.
(1ZB) In subsection (1ZA)(b) “repeat tenancy” means an assured tenancy under which the tenant becomes entitled to possession of the premises within the period of one month beginning with the day after the last day of a previous assured tenancy—
(a) under which the same premises were let, and
(b) which was between the same parties.
(1ZC) A notice to quit satisfies this subsection if it is given not less than four weeks before the date on which it is to take effect.’”
The Chair
With this it will be convenient to discuss the following:
Amendment 66, in clause 19, page 31, line 31, at end insert—
“(aa) where it is given by a tenant who meets the student test under Ground 4A, not less than ten months before the date on which the notice is to take effect;”.
Amendment 67, in clause 19, page 31, line 31, at end insert—
“(aa) where it is given by a tenant in relation to a premises in which they are the first tenants since its construction, not less than twenty-four months before the date on which the notice is to take effect;”.
Clause stand part.
Clause 20 stand part.
David Simmonds
One issue that we have debated—I think, once again, it falls to a small p political and philosophical difference—is ensuring the availability of appropriate options for levels of term, in pursuit of our aim of freedom of contract for those to whom these terms would most lawfully and best apply. The purpose of this amendment is to move us on towards achieving that, and I believe that it would.
Mr Amos
The intention behind amendment 66, which stands in my name, is to take landlords at their word that they value hugely the opportunity for fixed-term tenancies, which of course are being removed by this Bill. We support the move to longer tenancies—periodic tenancies—in the Bill. Our policy was to extend them to at least three years, and in effect this Bill extends periodic tenancies almost indefinitely. But for the student population, it is a big disadvantage that students can no longer really rent premises or rent accommodation for the 10 months for which they need it. They nearly always face being forced to rent for 12 months, and paying rent over the summer period when they do not want to do so.
We are taking landlords at their word that they really value fixed-term tenancies, and that fixed-term tenancies would unlock investment and support from the landlord sector. The amendment would offer landlords and student tenants the option to enter into a 10-month fixed-term tenancy, which would benefit students in not having to rent for 12 months. MoneySuperMarket.com—other websites are available—has said that according to a survey in 2023, average student rents are £535 a month. Saving each student two months’ rent would save them £1,000, which is well worth it from their point of view. From the landlord’s point of view, if, as we heard in oral evidence, landlords value fixed-term tenancies, the option to have such certainty would be of value to them.
Having looked at the amendment again in the cold light of day, I will be withdrawing it, because I am not sure that the wording—for which I take full and complete responsibility—delivers my proposal as an option; it seems to indicate a requirement for a rolling 10-month notice period. However, I encourage the Committee to consider the benefits to students of reducing their tenancies from 12 to 10 months.
Matthew Pennycook
Clause 19 amends section 5 of the Protection from Eviction Act 1977 to set out the rules about what period of notice a tenant must provide to end a tenancy, stipulating that they will not have to provide more than two months’ notice. This will help renters to end tenancies quickly if they have a change of circumstances, such as needing to change jobs or move to a new area. It will also prevent them from being trapped in substandard properties for long periods of time. Allowing tenants to move on from poor properties is fundamental to establishing fairness in the new system, and it will incentivise landlords to provide a good service.
This will also provide landlords with the certainty they need. We believe that two months is sufficient time for landlords to re-let the property, minimising the time and costs of void periods. Landlords will not be allowed to ask for more than two months’ notice in the tenancy agreement. That will prevent them from replicating fixed terms by locking tenants in for long periods of time. If the tenancy agreement does not mention the tenant’s notice period, clause 19 requires tenants to provide at least two months’ notice. They will be able to provide more notice if it suits their circumstances. We recognise that sometimes a shorter notice period will be preferable for both tenants and landlords. The landlord and tenant may therefore agree to a shorter notice period in writing.
Clause 20 prevents landlords from specifying the form of writing that a tenant’s notice to quit must take. Landlords will not be able to include terms in the tenancy agreement that insist the notice to quit is provided in a particular form, such as a letter. Any attempt to do so will be rendered void by this clause. Instead, tenants will be able to provide notice in any written format, such as text message, email or letter. That will remove unhelpful barriers to tenants’ ability to provide notice to quit.
Clause 20 also clarifies that a tenant’s notice to quit can be withdrawn before it comes into effect, if the landlord agrees in writing. That is a sensible clarification to ensure that both parties can agree to continue the tenancy if that suits their respective circumstances.
I have to be clear that we will not accept any change that would increase the length of notice that tenants are required to provide. Amendment 49, which was tabled by the shadow Minister, seeks to prevent tenants from ending a tenancy in the first six months by ensuring that only notices that expire after six months would be considered valid. We will not be reintroducing that measure, which even the previous Government felt was unnecessary until the very late stages of their own Renters (Reform) Bill.
Tenants will not routinely end tenancies just after moving in or use assured tenancies as an alternative to holiday lets. In our view, tenants have to go through far too much administration and provide too expensive a deposit for this to be a viable concern. If tenants do have to end a tenancy, I am confident that two months is a fair amount of time for both parties to adjust. Six months is a long time to live in a house with damp or mould that the landlord simply painted over when doing viewings, or perhaps simply advertised inappropriately online—just as it is too lengthy a period to remain living with a partner after, for example, a relationship breakdown. I note again that landlords could still regain possession in that six-month period if the tenant was at fault, using the clear grounds for possession set out in schedule 1. Why should a tenant’s right to leave, when a landlord is at fault, be any different?
I turn to amendments 66 and 67, tabled by the hon. Member for Taunton and Wellington. Amendment 66 would require tenants who meet the student test in possession ground 4A to give 10 months’ notice. That would mean that students would have to know 10 months in advance whether they wanted to remain in the property. Landlords who are concerned about making a property available for new student tenants can seek possession under ground 4A if they meet the requirements of that ground. Similarly, amendment 67 would require tenants who are the first residents in newly built properties to provide 24 months’ notice when ending an assured tenancy.
I am afraid that I do not accept that it is reasonable to penalise some tenants because of the circumstances or the property in which they live. Those tenants deserve the same flexibility that everyone else will enjoy under the single system of periodic tenancies. We do not believe that it would be fair or justifiable to lock them in for such long periods of time. Again, since most new buildings should be good quality, tenants will only leave if they really need to. In other words, they can stay for 24 months, or perhaps longer if they want to, under the periodic tenancies that the Bill provides for. For those reasons, I ask the shadow Minister and the hon. Member for Taunton and Wellington not to press their amendments to a vote.
David Simmonds
I would like to ask the Minister, not at this stage but in due course, to provide a little bit more detail. In his response to these amendments, he referred to what sounds like an asymmetric process in the expectations of how notices would be given. It would be a requirement for a landlord to put a notice of any kind to the tenant in writing, but the tenant would be able to give notice by means of a text message. It seems very clear that that situation could give rise to disputes about whether information or notices were properly served in both directions. I urge the Government to ensure that, as the Bill makes progress, there is sufficient symmetry. For example, when disputes arise that might go before the courts or the tribunal, there needs to be real clarity, by way of an audit trail of what has been said to each party.
Matthew Pennycook
I thank the shadow Minister for that. I will undertake to provide him with more detail on the specific point he has made, which is noted and understood, either at an appropriate point in our further consideration of the Bill or in writing.
David Simmonds
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 19 ordered to stand part of the Bill.
Clause 20 ordered to stand part of the Bill.
Clause 21
Limitation on obligation to pay removal expenses
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
Section 11 of the Housing Act 1988 currently requires landlords of assured tenancies, who have been awarded possession under the redevelopment ground 6 or suitable alternative accommodation ground 9, to pay the tenant reasonable moving expenses. These grounds are mostly used by social landlords, who use assured tenancies and do not have access to section 21 no-fault evictions. The grounds support social landlords to manage their stock, ensuring that social housing is good quality and remains available for those who need it.
Clause 21 amends section 11(1) of the 1988 Act to ensure that only private registered providers of social housing will be required to pay removal expenses for grounds 6 and 9, once all tenancies become assured tenancies. We think it is unlikely that private landlords will regularly use grounds 6 and 9. However, on the rare occasions that they need to use them, they will not be required to pay removal expenses, ensuring that they are able to manage their assets in a reasonable way. I commend the clause to the Committee.
Question put and agreed to.
Clause 21 accordingly ordered to stand part of the Bill.
Clause 22
Assured agricultural occupancies: grounds for possession
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
As Committee members may be aware, qualifying agricultural workers are automatically entitled to an assured agricultural occupancy, which offers enhanced security of tenure to those who qualify. Tenants under AAOs cannot be evicted using section 21 or if their employment by the landlord comes to an end. Clause 22 makes consequential changes to AAOs to reflect the new tenancy system. That includes preventing landlords from evicting AAO tenants under the employment ground, now 5C, as well as ground 5A and the new superior landlord grounds. Those grounds cover circumstances where tenants under AAOs cannot currently be evicted, but they are being amended or introduced by the Bill and may pose a risk to their security in the new system. The clause will maintain the status quo.
Clause 23 seeks to replicate the existing mechanism in the Housing Act 1988 that allows landlords of qualifying agricultural workers to opt out of providing assured agricultural occupancies. They can issue assured shorthold tenancies instead, as long as they inform the tenant from the outset. We understand that many landlords make use of the opt-out, as it provides more flexibility for the agricultural sector and helps to maintain the supply of rural housing for workers. The clause therefore replaces the existing opt-out in a way that will be compatible with the new tenancy regime once ASTs are abolished, giving landlords access to the full range of new possession grounds.
I hope that both clauses are uncontroversial, and I commend them to the Committee.
David Simmonds
I can assure the Minister that we do not want to push these clauses to a vote. I am grateful to him for his explanation. It is important to recognise that agricultural workers are one category of tenant who often have different sets of circumstances, as their access to a home is connected to their job. School caretakers are another common example; it is not unusual for there to be a property on the school site that the post holder has the right to occupy.
It has become increasingly common, rather than going down the route of creating a tenancy from the outset, for the employment contract to have a side agreement of a licence to occupy, so the home is made available to the individual not as part of a tenancy agreement, but as part of a licence to occupy connected to their role. I would like the Minister to illuminate the Committee with the Government’s thinking on that issue.
There is a second issue. As has been described to us by a number of representatives from rural businesses, it is quite common for landlords to ask a tenant to vacate a particular property because its location or its facilities are directly connected with a role that they formerly did, and to offer them another like or equivalent property on the same estate. Traditionally, that has been a way of ensuring that, for example, farm workers who retire from a role in the care of animals where they had to be on the site 24 hours a day, and therefore cease to carry out that function, can be moved to another property on the estate without having to go through an extremely complicated and bureaucratic process. That process may not be good for the landlord, who has an urgent need for a worker on site to look after the animals, or for the tenant, who may have expectations about how their new accommodation will be secured, particularly at the point of retirement.
I would be grateful if the Minister could illuminate the Committee with the Government’s thinking on how that issue could be effectively addressed, so that we can take the matter into full consideration for those rural communities where it is particularly important.
Matthew Pennycook
I thank the shadow Minister for his points. If I have understood him correctly, I fear that those matters are slightly outside the scope of these clauses. I reiterate that we understand that many agricultural landlords use the opt-out to provide ASTs to their tenants instead, and that opt-out is retained by clause 23. We do, however, think that AAOs are a crucial part of the tenancy system, and we do not want to reduce their security by abolishing them outright and bringing these tenants into the wider assured tenancy system. I will take on board the points the shadow Minister made and come back to him in writing, if he will allow me; they raise a number of matters pertaining to housing that may or may not be in the scope of the Bill and these clauses. I think it is probably better if I come back to him in writing, given how specific and somewhat technical they are.
Mr Amos
I wonder whether the Minister would help me with an issue that is somewhat related to agricultural tenancies. In fact, it is a different kind of tied tenancy that has been raised with me by constituents, where the notice period required to be given for Church of England ministers—
Matthew Pennycook
The hon. Member for Taunton and Wellington tests my knowledge. I keep a lot of things in my head, but the particular tenancy arrangements as they pertain to Church of England ministers is not there. I am more than happy to discuss some of these issues with the hon. Gentleman outside the Committee, Dame Caroline.
The Chair
That would certainly help with my job.
Question put and agreed to.
Clause 22 accordingly ordered to stand part of the Bill.
Clause 23 ordered to stand part of the Bill.
Clause 24
Accommodation for homeless people: duties of local authority
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
The Bill will remove fixed tenancies and section 21 evictions, as we have discussed at length. These changes mean that we also need to amend part 7 of the Housing Act 1996 to ensure that councils’ statutory homelessness duties align with the new system. Clause 24 makes three changes to homelessness legislation to ensure that is the case.
First, clause 24 makes changes to how local authorities discharge their main housing duty. One of the ways in which local authorities may currently bring their main housing duty, which is a duty to secure settled accommodation, to an end, is by making an offer to a tenant of a suitable private rented sector tenancy with a fixed term of at least 12 months. With the removal of fixed-term tenancies, section 193 of the Housing Act 1996 is amended to instead refer to an assured tenancy.
Secondly, the clause amends sections 193(1A) and 193C of the Housing Act 1996, which concern the consequences when a person owed either the prevention or relief duty deliberately and unreasonably fails to co-operate with the local housing authority. If the local housing authority is satisfied that the applicant is homeless, is eligible for assistance, has a priority need, and is not intentionally homeless, then the applicant is still owed a duty to be accommodated. This duty, however, is currently a lesser one than the main housing duty. The lesser duty is to offer a fixed-term tenancy of at least six months as opposed to the period of at least 12 months that is required under the main duty. With the repeal of fixed-term tenancies, the lesser offer is redundant, and is removed by the clause.
Thirdly, subsection (4) of clause 24 repeals section 195A of the Housing Act 1996, which is the duty in homelessness legislation to offer accommodation following re-application after a private sector offer, known more commonly as the re-application duty. The re-application duty was introduced, alongside the introduction of private rented sector offers, as a means to end the main homelessness duty. It was introduced to respond to concerns that due to the short-term nature of assured shorthold tenancies, applicants who accepted a private rented sector offer may become homeless again within two years, and no longer have priority need.
The increased security of tenure and removal of section 21 evictions means that the re-application duty will no longer be relevant. The change will streamline the management of re-approaches and ensure that all applications will be treated according to their current circumstances at the point of approaching. There will no differential treatment between those placed in either private rented or social housing accommodation. The clause makes necessary and reasonable changes to the homelessness legislation as a consequence of the tenancy reform that we are introducing. I commend it to the Committee.
David Simmonds
The Homelessness Reduction Act 2017 was the main vehicle for ensuring that the homelessness duty might be addressed through an offer in the private rented sector. That was a means of ensuring that people who are not able to immediately access the kind of accommodation they need through the local authority can instead secure it in the private sector, and it has, to an extent, been very successful.
I want to ask the Minister what consultations are being undertaken across the Government to ensure alignment between parts of Government that have different responsibilities and duties, particularly in respect of notices that might fall within the scope of this Bill. I am thinking, in particular, of young people leaving the care system, who may be accommodated under section 20 by the local authority because of their risk of homelessness. In addition, when asylum seekers are placed in accommodation by the Home Office, there is a move-on period; the Home Office-owned legislation may result in their needing to access accommodation, so they may fall within the scope of this Bill. What consultation is being undertaken to ensure that those notice periods are aligned? I have to acknowledge that that was an issue for the previous Government—particularly in respect of asylum seekers, for whom the homelessness duty set out a different period from the Home Office’s move-on period, so individuals found themselves falling between those periods and were therefore unable to access the support they needed to find accommodation through their local authority.
Matthew Pennycook
I thank the shadow Minister for that point. I hope he will be satisfied with the following answer: extensive engagement has taken place between Departments in developing this Bill as it pertains to areas that cross departmental responsibilities. Again, given the extremely technical nature of his question—particularly in relation to asylum accommodation, which is not within my area of responsibility—I will come back to him in writing.
Question put and agreed to.
Clause 24 accordingly ordered to stand part of the Bill.
Clause 25
Tenancy deposit requirements
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
Clause 25 will maintain important deposit protections so that tenants can be confident that their money is being handled safely. Landlords will be required to comply with deposit protection rules before a court can make an order for possession under section 8 of the Housing Act 1988. That will apply only if the landlord has failed to store the deposit in one of the prescribed schemes or comply with the applicable rules.
The clause also makes consequential amendments to the Housing Act 2004 to ensure that deposit protection rules continue to apply in the future once assured shorthold tenancies are abolished. Deposits taken for existing assured shorthold tenancies will still need to be protected after the new system has come into force. Deposits taken for assured tenancies created after commencement will also need to be protected. This is an extremely straightforward and simple clause, and I look forward to the extremely technical question that the shadow Minister will put to me on it.
David Simmonds
The Minister will be delighted to know that I do not have a detailed, technical question to ask him on this clause, but I am sure that if he gives me some time, I will be able to come up with one.
The Chair
Let us not do that.
Question put and agreed to.
Clause 25 accordingly ordered to stand part of the Bill.
Clause 26
Tenant fees
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
Clause 26 amends the Tenant Fees Act 2019 to ensure that its provisions remain applicable and relevant to the tenancy reforms in the Bill. In particular, it removes the provision that prevents a landlord from serving a section 21 notice where they are in receipt of a prohibited payment from a tenant. Removing that provision is necessary, given that section 21 notices will be abolished. There will remain strong enforcement mechanisms in the Tenant Fees Act, including offences for landlords who require payments from tenants that are prohibited under that Act. That will ensure that under the new system tenants will continue to be protected from unfair and prohibited payments that were previously outlawed.
Clause 27 amends council tax rules to clarify council tax liability once fixed-term assured tenancies are abolished. That will ensure that assured tenants remain liable for council tax until the end of their tenancy agreement. That will include where they have served notice to end the tenancy but leave the property before the notice period has ended. In that instance, the liability will not fall to the landlord until the tenancy has ended. I commend clauses 26 and 27 to the Committee.
David Simmonds
I would be grateful if the Minister shared the Government’s thinking on the interaction between this issue of liability for council tax and the legal duties on local authorities to collect it, where they have an obligation to ensure that, as part of the efficient delivery of public services, they maximise the level of council tax collected. I understand the purpose of what the Minister has just described. I would try to ensure that, in situations where there may be an end to the tenancy, we do not create a situation both where the liability is difficult to assign and there is potentially an issue of who needs to be pursued for that council tax. Clearly, it is important to ensure that local authorities with a separate set of legal obligations in that respect are fully sighted on what the impact of this may be, and on the performance of their duties.
Matthew Pennycook
To reassure the shadow Minister on the general matter, there has again been extensive engagement with local authorities on the development of this Bill. I think he referred to clause 27, and it is our view that tenants should obviously be responsible for council tax payments until the tenancy has formally ended. When a tenant serves notice, the tenancy does not end until the notice period has expired, even if the tenant leaves the property before then. This measure will not change anything for most tenants, but clarifies where they will be liable for council tax until the end of the notice period, including where they have served notice to end the tenancy but leave the property earlier. It simply ensures that council tax remains aligned with other household costs, such as rent and bills. I hope that reassures the shadow Minister, but if not, I am more than happy to pick it up at a future point or in writing.
David Simmonds
That goes a long way in providing the necessary assurance. It is necessary for there to be clarity, for example, where a contract includes not just the rent but council tax within a single payment to the landlord, who will then be paying the council tax on behalf of the tenant, as happens under some rental contracts. We do not want to create a situation where the local authority is pursuing a tenant for the council tax at that point, because the tenancy has ended and the tenant argues that they have already made that payment to the landlord and it has not been passed on. I simply wanted to ensure that, in the performance and function of the collection fund, which I know is high level and a very important part of the Department’s overall calculation of the level of local government finance, we are not at risk of creating any potential loopholes.
Matthew Pennycook
That has usefully clarified the point that the shadow Minister is driving at. Local authorities are well-experienced in the administration of council tax, including determining who is liable. For example, they have powers to require residents, owners or managing agents to provide information to help establish liability, and where that is not complied with, they can impose a penalty. We will work closely with the local authority sector when implementing the new system to ensure that the new rules are well-understood, but we think local authorities have sufficient powers to determine liability for council tax in any particular circumstance.
Question put and agreed to.
Clause 26 accordingly ordered to stand part of the Bill.
Clause 27 ordered to stand part of the Bill.
Clause 28
Other amendments
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following:
Government amendments 12 to 21.
Schedule 2.
Clause 29 stand part.
Matthew Pennycook
The Renters’ Rights Bill makes some significant changes to legislation, such as abolishing section 21 notices, assured shorthold tenancies and fixed-term tenancies. This means that there are references that need to be removed and changes needed to ensure that the wider stature book remains in good order.
Clause 28 sets out that those consequential amendments to existing legislation are made in schedule 2 of this Bill. Schedule 2 makes consequential changes to a number of Acts of Parliament to reflect the abolition of assured shorthold tenancies, fixed-term assured tenancies and no-fault evictions. They ensure that existing legislation can continue to operate after our reforms to the tenancy system have taken place, and they are predominantly minor and technical in nature. For example, our amendments to the Housing Act 2004 in paragraph 45 are simply repeals of legislation that prevented landlords using section 21 to evict tenants from an unlicensed HMO. We have amended the Housing Act 1985 and the Localism Act 2011 to reflect the abolition of demoted tenancies, where social housing tenants can be “demoted” to less secure assured shorthold tenancies, as ASTs will no longer exist.
In paragraph 48 of schedule 2, we have also repealed provisions in the Deregulation Act 2015 that outlawed retaliatory evictions via section 21 as this legislation will cease to have that effect after the Renters’ Rights Bill is implemented. In paragraphs 1 to 7, we have made amendments to the Reserve and Auxiliary Forces (Protection of Civil Interests) Act 1951 to ensure that mobilised reservists’ tenancies continue to be protected. From those examples, the Committee will see that the changes that schedule 2 makes are technical and uncontroversial, ensuring the statute book continues to operate effectively and consistently after our reforms to the tenancy system.
David Simmonds
I commend the Government for the work they are doing to ensure that the statute book lines up across all the different pieces of legislation. Will the Minister inform the Committee how the changes to the homelessness prevention duty will impact on tenants who have no recourse to public funds in the UK?
Matthew Pennycook
I commend the shadow Minister for challenging me on those points. I do not have that answer to hand, so I will commit to come back to him in writing on that specific point.
Question put and agreed to.
Clause 28 accordingly ordered to stand part of the Bill.
Schedule 2
Amendments relating to Chapter 1 of Part 1
Amendments made: 12, in schedule 2, page 174, line 29 at end insert—
“Greater London Council (General Powers) Act 1973
7A In section 25 of the Greater London Council (General Powers) Act 1973 (provision of temporary sleeping accommodation to constitute material change of use), in subsection (2)—
(a) in paragraph (a), after ‘person’ insert ‘otherwise than under or by virtue of an assured tenancy’;
(b) after that paragraph insert—
‘(aa) “assured tenancy” means an assured tenancy within the meaning of Chapter 1 of Part 1 of the Housing Act 1988;’”.
This creates an exception to the restriction on the provision of temporary sleeping accommodation in residential premises in Greater London for less than 90 days, where occupation of such accommodation is under or by virtue of an assured tenancy agreement.
Amendment 13, in schedule 2, page 174, line 31, leave out paragraph 8 and insert—
“8 The Housing Act 1985 is amended as follows.
8A In section 81ZA (grant of secure tenancies in cases of domestic abuse), in subsection (4), in the definition of ‘qualifying tenancy’, in paragraph (b), omit sub-paragraph (i).
8B In section 81B (cases where old-style English secure tenancies may be granted), in subsection (2C), in the definition of ‘qualifying tenancy’, in paragraph (b), omit ‘which is not an assured shorthold tenancy and’
8C In section 82A (demotion because of anti-social behaviour)—
(a) in subsection (1), omit paragraphs (ba) and (c);
(b) in subsection (8), omit paragraph (b).
8D In section 171B (extent of preserved right), omit subsection (1A).
8E In Schedule 3 (grounds for withholding consent to assignment by way of exchange), in ground 2A, in the definition of ‘demotion order’, omit ‘or section 6A of the Housing Act 1988’.”.
This adds further amendments to the Housing Act 1985 to remove the power of private registered providers of social housing and registered social landlords to apply for demotion orders relating to secure tenancies (new paragraph 8C(a)) and otherwise in consequence of the changes made by Part 1 of the Bill.
Amendment 14, in schedule 2, page 176, line 2, at end insert—
“17A In section 15 (limited prohibition on assignment etc. without consent), in subsection (3), omit ‘a statutory periodic tenancy or’.
17B In section 17 (succession to assured tenancy)—
(a) in subsection (1)(a), omit ‘periodic’;
(b) in subsection (1A)(a), omit ‘periodic’;
(c) omit subsection (1B);
(d) omit subsection (1C);
(e) in subsection (1D), for ‘, (1A), (1B) or (1C)’ substitute ‘or (1A)’;
(f) in subsection (5), omit ‘or (1B)(c) above’;
(g) in subsection (6), omit ‘, (1C)’;
(h) omit subsection (7).”
This makes further amendments to the Housing Act 1988 to take account of changes made by Part 1 of the Bill.
Amendment 15, in schedule 2, page 176, line 17, leave out paragraph 21 and insert—
“21(1) Section 39 (statutory tenants: succession) is amended as follows.
(2) In subsection (5), in the words after paragraph (b), omit ‘periodic’.
(3) In subsection (6)—
(a) in the words before paragraph (a), omit ‘periodic’;
(b) in paragraph (d), after the second ‘tenancy’ insert ‘(but this is subject to section 4A)’;
(c) in paragraph (e), for ‘sections 13 to 15’ substitute ‘sections 13 to 16C’;
(d) omit paragraph (f).
(4) Omit subsection (7).
(5) In subsection (8)—
(a) omit ‘periodic’;
(b) after ‘above)’ insert ‘; and section 24A does not apply in relation to the assured tenancy to which the successor becomes entitled’.
(6) For subsection (9) substitute—
‘(9) Where, immediately before the predecessor’s death, the predecessor was a tenant under a fixed term tenancy (the “former tenancy”), the following provisions of this subsection apply in relation to the assured tenancy to which the successor becomes entitled on the predecessor’s death (the “new tenancy”)—
(a) not later than the first anniversary of the date of the predecessor’s death, the landlord may serve on the tenant, or the tenant may serve on the landlord, a notice in the prescribed form (a “notice of variation”)—
(i) proposing terms of the new tenancy, other than terms as to the amount of the rent, that are different from the terms which have effect by virtue of subsection (6)(e) (the “implied terms”), and
(ii) if the landlord or the tenant considers it appropriate, proposing an adjustment of the amount of the rent to take account of the proposed terms;
(b) where a notice of variation has been served under paragraph (a)—
(i) within the period of three months beginning on the date on which the notice was served on him, the landlord or the tenant, as the case may be, may, by an application in the prescribed form, refer the notice to the appropriate tribunal under paragraph (c), and
(ii) if the notice is not so referred, then, with effect from such date, not falling within the period referred to in sub-paragraph (i), as may be specified in the notice, the terms proposed in the notice shall become terms of the tenancy in substitution for any of the implied terms dealing with the same subject matter and the amount of the rent shall be varied in accordance with any adjustment so proposed;
(c) where a notice of variation is referred to the appropriate tribunal, the appropriate tribunal must consider the terms proposed in the notice and must determine whether those terms, or some other terms (dealing with the same subject matter as the proposed terms), are such as, in the appropriate tribunal’s opinion, might reasonably be expected to be found in an assured tenancy of the dwelling-house concerned, being a tenancy—
(i) which begins on the date of the predecessor’s death, and
(ii) which is granted by a willing landlord on terms which, except in so far as they relate to the subject matter of the proposed terms, are those of the new tenancy at the time of the appropriate tribunal’s consideration;
(d) whether or not a notice of variation proposes an adjustment of the amount of the rent under the former tenancy, where the appropriate tribunal determine any terms under paragraph (c), they must, if they consider it appropriate, specify such an adjustment to take account of the terms so determined;
(e) in making a determination under paragraph (c), or specifying an adjustment of an amount of rent under paragraph (d), there must be disregarded any effect on the terms or the amount of the rent attributable to the granting of a tenancy to a sitting tenant;
(f) where a notice of variation is referred to the appropriate tribunal, then, unless the landlord and the tenant otherwise agree, with effect from such date as the appropriate tribunal may direct—
(i) the terms determined by the appropriate tribunal become terms of the new tenancy in substitution for any of the implied terms dealing with the same subject matter, and
(ii) the amount of the rent under the statutory periodic tenancy is altered to accord with any adjustment specified by the appropriate tribunal;
but for the purposes of sub-paragraph (ii) the appropriate tribunal must not direct a date earlier than the date specified, in accordance with subsection (3)(b) above, in the notice of variation;
(g) nothing in this section requires the appropriate tribunal to continue with a determination under paragraph (c) if the landlord and tenant give notice in writing that they no longer require such a determination or if the tenancy has come to an end.’”.
This makes consequential amendments of section 39 of the Housing Act 1988.
Amendment 16, in schedule 2, page 176, line 37, at end insert—
“30A In section 124 (introductory tenancies), in subsection (2)(b), omit ‘, other than an assured shorthold tenancy,’.
30B In section 125 (duration of introductory tenancy)—
(a) in subsection (3), omit ‘, or a relevant assured shorthold tenancy,’;
(b) omit subsection (3A).”.
This adds further amendments to the Housing Act 1996 relating to introductory tenancies to take account of the changes made by Part 1 of the Bill.
Amendment 17, in schedule 2, page 177, line 2, at end insert—
“31A In section 143C (change of landlord), in subsection (3), omit ‘shorthold’.”
This adds further amendments to the Housing Act 1996 relating to demoted tenancies to take account of the changes made by Part 1 of the Bill.
Amendment 18, in schedule 2, page 178, line 23, at end insert—
“(c) in Schedule 1 (demoted tenancies), omit paragraph 2(3).”
This amends Schedule 1 to the Anti-social Behaviour Act 2003 in consequence of the amendment made to section 171B of the Housing Act 1985 by Amendment 13.
Amendment 19, in schedule 2, page 178, leave out lines 25 to 27 and insert—
“45 The Housing Act 2004 is amended as follows.
46 Omit section 75.
47 Omit section 98.
48 In section 116 (general effect of final management orders), in subsection (4)—
(a) in paragraph (a)(ii), omit ‘subject to paragraph (b))’;
(b) for paragraph (b) substitute—
‘(b) paragraph (a) does not apply to the creation of an interest in the nature of an assured tenancy within the meaning of Part 1 of the Housing Act 1988.’
49 In section 136 (making of final EDMOs), in subsection (5), before paragraph (a) insert—
‘(aa) paragraph 2 is to be read as requiring the notice under paragraph 1 to also set out the rights and powers of the authority under paragraph 10(3) of Schedule 7 in connection with a dwelling in relation to which a final EDMO is in force;’.
50 In Schedule 7 (general effect of final EDMOs), in paragraph 10(4)—
(a) in paragraph (a)(ii) omit ‘(subject to paragraph (b))’;
(b) for paragraph (b) substitute—
‘(b) paragraph (a) does not apply to the creation of an interest in the nature of an assured tenancy within the meaning of the Housing Act 1988.’”
This replaces the amendments to the Housing Act 2004 and adds new amendments to the provisions in that Act relating to management orders to take account of the changes made by Part 1 of the Bill.
Amendment 20, in schedule 2, page 179, line 4, at end insert—
“(ba) in section 158 (secure and assured tenancies: transfer of tenancy)—
(i) omit subsection (3)(b)(i) and the ‘and’ after it;
(ii) omit subsection (4)(b) and the ‘or’ before it;
(iii) in subsection (8)(b), omit the words ‘that is not an assured shorthold tenancy’;
(iv) in subsection (9)(b), omit the words ‘that is not an assured shorthold tenancy’;
(v) in subsection (10), omit ‘shorthold’;
(bb) in section 159 (further provisions about transfer of tenancy under section 158), in subsection (6)(c), for ‘and “assured shorthold tenancy” have’ substitute ‘has’;”.
This adds further amendments to the Localism Act 2011 in relation to the transfer of tenancies to take account of the changes made by Part 1 of the Bill.
Amendment 21, in schedule 2, page 179, line 8, at end insert—
“(ea) in section 184 (tenancy deposit schemes), omit subsections (10) to (13);”.—(Matthew Pennycook.)
This repeals section 184(10) to (13) of the Localism Act 2011. The repealed provision amends section 215 of the Housing Act 2004 (which is replaced by clause 25(5) of the Bill).
Schedule 2, as amended, agreed to.
Clause 29 ordered to stand part of the Bill.
Clause 30
Tenancies of more than seven years
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
With this clause, we turn to chapter 2 of part 1, which deals with tenancies that cannot be assured tenancies. The clause excludes from the assured tenancy regime fixed-term leases of more than seven years, which is particularly relevant for leasehold homeowners and those who purchased via shared ownership, who can sometimes be legally considered tenants under the assured regime despite having purchased their property. The clause will therefore exclude entirely such fixed-term leases and any others over seven years in length from the assured regime, thereby supporting the continued operation of shared ownership and providing additional security to shared ownership homeowners by exempting them from the grounds for eviction in the Housing Act 1988. It will also exclude leaseholders from the assured tenancy system, finally closing the so-called tenancy trap. It is unjustifiable, in the Government’s view, that leaseholders who have purchased their homes can face repossession for rent arrears through the assured tenancy regime. The exemption will therefore ensure they are protected.
I am grateful to stakeholders for raising concerns with me over the ways the clause could be undermined or abused. Let me be clear: we will not tolerate attempts to get around the abolition of section 21 by abusing this clause. I am therefore considering whether any action is needed to ensure that the system operates as intended, and that no abuse of the system can take place.
Clause 31 rectifies an omission to ensure that, as is the case for other specified sections where local authorities have an interim duty or discretion to provide temporary accommodation, a tenancy granted pursuant to section 199A of the Housing Act 1996 cannot become an assured tenancy. This will allow the private landlord to regain possession of their property once the local authority’s duty to provide it by way of interim accommodation ceases.
David Simmonds
From our constituency work, many of us will be aware that when an individual has a “no recourse to public funds” condition because of their immigration status, although they may be employed in the UK and potentially in the public sector, the local authority has no duty to house that individual. That, however, may be compromised if, for example, there are children in the household, where duties under the Children Act 1989 and the National Assistance Act 1948 are triggered and the local authority effectively has a responsibility by another route. Although the individual may occupy a private rented sector property that has been procured for them by the local authority under those duties, they do not have any rights to public funds to pay for it, and therefore fall into a slightly ambiguous position with respect to this Bill. Some clarity would be helpful, especially given that there is a significant market of landlords, many of them directly contracted with the Home Office, who specifically provide accommodation for people who find themselves in a NRPF situation.
Matthew Pennycook
I thank the shadow Minister for that point; it is well made and well understood. As I will write to him on the subject of no recourse to public funds, I will ensure that that point is also covered in our correspondence.
Rebecca Smith
I have a point on which I would appreciate clarification. Increasingly, local authorities are purchasing properties to act as temporary accommodation because of a shortage of private rented accommodation. I am interested in whether it is within the scope of the Bill to look at how we would ensure that local authorities are not inadvertently caught up in the new legislation if, for example, they have bought 10 flats in a block to act specifically as temporary accommodation. If they put residents in it temporarily, are they inadvertently caught by the new legislation? Or will they be able to find somewhere else for the people to live, enable them to finish that tenancy and provide it for somebody else who might need temporary accommodation? It is a pretty niche example, but it is happening in my constituency. I am interested to see whether we have accidentally tied ourselves in knots.
Matthew Pennycook
That is a niche point—one of many we have had on some of the more technical clauses. That is not a concern that has been expressed to the Government in relation to this clause or other aspects of the Bill, but I will commit to go away and deal with that set of issues relating to temporary accommodation and no recourse to public funds in the round. I will give Committee members a full and detailed answer on each of the points that have been raised.
Question put and agreed to.
Clause 30 accordingly ordered to stand part of the Bill.
Clause 31 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Gen Kitchen.)
Renters' Rights Bill (Fifth sitting)
Thursday 31st October 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 31 October 2024 - (31 Oct 2024)
The Chair
With this it will be convenient to discuss the following:
Clauses 33 to 38 stand part.
Amendment 78, in clause 39, page 47, line 3, at end insert—
“(6A) On recovering a financial penalty imposed under this section, a local housing authority shall pay 20% of the recovered penalty to the person who was the subject of the discrimination.
(6B) Where the person who was the subject of the discrimination complains to the relevant landlord redress scheme about the same discriminatory behaviour, the scheme provider shall take into account any sum paid or payable to that person under subsection (6A) in assessing any further award of compensation which the relevant person is directed to pay to that person under the scheme.”
This amendment provides a mechanism for a complainant to receive a portion of the financial penalty imposed by a local housing authority as compensation for being discriminated against.
Clauses 39 to 41 stand part.
Amendment 79, in schedule 5, page 207, line 31, leave out—
“Where” and insert “Subject to section 39(6A), where”.
See Amendment 78.
Matthew Pennycook
It is an absolute pleasure, Mr Betts, to continue our consideration of the Bill with you in the Chair, not least because you will have extensive knowledge of what we are talking about as we proceed through the clauses.
Before we proceed to the substantive matter, I draw the Committee’s attention to the letter that I sent the Chair this morning, responding to the various technical questions put to me in the previous sitting. I hope that Members find my responses useful. I look forward to continuing this co-operative approach as we debate the remaining clauses.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
I put on the record my thanks to the Minister for the prompt and detailed response to the points made. We had a brief discussion this morning about a small omission involving, for example, school caretakers or NHS staff who are provided with accommodation on site as part of their employment. I am grateful that the Minister has undertaken to respond to that, too, in due course.
Matthew Pennycook
I will indeed respond to that specific point in the extensive future correspondence that I expect to have with the shadow Minister, given his form in previous sittings.
Having considered assured tenancies and tenancies that cannot be assured tenancies in our third and fourth sittings on Tuesday, we now turn to chapter 3 of part 1 of the Bill, which concerns discrimination in the rental market in England. The Government are determined to make it unlawful for landlords and agents acting on their behalf to engage in discriminatory conduct against tenants with children or those in receipt of benefits. The case for prohibiting such conduct is indisputable.
Not only should all renters be treated fairly in their search for a place to call home as a point of principle, but the changing nature of the private rented sector, and the fact that it now contains increasing numbers of families and those in receipt of housing support, make it imperative that the Government act in this area. Individuals in receipt of benefits or who have children should have the opportunity to be considered for a tenancy on their own circumstances, rather than rejected straight away under a blanket policy.
The problem that this part of the Bill attempts to resolve is that a blanket ban of the kind we are considering is already contrary to the Property Ombudsman’s code of practice, and already almost certainly unlawful by virtue of the premises provisions in the Equality Act 2010, which provide for a prohibition against discrimination in the letting, managing or dispensing of premises. However, despite a number of court rulings confirming that rejecting a tenant’s application because of benefit status or family circumstances is a breach, proving discrimination is incredibly difficult. As a result, despite a growing body of case law, it remains fairly common for landlords to refuse to allow benefit claimants or those with children to view an affordable property, or to consider them as a potential tenant, and for properties to be advertised with restrictions such as “No DSS”, “No benefits” and “No kids”.
Discriminatory conduct of this kind is constantly evolving and is therefore difficult to adapt to. For example, following landmark rulings that a “No DSS” policy is unlawful as it indirectly discriminates, explicit “No DSS” adverts morphed into more subtle forms of messaging with the same intent, such as specifying “Working professionals only”. The question is, therefore, how we best ensure that the underlying discrimination in this area does not occur in practice.
During consideration of the previous Government’s Renters (Reform) Bill, I challenged the then Minister, the former Member for Redcar, to specify through regulations behaviour that for the purposes of the Equality Act 2010 should be considered unlawful discrimination unless the contrary is shown. In other words, my suggestion to the Minister at the time was that the onus should be placed on landlords to convince a court that a ban had no discriminatory impact. In developing the Renters’ Rights Bill I considered carefully whether that approach would be the most effective way to try to bear down on the problem of discriminatory conduct against tenants with children or who receive benefits. I ultimately concluded that it would not, both because it would have entailed a complex reform of the Equality Act, and because it would require tenants themselves to bring costly civil litigation to seek redress.
Jerome Mayhew (Broadland and Fakenham) (Con)
The Minister identified other legislation that already make discrimination illegal, and went on to make the point that proving discrimination is very difficult, so my question is twofold. First, if we have already outlawed that kind of behaviour, why do we need further legislation to do exactly the same thing? Secondly, if we do require further legislation, how is the evidential burden going to be passed more easily under this clause than has been the experience under previous provisions?
Matthew Pennycook
I thank the hon. Gentleman for his two reasonable questions; I will come on to answer them both in my remarks. If he feels that I have not sufficiently explained the matter, I am more than happy to give way to him again, but I will address both those points. The first I have already touched on: despite it almost certainly being unlawful under the Equality Act, discriminatory conduct of the kind that we are trying to bear down on happens fairly routinely, so it is evident to the Government that the existing legislation does not allow us to bear down on the problem effectively in practice. We think the Bill’s provisions will allow us to do so. I will pick up the hon. Gentleman’s point about the evidential burden and how local authorities make that judgment in due course.
In contrast to the approach on which I challenged the then Minister in the previous Parliament, the advantage of the approach taken in the Bill is that, first, responsibility for enforcement lies with local authorities and not tenants, and secondly, breaches can be addressed relatively easily, in the English context, via a civil offence with a lower burden of proof than a criminal one.
Clauses 32 and 33 directly and expressly prohibit discriminatory bans and restrictions on the letting of private rented sector properties on the basis that children would live with or visit a person at the property, or to persons in receipt of benefits. They also prohibit any conduct that might otherwise effectively constitute such bans or restrictions. In other words, the provisions are intended to deal with both direct and more subtle forms of discrimination. It is important to note that landlords and agents will continue to have the final say on who they let their property to, and they will be able to continue to carry out referencing checks to make sure that tenancies are sustainable for both parties.
It is also the case, as clause 40 makes clear, that nothing in this chapter will prevent landlords from making a final decision based on an objective and fair assessment of whether the prospective tenant can afford the rent, nor will it force landlords into entering into unsustainable tenancies. The majority of landlords—those who already act fairly and conscientiously and treat applicants equally, assessing their suitability on a case-by-case basis—have absolutely nothing to fear as a result of the introduction of the new rental discrimination framework.
Jerome Mayhew
The Minister made reference to the burden of proof under the clause being the civil burden, and compared that to the Equality Act. I just had a quick look at that Act—I stand to be corrected because it was a very brief look—and the burden under that Act appears to be a civil burden and also one where the maxim res ipsa loquitur can be applied. If that is the case, what is the difference between the burden of proof in this clause and that of the Equality Act?
Matthew Pennycook
If I have understood correctly, the hon. Gentleman is challenging me on the burden of proof. I will say two things: first, who is the actor in charge of enforcement? It is for local authorities to make a judgment on whether the burden of proof has been met. That is a key difference. On the legal point, I am more than happy to come back to the hon. Gentleman in terms of how the burden applies in this case and whether it is any different from the provisions under the Equality Act, but we are talking about the provisions of the Bill and the most practical way to bear down on the problem. It is a difficult one to bear down on, as he will appreciate.
Landlords and related parties will be exempt from the prohibitions if the prohibition was necessary for the landlord to fulfil a restrictive term in an existing insurance contract that prohibits occupation by children or if a prohibition was a proportionate means of achieving a legitimate aim. The example we chose in the explanatory notes was a landlord reasonably refusing to rent a small bedroom in a house in multiple occupation to a women with two teenage children, in order to adhere to overcrowding regulations. However, in general terms the clauses will bear down on rental discrimination by ensuring that prospective tenants are considered on an individual basis rather than on the basis of whether they have children or are in receipt of benefits. To reassure Opposition Members, the provisions broadly mirror those in the previous Government’s Renters (Reform) Bill.
Clauses 34 to 37 merely nullify any discriminatory clauses relating to children and benefits in tenancy agreements, superior leases, mortgage deeds and insurance policies by rendering them unenforceable. As with clauses 32 and 33, exemptions apply for a prohibition if it is a proportionate means of achieving a legitimate aim.
It should be noted that while the mortgage and lease provisions set out in clauses 35 and 36 are retrospective, the insurance provisions set out in clause 37 are not. We have taken this approach because insurance contracts are renewed with greater frequency than mortgages and leases, so will naturally be updated to reflect the new requirements without necessitating immediate action or impacting existing insurance rates.
The provisions in this chapter of the Bill make it clear that rental discrimination against families with children or people who receive benefits has no place in a fair and modern housing market. We recognise, however, that we may need to extend the new protections to additional cohorts, if required in future. Clause 38 allows us to do so by way of regulations, subject to the affirmative procedure and following a consultation, provided that any new protections remain consistent with the existing framework.
For example, I have received representations from my hon. Friend the Member for Doncaster Central (Sally Jameson) to extend the rental discrimination provisions to care leavers. The Government feel strongly that the protections provided for by this chapter should be extended to additional cohorts only if there is sufficient evidence to suggest that is required. We do not yet have such evidence in the case of care leavers, but I intend to keep the matter closely under review. If we do need to look to extend discrimination protections to care leavers, we will. The powers in clause 38 will allow us to do so, as well as to respond promptly to any new acts of unlawful discrimination that may emerge in future.
Clause 39 gives local housing authorities the power to impose a financial penalty of £7,000 on a person if on the balance of probability—this directly addresses the question earlier from the hon. Member for Broadland and Fakenham—the local authority is satisfied that there has been a breach of a rental discrimination measure in this chapter. The penalties will be compounding for continuous or repeated breaches.
In summary, although we appreciate the inherent challenges in legislating to tackle rental discrimination, I believe that the measures in this chapter, set alongside strong communication and clear guidance, will see us make measurable progress towards ending discriminatory conduct against tenants with children or those in receipt of benefits. I commend them to the Committee.
Amendments 78 and 79, tabled in the name of the hon. Member for Bristol Central, would ensure that prospective tenants who report rental discrimination could receive a share of any financial penalty imposed on the landlord or letting agent. My assumption—the hon. Lady may well correct me—is that the intent of the amendments is to create an incentive for prospective tenants to complain to the relevant local authority where they consider they may have been a victim of such discrimination. That is an entirely worthy objective, and we do want tenants who find themselves in such circumstances to make a complaint to the relevant local council. We have placed a duty on local authorities to enforce the provisions when they have sufficient evidence to act. However, I cannot accept the amendments, for the following reasons. First, the idea of giving prospective tenants a cut of the civil penalty is wrong in principle. They are penalties imposed by a public body for breaking the law, not a mechanism for compensation.
Secondly, I worry about the potential impact on local government. Allowing a proportion of any such penalty to be allocated as compensation would undermine the principle that all civil penalty income must be ringfenced for enforcement activity in the private rented sector. Moreover, we would expect local authorities, including the hon. Lady’s, to take issue with surrendering part of a receipt that may, in practice, already not be enough to cover the costs of pursuing enforcement action. The arrangements necessary to facilitate such compensation would also add to the administrative burden on local authorities. Financial incentives might also create the risk that prospective tenants complain when it is not warranted and press local councils to propose civil penalties when the evidence is lacking.
Thirdly, there are likely to be practical difficulties in identifying who has been the subject of discrimination— for example, in instances where more than one tenant is involved. There would also be an administrative burden if the compensation were to be paid in instalments.
David Simmonds
The Opposition broadly support the clauses. I have some questions for the Minister, which are matters not of amendment but of clarification.
Clause 35 deals with tenancies where there may be restrictions on children either visiting or living in a property. There has been a significant increase in the number of retirement communities across the UK, and it is quite common for them to set out a condition— for example, that occupiers must be aged over 55. That housing supply is important, especially to encourage people who are under-occupying family homes to choose to move later in life to a retirement property that is designed and built specifically for that purpose. I seek assurance from the Government that while the clause effectively nullifies any restrictions on the ability for children to live in a property, bespoke retirement communities, constructed specifically with the needs of older people in mind, will not find it a problematic provision.
We support the Government’s position in clause 40, on taking income into account. It is clear that the purpose behind the previous voluntary codes, introduced under previous Conservative Governments, and under Labour Governments with the support of the Conservative Opposition, was to bear down on the practice of restricting benefit tenants from accessing private rented property. However, as the Minister clearly said, there is a requirement for referencing checks to be undertaken. Clause 40 specifically says that there will be no prohibition on taking income into account. There is clearly a risk of a loophole in the clause, given that the Bill does not clearly specify what is meant by referencing checks.
Landlords can use insurance to cover the risk of a loss of income where a tenant defaults on a rental payment. If the insurer says, “We consider the risk of anybody on benefits to be too high,” the landlord may say, “We do not directly discriminate, but our referencing check will always decline to provide insurance for an individual in those circumstances.” There is potentially the risk that benefit claimants will fall between two stools. Universal credit is flexible and provides a top-up on a person’s rental income, so they may eligible to receive the benefit but fall outside it for a period of time. We need to ensure that that is fully taken into account. I ask the Minister to clarify the position, perhaps in writing.
Finally, I have some points relating to the interaction of all the clauses. I previously raised the issue of people who have no recourse to public funds. They are not eligible to receive benefits but may be the beneficiary of an obligation on a local authority to provide support—for example, under the Children Act 1989 or previous housing legislation. It would be helpful to understand how the clauses will apply to that group of individuals. They are likely to be creditworthy and to apply for private rental on the basis that they have a job and an income. They are not eligible for the state benefits listed in the examples of benefits that are included. We therefore need to ensure that, so far as the Government intend, they fall within the ambit of the Bill.
There is a similar issue for care leavers, about which the Minister said he has received representations. The Children (Leaving Care) Act 2000 creates a set of obligations on local authorities to secure appropriate accommodation for care leavers as they enter adulthood. Although I understand the Government’s decision not to bring a specific category of care leavers within the scope of the legislation, those who are the beneficiaries of that obligation on behalf of somebody else will find themselves discriminated against not because of rights arising from their personal circumstances but because of the obligation to somebody else—in this case, that a statutory authority has to provide support for them.
Finally, we support the Government’s position on the amendments. Although I have complete sympathy with the point being raised, as the Minister does, there is clearly a risk that what is intended to be a matter of criminal law—discrimination against an individual, whereby a court can make an order for compensation—is mixed up with a civil penalty that is designed to ensure that landlords pay appropriately.
The Minister is correct, but he may need to provide total clarity for the sake of parliamentary proceedings that a local authority will use that civil penalty in the same way as would apply if it were dealing with an issue of fly-tipping, littering or environmental nuisance, as opposed to having to prove to a criminal standard that discrimination is taking place. As those two things are different, they need to be handled differently in the way that the legislation addresses them, as my hon. Friend the Member for Broadland and Fakenham alluded to.
Matthew Pennycook
Let me address that group of questions, which are well understood and well made. I will respond to each in turn.
I think the shadow Minister may have got the clause wrong, because clause 35 deals specifically with superior leases and ensuring they are not enforceable. However, I take his point about what is usually older people’s bespoke accommodation. I am sure that we would all welcome children visiting those sorts of accommodation. I will provide a specific written answer to confirm this position, but I would expect a provider to argue that refusing tenants living with children in such a block would be a proportionate means of achieving a legitimate aim and would therefore be appropriately accommodated within the legislation.
On clause 40, the Bill will allow landlords to check if a tenant has sufficient income to ensure that they can afford to pay for a tenancy and it is sustainable. The shadow Minister made the point again, as he did in the evidence sessions, about insurance and referencing checks. I will give him a specific answer as to whether particular referencing checks or insurance products will, as a matter of course—I think this was his point—rule out universal credit applicants as tenants who can afford to pay. I do not necessarily think that that should be the case, but if it is, I will give it due consideration.
David Simmonds
It is helpful to have this conversation with regard to insurance that covers the loss of rent and insurance that specifically requires the prohibition of a child living with tenants, as referred to by clause 35. Our concern is that although the Bill’s intention is to create a clear situation where there is no discrimination against a tenant with children who would be living with them or visiting them at the property, there is a risk of ambiguity if a landlord finds, for example, that they cannot gain any insurance or that the cost of insurance is prohibitive. They would then argue that they simply could not meet their obligations as a landlord if they were to allow tenants with children who live at or visit the property. We need to therefore bring clarity so that we do not leave a loophole through the insurance market that effectively nullifies the intended impact of the legislation.
Matthew Pennycook
I appreciate and understand that point, and the shadow Minister is right to say that we need to bring the requisite level of clarity in this area. He has asked a series of questions in Committee on insurance products more generally and I will attempt to give him a more comprehensive answer in writing so that we can draw a line under some of his concerns.
The shadow Minister asked specifically about no recourse to public funds and care leavers, which again is a specific subset of issues that he is right to raise. I will come back to him on those as well.
On civil penalties and whether they can be proved, we have taken a different approach in the Bill from Scotland and Wales where the situation is different. While they seek to enforce discriminatory provisions through a criminal offence, we have deliberately taken the civil route because of the lower burden of proof required for local authorities, and the ease with which they will therefore be able to take enforcement action against cases of discrimination where they have sufficient evidence.
Matthew Pennycook
If I have answered the shadow Minister’s point, the hon. Gentleman can come in.
Jerome Mayhew
The Minister will be aware that, although there is a civil burden of proof under English and Welsh law, the level to which the courts hold that burden of proof varies substantially, depending on the nature of the tariff or the consequence of that finding. Given that councillors will be seeking to impose what looks quite like a criminal fine under clause 39—a fine of many thousands of pounds—is it the Minister’s understanding that, although the burden of proof required is civil, it will be a high hurdle when applied by the courts?
Matthew Pennycook
I do not think I would make that particular point. To expand further, we have taken this particular approach because we think there is a benefit provided by the burden of proof that local authorities are required to meet. It is also the case that making breaches of rental discrimination provisions a single civil matter in England is in line with our wider discrimination legislation, in the way that it is not in Scotland and Wales—we will come on to discuss those points.
It is worth noting that, where there is evidence, local authorities can take enforcement action against either the landlord or the letting agent, or indeed both, if the letting agent has been party to the breach, and they can face multiple fines. They are civil fines at the £7,000 level rather than the criminal fines found elsewhere in the Bill, which have a much higher threshold of £40,000. I hope that answers the point made by the hon. Member for Broadland and Fakenham. Again, if he writes to me, I am happy to give him a more detailed answer.
I hope that I have reassured the shadow Minister as to why we have taken this approach and that we have considered its impact on different cohorts. It is important that the power provided for in clause 38 is there. We will take it forward only very specifically, as I have said, after consultation and through the affirmative procedure, but we want to have it so that the system can to adapt to any new instances of discrimination that arise. To go back to the point that my hon. Friend the Member for Doncaster Central has put to me fairly frequently, if sufficient evidence is brought to us that shows that certain cohorts, be it care leavers or anyone else, are facing the type of discrimination we want to bear down on through the Bill, we can more easily add them and cover them with that power.
Carla Denyer (Bristol Central) (Green)
I will quickly clarify the comments made about my amendment 78 by the shadow Minister, and then I will discuss my amendment and answer some of the Minister’s points. If I heard correctly, the shadow Minister said that he did not support the amendment because it mixes up compensation with criminal penalties, but my understanding of the conversation that we have just had is that the clause uses civil law rather than criminal law, so that point does not stand—or have I misunderstood something?
David Simmonds
I raised the question to bring some clarity to it. My hon. Friend the Member for Broadland and Fakenham, who has a lot more legal experience than I do, highlighted that different standards are applied to the burden of proof, and that the way in which those standards are applied also varies because of the tariff. It is important to fully understand what we are dealing with. As the Minister’s response showed, the Government’s approach is correct in that the bringer of the enforcement action would be the recipient of the penalty.
Carla Denyer
In that case, I am pleased to confirm that I have anticipated those questions and concerns, and I can answer them now. Amendments 78 and 79 provide a mechanism for the complainant—the tenant, or the prospective tenant in this case—to receive a portion of the financial penalty imposed by a local housing authority as compensation for being discriminated against.
First, let me give a little context. As the Committee has heard in oral and written evidence, discrimination is rife in our private rented sector, and the Bill has the potential to deliver real change for those who find themselves wrongly and consistently locked out of housing. A YouGov survey from last year shows that 52% of landlords harbour a preference against tenants who are in receipt of benefits, and the English housing survey 2021 to 2022 found that one in 10 private renters said they had been refused a tenancy in the past 12 months because they received benefits. That shows the scale of the problem.
Families with children also face serious discrimination. There are 1.4 million families in the private rented sector with dependent children, and we have already discussed the harmful effect that it can have on them.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Does the hon. Lady think that the ombudsman could play a greater role in determining outcomes? Her point on the damage that discrimination can do was well made, but the Bill may be able to address that discrimination in other ways.
Carla Denyer
I thank the hon. Lady for her question, which I will come to in a moment. I have considered the role of the ombudsman, but the point of amendment 78 is predominantly to incentivise tenants to engage with the enforcement of the local housing authority.
Given the seriousness and scale of discrimination, bold measures are required. Though I welcome the Bill’s intention to stamp out discrimination, the reforms will only be as effective as the enforcement that underpins them. Under the legislation, local authorities will remain dependent on prospective tenants reporting a breach in the first instance. Let us bear in mind that we are discussing discrimination before somebody becomes a tenant—it is discrimination in the advertising of a property—so the prospective tenant may well not have an incentive for pursuing it. Local authorities will be dependent on tenants reporting the breach in the first instance, maintaining a potentially lengthy co-operation with the local authority and assisting the inquiry all the way to its conclusion.
That is a real burden. A tenant who has been refused a tenancy will likely still be contending with the extremely pressing issue of where they are going to live—they may have just been served an eviction notice or they may have had to move out of their accommodation quickly for another reason. They are unlikely to have the time or energy to volunteer their services for free to the local authority in exchange for no benefit.
I want to address a point that the Minister made against the amendment. In the circumstances I mentioned, the chance of tenants falsely or speculatively submitting a complaint is pretty slim, because they will have pressures on their time. If the prospective tenant were to get a cut of the amount received by the local housing authority, that would be a good incentive for them to report discrimination to the local authority, and discriminatory landlords would begin to be rooted out.
Carla Denyer
Can I get to my next point? I suspect that I am about to answer the Minister’s question.
Matthew Pennycook
If the hon. Lady answers it, I apologise. I want to make two points. First, I understand her concern about tenants not having an incentive to take a complaint to the local authority. We want tenants to make legitimate complaints about rental discrimination, and I think that can be encouraged through Government messaging and guidance.
Secondly, one of the four concerns I expressed was about the impact on local authorities. Has the hon. Lady spoken to her own local authority to determine how comfortable it feels about losing £1,400 out of every £7,000 fine for a breach under this provision?
Carla Denyer
I will plough on, because I was indeed going to come to that issue.
First, however, I will address one of the Minister’s other points on the convergence of penalty and compensation principles. I understand his purpose in pointing out that these are not normally combined, but there is a precedent. Sharing the proceeds of a civil penalty between public bodies and the person on the end of the wrongdoing is a departure from the norm but, as I understand it, under section 214 of the Housing Act 2004, if a landlord has failed to comply with the tenancy deposit protection regulations, a court can award a tenant a sum of between one and three times the deposit they paid.
While there is no question in that legislation of sharing an award with the local authority, it is nevertheless an example of the convergence of penalty and compensation principles in a single move. Although deposit protection rules do not give us a blueprint for the proposal I put forward in amendments 78 and 79, they demonstrate that an acknowledgment elsewhere in housing law of the importance, proportionality and justification of restitution for tenants, which also serves as a form of deterrent and admonition for rule breaking, all in one go.
The Minister may be aware that I tabled an amendment to increase civil penalties for exactly the reason that he has highlighted: if the local authority is to share the proceeds with the tenant, the total amount should be higher to ensure that it covers the cost of the local authority taking on the enforcement. That amendment was not selected for debate, so I will not shoehorn in my comments on the subject, but since the Minister specifically asked me about it, I will make the case for increasing the total civil penalty. I proposed that it be increased to £15,000 so as to not harm the local authority’s ability to undertake enforcement activity, as well as to properly reflect the time and expertise involved in the local authority pursuing such cases. I think that addresses the concerns the Minister raised.
In conclusion, the tenant is the linchpin upon which a discrimination case such as this depends. On that basis, I believe that some form of financial compensation for the person on the end of the illegal treatment is fair and proportionate. They can pursue a case with the housing ombudsman case as well, and there is an argument for taking into account whether the tenant has received something through the housing ombudsman in determining what they receive in my proposed scheme, or vice versa, but the function of the two tools is different.
Carla Denyer
I am seconds away from finishing my point, so I will give way shortly. My amendments 78 and 79 are designed to ensure that the ambition to eradicate discrimination in the private rented sector is realised, by giving tenants incentives to take the step of reporting and aiding investigations. I ask the Minister to consider that because, to put it bluntly, I am not sure that a public information campaign from councils will incentivise tenants as he suggested.
Rachel Blake
Does the hon. Lady acknowledge that her description of some kind of arrangement between the ombudsman and her proposed scheme would be incredibly burdensome, complicated and opaque for tenants? It would not necessarily deliver the type of justice she described.
Carla Denyer
A number of the organisations that gave evidence suggested something along those lines, and they had looked into the viability of both mechanisms existing in parallel. I do not have the exact chapter and verse of what they said in my head; we can look at that in Hansard.
Sam Carling (North West Cambridgeshire) (Lab)
On the suggestion made by the hon. Member for Bristol Central, the civil penalty income is imposed by a public body as a punishment for breaking the law. There is a point of principle about whether it is right—whether there is a precedent—to give a contribution back to the tenant from that. It feels very unusual to me.
I have a brief question for the Minister; it may be that as a new Member of Parliament I am not used to this yet. Is it normal to specify the amount of the fine in primary legislation? Can that cause problems later in respect of needing to uprate it with inflation or anything like that?
Matthew Pennycook
On the point made by my hon. Friend the Member for North West Cambridgeshire, it is conventional to put the amount of the fine on the face of the Bill. There are provisions in the Bill that allow the Government to increase the fine to reflect the increase in inflation over time, so it is not a static, once-and-for-all £7,000 or £40,000 in the case of criminal offences.
On the point from the hon. Member for Bristol Central, I sympathise very much with the intent. We have to ensure that prospective tenants who face direct or more subtle forms of discrimination take a complaint to the local authority, but I have confidence that tenants will, and I have concerns about the approach she specifies. First, on a point of principle, the penalties are imposed by a public body for breaking the law. They are not a mechanism for compensation. It would be a departure from the norm, as she rightly appreciates.
My primary concern—I think the hon. Lady underestimates it even with the increased fee she proposes —is that there would be a significant impact on local authorities. They will take issue with losing 20% of the fine they can levy. I will check with her local authority after I leave the Committee as to whether they would be happy to lose that.
Matthew Pennycook
Let me develop this point; then the hon. Lady is more than welcome to come back on it. Even if the loss of 20% of the £7,000 were covered by an increased fine, there are good reasons why we do not think that the fine should be higher in the Bill. Setting that aside, we think there would be significant administrative burdens to overseeing a system that redistributes part of a fine issued and secured via the specified means through the local authority. Different arrangements would need to be put in place to facilitate that. Financial incentives might create the risk of tenants taking cases where there is not sufficient evidence to press local authorities to investigate.
We have already had extensive discussion on whether, through this Bill, local authorities will be able to effectively enforce, because of the resource pressures on them. We are committed to new burdens funding to ensure that they can. I think that putting additional administrative burdens on them in the way specified is the wrong approach. The hon. Lady did not address this point, but there are real practical difficulties in identifying who has been the subject of discrimination. In her example it is simple, with a single tenant, but in cases of multiple tenants, what is the proportion of the compensation to be paid?
I think the hon. Lady’s amendment references instalments and a subdivision of the amount compensated for. This would be an over-complication of the Bill’s provisions. I am confident that the provisions will work in the way intended and that tenants will take their cases to local authorities. There is a duty on local authorities to enforce the provisions. The approach I put to the previous Minister was to put the onus on tenants and to enforce through the Equality Act. We are taking that burden off tenants and placing it on local authorities, imposing on them a duty to investigate and take action in cases of such increases. For those reasons, I am afraid I cannot accept the hon. Lady’s amendments.
Carla Denyer
I have a few follow-up questions for the Minister based on what he just said. First, does he recognise that 20% of double the amount still leaves a significant increase for the local authority? He was talking about the local authority receiving a reduced amount, but losing 20% of double the amount still means a larger amount than previously.
Matthew Pennycook
If the hon. Lady will give way, I can address that point.
Carla Denyer
My next point relates, so the Minister can probably address them together.
Secondly, the Minister said there were good reasons why he had selected £7,000 specifically and not a few thousand above or below that. Will he expand on why £7,000 is the magic number?
Thirdly, I would like to understand the Minister’s view on how tenants will be incentivised to have the prolonged engagement with a local authority that would be necessary to see the process through to conclusion—with only a public information campaign?
Matthew Pennycook
First, what research has the hon. Lady done on the administrative burden on local authorities of subdividing the amounts of money they take in through breaches to give that 20%? It is easy to say, “Increase the amount and the 20% is covered,” but, as I have put to her, there would be significant additional administrative burdens from setting up the type of arrangements she wants to see.
Secondly, why does the hon. Lady think that under the arrangements in the Bill tenants will have to spend an inordinate amount of time co-operating with the local authority to enforce breaches? As I have said, the onus is on the local authority duty, under the legislation, to investigate. Tenants have to co-operate, but I do not see any circumstances where a huge amount of their time is spent on investigation and enforcement. That is for the local authority. Does the hon. Lady have any more insight on those two points?
Carla Denyer
I have not myself done the calculations and consultations on what that might take a local authority. However, the amendment is based on evidence provided by experts in the evidence gathering part of the Committee’s work. I am trying to get the written evidence up on my parliamentary laptop, which is not co-operating. Off the top of my head, I believe it was from Shelter—I will try to look in a moment, when I have sat down. I am sure Shelter has done the work, so I would be pleased to get back to the Minister on the details when I can lay my hands on them.
Apologies, but I have forgotten the second thing the Minister said.
Matthew Pennycook
I simply asked why the hon. Lady thinks the process set out in the Bill will require huge amounts of tenant energy and time to see the enforcement process through. As I said, there is a statutory duty on local authorities in the Bill to take the process through. We have put the onus on them, not tenants. I wonder why the hon. Lady assumes it will take lots of effort on the part of the tenants themselves to seek redress through the provisions that the Bill sets out.
Carla Denyer
Yes, I remember now that the Minister asked whether I expected the tenants to investigate. I do not expect the tenants themselves to investigate, but I expect that a level of ongoing engagement will be required, which would be onerous if they are trying to flat or house-hunt and move house at the same time. My experience as a councillor for nine years, and as an active citizen, is that it often requires several successive engagements with a local authority to get the desired outcome.
Matthew Pennycook
I will respond briefly because I have set out in some detail the Government’s view on the matter. If I can say so politely, there were a huge number of assumptions in there. There is an assumption that the tenant will have to spend inordinate amounts of time working with the local authority to enforce the provision. We do not want that to be the case. Tenants will have to engage, but the onus and duty is very much on local authorities to do the work.
The hon. Lady underestimates the amount of cost, time and resource that would fall on local authorities in terms of having to set up and administer a more complicated scheme to redistribute money. The ombudsman has powers in this area to investigate complaints. The provisions in the Bill are specifically targeted at ensuring that local authorities, through that civil offence procedure and that lower burden of proof, can take action to enforce. It is right that the fees set out in the Bill are ringfenced to local authorities to be able to enforce.
I sympathise with the objective that the hon. Lady is trying to achieve, and we want tenants to take cases to their local authorities, but her amendments are flawed. I do not think they are thought through, and they rest on a series of assumptions that I do not expect to see occur in practice. For that reason, we will resist them.
David Simmonds
Not that they need it, but the Government have our support in their stance on this issue.
The hon. Member for Bristol Central raises an important point. From my experience in local authorities, I know it is often extremely complicated when they seek to allocate or judge issues of compensation on civil penalties. For example, similar legislation applies in respect of environmental nuisance, and we know it is incredibly difficult to identify who has been a victim, how to quantify the level of harm they have suffered and then how to allocate an appropriate level of compensation.
Given the good will the Minister has shown on the issue, I hope there is scope for some further discussion to ensure that if there is a pattern of egregious behaviour by a specific landlord who is clearly discriminating against particular groups of people—we recognise that particularly in London there is often a high level of demand, and a tenant may visit a dozen or more properties to secure a tenancy—there is a means of providing some form of restitution for the waste of that person’s time as a result of that discrimination.
Matthew Pennycook
Can I make a further point, which I have made before but is clearly not registering? This is where we need to take a step back and look at which different parts of the Bill do what. The ombudsman can review each complaint on a case-by-case basis. Complaints can be about discrimination and the ombudsman has the powers to put things right, including by ordering the landlord to pay compensation or correct the behaviour in question. It is not that we do not think there is a case for the suggestion—we will come to the significantly strengthened rent repayment orders that we have included in the Bill—but that this is not the place for it. Clause 39 is a quite simple provision to allow local authorities to issue fines for breaches and to be able to keep that money to fund further enforcement activity. For that reason, we cannot support the amendments.
Question put and agreed to.
Clause 32 accordingly ordered to stand part of the Bill.
Clauses 33 to 41 ordered to stand part of the Bill.
The Chair
I should explain to the Committee why we have not considered amendment 79 for a decision at this stage. Although it was been debated as part of the group, it relates to a later part of the Bill. If it does require a vote, that will be done at a later stage. The way we do things can sometimes be a bit confusing, but that is the explanation as to why that particular amendment was not considered.
Clause 42
Discrimination relating to children or benefits status: Welsh language
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
I will be brief on this group of clauses, which simply provide for rental discrimination powers and prohibitions in Wales that mirror those in England, with minor adjustments made in order to fit them into existing housing offence enforcement procedures. The measures are broadly equivalent to chapter 3 of the Bill for England, which we have just discussed at length, with adjustments made to align with the existing Welsh enforcement framework.
As I have already mentioned, Wales is taking a criminal enforcement approach, while the same conduct is a civil breach in England. That reflects the private rented sector enforcement regime in Wales, where criminal offences are in line with other housing legislation. I commend the clauses to the Committee.
David Simmonds
As the Minister has outlined, this is a fairly straightforward translation. First, I presume the measures will require a legislative consent motion on the part of the Welsh Government, and ask the Minister to clarify that.
Secondly, in respect of the proceeds of the fines, it is clearly envisaged in England that it will be the local authority that carries out enforcement and that the revenue from the fines will finance that. If it is a criminal matter in Wales—a criminal enforcement regime—will the same rules apply? We briefly debated the issue of whether fines in a criminal matter would go into the consolidated fund, as is currently the case with criminal penalties, or directly to the local authority, in order to finance the enforcement regime; will the Minister clarify how the matter will be dealt with in Wales?
Matthew Pennycook
I thank the shadow Minister for those questions. There is a simple answer to the first: yes, it requires a legislative consent motion on the part of the Senedd to bring the measures into effect.
On the approach in Wales more broadly, as I said, it reflects the established private rented sector enforcement regime in Wales. There are a number of differences. The Welsh Government, and the Scottish Government, take the criminal offence path, rather than the civil one. What that means—this is one of the reasons why we determined to go with the civil offence approach in England—is that fines are capped at £1,000 in the Welsh and Scottish contexts, whereas under the approach in the Bill we can levy £7,000, and do so repeatedly if breaches are continuous and ongoing. That is why that is reflected.
On the consolidated fund point, as it applies to the Welsh Government, I am afraid I do not have the answer. I will more than happily get an answer to the hon. Gentleman in writing.
David Simmonds
What the Minister said in respect of the consolidated fund is very helpful. I posed the question because, under the Bill, we will create responsibilities for the local authority to be the enforcement body, which as I understand it will apply in Wales as well, but the decision to take the criminal route is a matter for the Senedd, which is not the local authority. Indeed, there is some tension in the relationship between the Senedd and local authorities. Clearly, if the income is going into a consolidated fund or to the Senedd, the risk is that the enforcement body given the duty under this legislation will not receive any of the financial income raised through enforcement action. I ask so that we are completely clear about where the legislation will stand in Wales once passed.
Matthew Pennycook
I understand that point and will get the shadow Minister a precise answer in writing. It is important for the Committee and the public to have clarity on precisely all the ways in which the enforcement is, and in some cases is not, aligned in the Welsh and English contexts. I will come back to him on that point.
Question put and agreed to.
Clause 42 accordingly ordered to stand part of the Bill.
Clauses 43 to 48 ordered to stand part of the Bill.
Clause 49
Discrimination relating to children or benefits status
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
I might pre-empt the shadow Minister by saying that in the written correspondence to which I have just committed, I will give him the same set of answers on the consolidated fund and the role of local authorities in the Scottish context.
Clauses 49 to 54 provide similar protections and prohibitions in Scotland regarding rental discrimination, albeit with different processes around the power to add protection to additional cohorts. That is different from the situation as it applies to Wales. Again, the measures are broadly equivalent to those for England in chapter 3, with adjustments made to align with the existing Scottish enforcement framework. In Scottish housing law, rental discrimination enforcement is in line with other criminal penalties, as it is in Wales. I commend the clauses to the Committee.
Question put and agreed to.
Clause 49 accordingly ordered to stand part of the Bill.
Clauses 50 to 54 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Gen Kitchen.)
Renters' Rights Bill (Sixth sitting)
Thursday 31st October 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 31 October 2024 - (31 Oct 2024)
The Minister for Housing and Planning (Matthew Pennycook)
It is an absolute pleasure—I genuinely mean that—to continue our proceedings with you in the Chair, Mrs Harris.
The clause will end the unfair practice of pitting renters against each other in bidding wars. Many members of the Committee will have come across that as councillors and as Members, and they do not need me to tell them about the severe impact on renters. Those of us who represent constituencies with particularly hot rental markets are all too familiar with the common story: a prospective tenant arranges a viewing and turns up in person, only to find themselves being asked to compete with other tenants on the spot. Their experience is not that of a viewing, but of a kerbside auction. The impact on renters of the practice is clear.
In other cases, the growth of social media and other platforms allows this practice to occur without prospective tenants even being in the same place. Renters who have applied for a property may find themselves being added to a WhatsApp group and asked to submit offers in front of each other. Again, the detrimental impact of that practice on renters cannot be overstated.
Rental bidding restricts tenants’ ability to make an informed choice about one of the most financially significant decisions they face. It is clearly an unfair practice, and one that, thankfully, only a minority of landlords make use of. The clause will end the practice for good. It will require landlords and letting agents to state a proposed rent in any written advertisement or offer. Landlords and letting agents will then be prohibited from asking for, encouraging or accepting bids above that price. That will improve the experience of prospective tenants across England and provide clarity to all involved in the lettings process.
I turn to clause 56, which sets the enforcement framework for breaches of the rental bidding measures set out in the previous clause. Once enacted, clause 56 will give local housing authorities the power to impose a financial penalty of up to £7,000 on persons who are in breach of the prohibitions. In addition, local authorities will be able to issue multiple civil penalties to any landlord or letting agent who repeatedly breaches the requirements set out in clause 55. In line with the new burdens doctrine, we will fully fund the cost of all additional duties on local government from enforcing the rental bidding prohibition. With that, I commend the clauses to the Committee.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
I echo the Minister’s comments about it being a pleasure to serve with you in the Chair, Mrs Harris.
I will not take too long on this point. The measure has been the subject of some controversy. Clearly, there is a philosophical question about the ability of the owner of an asset to gain the best possible market return, but the Government are determined on the matter. I will, however, make some practical points.
The first is about how to address the situation where the property in question is the asset of an organisation whose directors have a fiduciary duty to maximise the return on it, as is common in the case of pension funds, investment trusts or other bodies that may invest in property. Clearly, there is an obligation in law on the directors to seek the maximum possible return, but this legislation will prohibit them from undertaking any form of bidding process.
The second is about a situation where an intermediary sits between the tenant and the owner of the property. Clauses 55 and 56 set out what is meant by a prospective landlord but, in pursuit of their fiduciary duty, the ultimate owners of an asset might seek bids from a prospective managing agent or other intermediary party. They might bid to secure the maximum possible rent on that group of properties, in turn letting them out individually to tenants at a higher level of rent. Both those situations potentially create a degree of conflict.
I agree entirely with the point about the egregious practices of some landlords. It seems to me, however, that we must consider the situations that I have highlighted so that the legislation does not inadvertently lead to trustees and directors of pension funds that invest in property being in breach of their duties, or to the establishment of a get-out by means of a managing agent who sits between the property owner and the tenant.
Matthew Pennycook
I thank the shadow Minister for those well-made questions. This is a specific problem that we are trying to target, and the majority of landlords do not engage in rental bidding. We are trying to stamp out the egregious practice of a minority of landlords who exploit the fact that, particularly in hot rental markets, there is a lack of supply vis-à-vis demand. Tenants can be pitted against each other in ways that ensure the rent of a tenancy escalates to a point beyond which many of them can afford, or which, if they can afford it, puts incredible financial strain on them.
Once these provisions are in force, we think landlords will—in much the same way as the tribunal might—determine what the market rent is in a given area and what they can expect to receive from their property, and then advertise the rent at that price. I have been asked how that would work. Will landlords not advertise a price below what they could otherwise expect? We cannot have it both ways. If a landlord can expect a certain price through a competition, that suggests that tenants can pay a slightly higher price and bid up. We expect landlords to look at the market price in a given area and advertise the property at that rent, and these provisions will ensure that they cannot encourage or invite bids over that amount.
On the specific cases that the shadow Minister raises, I would not expect organisations of the type he lists to be in breach of their fiduciary duties as a result of these provisions. I understand his point about intermediary agents, particularly in groups of property where they might look to get the best deal on any of those things. I will come back to him on that specific point in writing, because I understand the need to work through those hard edge cases, but we think that only a very small minority of landlords will be affected. This is not the usual practice across every part of the country. His points were well made, and I will come back to them.
Question put and agreed to.
Clause 55 accordingly ordered to stand part of the Bill.
Clause 56 ordered to stand part of the Bill.
Clause 57
Penalties for unlawful eviction or harassment of occupier
Carla Denyer (Bristol Central) (Green)
I beg to move amendment 44, in clause 57, page 79, line 31, after “section 1” insert—
“—
in subsection (4)(a), omit ‘the prescribed sum’ and insert ‘£60,000’;
(b)”.
This amendment increases the maximum fine for illegal evictions under the Protection from Eviction Act 1977 to £60,000.
Carla Denyer
I am sure we are all aware of the risk that the abolition of section 21 may lead to a rise in illegal evictions. The Renters’ Rights Bill needs measures to protect against that, and that is the purpose of amendment 44. Across the country, a segment of private landlords evade the courts and attempt to evict tenants themselves by taking actions that include changing locks, disposing of belongings, and even cutting off electricity and water supply and harassing tenants. Many illegal evictions take place in the shadow market, where landlords and letting agents deliberately breach the law to maximise rental profits. Many renters in the shadow market are on lower incomes in marginal employment, and they are unfamiliar with their rights.
In 2019, there were just 30 prosecutions of offences under the Protection from Eviction Act 1977 in the whole of England and Wales. Such a low prosecution rate allows criminal landlords to act with impunity. When sentencing, magistrates are also very lenient; fines of less than £1,000, community service and conditional discharge are common penalties for such behaviour. If the maximum fine is £40,000—as it currently is in the Bill—because of the nature of civil penalty notices, it is unlikely that the fine will ever reach that maximum unless the offence is particularly violent. So—and here is the rub—landlords may still take a calculated risk that they can save money by unlawfully evicting tenants, given the abolition of section 21. Even where illegal eviction is not violent, it is still a horrific crime, so it is appropriate that fines reflect that. I therefore propose a maximum fine of £60,000, to give space for appropriate fines to reflect the criminality and harm caused within that range.
The change would help to ensure that, for rogue landlords, illegal eviction is not the path of least resistance, as I fear it could otherwise be. Increasing the maximum will also give a strong indication to the courts that this is not just a technical breach, and that will hopefully therefore have a knock-on effect on sentences issued upon conviction.
These cases are particularly complicated and expensive for councils to pursue, and that brings us back to the point about the cost to councils that we discussed earlier, especially where landlords refer a case to the first-tier tribunal. If local authorities are bound to lose money even when they win the case, they will be hesitant to begin proceedings. Increasing the maximum fine will help them to have more confidence that they will not lose a substantial amount of money. That is particularly important in the context of 14 years of council funding cuts, as we all know, which mean that if councils stand to lose a lot, they are disincentivised to act.
Matthew Pennycook
As we move to the final set of clauses in part 1, we cover several miscellaneous issues. As we have heard, clause 57 concerns unlawful eviction and harassment of an occupier.
The Bill clarifies and expands grounds for possession so that landlords can take their property back when there is good reason for them to do so. Landlords must always follow correct court procedures to legally evict a tenant. There is no excuse for those who seek to gain possession in an unlawful way.
The Government are clear that illegal eviction, which can include harassing individuals to leave their home, is a criminal offence, and those who flout the rules and deprive tenants of a home in this way must be punished accordingly. Clause 57 amends the Protection from Eviction Act 1977 to strengthen local authorities’ powers to do so if they are satisfied beyond reasonable doubt that a person has committed such an offence.
At present, local authorities can only prosecute offenders. That can be a lengthy process, and the fines imposed can be low. Although local authorities will still be able to prosecute after these provisions come into force, for the first time they will be able to issue a financial penalty on landlords who evict their tenants illegally in lieu of such a prosecution. That fine will be up to £40,000. It will be an alternative route to criminal prosecution, and it may often be simpler and more cost-efficient for local authorities.
The schedule that accompanies this clause sets out the procedure that authorities must follow regarding financial penalties. That includes information on handling the imposition of financial penalties, appeals and enforcement, and how to use the proceeds of the penalties.
The provisions will ensure that local councils consistently punish the most egregious offences, while allowing them to take the context of individual cases into account. By strengthening the enforcement framework, we will deter unscrupulous landlords from flouting the rules, drive out bad actors from the sector and improve protections for tenants.
I thank the hon. Member for Bristol Central for tabling amendment 44. The Government accept that any attempt to force a tenant from their home unlawfully is unacceptable, and those who do so must be met with enforcement. However, in our view, the amendment is not required. It seeks to increase the fine for illegal eviction in the Protection from Eviction Act 1977 from £5,000 to £60,000, as the hon. Lady has just set out. However, the cap on magistrates’ court fines for these offences has already been removed by section 85 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, and the offences are punishable by a fine of any amount.
Through the Bill as a whole, we are taking strong action on illegal eviction. We are extending civil penalties and rent repayment orders, placing a new duty on councils to take enforcement action and enhancing their powers of investigation to make that easier. We consider that our approach to enforcement is a fair and proportionate one. We are taking a clear, escalatory approach to civil penalties with first time, less serious non-compliance subject to much lower maximum penalties than serious or repeat non-compliance. The Government believe that the £40,000 maximum penalty for illegal eviction will act as an effective deterrent and is consistent with other serious offences across the Bill. I point out that that is higher than under the previous Government’s Renters (Reform) Bill, in which the amount was set at £30,000. As such, in our view it will act as a greater deterrent.
As I have said, criminal prosecution of course remains available for illegal eviction, and local authorities may decide that is the right course of action for the most serious cases. In such cases, landlords can be sentenced to imprisonment or to an unlimited fine. I therefore ask the hon. Lady to withdraw the amendment.
Carla Denyer
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 57 ordered to stand part of the Bill.
Clause 58
Abandoned premises under assured shorthold tenancies
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
One of the key objectives of the Bill is to give tenants greater security in their homes. It is imperative that landlords cannot evict their tenants without a valid ground for possession, and we want to ensure that none can circumvent the requirements of the Bill in respect of seeking possession. Part 3 of the Housing and Planning Act 2016 permits the landlord to recover abandoned properties let under an assured shorthold tenancy without a court order, provided that the tenant or tenants in question are in rent arrears and three warning notices have been served without receiving a response.
Although the Government recognise that genuine abandonment can cause problems not just for landlords but for the wider community, we do not believe that these historic provisions should remain on the statute book. They were criticised at the time of their introduction —I recall this, Mrs Harris; it was one of the first Bill Committees I sat on as a relatively new Member back in the 2015 to 2017 Parliament—for being a rogue landlords’ charter. It is not surprising that, as with a number of provisions of the 2016 Act, they were never brought into force.
Clause 58 repeals part 3 of the 2016 Act. As a result, where tenants abandon properties, landlords will need to demonstrate that they have a valid ground for possession under schedule 2 to the Housing Act 1988, as amended by this Bill. In unequivocal cases, implied surrender may also apply, such as when keys have been returned that the landlord has accepted, even if no notice has been provided. It is likely that when properties are abandoned, tenants are not paying rent, so the rent arrears grounds are available. Landlords may also be able to seek possession for breach of the tenancy agreement, if the agreement prohibits the property from being left unoccupied for long periods, or even the deterioration of property grounds. It is right that tenants have access to justice when they are at risk of losing their homes. Clause 58 ensures that provisions are removed from the statute book to make it coherent.
Question put and agreed to.
Clause 58 accordingly ordered to stand part of the Bill.
Clause 59
Remedying of hazards occurring in dwelling-houses in England
Matthew Pennycook
I beg to move amendment 22, in clause 59, page 84, line 23, leave out from “in” to end of line 25 and insert “section 13(1A), (1AA) or (1AB);”.
This adds a reference to the new subsection (1AA) which will be inserted into section 13 of the Landlord and Tenant Act 1985 by clause 30(3)(b)(ii).
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Clause 60 stand part.
Matthew Pennycook
The death of two-year-old Awaab Ishak, as many Members will know, was caused by prolonged exposure to mould in his social rented home in Greater Manchester. It was an avoidable tragedy that shames us as a nation, and it should never be repeated. I had the privilege of meeting Awaab’s family. Following a campaign by them, the Manchester Evening News and Shelter, the previous Government legislated to introduce Awaab’s law for social housing tenancies. I must credit the previous Government and the former Secretary of State, the then right hon. Member for Surrey Heath, for introducing that legislation. It was absolutely the right thing to do. We supported it in opposition, but it was only a welcome first step. This Government are clear that we need to go further and ensure that no tenant is forced to live in a home that places their health and safety at risk. That is why, in our manifesto, we committed to extending and applying Awaab’s law to the private rented sector.
Clause 59 will extend Awaab’s law to tenancies in the private rented sector. It will allow us to set legal requirements about how private landlords must tackle hazards in their properties, including setting clear timescales for repairs. It will ensure that those living in privately rented homes are empowered to challenge dangerous conditions, and that landlords cannot ignore their complaints. We recognise that there are important differences between private and social landlords, such as the average size of property portfolios, so we plan to consult on the detail of how we will apply Awaab’s law to the private rented sector. That will allow us to ensure that our approach works effectively for the sector, and that it is fair and proportionate for both tenants and landlords.
Clause 60 allows Awaab’s law to be applied to accommodation occupied under licence. A licence to occupy is used rather than a tenancy in certain circumstances, mainly for short-term arrangements or where there is no exclusive right of occupation. In general, it would be disproportionate to apply Awaab’s law to accommodation occupied under licence, such as when homeowners have a lodger staying in a spare room. However, there are cases where it may be appropriate to do so. For example, some temporary homelessness accommodation and supported housing is occupied under licence. We should explore whether vulnerable tenants of such accommodation should be subject to the protections provided by Awaab’s law as part of the consultation to which I have referred. Clause 60 will therefore allow us, as part of that wider consultation, to consider and consult on what types of accommodation occupied under licence should be in scope. It will then allow regulations to be made to bring such accommodation within scope.
Government amendment 22 is a minor and technical amendment that will ensure that Awaab’s law continues to apply to social rented properties let by private registered providers under tenancies of more than seven years. It is simple and straightforward.
David Simmonds
This measure was introduced by the previous Government. We supported it then, and we support it in opposition. Will the Minister reassure me that, as part of the consultation, he will include large public sector landlords, particularly the Ministry of Defence and the NHS? They have significant numbers of people in employment-related accommodation, and we are all aware that there has been a history of issues such as those that this legislation is specifically designed to tackle.
Matthew Pennycook
I hope I can give the shadow Minister some reassurance in that regard, taking Ministry of Defence accommodation as an example. Colleagues in the Ministry of Defence are clear that they want to mirror the same level of standards as we intend to apply across the sector, but the approach that we are taking through this Bill is not necessarily appropriate for the unique circumstances that surround Ministry of Defence accommodation. That is a good example of where a Department is taking forward its own work on standards separate from this Bill. I will get the shadow Minister a full written response that sets out exactly how such accommodation, which is not necessarily within the scope of this clause, aligns with not only Awaab’s law but the decent homes standard more generally.
Amendment 22 agreed to.
Clause 59, as amended, ordered to stand part of the Bill.
Clause 60 ordered to stand part of the Bill.
Clause 61
Meaning of “residential landlord”
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
We move on to part 2 of the Bill, which concerns landlord redress schemes and the private rented sector database. Clause 61 sets out the meaning of “residential landlord”, “relevant tenancy” and “dwelling” for the purpose of defining which tenancies fall within the scope of that database and ombudsman service.
Most private rented sector tenants have assured or regulated tenancies, and those arrangements are covered under this clause. Certain other tenures and dwellings are excluded by clause 61. That is because some tenures, such as licences, provide tenants with very different rights from assured tenancies, while some dwellings, such as non-permanent structures, are subject to different standards requirements from typical PRS properties. Landlords of social housing will also be excluded from the requirements.
We are aware that the private rented sector is dynamic and continues to evolve, and that is why we have included a power in this clause to amend the definition of “residential landlord”, “relevant tenancy” and “dwelling”. That power is required so that the legislation can keep pace with changes in the sector. It will give us the flexibility to extend landlord redress and the database to further tenures or dwellings, if that proves necessary. I commend the clause to the Committee.
Question put and agreed to.
Clause 61 accordingly ordered to stand part of the Bill.
Clause 62
Landlord redress schemes
David Simmonds
I beg to move amendment 65, in clause 62, page 89, line 25, after “residential landlord” insert—
“, whose property is not managed by an agent who is a member of an independent redress scheme approved by the Secretary of State,”.
This amendment would only require a residential landlord to be a member of the landlord redress scheme introduced by Clause 62 if their tenant does not already have access to one by virtue of the landlord using an agent who is a member of another approved independent redress scheme.
The Chair
With this it will be convenient to discuss the following:
Government amendment 23.
Clause stand part.
Clauses 63 to 71 stand part.
Schedule 3.
Clause 72 stand part.
David Simmonds
We move on to the chapter on landlord redress schemes. The Opposition agree on the need for effective measures, but we need to make sure that those measures are functional in practice.
Matthew Pennycook
The private rented sector has lagged behind other housing tenures when it comes to access to redress. For example, tenants in social housing have long been able to escalate complaints through the housing ombudsman’s social landlord redress scheme. Private tenants have had, in comparison, severely limited options for resolving issues, in spite of the fact that they suffer from poorer housing standards on average. I believe that once tenants no longer have the threat of section 21 evictions hanging over them, they will finally feel able to challenge poor practice from landlords at the disreputable end of the market without the fear of retaliatory evictions.
The Bill introduces a new mandatory landlord ombudsman service, which will give tenants free access to redress if their landlord fails to resolve a legitimate complaint. The landlord ombudsman scheme will be a non-adversarial route for escalating complaints, and it will empower tenants to challenge landlords who provide a poor level of service or who behave inappropriately. The ombudsman will benefit landlords who are committed to providing a decent home and a good service. It will give them access to an impartial decision maker to resolve complaints in the quickest and most cost-effective way. This will help to maintain landlord-tenant relationships and therefore, we hope, sustain tenancies for longer.
Clause 62 allows the Secretary of State to make regulations to require landlords, as defined under clause 61, to be members of the private rented sector landlord ombudsman. The provisions in clause 62 will allow prospective, current and former tenants to raise complaints to the ombudsman. This is because things can go wrong for tenants at any point in the rental process, so tenants should be able to seek redress for issues that occur during the pre-letting period or at the end of a tenancy.
Clause 62 will allow the ombudsman to provide voluntary services as well as mandatory redress, which could include mediation services. As I think I said in the evidence sessions last week and on Second Reading, we are exploring options for introducing landlord-initiated mediation to complement the landlord ombudsman service. That is another example of how we are trying to take pressure off the courts and tribunals system.
Government amendment 23 to clause 62 will enable us to require landlords to register all their properties with the landlord ombudsman and keep that information up to date. That was always the intention, and the amendment clarifies that in the legislation. If a landlord chooses not to provide the correct information, they will be liable for enforcement as set out in clauses 64 and 65. That will ensure that landlords pay the correct fee, where fees are based on the size of their property portfolio.
Clause 63 allows the Secretary of State to set out in regulations the conditions that a private rented sector redress scheme must meet before it is approved or designated by Government. By putting conditions in regulations, we will set the framework for a high-quality redress service that can adapt to an ever-changing housing market. For example, to be approved, the scheme must include provision about accepting tenant complaints and requiring landlords to put things right. That could be achieved by making a repair or paying compensation. We will ensure that the ombudsman’s decisions are enforceable by requiring the scheme to set out a route of expulsion. That means that if a landlord does not comply with a redress order, they could be expelled from the scheme and liable for local authority enforcement.
The clause allows the Secretary of State to set out in regulations how a scheme will be approved or designated. In pursuit of a simple and effective user journey, we will set out in regulations in due course that only one scheme will be operational at any one time. It is crucial that the ombudsman is supported by a robust enforcement regime, so that all landlords understand the importance of abiding by the requirements to join the scheme and tenants can get the resolution that they deserve.
David Simmonds
It has been helpful to hear from the Minister in detail on those points. The intention of amendment 65 was to avoid a risk of double jeopardy for a landlord if they had a managing agent who was a member of the redress scheme, but if they were also required separately to be a member of the redress scheme by virtue of the fact that they were a landlord. The Minister has set out how he intends to deal with that in regulation.
I ask the Minister to clarify something—perhaps not today, but in due course. He mentioned examples of where damp and mould would be considered a landlord issue as opposed to a managing agent issue. We are all aware that certain blocks, which may be owned by an absentee landlord or someone who works abroad, are let and managed entirely by an agent who handles the day-to-day responsibility in return for payment and under a contract. We do not wish to exclude completely the possibility of redress through the agent, where the agent has been explicitly given responsibility for dealing with such things, by saying that that will always be a matter for the landlord. Will the Minister write to me to explain how that issue—most of us have seen it from time to time in our constituencies—will be dealt with, should it arise in practice?
Matthew Pennycook
I am more than happy to write to the shadow Minister to clarify that. If I have understood him properly, there are certain issues that we think are the landlord’s responsibility, and that is why our approach is the right one. To address his point directly, I will happily set out in some detail in written correspondence how that will operate when landlords are completely absent for the process, and the managing agent’s role in that situation vis-à-vis the new redress scheme.
Mr Gideon Amos (Taunton and Wellington) (LD)
It is a pleasure to serve under your chairmanship, Mrs Harris. The shadow Minister’s amendment refers to agents, such as managing agents, and their redress schemes. Managing agents are often also letting agents—they are the same kinds of companies. Can the Minister comment on the case for regulating those agents, for which this Bill provides an excellent opportunity? Members of the other place who are experts in housing have spoken to me about the need to do that. The Liberal Democrats would certainly support such a move, and I would be grateful if the Minister commented on it.
Matthew Pennycook
I suspect I know the noble Lord that the hon. Gentleman refers to. I have had many extensive conversations with the noble Lord about the matter, and I will continue to engage with him. We supported the implementation of the Lord Best review in opposition. We took the view that the Bill was not the appropriate place to consider those measures, but we intend to set out our approach to the regulation of managing agents, letting agents and estate agents in due course. If the hon. Gentleman wants a specific comment from me, I refer him to the answer I gave in oral questions a few a days ago on this point in response to one of his colleagues. We understand the necessity for regulation in this area, and I hope to have further discussions with him and others in due course.
David Simmonds
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment made: 23, in clause 62, page 90, line 16, at end insert—
“(4A) Regulations under subsection (1) may require a person—
(a) to provide relevant property information to the administrator of a landlord redress scheme, on applying to become a member of the scheme;
(b) at any time after becoming a member of a landlord redress scheme, to notify the administrator of the scheme of any change to relevant property information previously provided by the person as soon as reasonably practicable, or within a period, as specified in the regulations.
(4B) For the purposes of subsection (4A), ‘relevant property information’ means such information as may be specified in the regulations relating to—
(a) any residential tenancy under which the person is the residential landlord;
(b) any dwelling which is proposed to be marketed for the purpose of creating a residential tenancy under which the person will be the residential landlord.”—(Matthew Pennycook.)
This enables regulations made under clause 62 (landlord redress schemes) to require a person on applying to join a landlord redress scheme to provide certain information about residential tenancies of which they are the landlord, or dwellings that will be marketed for the purpose of becoming residential tenancies of which they will be the landlord. There is also a separate duty to notify the scheme administrator of any changes to such information.
Clause 62, as amended, ordered to stand part of the Bill.
Clauses 63 to 71 ordered to stand part of the Bill.
Schedule 3 agreed to.
Clause 72 ordered to stand part of the Bill.
Clause 73
The database
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following:
Clauses 74 to 83 stand part.
Clause 87 stand part.
Matthew Pennycook
I turn to the private rented sector database provisions. Clauses 73 to 83 and clause 87 set the framework for establishing a database and the functions required for its operation and maintenance. The database has the potential to be transformative in the regulation of the sector, and I know there is a huge amount of interest across the Committee in that regard. The database will record the details of private landlords and their properties that are currently, or will be, let as a residential tenancy.
Clause 73 introduces the legal basis for the database to be created and maintained. The database will allow local authorities to build up a detailed picture of the private rented sector in their areas. It will support improvements in health and safety standards by increasing the intelligence available to local authorities. Landlords will be required to register on the database. The registration process will ensure that landlords are aware of their legal obligations and allow them to demonstrate their compliance.
Renters will be able to use the publicly available information to understand more about a landlord or a rental property. That information will increase renters’ confidence when deciding whether to rent a property. The information on the private rented sector database will support the Government in developing a richer understanding of the sector to inform future policy. The database will be key to the successful implementation and enforcement of the wider reforms legislated for in the Bill.
David Simmonds
I have a few questions and would be grateful for the Minister’s response. In this chapter of the Bill, the regulations will clearly do a lot of the heavy lifting on what the database is like and what the tenant and landlord experience will be. First, how will the proposed database interact with the existing selective licensing schemes that a number of local authorities have in place? In the regulations, will the Government draw on the learning from the existing schemes to inform the database’s operation? It is not entirely clear how it will interact, given the different regimes in Wales and Scotland that the Minister has announced. Again, I do not necessarily expect him to answer those questions straightaway, but it would be helpful to know, particularly given that a different enforcement regime will apply in Wales.
It is also not entirely clear what the Government’s thinking is about the geographical extent of the database and the way in which it will be designed. Given that designated local authorities will be enforcement bodies, will it operate in the same way as, for example, existing children’s social care databases? Will it be maintained by individual local authorities, but in a connected way so that we can extract data from it? Will there be a single national database or an England-wide database? I appreciate that the answers to some of those questions will result from the process of engaging with the market on who the provider will be. We know, from examples where such policies have been successful or gone badly wrong, that there are significant risks to the effectiveness of the Bill if we do not get this right. It would be helpful if the Minister could address those points, either now or later in writing.
Matthew Pennycook
I am grateful for the opportunity to provide some clarification, particularly on selective licensing, because I know that is a source of interest to many Members.
The Government are clear that selective licensing and the private rented sector database have different purposes. The database is not designed to replace selective licensing. Unlike the database, selective licensing schemes aim to target specific local issues in specific local geographies by enabling more intensive practical enforcement strategies. We believe that selective licensing is a valuable tool when used appropriately and combined with other measures. It enables local authorities to drive better outcomes for local residents, tenants and responsible landlords.
What is important, and what we are committed to doing, is ensuring that the use of selective licensing complements and is aligned with the new private rented sector database. There is some important work to do, which we are already engaged in, to refine the way the two systems will work together once they are both in force.
The shadow Minister asked me a reasonable question about the geographical extent of the database. I will come back to him on that specific point, particularly in respect of how it interacts with the rental discrimination provisions in the Bill, given our previous discussions on their application in Wales and Scotland.
Mr Amos
Clause 75 deals with the making of the database, and I want to raise the importance of its content. Had I been quicker off the mark and more used to the procedures, there would be an amendment before the Committee that I would speak in favour of, but it is absent—time ran away.
Will the Minister comment on the importance and potential real value of the database, depending on the information that it carries? The Liberal Democrats want to see the Bill include: the accessibility of the property for disabled people; whether enforcement action has been taken against the landlord; the energy performance certificate rating of the property, so that people have some idea of how expensive it will be to heat and live in; and, crucially, the rent that was paid in the first tenancy.
As I said the other day, we firmly believe that market rents are often inaccurately described and arrived at, by virtue of looking at advertisements. I appreciated the points the Minister made the other day in response, but none the less it remains the case. As I also said the other day, we believe that the cost of interest is the bigger driver of landlords’ costs, rather than inflation, and it should be a better proxy for limiting rent increases. Even without that, a database with the actual rents paid could be an enormously powerful tool for both renters and landlords, as well as the market generally. More information makes for a better marketplace and will hopefully improve the lot of landlords and tenants. We particularly wish to see all those features in the register and believe that would enhance the market.
The other day, in relation to whether the Bank of England rate was a relevant proxy for landlords’ costs, the shadow Minister said that the commercial interest paid by landlords was more important, but there is a relationship between the Bank of England base rate and the commercial rates of interest paid. It is the key driver of commercial rates of interest.
My main point is that having on the register the rent, including the level of the last increase in rent, would be a really important and powerful indicator. We wish to press for the details I have outlined to be on the register. If I had been quicker off the mark, there would be an amendment before the Committee.
Matthew Pennycook
I will say two quick things. I remember probing the previous Minister about this issue during the debate on the previous Government’s Bill, because I thought it was worth teasing out. In general, we did not want to be too prescriptive with what is on the face on the Bill in terms of the frameworks, because we need to strike a balance between the primary legislation and the flexibility for the details of the database to be developed in secondary legislation, so that we can respond to any evolutions in the sector and technology. We do not want to be too prescriptive on the face of the Bill.
In response to the call from the hon. Member for Taunton and Wellington for particular data to be included on the database, I draw his attention to my previous comments, which I think I made in the third or fourth sitting, about the potential for rents to be included. I am extremely sympathetic to that. Other information could potentially go on the database that might show patterns of behaviour on the part of landlords that would inform tenants’ choices. At a minimum, we want the database to include information about private landlords, the homes they rent out and how those homes are managed. I want debate with hon. Members about what goes on the database, but all the detail, as I am sure the hon. Gentleman will appreciate, will come forward in secondary legislation. At that point, the hon. Gentleman or his colleagues will be able to have a further debate and discussion on those matters.
Matthew Pennycook
I am making no specific commitment, but such is the significance of the regulations—they will provide all the detail for how the service will work in future—it would not be a cursory debate.
Question put and agreed to.
Clause 73 accordingly ordered to stand part of the Bill.
Clauses 74 to 83 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Gen Kitchen.)
Renters' Rights Bill (Seventh sitting)
Tuesday 5th November 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 5 November 2024 - (5 Nov 2024)
The Minister for Housing and Planning (Matthew Pennycook)
It is a pleasure to continue our proceedings with you in the Chair, Mr Betts. We now turn to clauses 84 to 86, which deal with access to the data collected on the database and the circumstances in which that may be shared.
Let me start by speaking to clause 84. One of the central objectives of the database is to provide tenants and prospective tenants with the data to allow them to make informed decisions about which landlords to rent from. For that reason, the clause gives the Government a regulation-making power to make certain information on the database visible to the public.
For the database to be a success, it is crucial that tenants have access to key information about a landlord and a rental property. The information that the Government plan to make available to the public will include details of the landlord, details of other parties involved in the management or ownership of the property, and information about the rental property. The Government also intend to use the database to make landlords’ unspent housing-related offences or penalties visible to the public. Tenants will be able to make a judgment about whether to rent from a landlord, and good landlords will be distinguished from the minority of landlords who commit offences.
Information about spent offences will continue to remain visible to local authorities until those offences must be removed from the database, as described under clause 87. That will help local authorities to devise their enforcement approaches. However, spent offences will not be visible to the public. The Government will make information from the database public only if that is necessary and proportionate to meeting the aims of the database. We are committed to providing tenants with the information they need to make sound decisions about renting, but we are determined to respect landlords’ rights to privacy and to follow data protection and human rights legislation.
The clause also gives authorities such as local housing authorities, which have an interest in enforcing property standards, unlimited access to the information on the database. That will ensure they have access to the data necessary for them to carry out their enforcement activities.
Clause 85 outlines circumstances in which restricted data may be shared. The database will contain information that could be useful to various third parties. Although it could be useful, it remains essential that the information is protected in such a way as to respect the privacy of landlords and to ensure that the data is disclosed only for the intended purpose. Under clause 84, access to information will already be possible for relevant enforcement authorities, and regulations made under clause 85 can be used to extend that access to restricted information to other important third parties. That could be another Department or other third parties, such as the police service and the fire service.
The Government remain committed to protecting the privacy of landlords, as I said, and will ensure that any data disclosed is disclosed only for the specific purposes outlined in clause 85 and in full compliance with data protection legislation. The clause contains limitations to ensure that restricted information is disclosed to third parties only when necessary—for example, to help to fulfil statutory requirements and functions, or to facilitate compliance with the rule of law.
The Government have yet to confirm which organisations will have access to that information. We believe that certain elements of the information contained in the database may be useful to other Departments and other external agencies, as I said. Should the database operator or other persons breach the restricted data disclosure restrictions imposed by clause 85, they could be guilty of an offence punishable by a fine.
Clause 86 outlines the circumstances in which data can be used by certain public bodies that are granted access. The clause restricts the use of database information by those bodies to housing-specific functions. I will list the agencies in turn, for the benefit of the Committee: local housing authorities may use information from the database only in relation to their functions concerning housing, residential landlords and residential tenancies; local weights and measures authorities will be able to use the information from the database only for purposes related to their enforcement of housing standards; the mayoral combined authorities and the Greater London Authority may use information only in connection to their housing-related functions; and, if the Government nominate a lead enforcement authority—we will discuss that in more detail in respect of a later clause—it will be allowed to use information from the database only in relation to its functions as a lead enforcement authority, and the provision of the landlord legislation for which it is responsible.
Clause 86 will mean that although those agencies will have access to the information collected by the database, they will be able to use the data only where necessary and connected to their work related to housing. That will provide for better intelligence gathering on the private rented sector, enhancing enforcement activities and driving up standards, while also ensuring the privacy of landlords. I commend the clauses to the Committee.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
It is a pleasure to serve under your chairmanship, Mr Betts. We spent some time on the use of the database in the previous Committee sitting, and the Opposition are satisfied with the Government’s direction of travel.
I have a question for the Minister in respect of his comments about those who will have access to the data and the purposes for which it is used. He spoke specifically about local authorities having the ability to access the data only for the performance of their housing functions. Predictive analytics are in quite widespread use in local authorities, largely based on the gathering of data from a number of sources—for example, the Ofsted databases that contain indicators relating to children, which might include the potential for a household to be made homeless, which would then trigger a requirement for a local authority to intervene.
It would be helpful if the Minister could clarify, perhaps in writing subsequent to this morning’s sitting, how housing functions will be defined so as not to inhibit the entirely commendable use of predictive analytics to identify households where there might be a risk that would trigger the local authority to intervene. How would that interact where elements of the service were provided by, for example, children’s trusts as a third party to the local authority, in order to ensure that the good work that is already being done to prevent households with children or vulnerable people from becoming homeless, and then requiring the intervention of a local authority, continues, and so that earlier intervention can forestall the level of risk?
Matthew Pennycook
I thank the shadow Minister for that question. To reassure him, any access to restricted information that is not displayed publicly through the database must be shown to facilitate compliance with a legal requirement, a rule of law or, as I said, the performance of a specific statutory function. I understand and recognise his point—namely, what are the limits? What is the definition of what a housing function is? What are the limits of what that applies to where statutory services are—I hope I have taken the shadow Minister’s meaning correctly—not strictly housing related but shade into housing-related issues? I will happily provide him some specific detail on that point through correspondence.
Question put and agreed to.
Clause 84 accordingly ordered to stand part of the Bill.
Clauses 85 to 87 ordered to stand part of the Bill.
Clause 88
Restriction on gaining possession
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
Clauses 88, 89 and 90 introduce a restriction on repossession for unregistered properties and new offences and financial penalties in relation to the database.
Clause 88 prohibits landlords from gaining a possession order for a property unless they have registered themselves and their property on the database. A comprehensive record is essential for the database to be of use to tenants —in the way I described in relation to the previous clauses—and to local authorities and central Government. This approach will incentivise landlords to register on the database, thereby empowering renters to make informed choices about where they live. However, the Government recognise the importance of tackling antisocial behaviour. It will therefore be possible for a possession order to be granted under grounds 7A or 14 if the matter relates to antisocial behaviour, even if a landlord and their property are not registered on the database.
The Government can, through regulations, amend the person to whom or circumstances in which the restriction on granting a possession order applies. This will allow the legislation to evolve to match the changing needs of the database and ensure that the possession restriction targets the right landlords.
Clause 89 allows local authorities to levy financial penalties on individuals who fail to comply with the database provisions. A transformative database will equip local authorities and tenants with the intelligence needed to make informed choices in the private rented sector. A strong enforcement framework will be crucial in maintaining the database’s integrity and ensuring that it serves its intended purpose. The clause grants local authorities powers to tailor penalties for non-compliance, and outlines a transparent and proportionate system for increasing penalties in cases where initial measures fail to achieve such compliance.
Clause 89 also allows local authorities to impose fines of up to £7,000 on persons who breach the restrictions in clause 80 regarding the marketing, advertising or letting of properties. Repeat offenders who commit similar breaches within five years, or continue to engage in unlawful behaviour, may face fines of up to £40,000, under clause 90. To further safeguard the integrity of the database, local housing authorities will have the power to impose fines of up to £40,000 on anyone who knowingly or recklessly submits false or misleading information to the database operator. Those fine levels will act as a powerful deterrent for landlords and agents, thereby ensuring high levels of compliance with the database provisions. The Secretary of State can amend the level of fines to reflect inflation; this power will ensure the continued effectiveness and relevance of our enforcement measures.
We understand that the database is a new service for local authorities, and we are designing the service to be as streamlined as possible. Our research indicates that a dependable source of information on the private rented sector will improve the efficiency of local authority enforcement practices. The clause mandates local authorities to have regard to guidance on financial penalties issued by the Secretary of State. The power will enable the Government to assist local authorities to fulfil their new responsibilities.
The success of the private rented sector database hinges on landlords and property agents fulfilling their new duties. Clause 90 will establish new offences for continued or repeated breaches of the requirements relating to the restrictions on the marketing, advertising and letting of a property imposed by clause 80. Those who continually or repeatedly breach the requirements within a five-year period are liable to an unlimited fine, following a successful prosecution.
Furthermore, clause 90 will establish a new offence where a person knowingly or recklessly provides false or misleading information to the database operator. Again, those who breach that requirement will face an unlimited fine on conviction. To ensure accountability in the private rented sector, we have extended liability for the offences to include corporate bodies. That will deter non-compliance and promote responsible behaviour among corporate entities and their representatives.
To combat these illegal practices, the Government will make regulations under the Housing and Planning Act 2016 to categorise the new offences established under clause 90 as banning order offences, which must be recorded on the database. As a result, depending on the decision of the local housing authority, landlords, agents or others convicted of such offences may be subject to a banning order.
The stringent penalties outlined in the clause will serve as a powerful disincentive for those who do not comply with the requirements of the database. By ensuring greater compliance, we will equip local authorities and tenants with essential information, while also enabling reputable landlords to differentiate themselves from those who do not, or refuse to, meet the required standards.
David Simmonds
Again, the Opposition support the measures, and I welcome the Minister’s words in introducing them.
On the restrictions around gaining possession, I have a brief question concerning the potential interaction between the database and planning law—for example, where a landlord has been registered and is letting a property that has not been authorised in planning terms. That is quite common on caravan sites, where the land might be illegally occupied, with a complex set of transactions leading up to that situation. The most vulnerable individuals and households are often accommodated in that type of property, which is sometimes of very poor quality. A local authority, therefore, needs to go down the appropriate enforcement path, in planning terms, to end the potentially illegal or unlawful use of that land.
Because planning law permits unlawful use to be rendered lawful by the seeking of retrospective permission, there is a potential risk to a tenant occupying such a property, if the local authority undertakes different courses of enforcement action simultaneously against a banned bad landlord and against a landowner or developer who has created a property that is not fit for occupation but is part of a rented-out property portfolio. I would like confirmation that those circumstances have been considered. Constituents of mine have been in that situation. I do not want to find that the most vulnerable and marginal households cannot benefit from the rights that the legislation intends to create.
Matthew Pennycook
I thank the shadow Minister for that question. I will give him the opportunity to clarify, if he feels that would be helpful. If I have understood him correctly, he is asking what would happen where there is an unauthorised development and potential planning enforcement in place, but the landlord is required under the new system to register with the database. Would they essentially be allowed to register with the database and comply with the requirements in the Bill, were they subject to a form of planning enforcement?
Matthew Pennycook
I will take that away and write to the shadow Minister. It is a good, detailed, specific question. We need to consider how various elements of local authority enforcement action relate to the Bill and how the Bill interacts with other requirements.
Carla Denyer (Bristol Central) (Green)
It has just occurred to me that the same question might apply to houses in multiple occupation, in areas where section 4 is applied. When the Minister looks into it, will he include that as well?
Matthew Pennycook
I am more than happy to include that in my correspondence with the Committee.
David Simmonds
I am grateful to the Minister for his response. My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) held a Westminster Hall debate on the topic of unauthorised development, but there are also issues with authorised development in places where there may be conflicts in planning law. For example, somebody occupying a caravan or temporary structure on land where they are subject to planning enforcement, but where they have a legal contract with a landlord, is in an especially vulnerable position. We want to ensure that they are not at risk of having their rights taken away as a result of ambiguities in the legislation. I am grateful to the Minister for looking into that.
Matthew Pennycook
Let me, hopefully, bring the exchanges on this matter to a close. I have taken away from this a very valid point. Under the provisions in the clause, if landlords correct a matter of non-compliance, vis-à-vis the requirements in the Bill, the possession process will be allowed to continue. Hon. Members have asked a reasonable question about whether, in circumstances where planning enforcement is still a live issue, it impacts in any way, and that can also apply in respect of HMOs. I commit to coming back to the Committee with fulsome detail on the subject.
Question put and agreed to.
Clause 88 accordingly ordered to stand part of the Bill.
Clauses 89 and 90 ordered to stand part of the Bill.
Clause 91
Power to direct database operator and local housing authorities
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
Clauses 91 to 94 deal with the power to direct the database operator, amendments to the Housing and Planning Act 2016, provisions for joint landlords and the interpretation of chapter 3.
The Government are aware that in order to achieve the aims of the database—to raise standards in the sector—we may need to direct the database operator or local authorities in respect of how they carry out certain functions in relation to the database. Clause 91 allows the Government to give the database operator or local housing authority instructions on how they exercise their functions. This may include giving instructions to local housing authorities on how to investigate and enforce property standards. The power will provide an agile database that can respond to the changing needs of the sector.
To ensure that local authorities can build a complete picture of enforcement activities, it is essential that banning orders and banning offences are recorded in one location. Clause 92 will require local authorities to record banning orders and banning order offences in respect of landlords on the private rented sector database once it has come into force. The clause amends section 28 of the Housing and Planning Act 2016 to signpost people to the new PRS database established under the Bill.
The purpose of clause 93 is simply to ensure that we have the ability to streamline the process for joint landlords in order, where possible, to avoid the duplication of entries. We anticipate creating a single sign-up process for joint landlords, with one lead landlord registering on behalf of others.
To help the understanding and aid the interpretation of the proposed legislation concerning the database, clause 94 defines certain key terms used in the legislation, or signposts readers to definitions elsewhere. Those terms are “database”, “lead enforcement authority”, “the landlord legislation”, “relevant banning order”, “relevant banning order offence” and “unique identifier”. I hope the Committee will have no issue with these simple, straightforward clauses.
David Simmonds
Once again, we support the clauses, but I have a question for the Minister. A little later, we will debate the allocated enforcement authority—which local authority has the power to undertake the enforcement. It will be a challenge for areas of England with two-tier councils where the housing authority is the district council, because the county council also has certain responsibilities that it must fulfil. For example, under the Children Act 1989, the county council has a duty to house somebody who is at risk of homelessness even if they have no recourse to public funds, because of the risk to children of being made homeless. Were the council not able to access the database because it was not the enforcement authority for that area, it would not be able to undertake the same level of due diligence.
I want the Committee to be confident that when the allocation of powers and duties is undertaken, the process will be sufficiently comprehensive for all the parts of the local government system that could have duties triggered under various parts of this legislation to have equality of access to the database to enable them to discharge their functions properly.
Matthew Pennycook
I thank the shadow Minister for posing that question. I am confident that the provisions are comprehensive enough to deal with those sorts of eventualities. I think we will discuss the matter in a bit more detail when we come to the clauses that relate to the lead enforcement authority and who has particular responsibilities in certain scenarios envisioned in the Bill. If I have not answered the shadow Minister’s question, I will be happy to respond again at that point.
Question put and agreed to.
Clause 91 accordingly ordered to stand part of the Bill.
Clauses 92 to 94 ordered to stand part of the Bill.
Clause 95
Financial assistance by Secretary of State
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
The clauses cover financial assistance provided by the Secretary of State to the PRS ombudsman and database, rent repayment orders and the interpretation of part 2.
On clause 95, we intend the private rented sector database and ombudsman to be self-funded through landlords’ registration or membership fees. However, clause 95 gives the Secretary of State the ability to give financial assistance to a person carrying out functions related to the PRS ombudsman or database provisions. Assistance will be granted in the event of an emergency, unforeseen circumstances or to cover enforcement shortfalls in particular circumstances.
Clause 96 concerns rent repayment orders. As members of the Committee will know, an RRO is an order made in the first-tier tribunal requiring a landlord to repay a specified amount of rent, either to the tenant or to the local housing authority, for a range of specified offences. The amount owed under an RRO is enforceable as if it were a debt in the county court. To grant an RRO, it is not necessary for the landlord or agent to have been convicted, but a tribunal must be satisfied beyond reasonable doubt that one of the offences has been committed. Presently, an RRO can require the repayment of a maximum sum of 12 months’ rent.
Rent repayment orders were introduced by the Housing Act 2004 and extended through section 40 of the Housing and Planning Act 2016 to cover a wider range of offences. RROs are an accessible, informal and relatively straightforward means by which tenants can obtain redress in the form of financial compensation, without having to rely on another body in instances where a landlord or his or her agent has committed an offence. For that reason—as you know better than anyone, Mr Betts—they have proved an extremely effective means for tenants and local authorities to hold to account landlords who fail to meet their obligations. RROs empower tenants to take effective action against unscrupulous landlords, but they also act as a powerful deterrent to errant landlords.
The previous Government’s Renters (Reform) Bill brought a number of continuing or repeat breaches or offences within the purview of rent repayment orders. In our view, it did not go far enough. We made the case at the time—ultimately without success, it must be said —that RROs should be a more significant feature of the Bill. I am therefore pleased that our Renters’ Rights Bill significantly expands rent repayment orders.
At this point, it would be remiss of me not to pay tribute to the late Simon Mullings, who unexpectedly died recently while on holiday in Scotland. Spike, as he was known by many, was a real enlarger of life and a real force for good in the sector, helping a great many families in need. His work on RROs, not least in the Rakusen v. Jepsen case, which went to the UK Supreme Court, and the exchanges we had in relation to the Renters (Reform) Bill in the last Parliament heavily influenced our approach to the legislation before us. He is sorely missed, and I thought it was right for me to make special mention of him, given how he has influenced the clauses we are discussing.
Clause 96 makes a series of important measures that strengthen rent repayment orders. First, it expands rent repayment orders to new offences across the Bill, including those in relation to tenancy reform, the ombudsman and the database. That ensures robust tenant-led enforcement of the new measures and supports better compliance with the new system. Secondly, the clause ensures that for all the listed offences, the tribunal must issue the maximum rent repayment order amount where the landlord has been convicted of, or received a financial penalty for, that offence or has committed the same offence previously. The intention is that rent repayment orders will provide an even stronger deterrent against offending and reoffending. Finally, clause 96 makes it easier for tenants and local authorities to apply for rent repayment orders, by doubling the maximum period in which an application can be made from the current 12 months to two years.
Clause 97 explains what activities constitute marketing a property to let and what comprises letting agency work. Landlords, letting agents and other persons will be prohibited from marketing residential properties to let, unless the landlord has registered with the private rented sector database and ombudsman scheme. Renters will benefit from knowing that a landlord has registered with the database, and tenants should be able to seek redress for issues that occur during the pre-letting period. We will retain the flexibility to narrow the definition of letting agency work by regulations in the future, if that is needed.
I commend the clauses to the Committee.
Question put and agreed to.
Clause 95 accordingly ordered to stand part of the Bill.
Clauses 96 and 97 ordered to stand part of the Bill.
Clause 98
Decent homes standard
Mr Gideon Amos (Taunton and Wellington) (LD)
I beg to move amendment 72, in clause 98, page 117, line 20, at end insert—
“(ia) the availability of which is secured by the Secretary of State under paragraph 9 of Schedule 10 of the Immigration Act 2016, or sections 4 or 95 of the Immigration and Asylum Act 1999;
(ib) that is provided by the Ministry of Defence for use by service personnel; or”.
This amendment would extend the Decent Homes Standard to accommodation provided to people on immigration bail and to that provided by the Ministry of Defence to service personnel.
The Chair
With this it will be convenient to discuss the following:
Government amendments 24 and 25.
Clause stand part.
Government amendments 26 to 40.
Schedule 4.
Mr Amos
It is a pleasure to serve under your chairmanship, Mr Betts, particularly as I know your expertise in this policy area. Amendment 72 would apply the proposed decent homes standard both to accommodation for refugees and people seeking asylum, and to accommodation provided by the Ministry of Defence for serving personnel. As I stated on Second Reading, it would be perverse, now that we have a decent homes standard for social housing and this Bill proposes a decent homes standard for the private rented sector, to leave our serving military personnel as one of the only groups not benefiting from decent living accommodation.
In debate on the Renters (Reform) Bill, my hon. Friend the Member for Twickenham (Munira Wilson), speaking on behalf of our hon. Friend the Member for North Shropshire (Helen Morgan), spoke about RAF Shawbury and Tern Hill barracks in north Shropshire, where the service accommodation was plagued by black mould, rat infestations and chronic overcrowding, meaning that individuals who have put their lives on the line for our country are not necessarily guaranteed a warm and safe place to live in return. I agree with the words of my hon. Friend the Member for Twickenham:
“That is no way to treat people who have put their lives on the line to serve this country…they deserve better.”—[Official Report, 24 April 2024; Vol. 748, c. 1004.]
I am grateful to the Minister for advising the House on Second Reading of this Bill that
“the MOD is reviewing its target standards so that we can drive up the quality of that accommodation separately from the Bill.”—[Official Report, 9 October 2024; Vol. 754, c. 412.],
but this is a long-running issue, and no doubt any Government at any time on any day in any month would say that they were “reviewing” the situation. Frankly, that is not going far enough.
Next week, of course, we will be commemorating those who sacrificed everything for our country. It would be appropriate, would it not, for the Government to take the opportunity under this Bill to commit to giving service personnel a decent homes standard for the public buildings in which they live? I have to say that the Government’s current position is a bit disappointing. I hope that the Minister will update that position, the more so because it falls short of the position taken by the previous Conservative Government, which is something of a surprise from where I am on the Liberal Democrat Benches. I hope very much that the Minister will update the position.
As the hon. Member for Ruislip, Northwood and Pinner will no doubt remember, the former Minister and then Member for Redcar, Jacob Young, in response to the equivalent amendment proposed to the Renters (Reform) Bill by my hon. Friends, made the commitment on Report that the Conservative Government would
“ensure that service accommodation meets the decent homes standard”.
However, he also said:
“Service…accommodation has unique features…including a significant portion being located on secure military sites where there will be issues around security and access for inspections.”
Therefore, like the Minister today, he recognised the unique challenges. However, he said that with
“the appropriate monitoring and reporting arrangements”,
the Government
“intend to ensure that service accommodation meets the decent homes standard”.—[Official Report, 24 April 2024; Vol. 748, c. 1029.]
Can it really be the case that the new Government are backtracking on the commitment of the last Government when it comes to decent homes for our serving military personnel? I certainly hope not.
In earlier sittings, this Minister emphasised that the exact nature of the standard would be subject to consultation, and clause 98(4) makes provision for exactly that consultation. I do not suggest that private rented housing would necessarily have poorer standards than the decent homes standard that applies to social housing. However, it is clear in clause 98 that the Government intend to develop a distinct standard appropriate to the private rented sector. What greater opportunity is there for the clause to ensure that the Government also develop a distinct decent homes standard that would be appropriate for the MOD conditions described earlier?
Finally, there is no doubt that tenants taking refuge here from war or other disasters in their own countries, who are awaiting determination of their asylum applications and many of whom have served our military and British forces in theatres of war such as Afghanistan, should also be in decent homes. Incidentally, the Liberal Democrats believe that asylum seekers should be working for that accommodation, so that they can earn for themselves and pay for it, but that does not take away from the fact that those families should not be in poor accommodation and should have decent homes.
I strongly urge the Minister, and the Committee as a whole, to recognise that the Bill provides a legislative opportunity, one that may not come again in this Parliament, to do right by those who should have decent homes. I urge the Committee to support the amendment and finally bring a long-running campaign to a successful conclusion, such that military accommodation will meet the decent homes standard.
Matthew Pennycook
We now move to part 3 of the Bill, concerning the decent homes standard. As members of the Committee will be aware, the private rented sector has the worst conditions of any housing tenure. More than one in five privately rented homes fail to meet the current decent homes standard, which sets a minimum standard for social housing. That equates to around a million homes. We are determined to tackle the blight of poor-quality homes and to ensure that tenants have the safe and decent homes they deserve. To do that, we will apply a decent homes standard to privately rented homes for the first time.
Clause 98 allows regulations to be made setting out the decent homes standard requirements that private rented homes must meet. As the hon. Member for Taunton and Wellington just mentioned, the Government will be consulting on the content of that standard, and we will set out the details of our proposals in due course. We want as many private rented sector tenants as possible to benefit from the decent homes standard. It will therefore apply to the vast majority of privately rented dwellings and houses in multiple occupation that are let under tenancies, as well as privately rented supported housing occupied both under tenancies and licences.
It is our intention that as much privately rented temporary homelessness accommodation as possible is covered by the decent homes standard too, but we need to avoid reducing the supply of such housing. Clause 98 therefore allows, following a consultation, temporary accommodation to be brought within scope of the standard through regulations. We are committed to engaging with the sector to assess the potential impacts and to ensure that our approach strikes the right balance.
Schedule 4 establishes a robust but proportionate enforcement framework for the decent homes standard. Local councils already have a wide range of powers to take action when properties contain hazards. Schedule 4 will allow those enforcement powers also to be used where private rented homes fail to meet decent homes standard requirements. It also gives councils a new power to issue financial penalties of up to £7,000 where the most dangerous hazards are found, as well as taking other enforcement action. That will provide a strong incentive for landlords to ensure that their properties are safe.
In most instances, the landlord who lets out the property to the tenants will be responsible for ensuring that it meets the decent homes standard. To reflect that, the schedule provides that the landlord will be subject to enforcement by default. However, some circumstances are more complex, such as leasehold properties and where rent-to-rent arrangements are being used. The schedule gives councils the flexibility in such situations to take enforcement action against the appropriate person. The schedule also allows for the fact that there will be legitimate reasons why some properties will not be able to meet all elements of the standard—for example, if a property is a listed building and consent to make alterations has been refused. Local councils will be able to take a pragmatic approach to enforcement in such cases. We will publish statutory guidance to support them in dealing with such issues in a way that is fair for both tenants and landlords.
We have tabled a number of minor Government amendments to ensure that clause 98 and schedule 4 work as intended. It is important that local authorities can take enforcement action against the person responsible for failures to meet quality standards. The amendments will ensure that the appropriate person can always be subject to enforcement action in respect of health and safety hazards in temporary homelessness accommodation.
David Simmonds
I share the Minister’s view of the amendment. We note the evidence that the vast majority of the MOD estate already meets the decent homes standard. The previous Government acted to apply the decent homes standard to the MOD estate in 2016 and, as far as I am aware, the commitment given by the previous Minister, Jacob Young, remains the Government’s position unless we hear otherwise. However, the amendment highlights a significant issue across Government: the NHS has a significant residential estate for the accommodation of nurses and doctors on hospital sites, and the Home Office also has a significant estate.
As the Minister outlined, because it broadly falls within the private rented sector, the vast majority of asylum accommodation is likely to come within the purview of the Bill by one means or another—and the decent homes standard applies to it anyway. There are a couple of issues that arise in respect of that. One is the way in which that standard will interact with unregulated children’s homes. As part of the care leaving pathway under the Care Act 2014, local authorities have a duty to secure accommodation, which is designed to provide an element of support for a young person preparing to move towards adulthood.
In many cases, because of the need for that support, but also due to that young person’s age, the home falls outside the regulation of Ofsted, which normally conducts inspections of regulated children’s homes. We have known for some time that the Department for Education is looking at issues that have arisen from time to time with the standard and quality of that accommodation. It would be helpful to understand how the decent homes standard may be applied, or whether there is separate action within the remit of the Department for Education—which has made announcements about this—that is designed to address the issue.
Finally, I welcome what the Minister said about temporary accommodation—that there is a degree of discretion, but that the aim is to bring the temporary accommodation estate within the remit of the decent homes standard. One of the challenges is around the homelessness duty introduced by the Homelessness Reduction Act 2017. Many local authorities will have a conversation with a homeless household about that household or individual securing for themselves private rented accommodation. Sometimes the quality of that accommodation is not good, particularly in areas with high demand for it.
With that, I return to the subject of temporary structures, such as caravans, chalets and things like that, which are sometimes on authorised sites with planning consent, but sometimes not. We simply want an assurance that, where individuals access accommodation through that route—where the local authority is paying or subsiding the rent to prevent homelessness—but the structure is unlikely to meet the decent homes standard from the outset, there will be an appropriate enforcement mechanism or at least clarity, so that, in a sector with the highest satisfaction rate but also the most egregious outliers, the most vulnerable and marginalised people can enforce their rights.
Carla Denyer
I rise to support amendment 72, tabled by the hon. Member for Taunton and Wellington, who made a compelling case for the need to provide adequate housing for those who serve us in the armed forces. I want to pick up on the reassurance that the Minister attempted to offer us on the existing regulatory regime for asylum accommodation, which he believes is sufficient. There is a two-word answer to whether it is sufficient: Bibby Stockholm. Would the Bibby Stockholm meet the decent homes standard? No, it clearly would not, and the Bill is an opportunity to fix that.
Matthew Pennycook
I will respond briefly, partly because a number of the issues raised are outside my ministerial responsibility. I commit to replying in writing to the points raised in relation to the responsibilities of the Home Office and the Department for Education, to give the Committee more clarity. Some of those details will come out when we consult. Everyone is assuming that we are talking about the decent homes standard as if it exists—it does not exist. We need to consult on what those specific standards will be and introduce the regulations.
The powers we have given ourselves in the measures will ensure that the standard can be extended to temporary accommodation, and to other types of housing provision where needed. I will happily come back on the point that the hon. Member for Bristol Central raised about the provision of asylum accommodation.
Mr Amos
The hon. Member for Ruislip, Northwood and Pinner believes that the commitment from the last Government that the decent homes standard will be applied to Ministry of Defence housing still stands, but the Minister says that the decent homes standard will not apply to MOD homes and instead that the MOD has it under review.
David Simmonds
The Minister and the previous Government were clear that the decent homes standard has applied to MOD accommodation since 2016, so it is in effect already. That is the evidence the Committee has heard. This debate is therefore not about whether to apply it; it already applies, and has done for some time.
Mr Amos
That is not consistent with what Jacob Young said in 2023, as recorded in Hansard, namely that the intention was to extend the decent homes standard to cover Ministry of Defence accommodation. That is the intention of the amendment. That is why I tabled it and why my hon. Friend the Member for North Shropshire tabled it in the last parliamentary Session. We are hearing that someone in the MOD has it under review. At the moment, that is not a huge reassurance. The whole subject of MOD housing and the need for serving personnel to benefit from it has been omitted.
The Minister mentioned the difficulty of enforcing the decent homes standard because MOD accommodation is behind the wire, but according to him we know that 96% of MOD accommodation would meet the standard. That work has been done, surveys have been carried out and the information is being freely exchanged, so clearly it is not that difficult to inspect the accommodation and understand what standard it meets. All accommodation on MOD bases can be easily accessed with the permission of the officer commanding the base. All sorts of inspections are carried out on MOD bases.
I accept that the Government are supportive of the principle of improving the standard of asylum seeker accommodation, but as with MOD housing, the fact that it is under review is not much of an assurance. I therefore will not withdraw the amendment.
Matthew Pennycook
Unless the hon. Gentleman is pressing his amendment simply to make a political point, I ask him gently: what outcomes are we seeking? He wants to bring MOD accommodation up to the decent homes standard. I have made it very clear to him that the MOD has been benchmarking minimum housing standards to the decent homes standard since 2016, and the shadow Minister has made the same point. The MOD inspects its properties. It knows what that standard is. It reports that 96% of its accommodation meets that standard.
The MOD also has a higher standard, the MOD-developed decent homes-plus standard, to which it benchmarks its accommodation. It found that 84.4% of its accommodation meets that standard. So we know that the MOD is already inspecting and monitoring its standards. The MOD has made it very clear under the present Government that it is reviewing how it takes forward those standards and—this is important to the point about outcomes—that in driving up standards in its accommodation, it is seeking an equivalent standard that we will introduce for the private sector through the Bill.
I gently say to the hon. Gentleman that we share the same objective; it is about how that is achieved. I have tried to give him the reassurance that the MOD is not just brushing off the review; it is absolutely committed to driving up standards through its particular route, given some of the challenges it faces. I have a barracks in my constituency, and it is not that easy for local authority enforcement officers to just make an appointment to visit it and inspect. It is for the MOD to take this forward, and it is absolutely committed to doing so. If the hon. Gentleman’s point is simply about how we achieve the same objective, I am very confident that the MOD should be the one to do it through the specific route it has outlined, rather than by bringing military accommodation into the Bill, which could have all manner of unintended consequences.
David Simmonds
The Minister said earlier that there is a requirement for a consultation on the decent homes standard. It is important to recognise that a decent homes standard already exists, and in fact has existed since the previous Labour Government, which introduced it for social housing. The MOD is benchmarking its accommodation to that existing social housing decent homes standard, which includes things such as the state of repair of the property and its thermal insulation—the property needs to be sufficiently warm for safe occupation. Those criteria already exist and are already in use. Where there is an element of doubt is on the specific decent homes standard that the new Government would apply to the private rented sector. But there is already a decent homes standard, which is in use in the Ministry of Defence now.
Matthew Pennycook
I give way to the hon. Member for Taunton and Wellington.
Matthew Pennycook
We have been in office for a little over 120 days, so the hon. Gentleman will forgive us for not publishing information about every action that we are taking. I will make him this offer: I will take his point away to MOD Ministers who we are in conversation with, and if I cannot give him further assurances through written correspondence about the process that the MOD intends to take forward, including in response to his specific point about timelines, he is more than welcome to push the amendment at a later stage. However, at this stage I urge him to accept that we think there are good reasons why this is not the legislative vehicle to take the amendment forward. The objective is shared; from our point of view, this is about the means by which it is most appropriately achieved.
Mr Amos
Given the assurance that the Minister has generously given, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendments made: 24, in clause 98, page 118, line 27, at end insert—
“(ba) a building or part of a building constructed or adapted for use as a house in multiple occupation if—
(i) it is for the time being only occupied by persons who form a single household, and
(ii) the accommodation which those persons occupy is let under a relevant tenancy or is supported exempt accommodation,
except where the accommodation which those persons occupy is social housing and the landlord under the tenancy, or the provider of the supported exempt accommodation, is a registered provider of social housing,”.
This expands the definition of “qualifying residential premises”—and therefore expands the scope of the power in new section 2A inserted by this clause—so as to catch HMO accommodation which is occupied by only one household (and therefore does not count as an HMO because it is not actually in multiple occupation).
Amendment 25, in clause 98, page 118, line 34, after “(b)” insert “, (ba)”.—(Matthew Pennycook.)
This is consequential on Amendment 24.
Clause 98, as amended, ordered to stand part of the Bill.
Schedule 4
Decent homes standard
Amendments made: 26, in schedule 4, page 186, line 4, leave out sub-paragraph (3) and insert—
“(3) After subsection (8) insert—
‘9) But unoccupied HMO accommodation is “qualifying residential premises” for the purposes of this Part only to the extent provided for by section 2B(1)(ba).’”
This is consequential on Amendment 24.
Amendment 27, in schedule 4, page 202, line 5, leave out from second “premises” to “, and” in line 6 and insert “other than—
(i) homelessness accommodation (see paragraph B1), or
(ii) common parts (see paragraph 4)”.
This excludes homelessness accommodation from the scope of the new paragraph A1. Instead it is dealt with by the new paragraph B1 inserted by Amendment 29. (Common parts are already excluded from new paragraph A1.)
Amendment 28, in schedule 4, page 202, line 11, leave out from beginning to second “the” in line 13 and insert—
“(1A) Sub-paragraph (2) applies in relation to the premises if they are—
(a) a dwelling or HMO let under a relevant tenancy,
(b) an HMO where at least one unit of accommodation which forms part of the HMO is let under a relevant tenancy, or
(c) a building or a part of a building constructed or adapted for use as a house in multiple occupation if—
(i) it is for the time being only occupied by persons who form a single household, and
(ii) the accommodation which those persons occupy is let under a relevant tenancy.”
This is consequential on Amendment 24.
Amendment 29, in schedule 4, page 202, line 31, leave out paragraph (b) and insert—
“(4) In this paragraph—
“common parts” means common parts that are qualifying residential premises by virtue of section 2B(1)(d);
“homelessness accommodation” means accommodation in England—
(a) the availability of which is secured under Part 7 of the Housing Act 1996 (homelessness), and
(b) which is residential premises, whether by virtue of paragraph (e) or another paragraph of section 1(4).
Service of improvement notices: homelessness accommodation (whether or not it is qualifying residential premises)
(1) This paragraph applies where the specified premises in the case of an improvement notice are homelessness accommodation (which has the same meaning here as in paragraph A1).
(2) The notice must be served on any person—
(a) who has an estate or interest in the premises, and
(b) who, in the opinion of the local housing authority, ought to take the action specified in the notice.
(3) This paragraph applies instead of paragraph 1, 2 or 3 (in a case where that paragraph would otherwise apply to the improvement notice).”
The definitions are consequential on Amendment 27. The new paragraph B1 provides for the service of all improvement notices relating to homelessness accommodation (and replaces the current provision which only catches notices about requirements under regulations under section 2A).
Amendment 30, in schedule 4, page 203, line 5, leave out “let under a relevant tenancy, or” and insert “a dwelling or HMO let under a relevant tenancy,”.
This is consequential on Amendment 24.
Amendment 31, in schedule 4, page 203, line 8, at end insert “or
(c) are a building or a part of a building constructed or adapted for use as a house in multiple occupation—
(i) that is for the time being only occupied by persons who form a single household, and
(ii) where the accommodation which those persons occupy is let under a relevant tenancy,”.
This is consequential on Amendment 24.
Amendment 32, in schedule 4, page 203, line 12, after “tenancy.” insert—
“(2B) Where—
(a) sub-paragraph (2A) does not apply in relation to the specified premises,
(b) the specified premises consist of or include the whole or any part of a building containing homelessness accommodation, and
(c) the person providing the homelessness accommodation—
(i) is a tenant of that accommodation under a tenancy which has an unexpired term of 3 years or less (the “short tenancy”), and
(ii) accordingly is not an owner in relation to the homelessness accommodation (see section 262(7)(b)),
the authority must also serve copies of the order on any person who, to their knowledge, is a tenant under the short tenancy, a landlord under the short tenancy, or a superior landlord in relation to the short tenancy, and who is not otherwise required to be served with a copy of the notice under this paragraph.
(2C) In sub-paragraph (2B) “homelessness accommodation” means accommodation in England—
(a) the availability of which is secured under Part 7 of the Housing Act 1996 (homelessness), and
(b) which is residential premises, whether by virtue of paragraph (e) or another paragraph of section 1(4).”
This requires copies of a prohibition notice to be given where homelessness accommodation is provided by a person who is a tenant of the accommodation under a lease with an unexpired term of 3 years or less.
Amendment 33, in schedule 4, page 203, line 13, leave out “after “(2)” insert “or (2A)”” and insert “for “sub-paragraph (2)” substitute “this paragraph””.
This is consequential on Amendment 32.
Amendment 34, in schedule 4, page 203, line 28, leave out “let under a relevant tenancy, or” and insert “a dwelling or HMO let under a relevant tenancy,”.
This is consequential on Amendment 24.
Amendment 35, in schedule 4, page 203, line 31, at end insert “or
(c) are a building or a part of a building constructed or adapted for use as a house in multiple occupation—
(i) that is for the time being only occupied by persons who form a single household, and
(ii) where the accommodation which those persons occupy is let under a relevant tenancy,”.
This is consequential on Amendment 24.
Amendment 36, in schedule 4, page 203, line 35, after “tenancy.” insert—
“(2B) Where—
(a) sub-paragraph (2A) does not apply in relation to the specified premises,
(b) the specified premises consist of or include the whole or any part of a building containing homelessness accommodation, and
(c) the person providing the homelessness accommodation—
(i) is a tenant of that accommodation under a tenancy which has an unexpired term of 3 years or less (the “short tenancy”), and
(ii) accordingly is not an owner in relation to the homelessness accommodation (see section 262(7)(b)),
the authority must also serve copies of the order on any person who, to their knowledge, is a tenant under the short tenancy, a landlord under the short tenancy, or a superior landlord in relation to the short tenancy, and who is not otherwise required to be served with a copy of the notice under this paragraph.
(2C) In sub-paragraph (2B) “homelessness accommodation” means accommodation in England—
(a) the availability of which is secured under Part 7 of the Housing Act 1996 (homelessness), and
(b) which is residential premises, whether by virtue of paragraph (e) or another paragraph of section 1(4).”
This requires copies of a prohibition notice to be given where homelessness accommodation is provided by a person who is a tenant of the accommodation under a lease with an unexpired term of 3 years or less.
Amendment 37, in schedule 4, page 203, line 36, leave out “or (2A)” and insert “, (2A) or (2B)”.
This is consequential on Amendment 36.
Amendment 38, in schedule 4, page 203, line 37, leave out “after “(2)” insert “, (2A)”” and insert “for “sub-paragraph (2) or (3)” substitute “this paragraph””.
This is consequential on Amendment 36.
Amendment 39, in schedule 4, page 204, line 4, leave out “let under a relevant tenancy, or” and insert “a dwelling or HMO let under a relevant tenancy,”.
This is consequential on Amendment 24.
Amendment 40, in schedule 4, page 204, line 7, at end insert “or
(iii) are a building or a part of a building constructed or adapted for use as a house in multiple occupation that is for the time being only occupied by persons who form a single household and where the accommodation which those persons occupy is let under a relevant tenancy,”.—(Matthew Pennycook.)
This is consequential on Amendment 24.
Schedule 4, as amended, agreed to.
Clause 99
Financial penalties
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
These provisions deal with financial penalties. Schedule 5 sets out the process for a local housing authority to impose a financial penalty on a person and applies to clauses 39, 56, 64 and 89. Foremost, schedule 5 stipulates that, before imposing a financial penalty, a local housing authority must issue a notice of intent setting out its reasons for issuing the fine. Landlords then have 28 days to make written representations to the local authority—I have discussed this point outside of Committee with the hon. Member for Broadland and Fakenham. Following that period of representations, the local authority must decide whether to impose a penalty. If it decides to issue a penalty, the local housing authority must then issue a final notice detailing the fine to be paid by the landlords, who will be able to appeal a decision to impose a penalty or the amount of the penalty by bringing an appeal to the first-tier tribunal within 28 days. The process in the schedule follows the precedent of the Tenant Fees Act 2019 and is similar to the process in the Housing and Planning Act 2016.
Clause 99 applies the schedule 5 procedures and rules for imposing, appealing, recovering or applying the proceeds of a financial penalty related to the anti-discrimination provisions, rental bidding, landlord redress schemes and the private rented sector database. I commend the provisions to the Committee.
Question put and agreed to.
Clause 99 accordingly ordered to stand part of the Bill.
Schedule 5 agreed to.
Clause 100
Rent repayment orders: liability of landlords and superior landlords
Carla Denyer
I beg to move amendment 41, in clause 100, page 120, line 9, leave out from “order)” to the end of line 12 and insert—
“—
(a) in subsection (1), omit “, beyond reasonable doubt,”;
(b) at the end of subsection (3), insert—
“(d) section 46A (where an order is made against more than one landlord or there has been a previous order”;
(c) after subsection (3), insert—
“(4) Where the application for a rent repayment order relates to an offence under sections 1(2), (3) or 3(A) of the Protection from Eviction Act 1977, the First-tier Tribunal must be satisfied, on the balance of probabilities, that the offence has been committed.
(5) Where the application for a rent repayment order relates to any other offence to which this Chapter applies, the First-tier Tribunal must be satisfied, beyond reasonable doubt, that the offence has been committed.”””
This amendment would apply the civil standard of proof for Rent Repayment Orders pursued on the basis of a Protection from Eviction Act 1977 offence.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Clause 101 stand part.
Carla Denyer
The amendment is related to amendment 44, which I spoke to a few days ago, and to the serious issue of illegal evictions. Amendment 41 would apply the civil standard of proof for rent repayment orders, known as RROs, which are pursued on the basis of the Protection from Eviction Act 1977 offence, known as PFEA—I apologise; there will be acronyms. RROs are extremely difficult for renters to bring under the PFEA offence, due to the criminal standard of proof. As the Minister himself pointed out in our discussions on illegal discrimination, it is notoriously difficult for tenants to prove landlords’ culpability to a criminal standard of proof.
As I understand it, RROs for PFEA offences require a landlord who has committed an offence listed in the 1977 legislation to repay rent that has been paid in respect of a tenancy or licence. RROs are brought in the first-tier property tribunal, often as compensation by self-represented applicants who seek to reclaim rent they have paid to their landlord. Importantly, legal aid is not available for RRO claims, so tenants are almost always on their own. Currently, RRO claims require a criminal standard of proof. That is inappropriate because an RRO is not a criminal prosecution. It does not follow criminal procedural rules, or result in a criminal sentence or a criminal record if the defendant is convicted. As things stand, PFEA RROs are an anomaly. A civil claim in a civil court for illegal eviction or harassment applies the civil standard, despite the fact that civil claims typically attract much higher penalties in the form of civil damages. It is therefore logical and consistent to apply the civil standard of proof to PFEA RROs, in line with the rest of civil law.
What is more, RROs are intended to be accessible to lay applicants, but although that may be so for licensing offences, it is far from the case for PFEA offences. Lay applicants—I would include myself in that category, because I would also make the following mistake—might understandably focus on proving one aspect of the offence, for example the locks being changed, rather than a separate part of the offence, for example by proving the intention of the landlord. To a non-lawyer, that might seem an insignificant distinction, but intention carries substantial legal weight.
Often, these offences are not just difficult but impossible to prove to a criminal standard. Often, if a landlord changes the locks, they do it when the tenant is not at home. Illegal eviction and harassment occur in the privacy of renters’ homes, often without witnesses or evidence. The criminal burden for PFEA RROs places an extra and often insurmountable burden on lay applicants to prove their case at tribunal. It has a chilling effect because it prevents many claims from being brought in the first place, as the evidence to meet that standard is simply not available. Under the current standard, therefore, renters cannot apply for RROs as they cannot prove their case beyond reasonable doubt, even when it is clear that an offence has occurred and that only the landlord would be motivated to commit it. That error weakens enforcement and access to justice, and it undermines the purpose of RRO legislation.
The incredibly low number of RROs and PFEA eviction offences demonstrates that the system is not working. Safer Renting—also known as Cambridge House—and the University of York have conducted research estimating that, over the two-year period from January 2021 to December 2022, there were at least 16,089 illegal evictions, and that number is almost certainly an undercount. Meanwhile, data gathered from the organisation Marks Out of Tenancy—founded in my constituency, as it happens—shows that in the same period, from 2021 to 2022, there were just 31 RROs in which a PFEA ground was successful. That is 31 out of more than 16,000. The system simply is not working.
I appreciate that the statistics that I have referred to might be explained by several things, but the standard of proof is certainly part of the problem and could be part of the solution. In fact, given that we are getting rid of section 21 evictions, I fear that failing to apply the civil standard of proof will risk creating the unintended consequence that illegal evictions will soar, as landlords find a way around the protections introduced by the Bill. I hope that, on that basis, the Minister will consider my amendment.
Matthew Pennycook
I will begin by addressing clauses 100 and 101, and I will then turn to amendment 41, which was tabled by the hon. Member for Bristol Central.
Clauses 100 and 101 make provision about the application of rent repayment orders to superior landlords and to company directors. To be most effective, tenants and local authorities need to be able to seek a rent repayment order against any landlord in the chain who has committed an offence. We are seeing a rise in so called rent-to-rent arrangements, which are often used by criminal landlords to mask illegal and exploitative practices and escape enforcement action. Clause 100 provides that superior landlords in such arrangements can be subject to rent repayment orders; that is currently not possible. With this important clause, we are ensuring that superior landlords cannot avoid their responsibilities. Rent repayment orders need to act as a sufficient deterrent to criminal landlords. Some criminal landlords see financial penalties simply as a cost of doing business. Clause 100 therefore doubles the maximum amount payable under a rent repayment order from 12 months to two years, making the deterrent effect significantly stronger.
Clause 101 will enable rent repayment orders to be made against directors and other similar officers of landlord bodies corporate that have committed a listed offence. Currently, if a tenant pursues a rent repayment order against a sham rent-to-rent or landlord company, the company can escape the penalty by virtue of having few or no assets or by simply dissolving. The clause will prevent this practice, for example by ensuring that, where certain conditions are met, individual directors of such companies can have a rent repayment order made against them. The clause ensures that rent repayment orders can be used effectively to tackle unscrupulous landlord companies and sham rent-to-rent companies.
Amendment 41 concerns an issue that the Government have previously considered and that I continue to keep under close review, namely what might be done to address the fact that proving illegal eviction and harassment to a criminal standard is, without doubt, extremely challenging and the prevalence of rent repayment orders in this area relative to other offences is low as a result.
As I have said before during our proceedings, the Government are clear that illegal eviction and harassment are serious criminal offences that cause significant harm and distress. Perpetrators must be robustly punished. It is right that the Housing and Planning Act 2016 extended repayment orders to cover these offences and that this Bill takes steps in other areas, including expanded civil penalties, to bear down on them.
Amendment 41, for which the hon. Member for Bristol Central made the case eloquently, would reduce from criminal to civil the standard of proof that needs to be met for rent repayment orders to be awarded in relation to unlawful eviction and harassment. To be candid with the hon. Lady and to explain my thought process, my concern about her amendment is primarily about the implications that it could have for the integrity of the rent repayment order regime as a whole. RROs are a mechanism designed to provide redress and act as a deterrent in relation specifically to criminal offences. As such, I fear that lowering the standard of proof for individual offences, as proposed in her amendment, runs the risk of weakening the link between the culpability of the landlord and the making of a rent repayment order. If the tribunal does not need to prove beyond reasonable doubt that the landlord committed an offence, we could see a weakening of that link.
I am absolutely committed to ensuring that rent repayment orders are effective across all the listed offences. I feel that that has to be balanced against the need to maintain the coherence, efficacy and fairness of a regime that is, as I hope she will acknowledge, in most instances working extremely well and that we want to strengthen. As we introduce the strengthened rent repayment orders in the Bill, I am mindful that we do not want to inadvertently damage the functioning of that regime, which we need to build upon.
Although I am more than happy to continue a dialogue with the hon. Member for Bristol Central on the matter, I kindly ask her to withdraw her amendment. We would have to resist it if she pushed it to a vote, and I would like that not to happen. We keep this area under review, and I would like to keep the conversation going.
Carla Denyer
I have a follow-up question. If the Minister desires to keep the criminal standard of proof for RROs, will he consider speaking to his colleagues about amending legal aid, so that it is at least available to tenants who would otherwise need to represent themselves in criminal courts?
Matthew Pennycook
I hope that the hon. Lady will appreciate that I cannot, as a Ministry of Housing, Communities and Local Government Minister, give her that commitment in Committee today, but we are having conversations across all Departments. This is an issue that the Government have considered, and I keep it under review. I recognise the challenge that the hon. Lady rightly poses, and which we have considered, which is that rent repayment order prevalence in this area is far too low.
As I have said, I worry about the unintended consequences of making what would amount to quite a significant change to the RRO regime. We want to strengthen it, because it is working and has worked incredibly well—particularly since the changes made in the 2016 Act—in providing effective tenant redress and acting as a deterrent. I am mindful about accepting significant changes in Committee, but I keep the matter under review. I will have those conversations, and my Department’s officials have had conversations across Government on this and many other areas.
Carla Denyer
On the basis of the Minister’s kind agreement to keep the conversation open—I will follow up on that—I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 100 ordered to stand part of the Bill.
Clause 101 ordered to stand part of the Bill.
Clause 102
Unlicensed HMOs and houses: offences
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
I will be fairly brief on these two clauses. Licensing requirements are a fundamental part of ensuring that HMOs and other rented properties are safe and well managed. Clause 102 ensures that superior landlords can be liable for the offences of failing to ensure that a property is properly licensed.
In a situation in which a correct licence is not in place for a property, local authorities and tenants need the ability to take enforcement action against the person, or persons, responsible for failing to obtain a licence. The measure ensures that superior landlords can be held to account where they are responsible. Building on our discussion of a previous clause, that is critical to tackling sham rent-to-rent arrangements. It is important that superior landlords who could not have known that the property was being let as an HMO—for example, freeholders of a large block of flats with long leases—are protected. Clause 102 provides additional defences to make sure that that is the case.
Clause 103 seeks to ensure that both landlords and superior landlords can, where appropriate, be served with improvement notices requiring the removal of hazards. The provisions in the Housing Act 2004 do not allow improvement notices to be served on landlords or superior landlords in rent-to-rent arrangements in all circumstances. Clause 103 addresses that anomaly by giving local councils the ability to serve improvement notices on landlords and superior landlords, based on who should take the remedial action required. It will also ensure that tenants can pursue rent repayment orders against such landlords if they fail to comply with improvement notices. I commend the clauses to the Committee.
Question put and agreed to.
Clause 102 accordingly ordered to stand part of the Bill.
Clause 103 ordered to stand part of the Bill.
Clause 104
Enforcement by local housing authorities: general duty
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
We expect that the vast majority of landlords will do the right thing and meet their new legal responsibilities, but there will be a minority who fail to do so. That is why, for this package of reforms to be effective and achieve its aims, consistent and effective enforcement by local authorities is absolutely necessary.
Clause 104 places a duty on every local housing authority in England to enforce the new measures in their areas. We expect local authorities to take a proactive approach to enforcing these reforms and give this area the priority that it deserves. Equally, we want councils to have flexibility and take action in a way that best addresses local problems and priorities. The duty is broadly framed to allow that to happen.
We recognise that different types of enforcement will be more suited to different cases. When considering enforcement, local authorities will be able to issue a civil penalty as an alternative to criminal prosecution for an offence, allowing them to decide the most effective method of enforcement in each case. Clause 104 also empowers county councils that are not local housing authorities to take enforcement action, and it enables local authorities to take enforcement action outside their own local authority areas.
Clauses 105 and 106 set out the notification requirements where local authorities take enforcement action outside their own boundaries, or where a county council that is not a local housing authority takes enforcement action.
Clause 107 places a duty on local authorities to supply information to the Secretary of State, as required, on the exercise of their functions under the measures created or amended by the Bill. Regular and robust data from local authorities will be vital to understanding the impact of our reforms and the action taken by local authorities. We will work with local authorities to agree a data reporting framework that is rational, proportionate and helpful to both local and central Government, and in line with similar data collections.
Clause 108 allows the Secretary of State to appoint a lead enforcement authority for the purposes of any provisions in the landlord legislation, which include many of the provisions in the Bill.
Clauses 109 and 110 outline the functions of the lead enforcement authority, which include: overseeing the operation of the provisions in the legislation for which it is responsible; providing guidance, advice and information to local authorities; and, where necessary, enforcing the provisions. We are carefully considering whether having a lead enforcement authority for any of the provisions in the landlord legislation will be beneficial, and we will continue to engage with local authorities and other stakeholders to shape our plans. I commend the clauses to the Committee.
David Simmonds
Although the Opposition are supportive of the clauses, it is important to clarify a few things. First, the aim of clause 104 is clearly to ensure that a very high standard is met in the private rented sector. Many local authorities will take action themselves to ensure that the standard is met in a property—particularly in respect of social housing—if the landlord fails to do so. The powers under this legislation do not go as far as that; they extend to imposing a financial penalty or instituting proceedings against a person for that offence. Renters may expect that the local authority will effectively take possession of a property to remedy a problem giving rise to a breach—for example, a breach of the decent homes standard at the property—and it is important to recognise their expectations.
I will ask the Minister a question about clause 110. Local authorities will generally find it more efficient to enforce the decent homes standard as a single function, rather than having separate private rented sector and social housing functions, both of which effectively do the same work. The financing of the social housing element would normally come through the housing revenue account, which, like a number of other local authority revenue accounts, is ringfenced—something I know you are familiar with, Mr Betts—meaning that resources raised through that account cannot be applied to another purpose. Clearly, we would not wish to allow a degree of inefficiency to creep in by creating duplication.
It would be helpful if the Minister could say whether the guidance provided to local authorities will clarify that there is no objection, in respect of the private rented sector, to a sharing of services that are funded partially through the housing revenue account and partially through the regime introduced by the legislation. I know that this issue has been significant in different types of funding provided to local authorities for particular functions.
Matthew Pennycook
I will be fairly brief, because I am more than happy to go away and check whether this is an error on my part rather than that of the shadow Minister, but we have to be very clear which provisions in the Bill these enforcement powers relate to. Clause 104 sets out that every local housing authority has a duty to enforce the landlord legislation in its area, which covers chapters 3 and 6 of part 1 of the Bill, part 2 of the Bill, sections 1 and 1A of the Protection from Eviction Act 1977, and chapter 1 of part 1 of the Housing Act 1988.
We will consult on it, so further detail will come forward, but, to put it simply, enforcement of the decent homes standard will come via a different track. Nothing in the enforcement provisions will interfere in the housing health and safety rating system, or the enforcement of Awaab’s law or the decent homes standard to come.
I am more than happy to go away and check, and I will write to the shadow Minister if I have misunderstood his question. To reassure him, though, I think we are talking about enforcement against specific parts of landlord legislation under the Bill.
Question put and agreed to.
Clause 104 accordingly ordered to stand part of the Bill.
Clauses 105 to 110 ordered to stand part of the Bill.
Clause 111
Power of local housing authority to require information from relevant person
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
The Committee will forgive me for talking at some length to ensure that we fully set out the rationale for this large group of clauses. The group of clauses provides new investigatory powers to local housing authorities to tackle non-compliant landlords. The measures aim to enhance compliance and accountability among landlords.
Clause 111 gives local housing authorities the power to require information from landlords, licensors, agents and marketers. The information will be for the purpose of exercising the local housing authority’s functions under specific new provisions introduced by the Bill or in other specified legislations. Clause 111 also contains provisions that enable housing authorities to more effectively enforce financial penalties. It also provides safeguards to ensure that the powers are not misused.
Clauses 112, 113 and 114 provide the power to require information from persons other than the landlord or agent. That includes information from banks, accountants and client money protection schemes. This information will support prosecution and help in setting appropriate levels of civil penalties, which should take rental income and the landlord’s financial position into account. To ensure that the power is used proportionately, local housing authorities can only use it when they reasonably suspect that a relevant breach or offence has occurred.
Clauses 115 to 122 and clause 130 give local housing authorities the power to enter the business premises of landlords. There is a power to enter business premises without a warrant and a power of entry under warrant. Local housing authorities will be able to use the powers to enter business premises if they require the production of documents or to seize and detain documents for the purpose of ascertaining whether there has been compliance with the rented accommodation legislation and whether documents are required as evidence in proceedings. A local housing authority officer will need to reasonably suspect a breach of, or an offence under, rented accommodation legislation before they can exercise the power to require the production of documents or to seize and detain them.
In many instances, the evidence will likely be on a landlord’s business premises. That evidence includes tenancy agreements, bank statements, letters and communications. Following entry, local housing authorities will be able to require a relevant person on the premises to produce documentation. An officer of a local housing authority may seize and detain such documentation if they consider that it may be needed as evidence in proceedings for breaches of, or offences under, rented accommodation legislation.
This set of clauses contains safeguards to prevent them from being misused. For example, unless certain circumstances apply, local housing authorities must give at least 24 hours’ written notice prior to entry into business premises without a warrant. They will not be able to use that power where the premises are used wholly or mainly as residential accommodation. The clauses allow for relevant persons who have had their documents seized and detained to request access under supervision when appropriate, and all such documents will only be detained for as long as required.
Clauses 123 to 127 will give local housing authorities the power to enter residential premises without a warrant if they have a reasonable suspicion that the premises contain evidence that a relevant breach or offence has taken place. For entry into residential premises, with and without a warrant, the powers will apply only for the limited purposes of investigating specific breaches or offences relating to the private rented sector database or illegal evictions. Those breaches or offences are associated with serious potential harm and circumstances where physical evidence may be found on the premises.
The power of entry without a warrant will be available only where a specially authorised officer considers it necessary to enter the property to investigate whether there has been a relevant breach or offence. The power of entry with a warrant will be exercised only where a justice of the peace is satisfied that it is necessary for an officer to inspect the premises to investigate whether there has been a relevant breach or offence. The enforcement of the private rented sector database will sometimes require local authorities to enter the premises to establish whether the property needs to be registered. This will enable them to gather evidence to demonstrate that it is a residential tenancy, such as photographs of locks on bedroom doors or tenancy agreements.
Local housing authorities will also be able to use the powers to enter residential premises to investigate suspected illegal evictions, for example by checking whether locks have been changed or whether areas in the property have been blocked off. For the power of entry without a warrant, a written notice period of at least 24 hours is required unless the right to notice has been waived. The power can be used only where a specially authorised officer reasonably suspects that the premises are subject to a residential tenancy and entry is necessary to investigate whether a relevant breach or offence has occurred. These safeguards are in place to ensure that the power is used only where necessary.
Clause 128 will create new offences in relation to the new investigatory powers in part 4, including new offences in relation to requiring information from a relevant person, or any person, and the powers of entry into business and residential premises. The clause introduces a set of offences of obstructing an officer, failing to comply with requests, failing to provide other information or assistance if reasonably required by the officer for the purposes of exercising the powers, and providing false or misleading information.
The clause also introduces an offence with an unlimited fine for anyone falsely purporting to be a housing officer acting under the investigatory powers chapter. This is to protect landlords and tenants from anyone falsely trying to gain access to their property or obtain private information. It also makes it clear that a person is not committing an offence if they refuse to answer any question or give any information that might incriminate them.
Jerome Mayhew (Broadland and Fakenham) (Con)
I apologise for being rather slow on the uptake, but may I take the Minister back to clause 124, “Duties where occupiers are on residential premises entered without warrant”? Subsection (1) states:
“If an officer of a local housing authority enters premises under section 123(1) and finds one or more occupiers on the premises”—
in other words, if there are people there—
“the officer must produce evidence of the officer’s identity and special authorisation to that occupier or (if there is more than one) to at least one of them.”
That is very sensible—it means that the person must demonstrate who they are to the people in the premises—but subsection (2) states:
“An officer need not comply with subsection (1) if it is not reasonably practicable to do so.”
If we have already identified that an officer is entering premises that are occupied, what are the circumstances in which it would not be reasonably practicable for him to identify himself?
Matthew Pennycook
That is a very reasonable question. If the hon. Member will allow me, I will come back to him via written correspondence. In drafting the clause— I am raking my memory for our discussions about it—we thought that there would be certain circumstances in which the reasonability test might not need to be met. Some of the clauses have been developed following exchanges with local authorities. I will come back to the hon. Member on the specific point about whether we have met the test for it being necessary to include the subsection in the Bill.
Jerome Mayhew
The difficulty is that the Minister is asking us to support the wording of the Bill now, not subsequently to a letter being received. It is hard to support a clause that suggests on the face of it that an officer could come in and decide that it is not reasonably practicable to show their authority to somebody who is in occupation of their own residence. This is not an office building; it is where people live. I invite the Minister, who has his officials with him, to provide a more substantive answer in his next comments, because it is difficult for someone like me to support the clause as drafted.
Matthew Pennycook
I will happily try to do so: I will take away the point and try to get the hon. Member some reassurance in short order. I reassure him that we have drafted the clauses carefully, following extensive dialogue with local authorities and local authority stakeholders. We do not take the power lightly. If I understand him correctly, he is putting to me the reasonable point that such a power would never be necessary. If, in the course of our ongoing exchanges, I can give him an example in which it might be necessary, perhaps he will be reassured.
Question put and agreed to.
Clause 111 accordingly ordered to stand part of the Bill.
Clauses 112 to 133 ordered to stand part of the Bill.
Clause 134
Interpretation
Question proposed, That the clause stand part of the Bill.
Matthew Pennycook
I turn to part 5, on general provisions.
Clause 134 sets out the meaning of three terms used in the Bill: “lease”, “local housing authority” and “the 1988 Act”. Clause 135 sets out the Bill’s application to the Crown. Clause 136 sets out its application to Parliament.
Clause 137 clarifies various aspects of powers to make secondary legislation under the Bill. In particular, it contains a power to make consequential, supplementary, incidental, transitional or saving provision. It also clarifies which powers in the Bill will be subject to the affirmative or the negative procedure where exercised.
Clause 138 contains a power that will allow the Welsh Ministers to make consequential amendments arising from part 1 of the Bill. Clause 139 contains a power that will allow the Scottish Ministers to make consequential amendments arising as a result of chapter 5 of part 1 of the Bill, which makes provision to address rental discrimination in Scotland.
Clause 140 will give the Secretary of State the power to make consequential amendments arising from the Bill, such as by removing now defunct terms from other legislation. This is necessary to ensure that existing legislation continues to function as intended once the Bill has passed into law.
Clause 141 provides that the Bill’s extent, for the most part, is England and Wales. Housing is within the devolved legislative competence of the legislature in Wales, and in practice the application of the majority of the clauses will be to England only. A small number of changes will apply in England and Wales to address remaining aspects of the tenancy system in Wales that are still dependent on English law. Chapter 4 of part 1 applies the rental discrimination measure in Wales. Similarly, chapter 5 of part 1 extends only to Scotland and applies the rental discrimination measure in Scotland. I commend the clauses to the Committee.
Question put and agreed to.
Clause 134 accordingly ordered to stand part of the Bill.
Clauses 135 to 141 ordered to stand part of the Bill.
Clause 142
Commencement
David Simmonds
I beg to move amendment 45, in clause 142, page 150, line 26, leave out from “subject to” to end of line 27 and insert—
“—
(a) the publication of an economic impact assessment in relation to the bill, which must include the impact of abolishing fixed term assured tenancies on the student housing market; and
(b) subsections (2) to (6).”
The Chair
With this it will be convenient to discuss the following:
Amendment 64, in clause 142, page 150, line 26, leave out from “subject to” to end of line 27 and insert
“—
(a) the publication of an economic impact assessment of the bill, including abolishing fixed-term tenancies on student accommodation;
(b) the publication of an assessment under section [Assessment of operation of possession process]; and
(c) subsections (2) to (6).”
Clause stand part.
Clause 143 stand part.
Schedule 6.
Clauses 144 to 146 stand part.
David Simmonds
Amendments 45 and 64 would require the Government to give broader consideration to the economic assessment required to understand the full implications of the Bill. A lot of the evidence that we have heard on the Bill, and on the Renters (Reform) Bill in the last Parliament, concerns impact on supply, especially on the supply of accommodation for particular categories of tenant. Those categories include people in the student housing market, to which both amendments refer.
We are all aware that for local authorities and other public bodies such as transport authorities, the ability to predict and plan the need for student accommodation in particular locations is very significant. Transport for London and other transport authorities in major cities plan bus routes and other public transport based on the need for students to get to and from the places where they receive their education. The same is true in respect of retirement homes and so on.
This is a matter not merely of general political interest, but of practical interest for the public bodies whose responsibilities will be affected by the Bill. Although we recognise that a substantial amount of the Bill was already envisaged under the previous Government and has been through a significant process of scrutiny, we do not fully understand what the impact will be on supply, particularly on the supply of homes required by students. We have heard a great deal of evidence about the economic significance of students for our towns and cities, as well as for our university sector. The Opposition regard that as very important. I am interested to hear what the Minister has to say about our amendments and the clauses to which they relate.
Matthew Pennycook
I will speak briefly to the clauses in the group and then discuss the shadow Minister’s two amendments.
Clause 142 provides how and when the provisions in the Bill will be brought into force. This Government have made it clear on multiple occasions that we are determined to end the scourge of section 21 evictions as soon as possible. I think it has now been more than five years since the previous Government promised private renters across the country that section 21 evictions would be abolished. Renters have waited far too long for a Government to take action. We are determined to act for them to end the insecurity that they face, including the risk of homelessness, and—this is a point I have tried to stress throughout our discussions—to give good landlords certainty about what change means.
The clause provides the mechanism for ending section 21 once and for all for private tenancies. The new tenancy system for the private rented sector that is set out in chapter 1 of part 1 will come into force in a single stage for all assured tenancies. On that date, the new tenancy system will apply to all private tenancies. Existing tenancies will convert to the new system; any new tenancies signed on or after that date will also be governed by the new rules. This will give all private tenants the same security immediately: that will be the effect of clause 142(8). I reassure the Committee that we will work closely with all parts of the sector to ensure a smooth transition to the new system and that we are committed to providing sufficient notice ahead of implementation.
Beyond tenancy reform, the clause sets out how and when other provisions in the Bill will be brought into force. Some provisions, such as the investigatory powers in part 4, will come into force automatically two months after Royal Assent.
Clause 143 provides that the commencement of chapter 1 of part 1 will not have an impact on the continuation of existing tenancies. The Bill will apply to those tenancies, but they will not be treated as new tenancies. For example, although the landlord will not be able to use a section 21 notice in relation to such tenancies, the protected period during which the moving and selling grounds cannot be used will count from when the tenancy first began.
Schedule 6 will ensure a smooth conversion for existing tenancies to the new tenancy system by making specific provision to avoid unnecessary cliff edges, for example by maintaining the validity of rent increases and notices served prior to implementation. This will ensure that landlords and tenants are clear about which legal framework applies before and after the transition.
Clause 144 provides clarity about what happens when a fixed-term assured tenancy expires and becomes a statutory periodic tenancy. This will ensure that the periodic tenancy will be treated as continuous, meaning that any provisions in the Bill that apply from when the tenancy began will count from the beginning of the original tenancy rather than from when the statutory periodic tenancy arose.
Clause 145 will give the Secretary of State the power to make regulations that have transitional or saving provision in connection with the coming into force of any provision of the Bill. It will give powers to Welsh and Scottish Ministers to make transitional or saving provision in connection with the coming into force of chapters 4 and 5 respectively of part 1, which apply the rental discrimination measures in Wales and Scotland. The clause will also give the Secretary of State power to make provision concerning pre-application instruments that the Secretary of State considers will not operate effectively as a result of the Bill. It is standard and appropriate for the Secretary of State to have the power to make transitional or saving provisions; this is important to facilitate an orderly implementation of the new regime and to ensure that agreements and private legal instruments that were entered into prior to the Bill continue to operate as intended under the new regime.
Clause 146, as I think is self-evident, provides that the short title of the Act will be the Renters’ Rights Act 2024.
I turn to the shadow Minister’s amendments 45 and 64. Amendment 45, as he made clear, would require the publication of an economic impact assessment for the Bill, including an assessment of the impact of abolishing fixed-term assured tenancies on the student housing market, before its provisions are commenced. Amendment 64 would do the same, but would also make the publication of any assessment by the Lord Chancellor of the operation of possession proceedings for rented properties a prerequisite for commencing the provisions of the Bill.
I say gently to the shadow Minister that I have tried this trick before in a previous role, and I do not for one second condemn him for doing so, but we are committed to robustly monitoring and evaluating the private rented sector reform programme and the implications of the Bill. Our approach builds on the Department’s existing long-term housing sector monitoring work, and we will conduct our processes, impact and value-for-money evaluation in line with the Department’s published evaluation strategy. We will publish the evaluation findings in a timely manner that is consistent with our policy for the publication of research. Further data on the operation of possession proceedings for rented properties, to which amendment 64 refers, is already published and will continue to be published quarterly by the Ministry of Justice.
We are committed to ending the scourge of section 21. The sector and particularly tenants have waited too long for these changes to come into effect. We are therefore not minded to tie implementation to any additional requirements of the type that the shadow Minister mentions. I do not begrudge his trying, but I ask him to withdraw his amendment.
David Simmonds
I will have to accept the Minister’s gentle rebuff, but we have heard from the housing sector and from student organisations that these are very important issues. We recently debated rough sleeping in Westminster Hall; one challenge that emerged is that we did not count the number of rough sleepers until 2010, so it is very hard fully to understand what was going on. That is a lesson in the importance of doing the research and having impact assessments: they are a key part of the evidence that the Committee needs to consider to understand the direction of travel and whether it will do the job intended. However, I take the Minister’s point.
Matthew Pennycook
May I briefly intervene? I do not want to deprive the hon. Member for Broadland and Fakenham of an answer to his question about clause 124. I am told that the power is in place for very limited exceptions, in particular where an agent might face aggression from an occupier of a property and is therefore unable to show identification. The powers mirror the provisions in the Consumer Rights Act 2015 that apply to trading standards officers. It is a very limited exception for those circumstances. I hope that that provides some clarification and reassurance.
David Simmonds
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 142 ordered to stand part of the Bill.
Clause 143 ordered to stand part of the Bill.
Schedule 6 agreed to.
Clauses 144 to 146 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Gen Kitchen.)
Renters' Rights Bill (Eighth sitting)
Tuesday 5th November 2024
(1 year, 9 months ago)
Public Bill CommitteesRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 5 November 2024 - (5 Nov 2024)
The Chair
Good afternoon. Before we proceed, I should say that I am fully aware that a number of Members on both sides of the Committee have not served on Committees before. If you have any problems or questions, do not be frightened—just ask. I may know the answer, but if I do not, the Clerk certainly will.
New Clause 1
Impact of orders for possession on credit ratings
“(1) The Financial Conduct Authority must develop guidance for credit rating agencies on the impact of orders for possession on the credit ratings of tenants.
(2) Guidance prepared under this section must—
(a) outline that being subject to an order for possession under Grounds 1 to 8 must not negatively impact an individual’s credit rating;
(b) be published within three months of the passing of this Act.”—(Carla Denyer.)
Brought up, and read the First time.
Carla Denyer (Bristol Central) (Green)
I beg to move, That the clause be read a Second time.
I rise to move the new clause tabled in the name of the hon. Member for Walthamstow (Ms Creasy). The purpose of this probing new clause is to explore how we can ensure that renters’ credit scores are better protected against the negative consequences of having to move. I do not seek a vote on the new clause, and the detail of the wording may not be exactly right, but its purpose is to let us discuss what we can do to fix an injustice.
When tenants move repeatedly, it can affect their credit scores, making it harder for them to secure mortgages and get reasonable credit on credit cards and so on. It is not the actual act of moving home that affects someone’s credit report, but the admin that goes with it. Lenders like to see stability in personal details, so if someone moves house often, it will show up on their personal records as part of their credit report and could be a red flag. Opening more than one account with a utility provider in a six-month period would likely cause a person’s score to drop until they can prove they can pay their bills responsibly and on schedule, at which point it would start to build back up again.
It is important that we protect renters who are forced to move because their landlord seeks possession of a property for a reason that is not connected to their behaviour or ability to pay their rent. It is an injustice that renters’ credit scores suffer as a result of such actions. Fortunately, the Financial Conduct Authority is undertaking a review of credit referencing. I raise this issue in Committee because it is relevant to the work we do, but rather than looking for a vote, I am looking for a commitment from the Minister to write to the Financial Conduct Authority to ask for renters’ credit scores to be included as part of its current work.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
It is a pleasure to serve under your chairmanship, Sir Roger. We aired the issue of credit worthiness and its impact on prospective tenants’ ability to secure a property during earlier deliberations on the Bill, and the Minister has given detailed responses about how the Government are treating this issue. I welcome the fact that the new clause is a probing one. In my view, it is a sensible question to pose, as is the question about the availability of rental insurance to those who may have a poor credit history when they seek to secure a property and undergo checks as part of the affordability process. I hope the Minister will give us an indication of how the issue will be dealt with, but I am confident that the Government have it in their sights and an appropriate solution is in the offing.
Mr Gideon Amos (Taunton and Wellington) (LD)
It is a pleasure to serve under your chairmanship, Sir Roger. I add the support of the Liberal Democrats for the intent of the new clause. Clearly, tenants should not be penalised for having to move frequently, and we are interested in the Minister’s response on the subject.
The Minister for Housing and Planning (Matthew Pennycook)
It is a pleasure to serve with you in the Chair, Sir Roger. I thank the hon. Member for Bristol Central for moving the new clause tabled by my hon. Friend the Member for Walthamstow (Ms Creasy), and I thank the shadow Minister and the hon. Member for Taunton and Wellington for their contributions.
The Government absolutely agree that unwanted private rental moves are not only stressful but extremely expensive in terms of both the unrecoverable costs associated with moving home and the significant up-front costs of moving into a new property, including tenancy deposits. That is why one of the Bill’s main objectives is to remove the threat of arbitrary evictions and increase tenant security.
Under the new tenancy system a small proportion of tenants will still find themselves evicted through no fault of their own in circumstances where the landlord has good reason to regain possession of the property—for example, if the landlord or a close family member wishes to live in it as their only or principal home. I therefore recognise the worthy intentions behind the new clause—namely, to ensure that tenants’ credit scores are not adversely affected by unwanted moves resulting from the use of such possession grounds.
However, I am not convinced that the new clause, which would require the FCA to issue guidance on how possession orders specifically should be reflected in an individual’s credit score, is necessary, because tenants’ credit scores are not adversely affected by evictions under ground 8 possessions. Credit reference agencies do not receive information about possession orders from the courts, and as a result possession orders are not recorded on people’s credit reports and do not negatively affect their credit scores.
I acknowledge that there is a distinct, but related, issue in respect of the impact on credit scores of changes of address in general, on which it is worth noting two things. First, the methodology that underpins credit scores is not uniform across different credit reference agencies. Experian, TransUnion and Equifax, for example, each have their own distinctive approaches to credit scores, including in how they reflect changes of address. Secondly, almost all lenders review a person’s credit report when assessing an application for credit, and a change of address would still be recorded on those reports.
Whether it is feasible and sensible to seek to have the FCA attempt to ensure that credit reference agencies treat moves resulting from the use of certain possession grounds set out in schedule 1 differently from changes of address more generally is an entirely valid question, albeit one somewhat distinct from that posed by the specific wording of the new clause. As things stand, I am not entirely convinced that it would be, but I will happily seek to ensure that Treasury Ministers engage directly with the FCA on this matter, including on the review cited by the hon. Member for Bristol Central. However, for the reasons I have stated, I will not be able to accept the new clause and ask the hon. Lady to withdraw it.
Carla Denyer
I and thank the Minister for his consideration and beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 2
Review of the impact of the Act on the housing market
“(1) The Secretary of State must publish an annual report outlining the impact of the provisions of this Act on the housing market in the UK.
(2) A report under this section must include the impact of this Act on—
(a) the availability of homes in the private rental sector;
(b) rents charged under tenancies;
(c) house prices; and
(d) requests for social housing.
(3) A report under this section must be laid before Parliament.”—(David Simmonds.)
Brought up, and read the First time.
The Chair
With this it will be convenient to discuss the following:
New clause 3—Report on certain matters relating to tenancy reform—
“(1) The Secretary of State must make arrangements for an independent person to prepare a report on—
(a) the impact of sections 1 and 2 on the provision of relevant tenancies;
(b) the extent to which the grounds in Schedule 2 to the 1988 Act as amended by this Act—
(i) operate effectively;
(ii) are comprehensive;
(iii) are fair.
(2) The Secretary of State must, within the period of 18 months beginning with the relevant date, lay before both Houses of Parliament—
(a) a copy of the report, and
(b) a statement setting out the Secretary of State’s response to the report.
(3) Nothing in subsection (1) prevents the Secretary of State from arranging for the independent person to include in the report matters additional to those mentioned in that subsection.
(4) In this section—
‘relevant date’ means a date 18 months after the coming into force of sections 1 and 2 of this Act;
‘relevant tenancy’ means an assured tenancy within the meaning of the 1988 Act other than a tenancy of social housing within the meaning of Part 2 of the Housing and Regeneration Act 2008.”
New clause 7—Impact of Act on provision of short-term lets—
“The Secretary of State must, within two years of the passing of this Act, publish a review of the impact of sections 1 to 3 on the number of landlords offering properties on short-term lets rather than in the private rented sector.”
This amendment would require the Secretary of State to review whether the prohibition on fixed term contracts had increased the number of landlords choosing to offer short-term lets instead of letting in the private rented sector.
David Simmonds
I suspect that we rehearsed this debate earlier, when the Minister gently rebuffed the point and commended me for trying to secure a degree of impact assessment in advance of the implementation of the measures in the Bill. These new clauses are designed to increase the degree of scrutiny on the Government, in respect of both the Bill’s potential impact in advance, where we are able to consult on that, and its impact on the housing market, on which new clause 2 would require an annual report. A lot of the debates in the Committee’s evidence sessions revolved around the impact on supply of various of the Bill’s measures. We know that those are valid and legitimate concerns, and I would be interested to hear what the Minister has to say in response to the new clauses.
The Chair
If the hon. Gentleman wishes to intervene, and he is quite entitled to, he must get to his feet before I call the Minister. The procedure is that the Minister is called last after he has heard what everybody else has to say.
Mr Amos
I will bob more enthusiastically in future, Sir Roger.
I rise to speak to new clause 7, which is in my name and concerns the proliferation of short-term lets, holiday lets, Airbnbs and the like. In June 2023 there were 432,000 short-term rental properties in the UK, a steady increase from the pre-pandemic levels. Growth is particularly significant in regions such as mine. The south-west has the highest volume of listings, with 81,000 properties, while the east midlands saw a 49% rise. The increase is concentrated in holiday locations—the south-west, Cornwall and the Lake district. In Cornwall, more than one in 10 addresses are used as holiday homes, according to the Office for National Statistics.
The Liberal Democrat policy would be to license the system. We would like to see holiday lets controlled in a similar way to other rental properties. A licensing system that aligns short-term lets with the requirements of longer-term properties would address disparities in regulation. The danger that we face today is in regulating the private rented sector but not moving forward on the regulation of short-term lets. That would create disparity and could lead to the leeching of more homes into the Airbnb, short-term let sector.
We also want to see the creation of a new planning use class for short-term and holiday lets. I am aware that most recently, in February, although it has repeatedly come up, the then Government stated that planning permission would be required for short-term lets—that is lets of more than 90 nights per year—and that a mandatory national register would be created. We are waiting for that, and we are interested to know what the new Government will do in that policy area.
Landlord groups such as the National Residential Landlords Association and Dexters letting agency have argued that the Bill risks pushing landlords out of the sector and into short-term holiday lets. The NRLA estimates a 1% to 2% drop in rental stock. There is agreement on the topic across the sector, and there is a plausible worry that without any additional controls there will be a leeching of stock into more short-term holiday lets. For locations that particularly suffer from that phenomenon, the consequences could be the closure of businesses and services locally. New clause 7 would put into the Bill a requirement for a review of the legislation’s impact on the provision of short-term lets, so that the issue can be controlled.
The Chair
Just so that the Committee understands the procedure, because the new clauses are grouped, new clause 7 will not be moved now, but if the hon. Member for Taunton and Wellington wishes to move it when we come to it, then he may do so without further debate.
Matthew Pennycook
I am afraid I will have to resist all three new clauses. Although I will try to limit it, I fear that I may be somewhat repetitive in doing so, because the Government’s logic in each instance is similar.
As the hon. Member for Ruislip, Northwood and Pinner has made clear, new clause 2 would introduce a legal requirement for the Government to publish an annual review of the impact of the Bill’s reforms on the availability of homes. In particular, it would require an assessment to be made on the availability of homes in the private rental sector, rents charged under tenancies, house prices and requests for social housing. As per our previous discussion, I recognise that the underlying rationale for the measure is an interest in the practical difference the legislation will make over the coming years. I reassure the Committee that this is an interest I share, which is why we are committed to robustly monitoring and evaluating the private rented sector reform programme introduced by the Bill.
I will not detail the Government’s general approach to monitoring and evaluation, but suffice it to say that we believe that setting an arbitrary deadline for the work in law—as the new clause would require—would be an unnecessary step, and there is a risk that it would detract from evaluation and prevent us from conducting as robust an assessment as possible. However, given the interest in the Bill’s impact, I wish to reassure the Committee that we do not expect the Bill to have a destabilising effect on the rental market. This Government value the contribution made by responsible landlords who provide quality homes to their tenants. We will continue to work with good landlords and their representative associations throughout implementation.
New clause 3 would introduce a legal requirement for the Government to appoint an independent person to prepare a report on the impact of the reforms to the tenancy system and the grounds for possession. We are committed to robustly monitoring and evaluating the impact of our reform programme in line with the Department’s evaluation strategy; however, setting an arbitrary deadline in law for that work is unnecessary and, again, may detract from the quality of evaluation and prevent us from conducting as robust an assessment as possible.
New clause 7, tabled by the hon. Member for Taunton and Wellington, would introduce a legal requirement for the Government to publish a review of the extent to which the abolition of fixed terms and assured shorthold tenancies and the changes to leasehold covenants lead to landlords leaving the private rented sector to provide short-term lets within two years of the Bill passing. It is important to state that this Government value the contribution made by responsible landlords who provide quality homes to their tenants, and believe they must enjoy robust grounds for possession where there is good reason to take their property back. As such, good landlords have nothing to fear from our reforms and should be in no rush to change legitimate business models, as I have said repeatedly.
The private rented sector has doubled in size since the early 2000s. There is no evidence of an exodus since reform was put on the table by the previous Government. Our proposals will ensure that landlords have the confidence and support they need to continue to invest and operate in the sector.
Matthew Pennycook
I will come to the specific proposals under consideration for short-term lets and holiday lets. The use class was consulted on as one of a number of measures that the previous Government introduced. I will touch on that specific point shortly.
I will preface this with a point that I think all Committee members appreciate. The Government are very alive to the fact that there are many parts of the country—coastal, rural and some urban constituencies—where excessive concentrations of short-term lets and holiday homes are having detrimental impacts, not least on the ability of local people to buy their own homes or, in many cases now, rent their own homes. I have stated this on many occasions in the House since being appointed, but I will say it again: that is the reason why we will progress with abolishing the furnished holiday lets tax regime, and with the introduction of a registration scheme for short-term lets. That will give local authorities access to valuable data on them.
Those measures were committed to by the previous Government, and we will take them forward. However, as I said a number of times in the previous Parliament, we do not think they go far enough and we are considering what additional powers we might give to local authorities to enable them to better respond to the pressures they face as a result of the excessive concentrations of short-term lets and holiday homes. I hope to say more on that in due course.
In respect of this Bill, we are committed to robustly monitoring and evaluating the impact of our reform programme in line with the Government’s evaluation strategy. However, setting an arbitrary deadline in law for this work is unnecessary and may detract from our efforts in that regard. On that basis, I encourage Members not to press their new clauses.
David Simmonds
Given the Minister’s response, I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 4
Assessment of operation of possession process
“(1) The Lord Chancellor must prepare an assessment of the operation of the process by which—
(a) on applications made by landlords, the county court is able to make orders for the possession of dwellings in England that are let under assured and regulated tenancies, and
(b) such orders are enforced.
(2) The Lord Chancellor must publish the assessment at such time, and in such manner, as the Lord Chancellor thinks appropriate.
(3) In this section—
‘assured tenancy’ means an assured tenancy within the meaning of the 1988 Act;
‘dwelling’ means a building or part of a building which is occupied or intended to be occupied as a separate dwelling;
‘regulated tenancy’ means a regulated tenancy within the meaning of the Rent Act 1977.”—(David Simmonds.)
Brought up, and read the First time.
David Simmonds
I beg to move, That the clause be read a Second time.
At risk of rehearsing the debate we have already had, the new clause seeks to address the assessment of the possessions process. In evidence to the Committee a degree of concern was expressed on the part of landlords that the backlog in the courts may make it difficult to secure possession when that is necessary. Governments of all parties, including the previous Government, have put in place measures seeking to address that. We know that they are beginning to bear fruit, but it is important in maintaining the confidence of landlords both to come to the market and to remain in the market that they know it is possible to secure a court hearing, should one be necessary to gain access to the property. The new clause seeks to ensure that an assessment of that process is carried out.
Matthew Pennycook
New clause 4 would require the Lord Chancellor to prepare an assessment of the operation of the process by which the county court is able to make possession orders for rented properties and by which such orders are enforced. The assessment would be published at such time and in such a manner as the Lord Chancellor saw fit.
Hon. Members who followed the debates in the last Parliament will recall that the previous Government introduced a similar clause to their own Renters (Reform) Bill in the late stages of that Bill’s progress, via a Government amendment, together with a clause that prevented the Secretary of State from laying regulations to bring tenancy reforms into force for existing tenancies until after the Lord Chancellor’s amendment had been published. This Government have been clear that we will not follow a similar approach. We do not consider it reasonable that the implementation of our reforms should be constrained by such an assessment, not least an assessment of the kind proposed in the new clause, which is extremely broad and undefined.
The hon. Member for Ruislip, Northwood and Pinner tabled amendment 64, which would delay commencement until the Lord Chancellor has carried out and published the proposed assessment. I reaffirm that we have no intention of delaying these urgent and necessary reforms while awaiting an unnecessary assessment of the possession process against what is an unspecific metric. We will instead move ahead with tenancy reform as quickly as possible, but in conjunction with an extensive parallel workstream with colleagues from the Ministry of Justice and His Majesty’s Courts and Tribunals Service to ensure that the courts are ready at the point of implementation.
In any case, the assessment required by new clause 4 is entirely unnecessary and unhelpful, because data on the operation of possession proceedings for rented properties is already published by the Ministry of Justice on a quarterly basis, and will continue to be. Court rules specify that possession claims requiring a hearing should be listed between four weeks and eight weeks of receipt.
The Committee may be interested to know that figures for April to June 2024 show that claim to order median timeliness is 8.1 weeks, suggesting that—I am not necessarily attributing this to the shadow Minister—some of the more alarmist statements about the readiness of the county court system may have more to do with fundamental opposition to the abolition of section 21 and the current tenancy regime than they are an impartial assessment of court performance.
The proposed assessment would provide no obvious additional insight or benefit to any interested parties, in our view, and would merely detract from the vital work of the courts and tribunals by subjecting them to a nugatory additional process. All our focus is on ensuring that HMCTS is ready to stand up the new system at the point of commencement, and that should be our focus in the coming weeks and months. On that basis, I kindly ask the hon. Gentleman to withdraw his new clause.
David Simmonds
It is pleasing to hear from the Minister that the performance of the courts in this respect was so good under the previous Government. I am aware that one of the challenges has been the construction of a new IT platform to enable the new measures envisaged in the Bill to operate efficiently. This might be a legitimate concern for landlords to express, especially given that although the overall performance was good, there have been regional variations that have given rise to concern. However, bearing in mind what the Minister has said and the fact that there would be a degree of transparency about the data, I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 5
Repeal of requirement for selective licensing
“Part 3 of the Housing Act 2004 (Selective licensing of other residential accommodation) is repealed.”—(David Simmonds.)
This new clause would remove the ability of local housing authorities to designate areas as subject to selective licensing.
Brought up, and read the First time.
The Chair
With this it will be convenient to discuss new clause 9—Changes to discretionary licensing—
“(1) The Housing Act 2004 is amended as follows.
(2) In section 60(2), omit ‘five’ and insert ‘ten’.
(3) In section 84(2), omit ‘five’ and insert ‘ten’.
(4) In section 90(1), at the end of the subsection insert ‘or its condition and contents’.”
This new clause would increase the maximum duration of discretionary licensing schemes from five to ten years and would enable local authorities operating selective licensing schemes to use licence conditions to improve housing conditions.
David Simmonds
The measures for selective licensing have been in place for some time, and we certainly see lot of learning from the local authorities that have operated them. On the whole, those have tended to be in high-density urban areas. Clearly, a concern for the Opposition is how that interacts with the new measures introduced in the Bill, whereby there will be a nationally procured database with a set of accountability measures operated by the Secretary of State. That could interact unhelpfully with local databases. I hope that the Government are determined to learn the lessons from those existing selective licensing arrangements. The Opposition’s view is that given the measures introduced by the Bill, selective licensing in the way that it is currently undertaken would no longer be necessary nor appropriate.
Carla Denyer
New clause 9 would head in the opposite direction from new clause 5. It is about removing unnecessary barriers to the use of licensing schemes to improve housing standards. The new clause would do two things. First, it would increase the maximum duration of discretionary licensing schemes from five years to 10. Secondly, it would enable local authorities operating selective licensing schemes to use licensing conditions to improve housing conditions.
Licensing can be an effective way to improve housing standards for at least three reasons. First, it is proactive. It provides a means for local authorities to inspect privately rented housing using enforceable conditions and to identify and resolve problems without the need for tenants to have complained, and it provides that proactive regulation in a locally tailored form. It makes major contributions to area-based issues such as crime, antisocial behaviour and waste management, and it brings together a range of bodies to focus additional support services—for example, for landlords and tenants, improving public health and reducing burdens on the NHS. There are a huge number of wins, and I have experienced that at first hand with licensing schemes in my local authority.
Secondly, licensing is self-funding. It means that the market pays for its own regulation, which is a good principle, rather than relying on the taxpayer. It provides a sustainable and predictable source of income that enables local authorities to maintain staffing levels and support the training of new officers.
Thirdly, licensing is targeted. It enables local authorities to target regulation where that is most needed, so that the worst landlords and the most vulnerable tenants get the most attention and landlord costs can be minimised in other areas.
The problem, however, is that local authorities have to implement licensing schemes with their hands tied behind their backs, because previous Governments have made various decisions that have placed unnecessary and irrational barriers in their way. Given that licensing schemes are expensive and time-consuming for local authorities to initially introduce, it does not make sense to restrict the period over which they can act to only five years.
New clause 9 would amend sections 60 and 84 of the Housing Act 2004 to increase the maximum duration of discretionary licensing schemes, which includes both selective licensing schemes and additional—sorry, jargon again—for HMOs from five to 10 years. That would allow local authorities to advertise for longer-term posts for officers and to include training of new staff in those schemes. It would also provide more time for local partnerships formed through such schemes to become embedded and effective.
The new clause also addresses another issue, which was highlighted by the Chartered Institute of Environmental Health during oral evidence. That respected body pointed out that it does not make any sense to have the current peculiar disconnect in the 2004 Act, whereby local authorities can introduce selective licensing schemes to address poor housing conditions, but they cannot include a directly enforceable requirement relating to the housing condition as a condition of the licence—so they do not have the tools to do what they are set up to do. The new clause would therefore amend section 90 of the 2004 Act to enable local authorities to use licence conditions to improve housing conditions directly.
I stress that the new clause does not cover all that needs to be done to remove barriers to licensing. For example, I also urge the Minister to commit the Government to removing the Secretary of State’s ability to veto selective licensing schemes covering more than 20% of the local authority area.
Carla Denyer
I can see that the Minister is nodding in recognition of that, and I thank him. It does not make sense for local authorities introducing selective licensing schemes to have to spend a lot of money on preparing the paperwork for the scheme without knowing whether it will ultimately go ahead. I have seen at first hand the unnecessary impact on officer time and the cost to local authorities.
Similarly, I urge the Minister to commit the Government to removing the requirement for local authorities establishing selective licensing schemes to ensure that the private rented sector forms a high proportion of properties in the area. If there are acute issues in the private rented sector that can be addressed through a selective licensing scheme, it seems arbitrary for local authorities to be unable to establish such a scheme just because that sector does not form a large proportion of the whole housing stock. The reason why those measures are not included in the new clause is that they do not require primary legislation, as far as I understand it, but I raise them because they are directly connected to the content of the new clause.
In conclusion, the changes that I am suggesting are small, but they could make a big difference to housing standards on the ground and to the ability of local authorities to do their work. I will not push the new clause to a vote, but I sincerely hope that the Minister will actively consider it. I know that the Chartered Institute of Environmental Health would be happy to meet him to discuss any further details.
Matthew Pennycook
As we have heard, new clause 5 seeks to abolish selective licensing. This would remove the ability of local authorities to set up a selective licensing scheme of any size in their area. In contrast, new clause 9 seeks to extend selective and additional licensing of houses in multiple occupation by allowing local authorities to increase the maximum duration of schemes from five to 10 years. It also seeks to allow local authorities to use licence conditions under selective licensing to improve housing conditions, as the hon. Member for Bristol Central made clear.
This Government support selective licensing. It allows local authorities to proactively and more intensively target specific issues in private rented properties, where it is needed most. That includes tackling poor housing conditions and antisocial behaviour. If we abolish selective licensing, local authorities will lose a crucial tool in taking effective enforcement action against landlords who flout the rules. However, I take the shadow Minister’s point, and I reiterate that it is important that the selective licensing system, and the system introduced by the Bill, operate effectively alongside each other. That is very much our intention.
However, we recognise that licensing imposes a burden on landlords. Correspondingly, we think a maximum duration of five years for discretionary licence schemes strikes the right balance for the following reasons. It gives local authorities time to realise improvements while ensuring that landlords are not by default subject to increased regulation for prolonged periods. Of course, licensing in any given area may be part of a longer-term strategy. That is why, where a scheme has expired and there is still a case for licensing, local authorities may simply introduce a new scheme to drive further improvements. The duration that the hon. Member for Bristol Central is seeking selective licensing schemes to cover can be achieved in any given local authority area, if the local authority simply extends matters through a new scheme. We think that a five-year timeframe gives an opportunity to review the effectiveness of individual discretionary licensing schemes and ensure that they are proportionate in achieving their aims.
The broad intention of the hon. Lady’s new clause is to improve housing conditions. Let me be clear again that every private renter, not just those in licensed properties, has the right to a good-quality home. That is why, through the Bill, we are introducing a decent homes standard and applying Awaab’s law to the sector to tackle the blight of poor-quality homes.
Our reforms will establish a level playing field across the sector, ensuring that all renters and local authorities, not just those in areas with licensing schemes, can challenge and enforce against dangerous conditions. I will not address the hon. Lady’s specific point on the Secretary of State’s veto, because it is somewhat outside the scope of the Bill, but I take that on board. On the chartered institute, I will say nothing more at this stage other than that we will continue to review the use of selective licensing as we develop the database and other measures in the Bill. On that basis, I ask the hon. Members not to press their new clauses.
David Simmonds
We remain a little concerned that where selective licensing schemes are in operation alongside the measures introduced by the legislation, a degree of ambiguity and potential confusion is created, especially for some landlords who may seek to evade responsibility. Two schemes of a similar nature will be in place, with potentially different fees and standards in operation. However, I accept the numbers on the Committee, so I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
The Chair
New clause 6 has been debated and there is no requirement to call it for a decision, unless a Committee member wishes to move it—Mr Amos?
The Chair
Technically, the hon. Gentleman cannot withdraw the clause because it has not been moved, but his words are a matter of record.
New Clause 8
Guarantor to have no further liability following death of tenant
“(1) Subject to subsection (3), a guarantee agreement relating to a relevant tenancy ceases to have effect upon the death of a relevant tenant.
(2) Upon the death of a relevant tenant the guarantor in respect of a relevant tenancy shall incur no further liability in relation to matters arising under the tenancy.
(3) Nothing in this section shall affect the liability of a guarantor in relation to matters which arose before the date of the death of the relevant tenant.
(4) In assessing any liability under subsection (3), account shall be taken of any tenancy deposit paid in respect of the tenancy.
(5) Where there is more than one relevant tenant, this section shall apply only upon the death of both or all of the tenants.
(6) In this section—
a ‘guarantor’ is a person who enters into a guarantee agreement in relation to a relevant tenancy;
a ‘guarantee agreement’ is a contractual promise (whether incorporated in or separate from the tenancy agreement) to indemnify or compensate a relevant person in respect of an obligation under the tenancy if the tenant fails to perform or comply with the obligation;
a ‘relevant tenancy’ has the same meaning as in section 36, and ‘relevant tenant’ is to be interpreted accordingly; and
‘tenancy deposit’ has the same meaning as in section 212(8) of the Housing Act 2004.”—(Claire Hazelgrove.)
Brought up, and read the First time.
Claire Hazelgrove (Filton and Bradley Stoke) (Lab)
I beg to move, That the clause be read a Second time.
The Chair
With this it will be convenient to consider new clause 14—Restrictions on the requirement for tenants to provide a guarantor—
“(1) A relevant person must not, in any of the circumstances set out in subsection (3), require a person, as a condition of the grant of a relevant tenancy, to provide a guarantor in relation to the observance or performance of the tenant’s obligations under the tenancy.
(2) For the purposes of this Act, requiring a person to provide a guarantor includes accepting an offer by that person to provide a guarantor.
(3) The circumstances are—
(a) that the person has paid a tenancy deposit or has been assisted under a deposit scheme;
(b) that the person is required to pay rent in advance equivalent to one month’s rent or more;
(c) that on a reasonable assessment of their means the person’s income (including state benefits received and any other lawful source of income) is sufficient to enable them to pay the full rent due under the tenancy;
(d) that arrangements will be made for housing benefit or the housing element of universal credit to be paid directly in respect of rent to the relevant person;
(e) that the relevant person has entered into a contract of insurance under which they are insured against non-payment of rent; or
(f) such other circumstances as may be prescribed in regulations made by the Secretary of State.
(4) In any other case where a relevant person lawfully requires a person, as a condition of the grant of a relevant tenancy, to provide a guarantor, the sum for which the guarantor may become liable under the relevant guarantee shall not exceed a sum equal to six months’ rent.
(5) In any case where a relevant person requires a tenant, as a condition of the grant of a relevant joint tenancy, to provide a guarantor, the sum claimed under the guarantee shall not exceed such proportion of the loss as is attributable to the act or default of the individual tenant on whose behalf the guarantee was given; and if such proportion cannot be proved, shall not exceed the sum obtained by dividing the total loss by the number of tenants.
(6) In this section—
‘guarantor’ is a person who enters into a guarantee in relation to a relevant tenancy;
‘guarantee’ is a contractual promise to be responsible for the performance of an obligation owed by the tenant to a relevant person under the tenancy if the tenant fails to perform the obligation;
‘deposit scheme’ includes a scheme whereby a sum payable by way of depositor a bond or guarantee is provided by a local authority, registered charity or voluntary organisation for the purpose of providing security to a landlord for the performance of a tenant’s obligations under a tenancy;
‘tenancy deposit’ has the same meaning as in section 212(8) of the Housing Act 2004.”
This new clause would restrict the circumstances in which a landlord can request a guarantor.
Claire Hazelgrove
I rise to speak in support of new clause 8, tabled by my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), who is not a Committee member. The new clause would provide protection for bereaved guarantors by prohibiting the application of a guarantor agreement in the event of the death of a tenant. My hon. Friend was motivated to table the new clause following the tragic case of her constituents who lost their son to suicide.
The young man was a first-year university student who had signed a private tenancy for his second-year accommodation. Very sadly, he died by suicide months before the new tenancy was due to start. His parents had signed a guarantor agreement that applied in the event of the tenant’s death, and while they were grieving the loss of their son, the letting agent pursued them for the rent on the property in which he would never live. That type of clause is not common to all guarantor agreements, and it is entirely unnecessary, because the loss of rental income due to the death of a tenant is an insurable risk for landlords.
New clause 8 would prevent guarantor agreements from applying in the event of the death of a tenant. It has been tightly drafted with the assistance of lawyers from Shelter. My hon. Friend is extremely grateful to the Minister for his positive engagement on the issue, both prior to the general election and subsequently. Although I do not seek to press the new clause to a vote, I hope the Minister will be able to give assurances either that the Government will accept the new clause or introduce an amendment to the Bill to the same effect.
I hope we can all agree that no one who is grieving the loss of a person for whom they have acted as a guarantor should be pursued for that person’s rent. That small change in the law would prevent the distress that was caused to my hon. Friend’s constituents from happening to anyone else.
Carla Denyer
I support new clause 8, and I would also like to speak in favour of new clause 14, tabled in the name of the hon. Member for Leeds Central and Headingley (Alex Sobel). New clause 14 seeks to address an injustice around guarantors for students. In this speech, I cite heavily evidence provided by the National Union of Students and individual student union officers in my home city of Bristol, all of whom are very concerned about this injustice.
The widespread landlord practice of demanding that tenants provide a guarantor is discriminatory, especially in this situation. Tenants are asked to put someone forward, normally a parent or relative, who owns a house in the UK and/or earns an income typically above the national average. The guarantor is asked to guarantee to pay the rent should the tenant default, and to pay for any damage to the property should the tenant be unable to do so.
Although for some, this is just an inconvenience, for tenants who are from deprived socioeconomic backgrounds, who are estranged from their families, who have a background in care or who are coming to the UK, such as international students from abroad, it can be a huge barrier to securing a home. The practice can push those unable to find a suitable guarantor into unsustainable debt, because they are forced to pay either months of rent up front or for costly guarantor schemes run by private companies. Others are forced into hostels or sofa surfing, and can even be made homeless.
The stats are stark: 13% of students experience homelessness during their studies, and that figure rises to 29% for international students. This issue has a detrimental impact on the lives of student renters and their ability to focus on their studies. It is imperative that we address the issue to ensure fair and equitable access to housing for all tenants, including students, allowing them to flourish in their education.
Landlords have several other means available to protect themselves against potential losses, including tenant referencing, rent guarantee insurance and deposit protection schemes, all of which make guarantor schemes unnecessary. I am not pushing for a vote today, but I ask the Minister to have a dialogue—if he is not doing so already—with the hon. Member for Leeds Central and Headingley, who tabled the new clause, and the NUS, with a view to including the changes in the next version of the Bill. Finally, I should mention that I have joined the all-party parliamentary group for students.
Matthew Pennycook
I thank my hon. Friend the Member for Filton and Bradley Stoke for speaking to the new clause tabled by my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), whom I commend for her work in this area, not just in this Parliament but in the previous one. She has been prodigious in pursuing this issue on behalf of her constituents, and I have reflected further on the points that she made on Second Reading.
The Government agree that it is unacceptable for bereaved guarantors to be held liable for unpaid rent where the only reason for it is the sad death of a tenant. Guarantor arrangements are not usually intended to protect landlords against the risk of financial loss caused by the death of their tenant; rather, they are used by landlords to reduce the financial risk of letting to a tenant who, for example, may have no previous residency in the UK and consequently no references from former landlords, or who might not successfully pass credit checks.
Although we understand that few landlords would use guarantor agreements to pursue debts that occur after a tenant’s death, we do know that sadly some do. This is an unacceptable practice that compounds the grief that families face after unexpected bereavements. I hope my hon. Friend the Member for Filton and Bradley Stoke will be reassured to hear that the Government have been considering this issue closely and in detail. We take it very seriously, and I am extremely sympathetic to the issues raised. I hope to be able to say more on Report about the matter and about the new clause tabled by my hon. Friend the Member for Dulwich and West Norwood.
I thank the hon. Member for Bristol Central for speaking to new clause 14, tabled in the name of my hon. Friend the Member for Leeds Central and Headingley (Alex Sobel). I am grateful to my hon. Friend for his work on this issue, and for his engagement with me and on the Bill more generally. The Government understand that obtaining a guarantor may be difficult for some prospective tenants, and I absolutely sympathise with those who are in that situation. For some tenants, the requirement can, as the hon. Member for Bristol Central made clear, effectively block access to the private rented sector.
The Government are clear that landlords should consider a tenant’s individual circumstances when negotiating rental contracts. I have been concerned to hear anecdotally about some landlords insisting that all tenants provide a guarantor, regardless of individual circumstances. That said, and ever mindful of the unintended consequences of weighing in without thought, I am aware that the use of guarantors can give landlords confidence to provide tenancies to individuals who otherwise may struggle to gain accommodation. That might include those with a history of rent arrears or with no previous rental history, those who are moving out of home for the first time and foreign students. As such, I am concerned that the wording of the new clause may inadvertently make it harder for those tenants to find a place to live, despite the honourable intentions behind it.
I recognise the importance of getting the balance right between barriers and enablers to accessing the private rented sector. I will continue to engage with hon. Members more broadly and with wider stakeholders, but in particular with my hon. Friend the Member for Leeds Central and Headingley, who has diligently pursued the matter. For the reasons I have given, however, I respectfully ask my hon. Friend the Member for Filton and Bradley Stoke to withdraw the new clause.
Claire Hazelgrove
I beg to ask leave to withdraw the new clause.
Clause, by leave, withdrawn.
New Clause 10
Home Adaptations
“(1) The Housing Act 1988 is amended as follows.
(2) After section 16 insert—
‘16A Home adaptations
(1) It is an implied term of every assured tenancy to which this section applies that a landlord shall give permission for adaptations where a local council has carried out a Home Assessment and recommends adaptations which constitute reasonable adjustments under the Equality Act 2010. Tenants have the right to appeal a landlord’s refusal to adapt a property.
(2) This section applies to every assured tenancy other than a tenancy of social housing, within the meaning of Part 2 of the Housing and Regeneration Act 2008.’” —(Carla Denyer.)
This new clause would ensure that landlords give permission for home adaptations where a Home Assessment has been carried out.
Brought up, and read the First time.
Carla Denyer
I beg to move, That the clause be read a Second time. The new clause would ensure that landlords give permission for home adaptations where a home assessment has been carried out. There are 16 million disabled people in the UK—that is more than a fifth of the population—and 19% of them live in the private rented sector. The Equality and Human Rights Commission estimates that a shocking one in three disabled people live in private rented properties that are unsuitable for them. Research by the National Residential Landlords Association found that only 49% of landlords—less than half—were willing to let to a tenant who required adaptations for accessibility needs. That number does go up when landlords are made aware of the funding that is available, but it still falls far short of where it needs to be.
Disabled renters need the landlord’s consent to make any adaptations to their homes. The Equality Act 2010 already imposes a duty on landlords to allow and make reasonable adjustments on request from their disabled tenants. Common home adaptations include changes to make the premises safe, facilitating access to things including use of the bathroom, washing facilities, cooking facilities, light controls and so on—things that it is perhaps easy for us to take for granted.
Disabled renters who are unable to self-fund may request that their local authority pays for smaller adaptations. That includes things such as grab rails to make it easier to get in and out of the bath. Through the disabled facilities grant, which is in a separate bucket, local authorities provide up to £30,000 to pay for major works that cost more than £1,000.
I tabled the new clause to prompt a discussion about the concern raised by Disability Rights UK, which points out that, unfortunately, the disabled facilities grant is a postcode lottery system that is failing and is not fit for purpose in its current form. An investigation by journalist Vicky Gayle found that in nine council areas in England and Wales, people had to wait on average more than a year to see an occupational therapist and complete the pre-application steps. On top of that, 80% of local authorities in England and Wales are using discretionary powers to top up funding, and that extra money varies wildly from council to council. There are many common barriers, including the fact that private landlords often refuse to make adaptations and many are unaware of their legal obligations to do so.
Matthew Pennycook
I very much sympathise with the intent behind the new clause, but I am afraid I will have to disappoint the hon. Lady by saying that I do not think it is necessary, and I will set out why. The Government strongly agree that landlords should not unreasonably refuse disability adaptations. As she rightly says, there is already a requirement in law that they do not. The Equality Act 2010 provides that landlords cannot unreasonably refuse a request for reasonable adjustments to be made for the purposes of a disabled person using their home. Where consent has been sought and is refused, the burden is on the landlord to show why their refusal or any conditions are reasonable.
The hon. Lady said that the Bill does nothing to target the problem that she outlines, but I think it takes a series of steps that will support disabled renters to challenge unreasonable refusals without fear of retaliatory eviction—I am talking about the general overhaul of the tenancy system, which should provide them with more confidence in that area. In addition, when the new PRS landlord ombudsman is established, tenants may be able to make a complaint to it if they think that the landlord should have given permission for disability adaptations but has unreasonably refused to do so. That is another means of redress that will be introduced through the Bill.
Notwithstanding the hon. Lady’s point about a postcode lottery—we could rehearse for many hours the pressures on local authorities’ budgets—where a tenant has applied for a disabled facilities grant, local councils have the power to override the requirement for tenants to have the landlord’s permission to make adaptations, and to award the grant without permission if they believe that permission was withheld unreasonably. For those reasons, although I will reflect on the point that she made and although I sympathise with the intent, the new clause is unnecessary and I kindly ask her to withdraw it.
Carla Denyer
I will be honest: I am not convinced that the new clause is unnecessary, but I can do the maths so will not seek to divide the Committee. I beg to ask leave to withdraw the new clause.
Clause, by leave, withdrawn.
New Clause 11
Rent controls
“(1) The Secretary of State must establish a body to be known as the Independent Living Rent Body within 12 months of the date of Royal Assent to this Act.
(2) The ‘proposed rent’ referred to in section 55(2) must be no more than an amount set by the Independent Living Rent Body.
(3) The amount referred to in subsection (2) must be calculated as a function of property size, quality, local incomes, location, and such other criteria as the Independent Living Rent Body sees fit.”—(Carla Denyer.)
Brought up, and read the First time.
Carla Denyer
I beg to move, That the clause be read a Second time.
Thank you for your forbearance, Sir Roger, as I have proposed quite a few new clauses this afternoon, but this is the last one from me. New clause 11 proposes setting a control on the amount that a stated or advertised rent can be. A control would be set by an independent living rent body, taking account of the property’s size and quality, as well as local incomes, location and other criteria that the body sees fit to include. Local flexibility will be vital.
We have a generation of people who will never be able to earn enough to have a mortgage, and who cannot even afford their rents now. New clause 11 recognises that and aims to bring some urgently needed fairness and balance to a private rented landscape that has become grossly distorted. Giving an independent body the power to set a ceiling for new rents is similar to models of new rent regulation in Germany and Spain.
I have tabled new clause 11 to probe the Minister, and I want to be clear from the outset that I am acutely aware that this is a complex policy area and that there is no silver bullet for the terrible problem of sky-high rents in the private rented sector. I know that I will be challenged in this debate, and I welcome that; there is a vital discussion to be had to ensure that unintended consequences are avoided, and I do not dismiss the importance of that. At the same time, I hope that we recognise the significance of the debate over what we do about the affordability of rents.
I put it to the Committee that we need to consider rent controls both within and between tenancies, because unaffordable private rents are hurting people and hurting our economy. Key workers are forced out of cities and out of the communities that they have made their home. Average rents in inner London, as those of us who are newly elected MPs and getting flats in inner London are very aware, are rather high. In fact, they are 106% of a teaching assistant’s salary.
The average rent in my constituency of Bristol Central has hit nearly £1,800 a month. If a 21-year-old living in Bristol rents a single room today at the average rate, they will have put £80,000 into their landlord’s bank account by the time they reach their 30th birthday. Rising rents in Bristol forced renter Anny, her key worker partner Alex and their four-month-old baby to move city completely, and to move away from their support network when they needed it most.
Private renters spend a disproportionate amount of their income—an average of 33%—on housing costs, compared with just 10% for mortgage holders, and a shocking one in five renters spends more than half of their income on rent. That has a knock-on effect on the economy. Renters are giving more and more of their wages to landlords. Many cannot make ends meet and are ending up homeless, and those who can just about afford not to become homeless are certainly not able to save anything like the eye-watering sums needed to get on the housing ladder.
Private renters have less disposable income, and therefore less buying power, in the local economy, too. Research by the Women’s Budget Group and Positive Money UK found that high private rents disproportionately impact the spending power of women and black, Asian and minority ethnic households. The knock-on costs to the taxpayer are high, too, through spending on housing benefit and temporary accommodation.
I know that the Minister has already made it clear that he will not accept the solution proposed in new clause 11, but I hope that he will at least accept that private rents are much too high relative to incomes and tell us how the Government plan to address that crisis in the here and now.
For two reasons, I am concerned that changes to the tribunal do not go far enough to address high rents, as the Bill stands. First, as discussed previously, most tenants will not use the tribunal system, because they do not have the time and energy to navigate it. Secondly, even if every tenant did so, it would not result in rents coming down overall, in relation to incomes. The tribunal panel judges only whether a rent rise is fair based on the price of new rentals of a similar size in the area, and the prices of new rentals have outstripped inflation consistently. Rental index data from the Deposit Protection Service backs that up. It found that rents outstripped inflation by a third last year, and Rightmove reports show that asking rents outside of London have risen 60% since 2020, far outstripping inflation or wage growth.
During our evidence sessions and previous discussions in Committee, we heard the important point that rent controls are not simply one thing; they are a category of policies. In an earlier sitting, we discussed in-tenancy rent controls, to stop rogue landlords hiking rents in order to kick people out, in lieu of using section 21. That is one thing, but the new clause goes further by aiming to address the unaffordable level that private rents have reached and rent hikes between tenancies.
I expect that the Minister will mention social housing. I agree that increasing the social housing supply is critical; however, the private rented sector is in an affordability crisis now, and it will take huge amounts of effort and time to increase the social housing supply at the scale and pace needed to have any impact on private rents. Models from Generation Rent and other economists predict that building 1.5 million homes over this Parliament will decrease the rent burden by just over 1%. More social rented homes are essential, but the cost of private renting is so distorted—the market is failing so badly—that we need Ministers to step in and treat rent affordability as the acute housing emergency that it is.
I am sure the Minister will also use the example in Scotland as a reason not to have rent controls here. I would strongly caution against that, though, because the data on whether rents have increased overall in Scotland are shaky, as we heard in the evidence sessions, and, if there have been increases, the data on whether they are anything to do with rent controls are even more so—if necessary, I am happy to go into that in more detail in the debate.
I imagine that the Minister will also highlight the potential unintended consequences on the supply side and the possibility that landlords will leave the sector. However, it is not enough simply to assert that any form of rent control—remember that this is a whole category of options—will break the private rented sector or cause lots of landlords to leave. That needs to be interrogated, with proper consideration given to the contrary case that rent caps would provide a clear and stable regime for rent rises for landlords, so that they know how much they can raise the rent by and plan for the future.
I encourage the Government and the Committee to look to European countries where rent caps co-exist with large private rented sectors, such as in Germany, where more than half the population rents privately and where they also have in-tenancy rent caps. In particular, I draw the Committee’s attention to comments by the chief executive officer of Greystar, one of the world’s biggest landlords, who said recently that rent controls need not stop big investors from funding new homes:
“You do not have to have the windfall of a year of 14 per cent rent increases in order to have a viable investment product…We operate in a lot of markets around the world where rent control does exist.”
The argument against rent controls is that they will break the private rented sector, but it is already broken, with immediate and severe consequences right now, for all the reasons we heard about in the evidence sessions. However, we need to talk about the risks attached to any policy of in-tenancy and between-tenancy rent controls. Any system to introduce them needs to be carefully designed and built—I acknowledge that, and I know that point will be made to me in a moment. Some robust work already exists on the kind of principles we should consider in designing a workable system, and my new clause 11 is just one suggestion.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
The hon. Lady might be coming on to the impact of the criteria in the new clause, but I am concerned that the market could respond to them by drawing investors into just one location that was already a serious hotspot. It would be helpful to understand more about why they might help.
Carla Denyer
Will the hon. Member clarify what she means by “drawing into” in that context?
Rachel Blake
I was referring to the suggestion that the proposed independent living rent body would start setting rents under subsection (2) based on the property size, quality, local incomes and location. Given the constrained market that would establish, surely it might reduce availability even further.
Carla Denyer
The hon. Member is correct that I was coming to that, but I thank her for asking anyway—I do welcome a debate. There is some robust work on what rent controls can look like and, without wishing to give any spoilers about the organisations that provided us with evidence, I understand that more is coming. I draw the Committee’s attention to work done in 2019 by the New Economics Foundation, which looked at how we might arrive at a rent control system in London. It set out six key building blocks all about how to transition carefully and gradually from the current market free-for-all to a controlled system, and there are some lessons to be learned there about how we address supply issues.
Matthew Pennycook
The hon. Lady’s new clause, which she has set out clearly, seeks to require the Government to establish an independent body to set the maximum rent at which a landlord could advertise a property in writing, under clause 55, which I remind Committee members requires a landlord or a person acting on their behalf to state a specific and proposed rental amount in a written advertisement or offer for a proposed letting. Although I very much recognise the concerns in relation to rising rents generally and extortionate within-tenancy rent increases in particular—I do not think anyone on the Committee dismisses those concerns, particularly in parts of the country with hot rental markets, as referenced by my hon. Friend the Member for Cities of London and Westminster—I do not believe the approach proposed in the new clause is necessary or proportionate.
I understand from the hon. Member for Bristol Central that her new clause is intended to provoke debate, and I am more than happy to debate it. However, I must confess that when I was considering the new clause’s specific wording, I struggled somewhat to ascertain how the new independent body would operate. I think she has given us a bit more clarity on her thinking, but I am still a little unsure. I will therefore put the two options in my mind that it might reasonably take.
It could mean that every landlord and letting agent in England would need to engage with the body proposed by the hon. Lady to set a maximum starting rent for every property they seek to advertise on every occasion that they require a new tenant. I think that is what she was driving at when she said that it would have to take into account specific factors relating to each property. We are debating the specific measure rather than a general point but if that is the case, the costs of administrating such an arrangement, which would have to apply to the approximately 950,000 new lets that occur each year, would be likely to be enormous. In my view, it would almost certainly have an impact on the time that landlords and tenants take to agree a rental price.
If, as the hon. Member for Bristol Central touched on later in her remarks, the body would simply be required to set maximum rents on the basis of broad principles and therefore not account fully for variation in the market, it would in effect be overseeing a form of rent control. The Government believe that would impact negatively on tenants as well as landlords, as a result of reduced supply, discouraged investment and declining property sales, as I have set out in detail previously.
I gently push back on the hon. Lady’s assertion that I am just asserting such a point; I have given the Committee extensive references to some of the negative impacts of various forms of rent control in other countries. There are academic studies on countries such as Sweden and Germany, and from cities such as San Francisco and Ontario, which show that rent regulation can have those precise effects. I was in Rome at the G7 yesterday, discussing this very matter with the German Housing Minister, who acknowledged that while there are benefits to the system in Germany, it has had an impact on supply in places. It could have a detrimental impact on tenants if we introduce it into our system here.
I am more than happy to debate. I think we will debate the issue throughout the Bill’s remaining stages in this place, and I am sure it will be a source of debate in the other place and again when it returns to us. I do not want to test your patience or the Committee’s, Sir Roger, by repeating the long discussion we have already had about rent control. I simply reiterate that the Government are confident that the Bill strikes the right balance when it comes to addressing, in particular, unreasonable within-tenancy rent increases. We do not believe the establishment of a body along the lines that the hon. Lady proposes would be beneficial to tenants or landlords.
I have made the point, and will do again, that the legislation is not the Government’s only answer to affordability pressures in the private rented sector. The hon. Lady referenced the Government’s intention to deliver the biggest increase in social and affordable housing in a generation. I appreciate the urgency with which that needs to take place. She is more than welcome to clarify the point, but I hope she commends the additional £500 million of funding in the recent Budget, the top up to the affordable homes programme this year and the action we are taking on right-to-buys, giving local councils 100% retention of discounts from sales. There will be more to come, not least when we set out further Government investment in the spending review next year.
On the basis of all the points I have made, I ask the hon. Lady to withdraw new clause 11. I do not think it will be the last time we debate the matter as part of the Bill or more widely across the Parliament.
Carla Denyer
I certainly welcome additional funding for social housing, and I know that many local authorities do too, although I suspect that most if not all would also say that they need more than that. In terms of what exact model of rent controls we are talking about and how the independent living rent body works it out, I am deliberately not attached to exactly how to do that.
As I mentioned, there are 17 European countries that have some form of rent controls; they are all tailored to specific circumstances and some have worked better than others. My point is that we should not rule out an entire category of available tools on the basis of looking at a few examples that have not worked. I would rather we look at how we could make it work or, if not, at what the Government are going to do instead to tackle affordability in the private rented sector, given that the positive measures on social housing are unlikely to bring down rents in that sector by anything like the necessary amount.
As it is clear that the Minister will not support new clause 11, I suggest he should at least consider the merits of setting up a living rent commission to undertake work to inform evidence-based decision making about what we can do on the issue. When I was a Bristol city councillor, I was the co-proposer with a Labour councillor of commissioning a local version of that work to look at how rent controls could theoretically work in Bristol if the Government gave the council the necessary powers. We took that route specifically because we were aware that several options were available, so we first needed research on how it might work and how to avoid unintended consequences. I would love the Government to commission an equivalent study at a national level so that we can make informed decisions in future.
Matthew Pennycook
I am afraid I cannot give the hon. Lady that commitment. She somewhat downplays the amount of thinking that has gone into this legislation by my officials, me and my colleagues as to the appropriate and necessary measures. We think the measures strike the right balance. This legislation is not the only intervention we are making on affordability pressures in the private rented sector. As I have said, I am more than happy to continue the debate with the hon. Lady in the remaining stages of the Bill.
Carla Denyer
I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
Question proposed, That the Chair do report the Bill, as amended, to the House.
Matthew Pennycook
May I take this opportunity, Sir Roger, to put on the record my thanks to you and to the other Chairs of the Bill Committee? Several Committee members are new to the process, and you and the other Chairs have done an incredibly effective job, with patience and generosity, of helping everyone to navigate the process.
I thank our exemplary Clerks, the Hansard Reporters, and the Doorkeepers for overseeing our proceedings. I also thank my officials and private office team, who have supported me and worked tirelessly over a short time to bring forward the Bill that we have debated in recent weeks.
Finally, I thank all hon. Members, including the shadow Minister, the hon. Member for Taunton and Wellington and the hon. Member for Bristol Central for the spirited and constructive dialogue we have had. I value all the contributions and the challenges that have been made. I know that we are united in wanting to deliver the best legislation that we can for all our constituents.
As we end this stage of scrutiny and prepare for Report stage, I hope we can all agree that these important reforms will finally provide certainty for the sector and deliver meaningful change to millions of renters and landlords. I look forward to further engagement with all hon. Members as the Bill progresses through its remaining stages.
David Simmonds
I share the Minister’s sentiments. I will pay him the highest compliment that I can: at times, he could have been a Conservative in the way he addressed the issues that I raised. I add my thanks to the officials, as I know that the Minister’s swift responses would not have been possible without their diligent work behind the scenes; I am enormously grateful that issues have been dealt with in such detail. I also add my thanks to Committee members for their sensible and sound contributions. I am sure the debate will continue, but we have carried out an efficient piece of work.
The Chair
All that is strictly out of order, but I am sure that the comments will be appreciated. I add my thanks to the Committee and to the Officers of the House, without whom our work would simply not be possible.
Question put and agreed to.
Bill, as amended, accordingly to be reported.
Renters’ Rights Bill
Tuesday 14th January 2025
(1 year, 6 months ago)
Commons ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 14 January 2025 - (14 Jan 2025)
18:12 - The House divided: - Ayes: 181 / Noes: 363 - Question accordingly negatived.
18:26 - The House divided: - Ayes: 118 / Noes: 434 - Question accordingly negatived.
18:43 - The House divided: - Ayes: 186 / Noes: 360 - Question accordingly negatived.
19:00 - The House divided: - Ayes: 440 / Noes: 111 - Question accordingly agreed to.
The Minister for Housing and Planning (Matthew Pennycook)
I beg to move, That the clause be read a Second time.
Madam Deputy Speaker (Judith Cummins)
With this it will be convenient to discuss the following:
Government new clause 14—Prohibition of rent in advance before lease entered into.
Government new clause 15—Guarantor not liable for rent payable after tenant’s death.
Government new clause 16—Limitation on obligation to pay removal expenses.
New clause 1—Limit on rent to be requested in advance of tenancy—
“In the 1988 Act, after section 14ZB (inserted by section 8 of this Act) insert—
“14ZBA Maximum rent to be paid in advance
No rent may be requested or received in advance of any period of the tenancy which exceeds the rent for two months of the tenancy.””
This new clause would prohibit landlords from requesting or accepting more than two month's rent in advance.
New clause 2—Impact of Act on provision of short-term lets—
“The Secretary of State must, within two years of the passing of this Act, publish a review of the impact of sections 1 to 3 on the number of landlords offering properties on short-term lets rather than in the private rented sector.”
New clause 3—Limit on rent in advance of tenancy—
“In Schedule 1 to the Tenant Fees Act 2019, after paragraph (1) insert—
“(1A) But if the amount of rent payable in advance of any period of the tenancy exceeds the equivalent of one month’s rent, the amount of the excess is a prohibited payment.””
This new clause would make it unlawful for a landlord to demand or accept more than one month’s rent in advance in respect of a tenancy or licence of residential accommodation.
New clause 4—Signature of lease for student accommodation—
“Where a tenant meets the student test set out in paragraph 10 of Schedule 1, the relevant tenancy agreement may not be signed before 1 March in the year in which the tenancy is intended to take effect.”
This new clause would prevent student leases being signed before March in the year in which they are intended to commence.
New clause 5—Review of tenancy deposit schemes and requirements—
“(1) The Secretary of State must, within 12 months of the passing of this Act, conduct a review of tenancy deposit schemes and tenancy deposit requirements.
(2) The review must include, but not be limited to—
(a) consideration of options for tenancy “passporting”; and
(b) measures to improve trust in the deposit dispute process.
(3) As part of the review the Secretary of State must consult with such parties as they see fit, which must include representatives of tenants’ and landlords’ interests.”
This new clause would require the Secretary of State, within 12 months of the Act passing, to review and consult on tenancy deposit schemes and requirements.
New clause 6—Duties of local authorities: care leavers—
“(1) Where it is requested of a local housing authority by, or on behalf of—
(a) a relevant child as defined by section 23A of the Children Act 1989, or
(b) a former relevant child as defined by section 23C of the Children Act 1989,
the local housing authority shall provide assistance to the individual making the request, or the individual on whose behalf the request is made, in paying or guaranteeing any deposit required to agree a tenancy.
(2) The assistance to be provided under subsection (1) may include, but not be limited to, the payment of a deposit on behalf of an individual listed in subsection (1), or acting as a guarantor for any deposit paid by or on behalf of an individual listed in subsection (1).”
This new clause would place a duty on local authorities to help care leavers pay or guarantee any required deposit to enable them to agree a tenancy in the private rented sector.
New clause 7—Rules for proposed rent levels—
“(1) The Secretary of State must establish a body to be known as the Independent Living Rent Body.
(2) The “proposed rent” referred to in section 55(2) must be calculated with reference to rules set by the Independent Living Rent Body.
(3) In setting rules to be applied to the calculation of a proposed rent under section 55(2) the Independent Living Rent Body will have regard to property type, size and condition, location, local incomes, and such other criteria as it sees fit.”
This new clause would require the Secretary of State to establish an independent body that would set rules to be used when calculating the proposed rent payable in relation to an advertised tenancy.
New clause 8—Mediated rent pauses (housing conditions)—
“(1) This section applies where–
(a) there is a tenancy to which section 9A of the Landlord and Tenant Act 1985 applies;
(b) it appears to the tenant that the landlord has breached the covenant implied by that section; and
(c) it appears to the tenant that the landlord has failed to carry out works necessary to remedy any such breaches within the timeframes set out in regulations made by the Secretary of State under section 10A(3) of the Landlord and Tenant Act 1985.
(2) A tenant is entitled to make arrangements to pay rent to an independent individual, rather than to the relevant landlord.
(3) The independent individual shall not pass any rent paid under subsection (2) to the landlord until there has been a determination or agreement between the landlord and tenant as to the landlord’s liability for any breach of the covenant implied by section 9A of the Landlord and Tenant Act 1985.
(4) Where a determination or agreement under subsection (3) sets a time by which works are to be completed, the independent individual will –
(a) release any rent paid under subsection (2) to the landlord if the works are completed by that time;
(b) release any rent paid under subsection (2) back to the tenant if the works have not been completed by that time.
(5) In this section an “independent individual” means the independent individual responsible for investigating complaints made against members of a landlord redress scheme under section 62.”
New clause 9—Home adaptations—
“(1) The Housing Act 1988 is amended as follows.
(2) After section 16 insert—
“16A Home adaptations
(1) It is an implied term of every assured tenancy to which this section applies that a landlord shall give permission for adaptations where a local council has carried out a Home Assessment and recommends adaptations which constitute reasonable adjustments under the Equality Act 2010. Tenants have the right to appeal a landlord’s refusal to adapt a property.
(2) This section applies to every assured tenancy other than a tenancy of social housing, within the meaning of Part 2 of the Housing and Regeneration Act 2008.””
This new clause would ensure that landlords give permission for home adaptations for people who have disabilities where a Home Assessment has been carried out.
New clause 10—Guarantor to have no further liability following death of tenant—
“(1) Subject to subsection (3), a guarantee agreement relating to a relevant tenancy ceases to have effect upon the death of a relevant tenant.
(2) Upon the death of a relevant tenant the guarantor in respect of a relevant tenancy shall incur no further liability in relation to matters arising under the tenancy.
(3) Nothing in this section shall affect the liability of a guarantor in relation to matters which arose before the date of the death of the relevant tenant.
(4) In assessing any liability under subsection (3), account shall be taken of any tenancy deposit paid in respect of the tenancy.
(5) Where there is more than one relevant tenant, this section shall apply only upon the death of both or all of the tenants.
(6) In this section—
“guarantor” is a person who enters into a guarantee agreement in relation to a relevant tenancy;
“guarantee agreement” is a contractual promise (whether incorporated in or separate from the tenancy agreement) to indemnify or compensate a relevant person in respect of an obligation under the tenancy if the tenant fails to perform or comply with the obligation;
“relevant tenancy” has the same meaning as in section 41, and “relevant tenant” is to be interpreted accordingly; and
“tenancy deposit” has the same meaning as in section 212(8) of the Housing Act 2004.”
New clause 11—Restrictions on the requirement for tenants to provide a guarantor—
“(1) A relevant person must not, in any of the circumstances set out in subsection (3), require a person, as a condition of the grant of a relevant tenancy, to provide a guarantor in relation to the observance or performance of the tenant’s obligations under the tenancy.
(2) For the purposes of this Act, requiring a person to provide a guarantor includes accepting an offer by that person to provide a guarantor.
(3) The circumstances are –
(a) that the person has paid a tenancy deposit or has been assisted under a deposit scheme;
(b) that the person is required to pay rent in advance equivalent to one month’s rent or more;
(c) that on a reasonable assessment of their means the person’s income (including state benefits received and any other lawful source of income) is sufficient to enable them to pay the full rent due under the tenancy;
(d) that arrangements will be made for housing benefit or the housing element of universal credit to be paid directly in respect of rent to the relevant person;
(e) that the relevant person has entered into a contract of insurance under which they are insured against non-payment of rent; or
(f) such other circumstances as may be prescribed in regulations made by the Secretary of State.
(4) In any other case where a relevant person lawfully requires a person, as a condition of the grant of a relevant tenancy, to provide a guarantor, the sum for which the guarantor may become liable under the relevant guarantee shall not exceed a sum equal to six months’ rent.
(5) In any case where a relevant person requires a tenant, as a condition of the grant of a relevant joint tenancy, to provide a guarantor, the sum claimed under the guarantee shall not exceed such proportion of the loss as is attributable to the act or default of the individual tenant on whose behalf the guarantee was given and, if such proportion cannot be proved, shall not exceed the sum obtained by dividing the total loss by the number of tenants.
(6) In this section–
a “guarantor” is a person who enters into a guarantee in relation to a relevant tenancy;
a “guarantee” is a contractual promise to be responsible for the performance of an obligation owed by the tenant to a relevant person under the tenancy if the tenant fails to perform the obligation;
a “deposit scheme” includes a scheme whereby a sum payable by way of deposit or a bond or guarantee is provided by a local authority, registered charity or voluntary organisation for the purpose of providing security to a landlord for the performance of a tenant’s obligations under a tenancy;
“tenancy deposit” has the same meaning as in section 212(8) of the Housing Act 2004.”
This new clause would restrict the circumstances in which a landlord can request a guarantor.
New clause 17—Use of licence conditions to improve housing conditions—
“In section 90 of the Housing Act 2004, for subsection (1) substitute—
“(1) A licence may include such conditions as the local housing authority consider appropriate for regulating all or any of the following—
(a) the management, use and occupation of the house concerned, and
(b) its condition and contents.””
This new clause would enable local authorities operating selective licensing schemes to use licence conditions to improve housing conditions.
New clause 18—Increases to duration of discretionary licensing schemes—
“(1) The Housing Act 2004 is amended as follows.
(2) In section 60(2), omit “five” and insert “ten”.
(3) In section 84(2), omit “five” and insert “ten”.”
This new clause would increase the maximum duration of additional HMO licensing schemes and selective licensing schemes from five to ten years.
New clause 19—Assessment of operation of possession process—
“(1) The Lord Chancellor must prepare an assessment of the operation of the process by which—
(a) on applications made by landlords, the county court is able to make orders for the possession of dwellings in England that are let under assured and regulated tenancies, and
(b) such orders are enforced.
(2) The Lord Chancellor must publish the assessment at such time, and in such manner, as the Lord Chancellor thinks appropriate.
(3) In this section—
“assured tenancy” means an assured tenancy within the meaning of the 1988 Act;
“dwelling” means a building or part of a building which is occupied or intended to be occupied as a separate dwelling;
“regulated tenancy” means a regulated tenancy within the meaning of the Rent Act 1977.”
New clause 20—Review of the impact of the Act on the housing market—
“(1) The Secretary of State must publish an annual report outlining the impact of the provisions of this Act on the housing market in the UK.
(2) A report under this section must include the impact of this Act on—
(a) the availability of homes in the private rental sector;
(b) rents charged under tenancies;
(c) house prices; and
(d) requests for social housing.
(3) A report under this section must be laid before Parliament.”
New clause 21—Appropriate insurance products to be available to landlords—
“The Secretary of State must, within six months of the passing of this Act, consult with representatives of the insurance sector to ensure that—
(1) sufficient and appropriate insurance products will be available for landlords wishing to let a property to a tenant who—
(a) is in receipt of benefits; or
(b) will be keeping a pet in the property during their tenancy; and
(2) such insurance products will not disadvantage landlords wishing to let a property to a such tenant or dissuade them from doing so.”
New clause 22—Requirement on landlords to pay for alternative accommodation—
“In section 9A of the Landlord and Tenant Act 1985 (fitness for human habitation of dwellings in England), after subsection(1) insert—
(1A) Where a dwelling—
(a)is found to be at any point in a tenancy; or
(b)becomes during the period of the tenancy unfit for human habitation, the landlord must pay any costs incurred by the tenant in obtaining alternative accommodation.
(1B) A landlord must hold appropriate insurance for the purposes of paying any costs under subsection (1A).
(1C) For the purposes of this section—
“costs” include—
(a) moving costs;
(b) deposits;
(c) rent, up to the amount of the rent for the original property;
“fitness for human habitation” is to be understood with reference to section 10 of this Act, but excludes any conditions caused by any damage or neglect on the part of the tenant.””
New clause 23—Permission for home adaptations—
“(1) The Housing Act 1988 is amended as follows.
(2) After section 16 insert—
“16A Home adaptations
(1) It is an implied term of every assured tenancy that a landlord shall give permission for adaptations where a local council has carried out a Home Assessment and recommends adaptations which constitute reasonable adjustments under the Equality Act 2010.
(2) A tenant may appeal a landlord’s refusal to give permission for such adaptations.””
This new clause would ensure that landlords of private and social tenancies provide permission for home adaptations for people who have disabilities where a Home Assessment has been carried out.
New clause 24—Discrimination relating to requirement for home adaptations—
“A relevant person must not, in relation to a dwelling that is to be let on an agreement which may give rise to a relevant tenancy—
(a) on the basis that a person does or may require home adaptations, prevent the person from—
(i) enquiring whether the dwelling is available for let,
(ii) accessing information about the dwelling,
(iii) viewing the dwelling in order to consider whether to seek to rent it, or
(iv) entering into a tenancy of the dwelling, or
(b) apply a provision, criterion or practice in order to make people requiring home adaptations less likely to enter into a tenancy of the dwelling than people who do not require home adaptations.”
Amendment 57, in clause 1, page 1, line 13, at end insert—
“unless the tenant meets the student test where the tenancy is entered into.
(1A) For the purposes of this section, a tenant who meets the student test when a tenancy is entered into has the same meaning as in Ground 4A.”
Amendment 58, page 1, line 13, at end insert—
“unless the landlord and the tenant mutually agree to have a fixed term during which period the landlord agrees to suspend the ability to seek possession under Ground 1 (Occupation by landlord or family), Ground 1A (Sale of dwelling-house) or Ground 6 (Redevelopment) of Schedule 2.
(1A) During a fixed term tenancy agreed under subsection (1) the landlord shall not be entitled to increase the rent as provided for by section 13.”
Amendment 60, page 1, line 13, at end insert
“unless the landlord acts as landlord for fewer than five properties.”
Government amendments 12 to 17.
Amendment 1, in clause 7, page 9, line 6, leave out from “determination” to end of line 11 and insert—
“(4AA) Where the rent for a particular period of the tenancy is to be greater than the rent for the previous period by virtue of a notice, determination or agreement mentioned in subsection (4A), the rent may not be greater than the rent for the previous period increased by the Bank of England Base Rate.
(4AB) Any provision relating to an assured tenancy to which this section applies is of no effect so far as it provides—
(a) that the rent for a particular period of the tenancy must or may be greater than the rent for the previous period otherwise than by virtue of a notice, determination or agreement mentioned in subsection (4A), or
(b) that the rent for a particular period of the tenancy, where greater than the rent for the previous period by virtue of a notice, determination or agreement mentioned in subsection (4A), must or may be greater than the rent for the previous period increased by the Bank of England Base Rate.”
This amendment would cap in-tenancy rent increases to the Bank of England base rate.
Amendment 9, page 9, line 6, leave out from “determination” to the end of line 11 and insert—
“(4AA) Where the rent for a particular period of the tenancy is to be greater than the rent for the previous period by virtue of a notice, determination or agreement mentioned in subsection (4A), the rent may not be greater than whichever is the lesser of—
(a) the rent for the previous period plus an increase equal to the rent multiplied by CPI; or
(b) the rent for the previous period plus an increase equal to the rent multiplied by the percentage increase in median national earnings.
(4AB) Any provision relating to an assured tenancy to which this section applies is of no effect so far as it provides—
(a) that the rent for a particular period of the tenancy must or may be greater than the rent for the previous period otherwise than by virtue of a notice, determination or agreement mentioned in subsection (4A), or
(b) that the rent for a particular period of the tenancy, where greater than the rent for the previous period by virtue of a notice, determination or agreement mentioned in subsection (4A), must or may be greater than the lesser of—
(i) the rent for the previous period plus an increase equal to the rent multiplied by CPI; or
(ii) the rent for the previous period plus an increase equal to the rent multiplied by the percentage increase in median national earnings.
(4AC) In this section—
“CPI” means the Consumer Prices Index 12-month rate published by the Office for National Statistics for 1 April preceding the date the notice is served.
“the percentage increase in median national earnings” means that calculated by the UK Statistics Authority over a three-year period ending on the date on which the notice was served.”
This amendment would introduce limits on the increases which could be made to rents by landlords. The limits would be calculated by reference to increases in CPI or median national earnings.
Amendment 5, in clause 8, page 11, line 16, at end insert—
“(aa) after “subject to” insert “section 13(4AA) and”;
(ab) omit from “concerned” to the end of the subsection and insert “should be let”;”.
This amendment would amend the Housing Act 1988 so that when determining rents tribunals must take into account the limits on rent increases introduced by Amendment 9 and need not consider existing market rates.
Amendment 6, page 11, line 17, leave out subsections (b), (c) and (d).
This amendment is consequential on Amendment 5.
Amendment 55, page 11, line 27, at end insert—
“(4A) In subsection (2), after paragraph (b) insert—
“(ba) any change in the value of the dwelling-house resulting from improvement works to the property facilitated by any means-tested energy efficiency grant scheme””.
This amendment would ensure that improvements to a property facilitated by means-tested energy efficiency grant schemes can be disregarded by a tribunal determining a new rent for the property, and can therefore not be used as grounds for increasing rent levels.
Government amendment 27.
Amendment 61, in clause 11, page 16, line 26, at end insert—
“(4) The Secretary of State must consult with representatives of the insurance sector before this section comes into effect to ensure that appropriate insurance products are available for tenants whose landlords have required insurance as a condition for consenting to the keeping of a pet.”
Government amendments 28 and 29.
Amendment 2, in clause 19, page 32, line 16, at end insert—
“(aa) where it is given by a tenant in relation to a premises in which they are the first tenants since its construction, not less than twenty-four months before the date on which the notice is to take effect;”.
This amendment would allow an assured short-term tenancy for the first two years after a premises is constructed.
Government amendments 30 and 34 to 39.
Amendment 7, in clause 75, page 101, line 6, at end insert—
“(2A) Information or documents to be provided under regulations under subsection (2) must include—
(a) in respect of a landlord entry—
(i) the address and contact details of the landlord;
(ii) the address and contact details of the managing agent;
(iii) details of each rented property owned by the landlord;
(iv) details of any enforcement action that any local authority has taken against the landlord;
(v) details of any enforcement action that any local authority has taken against the managing agent;
(vi) details of any banning orders or rent repayment orders that have been made against the landlord;
(vii) details of any reports that the landlord has failed to carry out works necessary to remedy any breaches of any applicable housing regulations within the timeframes set out by regulations made by the Secretary of State under
section 10A(3) of the Landlord and Tenant Act 1985.
(b) in respect of a dwelling entry—
(i) the address and contact details of the landlord;
(ii) the address and contact details of the managing agent;
(iii) details of any notices given to the previous tenant under
section 8 of the Housing Act 1988, including the grounds relied upon;
(iv) details of the rent that was payable at the commencement of the existing tenancy or, where there is no existing tenancy, the most recent tenancy;
(v) details of any increases in the rent imposed during the existing tenancy and the previous tenancy;
(vi) details of energy performance certificates required by
regulation 6(5) of the Energy Performance of Buildings (England and Wales) Regulations 2012;
(vii) details of gas safety certificates required by regulation 36 of the Gas Safety (Installation and Use) Regulations 1998;
(viii) details of electrical safety reports required by the Electrical Safety Standards in the Private Rented Sector (England) Regulations 2010;
(ix) details of checks required under
regulation 4(1)(b) of the Smoke and Carbon Monoxide Alarm (England) Regulations 2015; and
(x) details of any features of the dwelling relevant to people with disabilities.”
This amendment would introduce specific requirements for landlord and dwelling entries on the Private Rented Sector Database.
Government amendments 40 and 41.
Amendment 11, in clause 96, page 114, line 22, at end insert—
“(1A) In section 40 (introduction and key definitions), in subsection (1) after “has” insert—
“breached a requirement imposed by sections 62(1) or 80(3) of the Renters’ Rights Act 2025 or””.
This amendment would enable a tribunal to make a rent repayment order where a landlord has failed to join a landlord redress scheme or have active entries in the private rented sector database.
Amendment 3, in clause 98, page 117, line 33, after “(homelessness),” insert—
“or that is provided by the Ministry of Defence for use as service family accommodation,”.
This amendment would extend the Decent Homes Standard to Ministry of Defence service family accommodation.
Amendment 8, page 117, line 33, leave out from “(homelessness)” to the end of line 3 on page 118.
This amendment would make the Decent Homes Standard apply to all homeless temporary accommodation provided under the Housing Act 1996 by adapting the definition of “residential premises” in the Housing Act 2004 to remove a requirement for such temporary accommodation to meet certain Government regulations.
Government amendments 42 to 52.
Amendment 56, in clause 142, page 151, line 9, leave out from “subject to” to the end of line 27 and insert—
“the publication of an assessment under section [Assessment of operation of possession process].
Amendment 10, in schedule 1, page 160, line 13, leave out subsection (a).
This amendment would extend the special provisions for purpose-built student housing to HMO student properties.
Government amendments 18 to 22.
Amendment 59, page 168, line 25, at end insert—
“20A After Ground 6 insert—
“Ground 6ZA
The landlord or superior landlord who is seeking possession intends to undertake such works as are necessary to ensure that the property meets the standards set out by regulations under
section 2A of the Housing Act 2004
and the intended work cannot reasonably be carried out without the tenant giving up possession of the dwelling-house because—
(a) the tenant is not willing to agree to such a variation of the terms of the tenancy as would give such access and other facilities as would permit the intended work to be carried out, or
(b) the nature of the intended work is such that no such variation is practicable, or
(c) the tenant is not willing to accept an assured tenancy of such part only of the dwelling-house (in this sub-paragraph referred to as “the reduced part”) as would leave in the possession of his landlord so much of the dwelling-house as would be reasonable to enable the intended work to be carried out and, where appropriate, as would give such access and other facilities over the reduced part as would permit the intended work to be carried out, or
(d) the nature of the intended work is such that such a tenancy is not practicable.””
Government amendments 23 to 26, 31 to 33, 53 and 54.
Matthew Pennycook
It is a pleasure to bring this important Bill back to the House this afternoon. Let me begin by thanking hon. Members on both sides of the Chamber for their engagement with it over recent months. In particular, I thank the shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), and other members of the Committee for the diligent and thoughtful line-by-line scrutiny of the Bill that they undertook over the course of many sittings late last year.
This Labour Government promised to succeed where their predecessor had failed, by quickly and decisively acting to transform the experience of private renting in England. Today, we make further tangible progress towards delivering on that commitment. Our Renters’ Rights Bill will modernise the regulation of our country’s insecure and unjust private rented sector, levelling decisively the playing field between landlord and tenant. It will empower renters by providing them with greater security, rights and protections so that they can stay in their homes for longer, build lives in their communities and avoid the risk of homelessness.
It will ensure that we can drive up the quality of privately rented housing so that renters have access to good-quality and safe homes as a matter of course. It will also allow us to crack down on the minority of unscrupulous landlords who exploit, mistreat or discriminate against renters. The Bill will also provide tangible benefits for responsible landlords who provide high-quality homes and a good service to their tenants. Not only will its provisions see the reputation of the sector as a whole improve, as we clamp down on those landlords whose behaviour currently tarnishes it, but the Bill will also ensure that good landlords enjoy simpler regulation and clear and expanded possession grounds, so that they can regain their properties quickly when necessary.
Although we have eschewed the previous Government’s habit of shoehorning swathes of new clauses into legislation following Second Reading, we needed to make a modest number of improvements to the Bill in Committee. Many of the amendments in question were minor and technical or consequential in nature, but I shall briefly explain to the House some of the more substantive changes.
To increase fairness for tenants being evicted because their landlord is at fault, we chose to make an amendment connected to ground 6A. As hon. Members will be aware this mandatory ground allows landlords to remove their tenants when eviction is necessary for them to comply not only with enforcement action, but as a result of separate changes that we made to the Bill with planning enforcement action as well. The amendment allows the court to require landlords to pay compensation to the tenant when they are forced to vacate their homes under such circumstances.
To provide greater flexibility for social landlords in meeting the demands of local housing markets, we widened ground 1B for rent-to-buy tenancies, ensuring that registered providers can take possession in all necessary circumstances. We also exempted assured tenancies from the 90-day rule, which protects housing supply in London and benefits permanent residents by preventing the conversion of family homes into short-term lets. Should a tenant give notice early in their tenancy, meaning that they leave before 90 consecutive nights have passed, these changes mean that the landlord will not automatically be found to have inadvertently provided temporary sleeping accommodation.
Lastly, we made changes to ensure that the introduction of a decent homes standard in the private rented sector works as intended.
Helen Maguire (Epsom and Ewell) (LD)
Last week, I asked the Government to ensure that all service family accommodation meets the minimum standards of social housing, as set out in the decent homes standard. The Minister for Veterans confirmed that this is already done, so will the Government support amending the Renters’ Rights Bill officially to extend the decent homes standard to Ministry of Defence service family accommodation?
Matthew Pennycook
I thank the hon. Lady for her question and I agree with the objective that she has in mind, but, as we discussed fairly extensively in Committee, we do not think that the Renters’ Rights Bill and the way that the decent homes standard will apply to assured tenancies in this sector is right for MOD accommodation. The MOD is undertaking its own review, and I shall touch on that issue later in the debate.
As I was saying, the changes around the decent homes standard will guarantee that the appropriate person can always be subject to enforcement action and they close a potential gap that may have been exploited by clarifying the types of accommodation that will be required to meet the standard.
Today, we are proposing a small number of further improvements, most of which are again minor and technical in nature. As I have made clear repeatedly, the Government have long recognised that demands for extortionate amounts of rent in advance put undue financial strain on tenants and can exclude certain groups from renting altogether. I am sure that many of us in the Chamber will have heard powerful stories from our constituents about the impact of such demands. The typical story is all too familiar. Tenants find and view a property which, as advertised, matches their budget only to find that, on application, they are suddenly asked to pay several months’ rent up front to secure it. Tenants in such circumstances often confront an almost impossible choice: do they find a way to make a large rent-in-advance payment, thereby stretching their finances to breaking point, or do they walk away and risk homelessness if they are unable to find an alternative?
Florence Eshalomi (Vauxhall and Camberwell Green) (Lab/Co-op)
I thank the Minister for the work he has been doing. He highlighted the issue of tenants being asked to pay up front. In my constituency and many other London constituencies, that up-front cost amounts in some cases to a deposit to purchase a home. Does he agree that we need to look into that issue and into estate agents effectively getting tenants to bid against each other for private rented accommodation?
Matthew Pennycook
My hon. Friend the Chair of the Select Committee is absolutely right and, as I will detail, that is precisely why the Government are moving to prohibit that practice. As she will know, the Government have already moved to ban bidding wars through the Bill, where desperate tenants are often pitted against each other so that a landlord can extract the highest possible rental payment. Demands for large rent-in-advance payments—in many parts of the country, they can be six, nine or even 12 months’ rent in advance—can have a similar effect, with tenants encouraged to offer ever larger sums up front to outdo the competition and secure a home that may or may not be of a good standard, or risk being locked out of renting altogether.
As I stated previously, the interaction of the new rent periods in clause 1, which cannot be longer than a month, and the existing provisions of the Tenant Fees Act 2019 related to prohibited payments, arguably provide a measure of protection against requests for large amounts of advance rent. As I made clear in Committee, however, there is a strong case for putting the matter beyond doubt, and that is what we intend to do.
Chris Vince (Harlow) (Lab/Co-op)
As the Minister will know, before coming to this place I worked for a homelessness charity in Harlow called Streets2Homes. Part of our role was to support homeless people—both rough sleepers and the hidden homeless—to get into rented accommodation, and often we provided deposits for that. Does he agree that the legislation will help charities like Streets2Homes provide more support to more people in need?
Matthew Pennycook
It absolutely will. I will detail some of the other changes that we are making to ensure that the Bill achieves our objectives.
Having listened to the concerns raised by numerous stakeholders, the views expressed on Second Reading and in Committee, and the representatives made to me by individual hon. Members, including my hon. Friends the Members for Darlington (Lola McEvoy), for Sheffield Central (Abtisam Mohamed) and for Leeds Central and Headingley (Alex Sobel), we have tabled new clauses 13 and 14.
New clause 14 would limit the amount of rent that a landlord can require to a maximum of one month. It would prevent unscrupulous landlords from using rent in advance to either set tenants against each other in de facto bidding wars or to exclude all together certain types of renters who are otherwise perfectly able to afford the monthly rent on a property. It does so by amending schedule 1 to the Tenant Fees Act 2019 so that any payment of rent made before a tenancy agreement is signed will be a prohibited payment. If a landlord or letting agent invites, encourages or accepts such a payment, they could face local authority enforcement action and a fine of up to £5,000.
New clause 13 would amend the Housing Act 1988 to ensure that tenants continue to be protected from unreasonable requests for rent to be paid early once a tenancy has commenced. Landlords will no longer be able to include any terms in the tenancy agreement that have the effect of requiring rent to be paid prior to the rent due date. Tenants will retain the flexibility to make payments of rent in advance within a tenancy agreement should they wish to do so.
The effect of the new clauses will be that tenants can be certain that the financial outlay to secure a tenancy will not exceed the cost of a tenancy deposit and the first month’s rent, and that they will not be required to pay their rent earlier than agreed. The new clauses will thereby reduce the barriers that stop tenants moving from substandard or insecure housing, and I commend them to the House.
Hon. Members with large student populations in their constituencies will know that the dynamics of the general student rental market in many parts of the country see students compelled to make important decisions about accommodation long before they have formed stable friendship groups, or have had time to properly judge a property’s condition or location, and to consequently pay substantial deposits at a point in time when they are already coping with significant additional costs. This arms race, in which students are pressured ever earlier in the year to enter into contracts for the subsequent academic year, clearly is not benefiting them, and it is arguable whether it benefits the student landlords engaged in it.
The Government have therefore tabled amendments 18 and 53, which will prevent the use of possession ground 4A in instances where a student tenancy was agreed more than six months in advance of the date of occupation, thereby helping to reduce the prevalence of the practice. I want to be clear that the amendment will not lead to an outright ban on contracts being agreed more than six months in advance. Instead, making the use of ground 4A conditional on not doing so will act as a strong disincentive against landlords who wish to use it to pressure students into early sign-ups, as many do now. I thank all those who have advocated for this change, including the former Member for Sheffield Central, Paul Blomfield, during his time in Parliament, my hon. Friend the Member for Leeds Central and Headingley, and organisations such as Unipol.
Having taken up the cause of a family in her constituency who were forced by a letting agent to continue to pay as guarantors for a property that had been rented by their son before he tragically took his own life, my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) has been campaigning for many years to protect bereaved families by prohibiting the practice. I pay tribute to her for her tireless efforts to secure a change in this area. She was unable to persuade the previous Government to make the necessary changes to the Renters (Reform) Bill, but this Government are determined to act to end the abhorrent practice where guarantors are held liable for unpaid rent owed solely as a result of the death of a tenant who is a family member.
We have tabled new clause 15, which will limit the liability of a guarantor of a tenancy agreement for rent in circumstances where a tenant has died. I should make it clear that if in a joint tenancy the guarantor is not a family member, their liability for rent will be maintained. We consider that fair because we do not think it is reasonable to remove the guarantor’s liability and therefore expose a landlord to additional financial risk where the guarantor is not related to the deceased. Our new clause strikes the right balance: guarantors will be protected from being held liable for rent when they are grieving; landlords will be able to reclaim costs owed prior to a tenant’s death; and guarantor’s liability for other costs incurred under the tenancy will not be affected.
I turn to amendments 40 and 41, which will amend existing powers to charge fees for the private rented sector database. The amendments will expand the definition of relevant costs that can be considered when calculating such fees and would enable fee revenue to include PRS enforcement costs incurred by local housing authorities. Hon. Members should be assured that database fees will be calculated and agreed at a later date, with further details set out in secondary legislation and developed on the basis that fees must be reasonable and proportionate. The amendments do not alter that position. In setting the fees, a range of factors will be considered, including the costs incurred by landlords. However, we need to ensure that when calculating fees, we can take into account all relevant costs, and the amendments will ensure that that is the case.
Enabling fee revenue to include PRS enforcement costs is also important. For the reforms to have the impact we all want, effective enforcement will be crucial, and that point was debated at length in Committee. As we have touched on frequently throughout our consideration of the Bill, local housing authority capacity and resourcing is a real problem. The amendments provide an additional lever to help ensure that every local housing authority has the tools and resources it needs to carry out its enforcement role, so that good tenants and landlords benefit from a well-regulated and enforced PRS.
Amendments 35 to 39 will expand the scope of what can be covered by the compulsory fee that private landlords will be required to pay to fund the new PRS landlord ombudsman. They will ensure that the fee can cover the set-up costs of the ombudsman and activities specified in the regulations beyond those strictly necessary for mandatory aspects of landlord redress. That will allow the ombudsman to set up the core redress service and to provide additional member benefits, such as landlord-initiated mediation or voluntary member redress, without the costs having to be borne by the taxpayer.
I turn to amendments 42 to 52. Rent repayment orders are an important and effective tenant-led enforcement tool. They deter landlords from non-compliance and empower tenants to take action against unscrupulous landlords. The Bill will significantly strengthen rent repayment orders, including their extension to superior landlords in rent-to-rent arrangements. But we intend to go further and ensure that those sorts of arrangements cannot be used to evade responsibility and escape enforcement action. We are also making it clear that tenants and local authorities can seek a rent repayment order against any landlord in the chain, regardless of who they paid the rent to.
Amendments 24 and 26 will limit the circumstances in which landlords can use ground 7 to obtain possession from a person who has inherited a tenancy following the death of a tenant. They will provide greater security for bereaved tenants by preventing them from losing their home, and I acknowledge the role that Marie Curie has played in advocating for change in respect of the matter. Landlords will still be able to use ground 7 if the original tenant had inherited it by will or intestacy, or if the inheriting individual did not live in the property before the tenant passed away. Landlords will also be able to use ground 7 for specialist tenancies, such as supported and temporary accommodation. That is in recognition of the critical role such tenancies play in supplying housing to those with specialist needs.
Private registered providers are currently restricted from using the possession ground for redevelopment—ground 6—apart from where they have a superior landlord who wants to redevelop the property. Other possession grounds, such as the suitable alternative accommodation ground—ground 9—can be used to move tenants, but only if clear conditions are met. Although we expect PRPs to work closely with tenants to facilitate moves to enable redevelopment work, the Government accept that in limited cases it is increasingly hard to meet those conditions, preventing PRPs from progressing with crucial redevelopment work. I thank the National Housing Federation for raising concerns about that matter with me.
Jeremy Corbyn (Islington North) (Ind)
I welcome what the Minister just said. Is he aware that a lot of landlords are using unreasonable arguments to terminate tenancies or raise rents ahead of this legislation coming into force, and is there anything he or his Department can do to protect tenants during this stressful period for them?
Matthew Pennycook
There is a lot of bad practice out there. That is the very reason why the Government have acted so quickly to introduce these reforms, and we are confident that once they are in place, they will provide tenants with the protection that they deserve. In the interim, I am afraid that there will continue to be bad practice of the kind that the Bill will stamp out.
For the reasons that I have just alluded to, we have tabled amendments 19 and 22 to give private registered providers an alternative route for obtaining possession for redevelopment and for decant accommodation. Where the landlord seeks possession on ground 6 or ground 6ZA because they intend to carry out redevelopment work or want to move a tenant on from decant accommodation, they will need to provide alternative accommodation that meets specific requirements. That includes the accommodation being affordable, in a suitable location and not overcrowded. The accommodation must also be let as an assured tenancy or equivalent, unless it is being let for a temporary period pending the tenant being moved to an assured tenancy or equivalent. To use ground 6ZA, landlords must give tenants prior notice to ensure that they are fully aware that the accommodation is provided for temporary decant use. If the landlord does not do that, they are liable for a fine of up to £7,000.
Where landlords wish to accommodate tenants temporarily in properties that are earmarked for redevelopment, social landlords must give prior notice, and set out in a written statement the intention to redevelop the accommodation and the timeframe for redevelopment. Under those circumstances, alternative accommodation will not need to be provided. Social landlords will also be required to pay removal expenses for social tenants when using ground 6 and ground 6ZA. We do not expect that the need to use those grounds will arise often in practice through the engagement of PRPs with tenants, but where needed, the amendments will ensure that significant redevelopment work is not unduly delayed.
Government amendments 12, 13, 17, 20, 21, 23, 28 to 30 and 54 are related and consequential provisions to reflect the new ability for landlords to gain possession for redevelopment and for decant accommodation. We think that this group of amendments gets the balance right, enabling PRPs to progress redevelopment and use temporary decant accommodation during redevelopment works, while ensuring that tenants are provided with appropriate alternative accommodation and removal expenses.
Let me turn finally to amendment 34. Clause 30 ensures that long leases can continue to function by excluding leases over seven years from the assured regime. Those leases are typically used in purchases of leasehold and shared-ownership properties. I am grateful to stakeholders for raising concerns about the possibility of some unscrupulous landlords using clause 30 to circumnavigate the new assured regime by issuing leases of over seven years with a break or early-termination clause that is operable in the first few years. Tenants must not be cheated out of the protections of the assured tenancy regime. The amendment will therefore exclude all leases over 21 years from the assured regime. That will act as a much stronger deterrent to landlords who seek to avoid the assured tenancy regime. The amendment also excludes existing leases of between seven and 21 years, to ensure that they can continue to operate as currently intended. It also ensures that regulated home purchase plans can continue to enable consumers to purchase properties using the principles of Islamic finance by adding them to the list of excluded tenancies in schedule 1 to the Housing Act 1988.
The amendments that the Government have tabled for consideration today are a series of targeted changes designed to ensure that the Bill works as intended, and I commend them all to the House. I thank hon. Members for their efforts to improve the Bill, and for the scrutiny and challenge that the Bill has received so far. I look forward to listening to the remainder of the debate.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
May I echo the Minister’s comments, and extend my thanks to him and his team, the other Members who served on the Committee, and the many witnesses who came in to share their views? It is clear that a lot of the discussion has been on the real-world impact that the legislation will have, rather than on political points, and in that spirit, I will set out my responses, and the rationale behind a number of the amendments that we have tabled, which will be the subject of debate and votes this afternoon.
Clearly, legislation is about striking the right balance. This afternoon, we will recognise—as we have done in our contributions to debate on this issue—the impact that the Bill will have on tenants, landlords and the stakeholders whom our amendments seek to protect. I highlight in particular the impact on students; on financially vulnerable tenants, such as those with low credit scores; on tenants who have pets; on small landlords, who are themselves vulnerable to financial shocks; and of course on other groups, such as agricultural workers and those with work-related accommodation, including NHS workers, military families and school staff, all of whom were mentioned in Committee and will, I am sure, be covered again later. All our amendments have sought to address practical issues, such as ensuring that when work is required on a property and a tenant is reluctant to allow the landlord in to carry out that work for whatever reason, there is sufficient freedom and flexibility in the legislation to ensure that the work can take place.
Daisy Cooper (St Albans) (LD)
The shadow Minister talks about situations in which tenants must leave a property. A constituent of mine had a terrible ordeal. She moved into a new rental property, but after three months it became uninhabitable, and she spent a further 11 weeks going in and out of eight Airbnbs. She was left thousands of pounds out of pocket because the landlord’s insurance covered his loss of rent but did not cover the accommodation costs that she incurred as a tenant. Will the shadow Minister support my new clause 22, which would require landlords to hold appropriate insurance for the purposes of paying any costs related to alternative accommodation in such situations?
David Simmonds
There are a number of ways to address that issue. The Minister has talked compensation, and we have tabled amendments on insurance, but clearly there needs to be an effective dispute resolution mechanism in place, so that such situations can be resolved when they arise. We were focused in particular on ensuring that there is sufficient flexibility when, for example, work must be carried out to improve energy efficiency or to address health and safety concerns such as mould, and a tenant needs to leave because the work will render the property uninhabitable.
Although there have been substantial areas of agreement on the Bill, much of which takes forward work that started under the previous Government in their Renters (Reform) Bill, we have concerns that it creates significant new problems for the availability and affordability of accommodation in the private rented sector. That sector, we must not forget, enjoys the highest tenant satisfaction of any private tenure: 82% of private renters say that they are satisfied with their accommodation.
The backdrop is challenging, and has become a lot more so recently. The Chancellor’s Budget has set inflation rising, and borrowing costs are soaring. Markets are responding to the chaos in No. 11, and that is causing a great deal of uncertainty for tenants and landlords alike. Her decisions are stoking inflation, and that is pushing up rent and housing costs of all kinds. The black hole in local government funding, which was unveiled just before Christmas, means that councils facing the twin existential threats of wholesale reorganisation and growing funding shortfalls lack certainty from the Government about the funding to deliver this enormous increase in workload.
Florence Eshalomi
I know that the shadow Minister cares passionately about this area, especially in the light of his local government experience. Given that financial pressures on local authorities are added to by the need to provide temporary accommodation to families facing eviction, does he agree that we should have abolished section 21 no-fault evictions sooner?
David Simmonds
I say gently to the hon. Lady that had Labour-run Lambeth council not recently rushed to put 200 of its own people on the streets using section 21, because it is concerned about the impact that the Bill will have on its housing situation, that would have more credibility. It is clear that this is a difficult situation in all parts of the country. There is a significant shortfall in emergency accommodation in London in particular, and a rising cost attached to it there, just as other areas of the country have a surplus of accommodation. That is all part of a complex picture. We need to make sure that everything works efficiently and effectively together, and it is absolutely right that we set out our concerns about whether the Bill goes far enough in all areas towards addressing those issues—and about whether, in some cases, it goes too far.
I touched on the impact of the black hole in local government funding. Another area that is driving significant pressure is the Government’s approach to asylum. They are granting refugee status faster, so people are being pushed out of the doors of Home Office asylum dispersal accommodation and on to local housing waiting lists. I am sure that many hon. Members in this Chamber will have been lobbied by their local authority about the impact of that additional pressure—those additional people, who under our laws are perfectly entitled to that housing—on supply in their area. All those things have a huge collective impact on the pool of available housing.
Of course, as we have seen in the news, the declining confidence abroad in our economy is reducing the number of overseas students. That makes it more important than ever to support thriving student accommodation through tenancies that address students’ needs properly—especially the needs of students who are older, have families, or are studying for higher degrees and have a fixed commitment to a location. All those requirements need to be addressed effectively in this legislation.
Does the Bill in its new form rise to those challenges? It is clear that it fails to ensure that landlords can recover their property quickly when they need to. That reduces their incentive to rent it out, especially for small landlords. If the hon. Member for Hampstead and Highgate (Tulip Siddiq) needs to recover some of her property portfolio to return it to another owner, will she have the assurance under this Bill that due process is available to her? The Bill fails to ensure a flexibility and freedom of contract that allows tenants and landlords to agree a deal that suits them both. Students wanting to book accommodation for a guaranteed period of two years—or shorter or longer—and those moving to a new location for a fixed-term work contract require opportunities and flexibility that are taken away by this legislation.
The Bill takes away landlords’ opportunity to make allowances for financially riskier tenants, such as those with a poor credit record, through rent in advance or other safeguarding arrangements that give the landlord confidence that they will not lose out. That locks financially vulnerable people out of the rental market. The Bill also puts enormous obligations on local councils—one of the biggest additional sets of burdens and expectations in generations—and there is no real clarity yet on how it will be resourced, at a time when all the wider uncertainties that I have described add up to a great deal of additional cost. The Bill also fails to provide the necessary assurance that tenants who have pets and need to access insurance as part of their tenancy conditions will be able to find affordable insurance. That is dealt with in our new clause 21. More concerning still, the Bill is a missed opportunity to provide this House with a proper impact assessment, or the assurance of a future review that would give us really good evidence on which to base our decisions. Our new clause 20 would address that shortcoming, and the House will have the opportunity to vote for it shortly.
Let me give an example of where there is significant uncertainty. In some of the political knockabout, the Government have sought to blame their predecessor for court delays, while claiming that there are no delays worthy of regard in the passage of this Bill, which loads more regulation on to the sector. Both of those things cannot be true simultaneously, so let us properly assess the impact of the Bill before we legislate. There is a lot of good will—for example, on the point about tenants with pets being able to access the accommodation that they need. We do not want to find ourselves returning to this issue in the House because the legislation failed to achieve what we had hoped.
Clearly, it is the role of this Chamber to scrutinise and question, and it is the role of the Opposition to oppose when we cannot see that the legislation before us will result in an improvement in the lot of the people of this country. A pattern is emerging. The Government came after the farmers. They came after the pubs. They came after the small businesses. They came after the private schools. They came after our local councillors. Now this Bill, in its new form, comes after our tenants and our landlords. It is very clear from the number of Government amendments, which the Minister referred to, that the points we made in Committee about the many shortcomings of the Bill that need to be addressed were not lost on the Government.
I return to the point that even a Labour council—a bastion such as Lambeth, led by the Labour chair of London Councils—is rushing to use section 21 to evict its own tenants in advance of this Bill because of the impact it will have. A Labour council and a Labour Government are putting their own people out of their homes.
David Simmonds
I promise the hon. Member that that is exactly what I am going to do. I am going to make an apology to all those in the private rented sector. [Interruption.] The Minister says from a sedentary position that I have only four hours. I am afraid that I will not be able to go through all the private tenants individually, but the apology will be fulsome. I say to those in the private rented sector, 82% of whom are very satisfied with their accommodation, that I am sorry that they will be faced with the mess that this Bill will create, whether they are seeking to rent their first home or need to move to a new one.
David Simmonds
I will not give way, because I am concluding. We on the Conservative Benches give those people the undertaking that while they may have to endure that situation until the next election, we will put it right, for the benefit of landlords and tenants alike.
Madam Deputy Speaker (Judith Cummins)
I call the Liberal Democrat spokesperson.
Gideon Amos (Taunton and Wellington) (LD)
I thank the Minister for his constructive work with the Liberal Democrats and other parties in Committee.
For a generation cut off from the dream of home ownership who find that, after half a century of flogging off social houses and council houses—over 1.5 million have been lost since 1980—there are now basically none left, it is vital that we restore hope to millions who aspire to a decent home. As such, the Liberal Democrats support the key principle of this Bill, which is to bring an end to no-fault evictions. After the continual stop-start of the previous Government, giving tenants the security they deserve is long overdue. It is time to end once and for all the fear that any complaint from any tenant could be met with an instant eviction notice at any moment.
Of course, landlords do not generally act in such a cavalier fashion; most are good landlords, and we value them and what they bring to the market. As such, to sustain a healthy private rented sector, we have tabled amendment 10, which would extend to off-street student rental landlords the same possession laws that apply to purpose-built student accommodation. Given that fully 31% of properties on the Accommodation for Students website are one or two-bedroom properties rather than houses in multiple occupancy, as Unipol and the Higher Education Policy Institute have pointed out, that is a big chunk of the market, and one that needs to be addressed.
The need for more homes is why we have tabled amendment 2, which would particularly incentivise more build-to-rent accommodation. In Taunton and Wellington, our Lib Dem council has supported the delivery of tens of thousands of new homes; our population increased by 10% up to 2021. Our manifesto called for 150,000 social homes per year—I refer the House to my entry in the Register of Members’ Financial Interests regarding my experience as a social landlord. We clearly set out the borrowing of £6 billion per year that would make that happen, unlike the Labour and Conservative manifestos, which included no numbers whatsoever for social housing.
We need a lot of that build-to-rent accommodation also to be rent to own, so renters can accrue ownership of their own home. It is time to give a whole generation of young people who have been excluded that elusive first step on the housing ladder. Amendment 2 would therefore give a developer of build-to-rent housing the security of a fixed term of 24 months for the first tenancy. Since that was tabled, I have heard from the British Property Federation and others, and they have suggested that an initial fixed term of six months would enable them to secure the investment they need to build more and to get building. That would not undermine the general principle of moving to periodic tenancies, as build to rent is only 0.1% of the housing stock. We will not press amendment 2, but I genuinely urge the Government to take up the idea, run with it and generate more investment in new homes.
Let me turn to the interests of tenants, which have been so overlooked for so long. My constituent and friend Mike Godleman, who was disabled, died while recovering from major surgery and under the threat of a no-fault eviction notice, for no reason he could possibly work out. In part in his memory, our new clause 23 would ensure that landlords of both private and social tenancies must give permission for home adaptations when a home assessment has been carried out. If rental bidding is to be outlawed, as the Minister said, it must not be replaced by bidding up rent in advance, so our new clause 1 would limit rent in advance to two months’ rent. In that respect, I welcome Government new clause 13.
In-tenancy rent increases also need to be limited to protect tenants from exorbitant increases. The most sensible way to do this is set out in our amendment 1, which would peg increases to the Bank of England base rate. Property is a financial and investment asset, and landlords’ costs are more directly influenced by mortgage rates rather than by the general inflation and the cost of living. New clause 22, in the name of my hon. Friend the Member for St Albans (Daisy Cooper), would require landlords to pay for alternative accommodation when dwellings are unfit for human habitation.
Turning to the amendments proposed by other hon. Members, we support the proposed new clause 10 in the name of the hon. Member for Dulwich and West Norwood (Helen Hayes), which will prevent the guarantor from being liable on the death of a tenant, and we recognise that the Government have tabled new clause 15 to limit that liability, rather than end it altogether. We also support amendment 7 on the content that must be submitted for inclusion in the database. The database could be a very powerful instrument for tenants if it provides information, as I spoke about at some length in Committee. We also support new clause 6, which would give care leavers support through funding for a deposit when they move out of care. Both those amendments are in the name of the hon. Member for Liverpool Wavertree (Paula Barker).
One of the biggest concerns to landlords, tenants and local communities in Taunton and Wellington, as it is in Cornwall, the lakes and other places, is that there is no control over the number of homes being turned into holiday lets and Airbnbs. This has prompted a significant increase to about 3,000 holiday homes in Somerset—a 33% increase in short-term rentals in the south-west since 2019. Visitors of course bring welcome investment, but in some areas second homes are pricing locals out of local markets.
Mr Lee Dillon (Newbury) (LD)
My hon. Friend is talking about second homes, which can particularly affect rural communities. Schedule 1 provides mandatory grounds to recover possession in order to house an agricultural worker, but does he agree that the definition of “agricultural worker” is limited and does not reflect rural workers—for example, those who work in the horse training industry in the village of Lambourn in my constituency, where local housing is key to that industry given the nature and the hours of the work of stable staff?
Gideon Amos
My hon. Friend is absolutely right. That definition needs to cover the breadth of agricultural workers, and I am sure the Minister has heard his point.
Liberal Democrats have long argued for a licensing system and tougher planning controls for second homes, with a new use class to cover second homes and short-term lets. Both this and previous Governments have said that they would create a new use class, so I urge the Minister to say in today’s debate whether that will really happen. Without controls, there is a serious risk of second homes proliferating if landlords do not wish to be part of a more regulated private rented sector following the enactment of this Bill. Our new clause 2 would therefore require the Government to assess properly the growth in short-term lets, and I urge the Minister to do so. In fact, I am not sure why anyone would oppose that amendment.
Finally, our amendment 3 would apply the Bill’s proposed decent homes standard to military service family accommodation. I am grateful to the Minister for taking the time to write to me on this, but the argument that a standard would not be suitable for service family accommodation does not stand up, because clause 98 allows the Secretary of State to establish whatever version of the decent homes standard they feel is appropriate. I do not think anyone across the House would understand why that should be different for service families. We will no doubt hear the Ministry of Defence say that 90% or more of service family accommodation already meets the decent homes standard so it is all okay, but in that case, why not make that claim evident by subjecting that accommodation to the decent homes standard in the Bill?
To say that the recently published “Service Accommodation” report from the Defence Committee, under the chairmanship of the hon. Member for Slough (Mr Dhesi), says something different from the official reports would be a massive understatement. The Select Committee reported evidence from one service family, who said:
“It is impossible to challenge the ‘Decent Homes Standard’ without paying for a survey yourself. It is widely accepted that each house has not been checked but either guessed or it is assumed that the standard of one house is the same as all in one area.”
I therefore ask how sure we can be of the self-declared statistics from the Defence Infrastructure Organisation, or were they from Annington homes? As another witness before the Select Committee said:
“It is disingenuous for DIO to present glossy brochures about being ‘decent homes plus’ when they are anything but”
and
“it is clear that the DIO’s property frequently does not meet the standards.”
Crucially, the witness added:
“Moreover, there is no local authority”—
or anyone else—
“to hold them to account as would be the case for private and other local landlords.”
That is exactly what amendment 3 would provide.
In the Kerslake report, commissioned before the election by the now Secretary of State for Defence—a former Housing Minister—reports of damp, mould and, in other service accommodation, rat infestations abound. If all the witnesses and all these reports are wrong and the official figures are right, showing that over 90% of properties meet the decent homes standard, there is nothing for the MOD to fear in subjecting service accommodation to that assessment, just as social and private landlords will have to do under the Bill. The hard work of my hon. Friend the Member for North Shropshire (Helen Morgan) got even the previous Government to come round to the idea, and the then Minister, the former Member for Redcar, said in this Chamber on 24 April last year that the Government:
“intend to ensure that service accommodation meets the decent homes standard”.—[Official Report, 24 April 2024; Vol. 748, c. 1029.]
Service families such as those of 40 Commando Royal Marines, part of our Taunton and Wellington family community, make massive sacrifices for our country, and sometimes make the ultimate sacrifice. They deserve decent homes, and the MOD should be required to meet the standard, just as the Government are requiring that of other landlords. I am grateful to see support for amendment 3 from across the House. We will be voting for it this evening to support our service families, and I urge Members across the House to vote for it, too.
Madam Deputy Speaker (Judith Cummins)
I call the Chair of the Housing, Communities and Local Government Committee.
Florence Eshalomi
I start by paying tribute to Members from across the House who have tabled an amendment at this stage, and to the Minister, who has engaged constructively with Members between Second Reading and Report.
As we debate this Bill today, it is important to remember why it is so badly needed: the dire situation that many tenants across all our constituencies are facing through no fault of their own. We have to ask ourselves how we got to a position where tenants have the threat of eviction held over their head for no good reason. How did we get to a position where tenants can be given only a couple of months to raise thousands of pounds for rent in advance, on top of moving costs and the deposit? How did we get to a position where the average rent went up by 9.1% last year? For far too long tenants have been the innocent victims of an unjust power balance in the rental market. As a result, many of them have been unable to keep a roof over their heads and, sadly, have fallen into homelessness. This cannot continue any longer. We need a fairer deal for renters.
Jeremy Corbyn
Has the hon. Member noticed, as I have, an increase in the number of threatened evictions at the present time, as well as no-fault evictions, excessive rent rises and harassment by landlords of private sector tenants? Does she believe that there is any immediate and urgent protection that we can give those tenants?
Florence Eshalomi
As a fellow London MP, the right hon. Member will see what I see in my inbox, with many tenants facing that threat on an almost daily basis. They are the same tenants who come to our advice surgeries and are turned away from overstretched council departments, and who cannot apply to social housing waiting lists because those lists are already full. It is important that we get guarantees and protections for those tenants as outlined in the Bill, and hopefully help my constituents and his, and people up and down the country.
This situation cannot be allowed to continue. I am proud that the Bill will be strengthened by some of the welcome amendments that Members have tabled. I extend my support to new clause 3, tabled by my hon. Friend the Member for Leeds Central and Headingley (Alex Sobel), on limiting rent payable in advance. That is a big issue in my constituency of Vauxhall and Camberwell Green, and I have spoken to many tenants who are being asked to stump up six to 12 months’ rent in advance. That leaves many people priced out of the rental market, ending in a race to the bottom where landlords can charge more and more for less in return.
How can someone finally find a place that they want to call home, only to be told that they need to pay out thousands upon thousands of pounds up front? In some cases, because of the rents charged in my constituency, and many others, the money that people are asked to stump up in advance would amount to a deposit if they took it to purchase a home in another part of the country. We are talking in excess of £30,000 if someone is asked to stump up, with an average rent of £2,500 per calendar month in my constituency. The result is that those who do not have significant savings or family wealth end up needing to borrow money just to have somewhere to live. That cycle of exploitation is pushing thousands of people into debt, impacting them for the rest of their lives.
Research from StepChange shows that one in six private renters are relying on credit to make ends meet. Something must change, because the system is broken. We must lower immediate financial pressures on tenants and make private renting fairer for everyone. That is why I welcome the amendments tabled by the Secretary of State, and I urge the House to support measures that will reduce up-front costs for all renters.
My constituency is home to thousands of university students from great universities across London. Students often have the most insecure housing, because landlords know that they can charge a new group higher rents every year. I therefore welcome measures that restrict the time that a landlord can agree a new tenancy, prior to the end of the current tenancy in student housing. Many of us will remember the time when we went to university and looked for accommodation. We signed up to live with friends or someone we knew—perhaps by Christmas we had all fallen out, and there was that frantic search when someone left the property and we had to find a new flatmate. Many social media posts are put on SpareRoom.com or Facebook, and university students need time to bed into their new accommodation. The new clause will help to give students that breathing space, and avoid the problems they face as a result of early sign-up accommodation.
New clause 10 addresses a vital issue, and I pay tribute to my constituency neighbour, my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), for tabling it and for her tireless campaigning. The death of a loved one is a difficult and challenging time for anybody, and the one thing people need is the time and space to grieve. Under current rules, guarantors can end up facing a huge bill for the remainder of their loved one’s rent. None of us would want to be placed in that situation. It is right that the Government have acted to prevent guarantors from being faced with that unacceptable scenario, and I urge the House to support the new clause.
I also wish briefly to touch on some other amendments, which I hope the Government will consider during the Bill’s passage in the other place. Although the Bill introduces a rent tribunal for unfair rent rises, there is concern from groups such as the Renters Reform Coalition that measures in the Bill do not go far enough to prevent landlords from evicting a tenant under the guise of a large rent increase. I am particularly concerned that market rent may not be an appropriate benchmark when market data is poor. Renters at the bottom end of the market could end up being told that an unaffordable rent rise is acceptable under this system. We need guarantees that the use of a tribunal will resolve that, and that it is available and accessible to tenants.
In Scotland, only a handful of rent increase cases a year go through the tribunal system to the rent officer, and it would severely undermine the Bill if tenants who were being exploited did not take up the option available to them. I would be grateful if the Minister could explain how the Government will encourage the take-up of such a provision, and whether he will support the alternative measures and safeguards in the Bill, such as amendment 9, tabled by my hon. Friend the Member for Liverpool Wavertree (Paula Barker).
Finally, a number of amendments have touched on the vital issue of home adaptations in the private rental sector. It is not fair that disabled tenants end up with reduced access to their own homes. The Government are rightly looking at making it easier for disabled people to thrive in the workplace, but what is the point of someone thriving if they do not even have an adequate home or housing?
We cannot expect someone to go out and work and contribute to the economy if they have not had a good night’s sleep. Can any of us imagine being unable to have a shower in our own flat because the landlord refuses to make the necessary adaptations, or trying to cook in a kitchen when we cannot even reach the worktops? None of us would want to live in such conditions, yet that is the reality for many disabled people in the private rented sector in 2025 in the UK. People face such issues on a daily basis, with more challenges and blockages when trying to get private landlords to address them.
I urge the Government to ensure that disabled people do not face a private rented sector that is far too often completely inaccessible to them. I look forward to the Government responding to the report by my Committee’s predecessor on disabled people in the housing sector. The House must continue to look at how we fight for a rental sector that works for everyone, regardless of their background.
Rebecca Smith (South West Devon) (Con)
I was privileged to serve on the Bill Committee, and it is good to see many fellow members of the Committee in the House this afternoon. Before I start, I wish to pay tribute to the many excellent landlords across our country. The Bill has been designed to tackle the worst offenders, but it is worth putting on the record that thousands upon thousands of landlords do a good job of providing long-term accommodation for many people in the private rented sector. On Second Reading and in Committee we spoke about the unintended consequences that exist in the Bill, some of which still remain—that was alluded to by my hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds).
Rebecca Paul (Reigate) (Con)
My hon. Friend raises an important point about unintended consequences. Does she agree that it is important we consider our key workers, such as NHS staff and police, who rely on accommodation tied to their employment? With the abolition of assured shorthold tenancies, it is important to ensure that provisions are there to support such tenancies, so that they can continue and we can retain and attract much-needed police officers and NHS staff.
Rebecca Smith
I absolutely agree with my hon. Friend, and that is a perfect example of one of the unintended consequences that I do not believe have been put in deliberately but are something that we might see as a result of the Bill. Other issues include accidental landlords—those who did not intend to be landlords and are not large portfolio holders—and small landlords, and we have already heard from my hon. Friend the Member for Ruislip, Northwood and Pinner about the challenge they face regarding economic drivers and the risk of the market shrinking. We talked a lot about that on Second Reading, but ultimately landlords are leaving the market, and if there are fewer homes for people to rent, we are in a worse situation.
I support new clause 20, which stands in the name of my hon. Friend the Member for Ruislip, Northwood and Pinner. I believe a review of the Bill’s impact on the housing market after a year is important to ensure that we make it even better than it already is, and to address those unintended consequences. We can all agree that is important, given the challenges we have already heard about regarding the long housing waiting lists and the homelessness rife across our country. It is also important to listen to landlords.
In particular, I draw attention to some of the reasons why new clause 20 is so important. Plymouth Access to Housing, known as PATH, is a key player in tackling homelessness in my constituency, and it works especially with those who are harder to place into accommodation. It has rightly said that it supports the Bill in principle—as we have heard, the Opposition support large parts of it too—but in a buoyant private rental market. It is concerned that it is not buoyant, so there is already a challenge. That is why a review would be important. PATH also says that it has received funding in the past to support landlords to stay in the private rented sector. What plans does the Minister have, perhaps outside of this Bill, to ensure that such organisations, in which some Members present today have worked, might be able to mitigate the impact of some of those future challenges?
The South West Landlords Association, which I have mentioned, would benefit from new clause 20, because it would allow for an assessment of a provision that essentially amounts to a doubling of the amount of rent arrears that can be accrued and of the notice required for possession before a landlord can get somebody out of their property. Landlords are particularly concerned about that, for the financial reasons we have already set out. If they have to wait for three months of arrears and then another month’s notice before they can remove someone from their property when they have not been paying rent, that has a massive impact on small landlords, and on those accidental landlords in particular—that is nearly half a year of income they would lose. Ultimately, it is the luck of the draw. We do not know in advance how good tenants will be. If someone has an excellent tenant, it is not a problem, but with a bad tenant it is not so good.
Graham Stuart (Beverley and Holderness) (Con)
My hon. Friend is making a powerful speech. Does she agree that, fundamentally, the only way to secure the rights of tenants is to ensure the buoyant rental market that she is talking about, where landlords want to enter and invest in it? They are then competing for tenants in the market, which is the biggest and most powerful force of all. That will drive decent behaviour towards tenants, and without that, landlords cannot gain and retain tenants.
Rebecca Smith
I appreciate the point that my right hon. Friend makes. I agree that the market is important, but I also appreciate that there are some whom the market has failed. We have to find a situation where those who are not looked after by their landlords can receive support, but, as I have already said, my concern is that the Bill goes too far in the opposite direction.
Graham Stuart
With the freedom of being on the Back Benches, I can say that the last Conservative Government got this wrong. When they stopped landlords being able to offset the interest payments on the mortgage for that commercial asset against their income, it was one step among many that reduced the number of landlords coming into the market. Each step along the way, instead of seeking to strengthen the market, successive Governments—Conservative then, and the process is bound to be completed by Labour now—moved against landlords to make it a less and less investable asset. Ultimately, those who lose out most are tenants.
Rebecca Smith
I agree with my right hon. Friend that ultimately tenants are at risk of losing out if there are no properties left in the market. That leads me on to my next point and one of the other reasons why an assessment would be useful in the light of new clause 20. We heard in Committee that rural landlords are particularly concerned. According to the Country Land and Business Association, 44% of landlords are planning to sell in the next two years, and only 21% are planning to build new properties. When 90% of those planning to leave cite reforms to the private rented sector as a reason, we need an opportunity to reflect and to see the impact assessment.
Having set out some of my reasons for supporting new clause 20, I will turn briefly to new clause 15, which has been mentioned many times already. I appreciate why it has been tabled in the tragic circumstances that have been laid out. In the light of some conversations we had in Committee, I am interested to see who is in scope to be considered family for the purposes of that guarantor system. The new clause lists
“child…grandchild…parent…grandparent…sibling…niece or nephew…aunt or uncle…or, a cousin”.
That is a wide but—I think we would all agree—highly realistic view of what family is. However, in schedule 1 to the Bill, a landlord can only evict an existing tenant to house a parent, grandparent, sibling, child or grandchild.
I raised this matter with the Minister in Committee, and I know that he thinks tenants’ rights would be inhibited if we extended the definition of family, but I find it puzzling that a wide extended family is justified in new clause 15, but not in the determination of who lives in a property under schedule 1. Often, those family members may be vulnerable themselves and need somewhere to live. It is a niche point, but for the Government to say that someone cannot house their niece or nephew—or, in the light of new clause 15, their aunt, uncle or cousin—feels like an overreach of the state. We are slightly testing ownership rights and restricting trust and freedom in society as a result.
Michael Wheeler (Worsley and Eccles) (Lab)
I was pleased to serve on the Public Bill Committee for this legislation, which is a concrete example of the positive difference that this Labour Government are making to people’s lives. I fundamentally believe that everyone should have somewhere they can call home and that they should feel secure in that home. The Bill will deliver massive improvements for the millions of tenants in the private rented sector, who for too long have been forced to pay over the odds for housing that is often inadequate and insecure. It finally addresses the clear imbalance of power between landlords and tenants by levelling the playing field through the delivery of a once-in-a-generation boost to tenants’ rights, moving away from expensive, precarious, poor-quality accommodation and ending a status quo that has left tenants under the constant threat of losing their home.
On the Bill Committee, we heard evidence of landlords demanding multiple months of rent up front at the start of a tenancy. That highly exclusionary practice shuts lower income renters out of the market by requiring them to hand over thousands of pounds on top of their deposit at the start of a tenancy. The spread of this practice would have a devastating impact on the choices available to many tenants, so I warmly welcome new clauses 13 and 14 in the name of my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner), which address the issue.
Turning to section 21 evictions, one of the absolute privileges of being an MP is going to visit local schools to answer questions from pupils. Those questions can be about anything, but they normally relate to the interests and experiences of the children, such as, “What can you do about the traffic?”, “How can you make my park and playground better?”, and even—this is a real one—“I really like trees. Do you like trees?” On a recent visit to St Andrew’s primary school in Eccles, I was given a poignant reminder of why we are here and why this Bill is so important. One of the pupils asked me, “What are you doing to stop people being kicked out of their homes for no reason?” It was a shocking question to hear from someone so young, and it serves as an appalling illustration of how wide the fear of no-fault evictions is. No child should even know what a section 21 eviction is, and no child should live in fear of losing their home. We cannot allow these evictions to continue. For me, that is the most critical part of the Bill. It is beyond time to end the spectre of homelessness that hangs over these tenants and end section 21 evictions, giving people a steady, strong, secure foundation to build their lives around.
Unfortunately, no-fault evictions are just one of the many challenges facing tenants. Action to tackle unaffordable rents is badly needed, which is why the measures in the Bill to end rental bidding wars and stop the use of unreasonable rent increases designed to drive out tenants are so important. Never-ending rent increases are bad for tenants and bad for the economy, absorbing money that could be spent more productively elsewhere.
I welcome the measures in the Bill to drive up standards across the sector, such as the application of the decent homes standard and the establishment of a private rented sector database. All of those reforms are entirely necessary in a market where, year after year, tenants are expected to pay more for less.
It is hard to overstate the impact that housing has on people’s lives or the detrimental effects caused by the sector’s current flaws. The Bill’s reforms decisively rebalance a broken sector, ending the scandal of no-fault evictions and encouraging the market to provide affordable, high-quality accommodation with security of tenure. The Bill represents real and meaningful action, which we all should welcome.
Mr Will Forster (Woking) (LD)
Many of us are described as either a dog person or a cat person. I have had my dog for over five years now, and as a result I definitely feel like a dog person. Joking aside, it is quite clear that we as a country are in love with our pets; so many of us are defined by them. The laws that govern us should reflect how we live and how we choose to live, but our lack of respect for people’s ability to bring a pet into their home is shocking. That is why I am pleased with the Bill.
Sadly, there are gaps for pet owners in the rental market in particular, which not only creates an uneven playing field for people choosing new homes but fills animal shelters with much-loved pets that should be in their stable homes. Many pets are in animal shelters because of landlords’ unfair rules introduced over the years. According to research conducted by Battersea Dogs and Cats Home, only 8% of private landlords list their properties as pet-friendly. I do not just want to talk about statistics, as the numbers have real-life consequences for families and animals.
In my constituency of Woking, a woman along with her family were evicted after 16 years of a tenancy because the landlord decided to sell the property. The council tried to find alternative housing for the family but repeatedly came up against obstacles, including a no pets policy, which would have forced her and her family to give up their three cats, including one that her autistic son is emotionally bonded to—his emotional support pet. A letter from the GP stated how important the cat was to her child’s wellbeing, but it did not help. The cat reduced her son’s anxiety levels and helped him with his day-to-day functioning—it had a huge impact. Housing officers noted that they could have considered the family for a place in some new flats that the council had built, but the housing provider did not accept pets.
Sadly, that case, which is not unique, perfectly illustrates the emotional toll that the rules can have on families, particularly those with additional needs. Pet ownership might seem like a small issue in the face of homelessness, eviction and the heart-wrenching issues that we have heard about, but it is clear that sometimes, because there are no protections for families with pets, people are forced into a horrible situation. It is fair to say that the culture of a country should be reflected in the laws that govern it, and most of us have pets, so let us ensure that we are allowed to keep them.
I was pleased to hear my hon. Friend the Member for Taunton and Wellington (Gideon Amos) pursue my party’s amendments, and I was pleased to hear from the Chair of my Select Committee, the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi). There has been much cross-party support for the Bill, while we push the Government to go further still. As supportive as I am of the Bill, it could be better and help reduce our casework of heart-wrenching stories of vulnerable tenants pushed out and treated badly by landlords. The Bill will help us, but, through the amendments tabled and others that I know will be proposed in the other place, it could be better.
Bell Ribeiro-Addy (Clapham and Brixton Hill) (Lab)
I declare an interest: like one in three households in my constituency, I rent my home. As a renter and an MP who represents a large number of renters, it will come as no surprise that I rise to speak in favour of the Bill, which will bring in some important, long-overdue reforms to provide private renters with decent and secure homes.
Crucially, I am pleased to see the abolition of section 21 evictions, which was promised by the Conservative party, including in its 2019 manifesto, but never delivered. Close to a million people faced no-fault eviction notices in the last Parliament because of that failure, which added to the homelessness crisis that we now face.
I am happy to see measures in the Bill that focus on affordability. In my borough of Lambeth, renting a one-bedroom home now costs the average person more than half their take-home pay. When teachers, rail staff, nurses and other key workers went on strike to call for inflation-matching pay rises, the last Government attacked them and rejected their demands, calling them greedy, but that Government shrugged their shoulders as private landlords collected above-inflation rent hikes from some of those same key workers year after year.
In recent years, the situation has been particularly pronounced. In March 2024, the Office for National Statistics reported that monthly rents rose by 9.1%, the highest annual increase since records began in 2015. I am glad that the Bill brings some common sense to the situation, ensuring that rent increases can no longer be written into contracts and that landlords will be able to legally increase rents only once a year, and protecting tenants from egregious rent hikes.
Also highly positive are the new measures to strengthen enforcement against slum private landlords, to extend the decent homes standard to the private rental sector and to widen council enforcement powers while extending the range of financial penalties available to local authorities to fund enforcement activity.
I am pleased that the Bill legislates for a consultation on improving energy efficiency standards in rented homes. The UK has some of the most energy inefficient homes in Europe, with 2.6 million private rented homes falling below minimum energy efficiency standards in England and Wales alone. Almost a quarter of renters live in fuel poverty, the highest rate of any tenure.
The Bill contains important measures to provide renters with some basic security and to place some basic responsibility on landlords. However, so much more could be done to strengthen it. I am pleased to see that the Government are supporting the amendments tabled by my hon. Friend the Member for Leeds Central and Headingley (Alex Sobel), and I am pleased to support amendments 9, 5 and 6 tabled by my hon. Friend the Member for Liverpool Wavertree (Paula Barker), which would better protect sitting tenants from unaffordable rent increases. In its current form, the Bill caps rent increases only at market rate—the prices that landlords set. The amendments would instead cap them at the rate of the consumer prices index or wage growth, whichever is the lowest. I have yet to hear a compelling reason why landlords should see their incomes grow faster than people who actually work for a living.
I place on record my support for the Renters’ Reform Coalition’s call for a national rental affordability commission, to investigate methods to bring down rents relative to incomes.
Although there are not many Members on the Opposition Benches, the few speeches that they have made have talked about homes almost entirely as assets, forgetting that people need to live in them. I welcome the amendments that remember that people with a variety of different circumstances are living in those homes, and they should be viewed with compassion. I welcome and support new clause 10 tabled by my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), as well as new clause 9 tabled by the hon. Member for Bristol Central (Carla Denyer) on adaptations for disabled people.
It is welcome that the legislation would make it illegal to discriminate against benefit claimants and families for exactly the same reason. I would like further changes to prevent discrimination, such as scrapping right-to-rent checks and reforming the laws around guarantors more generally. I would like the legislation to go further on preventing illegal and back-door evictions. As the London Renters Union has pointed out, for the many families struggling with housing costs, a 20% rent hike is simply a no-fault eviction under a different name.
During my time as an MP, I have seen too many unscrupulous attempts to remove tenants to be unconcerned about a likely increase in illegal evictions in response to scrapping section 21. I welcome new enforcement powers, but we have to acknowledge the financial difficulties that local authorities face after 14 years of massive cuts. The Government must ensure that local authorities have the resources to use these enforcement powers.
Calum Miller (Bicester and Woodstock) (LD)
I broadly welcome the Bill and the strength and protections that it will provide private tenants. I associate myself with the comments of my hon. Friend the Member for Taunton and Wellington (Gideon Amos) and the amendments that he and my hon. Friend the Member for St Albans (Daisy Cooper) have tabled.
I wish to focus on one aspect of the Bill to see if I can encourage some last-minute reconsideration by the Minister. The Government recently repurchased more than 36,000 Ministry of Defence properties from the private sector. This move is a step in the right direction, yet many properties, including those in my constituency of Bicester and Woodstock, have fallen into disrepair, having failed to be managed properly, and are now substandard or unsafe. Service personnel and their families living in Ministry of Defence accommodation in Ambrosden and in Caversfield in my constituency have expressed frustration with the current management and maintenance companies.
Liberal Democrats are clear that our service personnel and their families deserve the same decent standards that the Government are proposing for the rest of the private rented sector. I am proud to support amendment 3 tabled by my hon. Friend the Member for Taunton and Wellington. Will the Government now commit to using the Bill to ensure that the recently reacquired Ministry of Defence accommodation will be covered by the decent homes standard, so that those living in service family accommodation in my constituency can access safe, weathertight and warm accommodation?
In response to my hon. Friend the Member for Epsom and Ewell (Helen Maguire) the Minister argued that it would not be appropriate to extend the decent homes standard to service family accommodation. Will he therefore clarify, so that I can inform my constituents, whether they should expect to live in service family accommodation that meets that standard and, if they should, how and to whom they can appeal if the accommodation continues to fall below that standard?
Amanda Martin (Portsmouth North) (Lab)
There are concerns that military accommodation, which I have in my constituency, is not included in the Bill, but one of my main concerns is the immense cut in funding to that accommodation. The properties are in such a state of disrepair that the Government have had to go back and re-buy them. Does the hon. Gentleman agree that there is a larger issue, which we need to deal with when looking at the Armed Forces Commissioner role?
Calum Miller
I wholeheartedly agree. The Ministry of Defence’s service family accommodation estate is in disrepair because of a significant lack of investment by the last Government, which failed to maintain the standards that should be enjoyed by our hard-working and dedicated service personnel and their families. However, the fact that this Government have made the welcome step to purchase that estate means that it is now their obligation to uphold standards. As we are talking about legislation that is intended to set the standard that all renters should expect, including those who are paying rent now to the Ministry of Defence for their accommodation, why are the Government resisting the opportunity to set that high standard for service personnel?
Finally, in the notes to the Bill, the Government emphasise that the concerns that led to Awaab’s law will now be extended to the private rented sector. Given how serious those concerns were, and given that the death occurred as a result of a failure to maintain property in the social rented sector, will the Minister tell me how I can go back to my constituents, who are tenants of the Ministry of Defence, and tell them they will enjoy the same protection as other private renters under Awaab’s law?
Adam Thompson (Erewash) (Lab)
Stability for 11 million renters, and, indeed, for 2.3 million landlords, is necessary to build our better Britain. For the tenants enduring the least affordable, poorest quality housing, disregarded renters’ rights have had a profound impact on people’s lives. Britain deserves more than dodgy landlords, back-door evictions and dismal living standards. The British people deserve to feel secure in their own homes.
Some of my constituents are forced to live in terrible accommodation, facing damp and mould. This treatment is fundamentally unacceptable.
Mike Martin (Tunbridge Wells) (LD)
The Defence Committee’s recent report described service accommodation as “shocking”, saying that two thirds required massive investment to bring it up to standard and that damp and mould were legion. The hon. Gentleman talks of dodgy landlords—would he characterise the Ministry of Defence as one? Should we be bringing those homes up to the decent homes standard that everyone else in the country will benefit from if the Bill is passed?
Adam Thompson
In his opening remarks, the Minister addressed the fact that there are issues in the space, but they go beyond the scope of the Bill. We need to continue having these conversations as we move forward. The hon. Gentleman raises a very important point.
Conservative failure has led to more than 200,000 households with children being forced to live in privately rented damp and squalid homes. According to The Guardian, each year, 31,000 children aged four and under are admitted to hospital because of damp and mould-related issues. I strongly believe that this simply cannot be allowed to continue. Shelter has recently found that a quarter of renters are afraid to ask their landlords for basic repairs for fear of being evicted, and that 26,000 households are at risk of being made homeless from the no-fault evictions we have been discussing today. We need to change, and fast. The abolition of section 21 will end these no-fault evictions for good. This is a vital part of this legislation, which will ensure peace of mind for tenants in their own homes, to which they devote a sizeable portion of their income.
Pressure on local authorities to provide temporary accommodation has become totally unsustainable. Crisis estimates that £2.2 billion of council funds in England were spent on temporary accommodation for 120,000 households between 2023 and 2024—an increase from 85,000 in 2019. My good colleagues at Erewash borough council tell me that they spent three times more on alternative accommodation in 2024 than in 2019. These temporary measures are incredibly costly and ultimately untenable. With accommodation including bed and breakfasts and hotels, alternative housing is an inadequate long-term solution. The Bill will make an excellent start to save council taxpayers’ money and protect tenants’ welfare from unsuitable temporary accommodation.
The vital extension of Awaab’s law to include private rental properties will prevent unsafe living conditions, landlord discrimination and bidding on rental properties. Prospective tenants in the housing crisis simply cannot afford bidding wars aimed at pricing them out. Discrimination based on receipt of benefits and having children will be prevented, ensuring an inclusive and impartial rental market. Hazardous properties will require prompt and efficient landlord responses, and tenants will be protected from unjustifiable rent inflation. Today, while we have been debating the Bill, I have received a communication from a constituent whose rental price recently went up by 21%, which is disgusting. The measures are essential for the efficient operation of rental markets in the UK and for the protection of tenants’ rights.
The much-needed introduction of the decent homes standard will further empower tenants to leave poor-quality homes and provide better value housing for all. According to the English housing survey 2023, one in five privately rented homes is considered substandard. The enforcement of the decent homes standard will put an end to this appalling practice. With the introduction of a £7,000 penalty for non-compliance, landlords will finally be properly incentivised to maintain the necessary high standards that renters deserve. New legal protections will secure quick, impartial, binding resolutions to protect both renters and landlords. Given the new private rented sector landlord ombudsman and the strengthened council enforcement for which the Bill provides, tenants and adults will feel assured that their concerns are respected and will be handled with compassion and certainty.
The Bill will allow us to end backdoor evictions and extortionate rents designed to force renters out. Periodic tenancies ensuring that rent increases are made per the market rate, once a year, will protect renters from unreasonable increases and unexpected evictions. Access to a private rented sector database will help landlords to understand their legal obligations and demonstrate compliance with the new regulations. These measures will allow for certainty in the law for both landlords and tenants. I understand that landlords are concerned about investing and entering the market for fear of payment insecurity, but the current system is designed around uncertainty. The serious lack of clear legislation has caused decades of chaos for both landlords and tenants, with unsafe homes and unsuitable dispute resolution. A transparent and fair system is needed so that all parties can make informed decisions.
As for student accommodation, the changes proposed in the Bill are necessary for the protection of landlords and students alike. Students deserve security as much as everyone else in society. The assured continuance of annual short-term student tenancies will still provide certainty in respect of landlord income, with the ability to evict tenants at the end of the academic year and to increase rents for new tenants as required. According to the National Union of Students,
“the average student loan...leaves students with just 50p a week to live off after…rent”.
Despite those extortionate costs, cold, damp, unsuitable housing has become the norm in student accommodation. Students are at risk of being unable to pay for basic essentials, so it is vital that they are protected from living in poor conditions under unfair terms.
The Bill will extend vital safety and reassurance to thousands of people in Erewash. My constituents cannot continue to endure poor housing at the hands of inadequate renters’ legislation; they deserve security in their own homes. The Renters’ Rights Bill is our way forward, and I urge all Members to support it, as amended today by the Government.
Rachel Gilmour (Tiverton and Minehead) (LD)
It is a pleasure to be called to speak in today’s debate on such an important topic. The Bill has many laudable aims, and represents a once-in-a generation opportunity to finally fix the private rented sector for the 11 million people in England—including me—who rent privately. I know that about 13,000 private renters in Tiverton and Minehead will be watching this debate with interest—particularly Owein and his family, whom it took me six months to rehome earlier this year—in the hope and expectation that the House can finally do what it promised to do under the last Government, and pass meaningful rental sector reform. That Conservative Government neglected renters, and I am pleased that this Government are introducing meaningful legislation now. Tiverton and Minehead sits at 88th out of 543 constituencies in England on the barriers to housing and services index of deprivation. I will think closely about anything that the Government can do to improve that, to ensure that it represents a fair deal for renters, particularly those in my constituency.
Let me start by stating the obvious. This is a good Bill, on the whole. It takes strong steps to protect tenants, especially when landlords are not maintaining their properties. Provisions such as Awaab’s law should and must be extended to the private rented sector, so that landlords have a duty to fix hazardous living conditions like those that cost that precious toddler his life, within a set timeframe. Shelter is a basic need, not just a want. I am very pleased that the Bill seeks to apply the decent homes standard to the private rented sector for the first time: such an extension is overdue, and very welcome.
As a pet owner, I am happy to see in the legislation the right for tenants to request a pet. Pets are often an integral part of the family, as they have been for me. My party’s former spokesperson on this issue, my hon. Friend the Member for North Shropshire (Helen Morgan), welcomed the inclusion of this measure in a previous iteration of the Bill, and I echo that welcome.
The Bill should be commended for its ambition in many sectors. For example, it creates a national private rented sector database, so that tenants know about their landlords. It also looks to stop bidding wars, and to ban in-tenancy rent increases being written into the contract. Those are all fantastic reasons to support the Bill today.
Naushabah Khan (Gillingham and Rainham) (Lab)
I join colleagues from across the House in saying that I was proud to serve on the Public Bill Committee. For too long, tenants in my constituency of Gillingham and Rainham have been at the mercy of a broken rental market. The system has gone unchecked for the last few decades, and left renters with a lack of security, limited rights and too often no choice but to live in unacceptable conditions. The previous Government promised change. Ministers stood at the Dispatch Box and assured the public that they would deliver fair reform in the rental sector, yet they failed. They kicked the can down the road, while tenants faced soaring rents, substandard housing and the ever-present threat of losing their home at a moment’s notice.
The failure to address the housing crisis is perhaps one of the most glaring legacies of the last Government. The number of people renting privately has exploded. Many are renting not from choice, but because it is the only option. In Gillingham and Rainham, 22% of households now live in the private rented sector, and rents have risen sharply over the last decade. Families, young people and older residents alike feel trapped. They are locked out of home ownership and housing security, and locked into paying for homes that are too often cold, damp or unsafe.
Recently, my inbox has been full of stories of constituents who have been evicted through section 21 evictions. Pat Cooper, for example, was told just before Christmas that she would have to leave her home of 35 years. It has left her feeling incredibly distressed, facing real uncertainty about what the future holds for her, with limited choices that she can afford. There are countless similar stories of people who have been plunged into uncertainty and the risk of homelessness because of no-fault evictions. The previous Government had every opportunity to end this injustice, but they chose delay and inaction over the wellbeing of often vulnerable families.
My constituents know that this Government are different. Within their first 100 days, they have brought forward this landmark legislation, which I know will deliver the security, dignity and fairness that renters in my constituency deserve. I welcome the fact that the Bill will end the scourge of no-fault evictions once and for all. I welcome the decent homes standard being extended to the private rented sector; that will guarantee that tenants no longer have to put up with mould, disrepair or unsafe conditions. Crucially, I welcome the introduction of an ombudsman to hold accountable those who do not uphold the law, and to give tenants a clear route to justice. I thank the Minister for considering representations from Members of different parties and the amendments in front of us, which introduce new rules to cap advance rent payments and provide safeguards for bereaved families—something that has been spoken about powerfully today.
This Bill sends a clear message: it is the end of the era of unchecked power for landlords who do not want to follow the rules. For far too long, too many tenants have been treated as second-class citizens in their own homes, and I am glad to see that this Government are putting an end to that. It is high time that renters across the country were treated with the fairness, dignity and respect that they deserve, and I am proud to support this Bill as it progresses through this place and the other place. It will give my constituents their basic rights.
Several hon. Members rose—
Madam Deputy Speaker (Caroline Nokes)
Before I call the next speaker, who I am sure will speak to her amendments, I remind Members that on Report we should consider the amendments and new clauses to the Bill; the debate is neither a rehash of Second Reading, nor a precursor to Third Reading.
Carla Denyer (Bristol Central) (Green)
I should declare that I am a member of the Association of Community Organisations for Reform Now, which campaigns on renters’ rights. I thank it for its important work on this Bill, including alongside me.
The Bill is hugely welcome, but it can and should go further to fix the grave and urgent housing crisis. I therefore rise to speak to my new clause 7, on rent controls and affordability; new clause 9, on home adaptations for disabled people; and new clauses 17 and 18, on selective licencing schemes. I also want to put on the record my strong support for a number of amendments tabled by others, including the hon. Members for Leeds Central and Headingley (Alex Sobel), and for Liverpool Wavertree (Paula Barker).
We have people living on the streets and in temporary accommodation because they cannot afford their rent. New clause 7 proposes a living rent body, which would set the rules that applied to the calculation of rent between tenancies. That would control rents and make them fair, considering factors such as the home’s property type, condition and size, average local incomes and so on. Local flexibility will be important. The measure is needed. The Bill gives renters a once-in-a-generation set of new rights that they have long been denied, but rent controls are still needed, because it is no help to anyone if they have a right to something that they cannot afford or access.
Once the Bill does away with section 21, we will need rent controls to prevent rogue landlords from instead hiking rents to kick people out. The Government’s changes to the tribunal system do not go far enough to protect renters from that. First, most tenants do not have the time or energy to navigate the system. Secondly, tribunal panel judges only judge whether a rent rise is fair compared with market rates, and the market rates are too high.
We have a generation of people who will never be able to earn enough to have a mortgage, and who cannot even afford their rent now. If a 21-year-old in my home city of Bristol rents a single room today at the average rate, they will have put £80,000 into their landlord’s bank account by their 30th birthday. No wonder that a third of private renters struggle with their housing costs. New clause 7 addresses the plain fact that the market is failing, with terrible costs for people who are struggling and made homeless.
There are huge economic costs, too; the Government are set to pay private landlords £70 billion of taxpayers’ money in the five years from 2021 to 2026. That is multiple times the spend on new affordable homes. Surely that is the wrong way round. We can add to that the huge annual spend on temporary accommodation, which cost councils at least £1.74 billion in 2022-23. Rent rises are far outstripping inflation. The Deposit Protection Service rental index found that rents outstripped inflation by one third in 2023. Rightmove reports show that asking rents outside London have risen 60% since 2020, and I assume that I do not have to tell the House that incomes have not grown by the same amount.
As I set out in Committee, discussion is vital if we are to avoid unintended consequences, and I do not dismiss the importance of that detailed work. At the same time, we cannot ignore the acute affordability crisis for renters. Key workers are being forced out of cities, and people are being forced out of communities that they have made their home. The average rent in my constituency of Bristol Central has hit nearly £1,800 a month.
I know what the criticisms will be, but let me remind the House that rent controls are an established part of private renting in 16 European countries, where they are a completely normal part of housing policy. It is interesting that private renters in England spend a higher proportion of their income on rent than those in any European country apart from Luxembourg and Norway. Our homes are in worse condition, too.
Rent controls are of course not a panacea. They are needed alongside a suite of housing policies, and increasing social housing supply is really important. However, the private rented sector is in an affordability crisis now, and it will take huge amounts of effort and time, even with the best will in the world, to increase the social housing supply on a scale that will impact private rents. Modelling from Generation Rent and other economists predicts that building 1.5 million homes over this Parliament will decrease the private rent burden by just over 1%.
Moving on to new clause 9, there are 16 million disabled people in the UK—more than a fifth of the population—and 19% of them live in the private rented sector. The Equality and Human Rights Commission estimates that a shocking one in three disabled people in the private rented sector lives in unsuitable accommodation, and a Government survey reveals that an appalling 44% of private landlords have said that they will not rent to someone who requires home adaptations.
My amendment seeks to ensure that, if all tenants can put up shelves, disabled tenants should be allowed to put up grab rails. If all tenants can replace a showerhead, disabled tenants should be allowed to put in accessible washing facilities. It is not acceptable that disabled tenants must get permission for these most basic adaptations.
In Committee, the Minister was sympathetic to my concern but argued that the Equality Act 2010 already covers this issue. However, it clearly is not doing the job. Disabled people are explaining this very clearly and patiently, as did the Chair of the Housing, Communities and Local Government Committee, the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi), whom I thank.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
I must declare an interest: my husband works for an organisation that funds the Renters’ Reform Coalition, which has been referred to today.
It is a privilege to speak in this debate after serving on the Bill Committee, which took a thorough approach to each element of the Bill. This topic is of great importance to me, I having worked in housing for my entire working life and representing 27,000 private renters in the Cities of London and Westminster. I speak today thinking of those constituents and their experiences.
One landlord revoked a promise to provide free heating for their tenant’s home, leading to it becoming infested with mould. The landlord later refused to respond to repeated reports of pests in the property, before subsequently charging that tenant £1,500 to fumigate the house. I also bear in mind my constituents who were evicted under a section 21 notice, are now living in temporary accommodation with three children and have been on the social housing waiting list for nearly 15 years.
After being let down by dither and delay from the Members on the Conservative Benches when they were in Government, renters such as my constituents have been denied the crucial powers to hold their landlords to account in even the most basic fashion. If those Members had delivered on their promise and tackled the dissenters in their midst, renters would already have the protections that we are introducing in this legislation. Yet the Opposition have the audacity to claim that the legislation and principles that they had tried to introduce when they were in power will, mysteriously, not work now.
On the amendments, the Opposition claim that the legislation will lead to landlords exiting the market, but they repeatedly fail to suggest where the homes owned by landlords would go. Even in his case for new clause 20, the shadow Minister started talking about where the homes might go, so I take the opportunity to ask him directly whether he thinks the homes would disappear. Would he have rather let a home lie vacant than let it out or sell it if it were unprofitable? And if a sale took place, would the mysterious buyers not live there? I will happily give way if he wants to answer—okay, he does not.
To continue on to my main point, I want to focus on the parts of the Bill that consider local authority enforcement and the new clauses that address that. Current regulations in the private rented sector have suffered from a lack of enforcement by local authorities due to a lack of knowledge about private rented stock, limited enforcement capacity and the range and complexity of laws relevant to enforcement. The legislation goes a long way towards addressing those issues. The Bill puts local authorities clearly in the driving seat in enforcing regulation, cleaning up the confusion of the past regime. It expands the range of civil penalties that can be used by local authorities to crack down on poor behaviour. Importantly, it introduces mandatory reporting for local authorities’ enforcement activity, ensuring that councils are accountable to their constituents and to central Government.
The introduction of the private rented sector database will also fill a key gap in the existing regime: a lack of knowledge of the location and nature of private rented properties. The remaining gap in the regime will be funding, and it is essential that fees for the private rented sector database are sufficient to fund the enforcement measures in the Bill. It is therefore encouraging to see that recognised by Government amendment 40, which I am happy to support.
Jeremy Corbyn
I support what the hon. Member says about resources for local government. Does she also accept that there is a real problem, particularly in London, where there is simply a lack of advice available for tenants because the advice agencies are completely overwhelmed and underfunded? We therefore need to fund independent advice agencies as well.
Rachel Blake
I will come on to some of the incredible work that advice agencies do in my constituency.
Funding will need to be met with an active approach by local authorities to recruit the right individuals with the appropriate skills to act as inspectors for the regime. Additional funding may be needed for the immediate recruitment and upskilling of inspectors, and to deal with a backlog of cases related to enforcing existing regulations. Most importantly, landlords must have as many points of potential accountability as possible. That means that reporting on enforcement activity should be published publicly, with the naming and shaming of poor-performing landlords.
The Bill marks not just an era of rights for the millions of private renters across the country, but a step change in the necessary enforcement activity by councils and by renters themselves. The campaigning groups and advice agencies that have stood up for renters for years, including Generation Rent and also Z2K, which operates in my constituency, deserve a mountain of praise for their work in keeping this issue on the agenda of parties and actors across the political spectrum, and I pay tribute to them for their work. The scale of support that this Bill has from Members on the Government Benches demonstrates the significance of this issue. It is important that we work together across Government and civil society to enforce this new rights framework and provide renters with their long-overdue protections.
Claire Young (Thornbury and Yate) (LD)
I am sure that all Members have plenty of examples in their inboxes of why this Bill is so needed. Recent cases in my inbox have ranged from someone who had to wait two years for a boiler to be fixed, to someone who has a home so damp that they cannot walk through it without shoes on, as the carpets are permanently wet. They have had numerous electrical appliances fail and have lost their property to mould. Worst of all, they are permanently ill. Even the ombudsman finding in their favour has not produced decisive action to address the problem. It is an outrage that people are living in such conditions in the 21st century and, after the inaction of the previous Government, I welcome the approach set out in this Bill to fixing hazards such as mould.
I also welcome the security of tenancy. So often when people approach their MP about homelessness issues, they talk about the importance of being in a particular location. They say it is because their children are settled in their school, because they need to care for a relative who lives there, and because they need the support of family and friends. Repeatedly moving around robs people of vital community links and stability. It also affects the life chances of children and young people. It is not only no-fault evictions that lead to people moving around; so too do rent rises. So I welcome the amendment of my hon. Friend the Member for Taunton and Wellington (Gideon Amos) to limit the maximum rent increase. Far too many people are forced out of their rental properties by exorbitant rent rises, and this Bill does not go far enough to prevent that situation.
The hon. Member for Cities of London and Westminster (Rachel Blake) asked where the properties will go. In some cases, as our new clause 2 sets out, they will go to people on short-term contracts. We therefore need to consider the impact on the market as a whole.
I wish to raise one small concern of a landlord about the impact that the changes will have both on them and on their tenants. They own a single, upper-floor, leasehold flat. They own only the inside of the flat—not the exterior, the wall gaps or the loft. The Bill’s provisions on energy efficiency and so forth are of concern to them. Obviously, we want people to have homes that they can afford to heat and that meet climate change obligations, but not all small landlords are scrupulous, and relying on them to be so is not appropriate protection for tenants. As the Bill progresses, I ask the Minister to consider how the Government will support small landlords who want to do the right thing, so that the private rental sector does not become the sole preserve of well-heeled, large landlords.
Matthew Pennycook
I wonder whether I might provide some helpful clarification: this Bill has no provisions in it that deal with minimum energy-efficiency standards in the private rented sector. The Department for Energy Security and Net Zero will shortly go out to consultation on those MEE standards for the PRS, but it is not within the scope of this Bill.
Claire Young
I thank the Minister for that clarification.
In conclusion, I welcome the Bill and the protections it provides, but I urge Ministers to accept the Liberal Democrat amendments put forward by my hon. Friends the Members for Taunton and Wellington and for St Albans (Daisy Cooper).
Paula Barker (Liverpool Wavertree) (Lab)
This is groundbreaking legislation, and I pay tribute to the Minister and the Deputy Prime Minister for the excellent work that they have done so far. In October, I said in this place that my hon. Friend the Minister for Housing and Planning, under the leadership of our Deputy Prime Minister, will get this job done, and they are doing exactly that.
This Government are getting on with the job. The previous Government made empty promise after empty promise, ultimately caving in to the landlord lobby on their own Benches. Perhaps that is why the Opposition Benches are so empty today.
The Bill goes a long way towards redressing the power imbalance between those who own assets and those who need to use such assets for the basic human needs of housing and shelter. It will finally see an end to section 21 evictions. To boot, the Bill ensures a protected period at the beginning of a tenancy, the end of discrimination faced by those in receipt of social security, an end to bidding wars, and the rolling out of the decent homes standard across the private rented sector. Indeed, the Government have indicated their intention to strengthen the Bill further by limiting the amount of rent payable in advance at the start of a tenancy.
Liz Jarvis (Eastleigh) (LD)
I am grateful for the opportunity to speak in this debate, which is important to my constituents, and to me personally, as I grew up in rented accommodation.
New clause 1 would limit the maximum rent that landlords can request or receive in advance to no more than two months-worth of the tenancy. Excessive deposits mean that far too many people face exclusion from the housing market altogether. For families on lower incomes, younger tenants or those receiving benefits, that practice can make finding a home almost impossible. Landlords increasingly use methods such requiring rent in advance to exclude those they deem undesirable tenants. According to the charity Shelter, 52% of private landlords refuse to let to tenants receiving housing benefit. By capping rent in advance, the new clause would help to level the playing field and reduce the financial burden on those who are looking for somewhere decent to live but cannot get in the door because they are living pay cheque to pay cheque.
Amendment 1 would ensure that any rent increase is capped at a maximum rate in line with the Bank of England base rate. Unchecked rent increases are driving families in Eastleigh and across the country into financial hardship. In the current system, unscrupulous landlords can impose excessive hikes that effectively force tenants out. One couple in my constituency, who are already working two jobs to provide a home for their young children, were forced out of their rented accommodation when their landlord hiked their rent to an unaffordable level. They had no choice but to move to a smaller property that does not cater as well to their family’s needs. Allowing that practice to continue undermines the stability and security that the Bill seeks to provide. Linking rent increases to the Bank of England base rate is both logical and fair. It would create predictability for tenants, while allowing landlords to adjust rents reasonably in response to economic conditions. Office for National Statistics figures show that private rents in Eastleigh rose by 7.6% in 2024. The amendment would provide more protection for people who are struggling because of the cost of living crisis and cannot pay extremely high rents.
New clause 23 would ensure that landlords approve necessary home adaptations for disabled tenants where a professional home assessment has been carried out. One in three disabled people in private rented properties live in unsuitable accommodation. The failure to secure appropriate housing can be life-limiting and make regular activities such as accessing a bathroom or moving between rooms very difficult. In England, 8.8% of disabled people rely on the private rented sector because of the chronic shortage of social housing, yet private rented properties are rarely accessible or adaptable, and only 6.6% of disabled facilities grants are used to make such homes suitable for disabled renters. Unsuitable housing not only hinders independence, but increases reliance on social care, leads to higher hospital admissions and reduces participation in work and community life. The amendment would ensure that disabled tenants have the autonomy and dignity to live independently in homes suited to their needs.
Finally, I express my support for amendment 10, which would extend protections to students in HMO properties. Students are some of the most vulnerable renters, often dealing with insecure housing, high rents and landlords who fail to maintain properties. This amendment would ensure that landlords of student HMOs are held to the same standards as other landlords, providing greater security and accountability. I also express my support for new clause 6: all young people deserve somewhere safe to call home, and as much support as possible to help them find it.
I welcome this Bill as an opportunity to reset the balance of power in the rental market. My constituents in Eastleigh and renters across the country deserve a rental market that works for them, not against them. I urge Members to support the amendments to which I have spoken, to ensure that the Bill delivers the fair deal that renters have been waiting for.
Mike Reader (Northampton South) (Lab)
I note for the record my interest in this area, because I am a landlord. As the Member of Parliament for Northampton South, I come to the Chamber today to speak strongly in support of the Bill and many of the amendments. The private and social rented sectors account for around a third of all households in my constituency—that is 35,000 people who will directly benefit from this legislation.
My constituents work hard. Northampton South has a higher economic activity rate than the UK average, yet despite working hard, many people still face incredibly high levels of housing insecurity, high rents and low housing standards. Housing remains the No. 1 issue in my inbox, and the Renters’ Rights Bill will help to address the insecurity and unfairness that my constituents have faced when renting. This Government are taking the decisive action that people in Northampton have long asked for.
I will speak to the amendments, but I have to start by addressing section 21. Ending no-fault evictions will protect my constituents. Right now, millions of renters across the country live with that sword hanging over their heads—that they could be forced to leave their home through no fault of their own. That means parents lying awake at night, worried that they will have to move their children mid-term; it means nurses and teachers being forced out of the communities that they work in; and it means families being unable to put roots down or plan for their future because they can be uprooted at any moment.
The numbers impacted by this insecurity are shocking, and it is really positive that the Government have not only recognised this, but included further protections through their amendments to strengthen protection for renters. I am particularly pleased by the amendments that limit rent to be paid in advance. We have heard some shocking stories today—my mouth dropped when I heard some of the rents being asked for in advance in certain parts of the UK. Protecting renters in this way is definitely the right thing to do.
I welcome the provisions that expand the decent homes standard. I have heard from people in my constituency who live in properties plagued by damp, mould and electrical hazards. Having spent nearly 20 years working in the construction industry and having worked with some great private and social landlords, I can say that it is not that difficult for people to maintain and look after the properties that they run. The fact that 21% of private rented homes in this country fail to meet basic standards is simply unacceptable. Landlords who do not properly maintain safe properties are irresponsible and deserve to be held to account, and this legislation will make sure that that happens.
I am particularly pleased that the Bill will recognise the impact on guarantors in the awful situation where a tenant who they support passes away. The new clauses that have been tabled will mean that guarantors are protected, while also providing fair recourse and support for landlords in that awful situation. I encourage Members to support those amendments.
I am encouraged by the provisions relating to the landlord redress scheme, which provides a clear route for tenants to resolve issues without costly court proceedings. However, I have had extensive conversations with students in Northampton and the Northampton Landlords Association, and with a number of my constituents who are part of the HMO action group, and they told me that, while they support the aims of the scheme—and they have been following the stages of the Bill up to Report in detail—they have concerns that the courts system or the justice system just will not be up to scale. I am encouraged by the Minister’s statement that this is being looked at, but it is critical for professional HMO landlords in my constituency, who will need quick resolution to disputes, and measures to deal with antisocial tenants and tenants who negatively impact on their co-habitees.
Helen Hayes (Dulwich and West Norwood) (Lab)
I rise to speak on new clause 10 in my name and Government new clause 15, but before I do so, I would like to make some brief remarks about other aspects of the Bill. In my constituency of Dulwich and West Norwood, housing is overwhelmingly the biggest challenge that my constituents face. Housing costs have spiralled, and the previous Government wasted more than a decade failing to build the homes we need. The effect of this has been that more and more of my constituents are living in privately rented homes, in which they are currently systematically denied the basic stability and security that most of us would agree are essential to being able to function properly in the rest of life.
Private tenants live with the constant fear that their landlord can at any time, without reference to the terms of their tenancy agreement, decide that they want their property back and serve an eviction notice. I have seen this happen time and again. It stops people putting down roots in their community, because they know that they are likely not to be able to stay. It means that parents live with the constant anxiety that they may have to move far away from their children’s school. It means that older people are denied security of tenure in their retirement. In return for extortionate rents, tenants all too often face appalling standards, and find it far too difficult to get basic health and safety issues addressed.
I therefore welcome this Bill, which delivers the biggest package of reforms to private renting for 40 years, redressing the current imbalance between landlords and tenants, strengthening tenants’ rights and providing much-needed additional security. I particularly welcome the scrapping of section 21 evictions—I have been speaking on them in this place since 2016—the strengthening of local authority enforcement powers and the creation of a new private rented sector ombudsman, and the application of Awaab’s law to the private rented sector.
There is a very great challenge about the affordability of private renting, particularly in London, and my constituents experience that every day. I hope the Minister will keep under review the measures in this Bill that are designed to limit the rate of rent increases to ensure they are as effective as they need to be to create a functioning rental market. I trust that the Minister will do that, and will not hesitate to take further action in future if it is needed.
I now turn to my own new clause 10 and Government new clause 15, which would ban the use of guarantor agreements in the event of the death of a tenant. In this place, all of us know that there are sometimes emails that stop us in our tracks. So it was for me when, in 2023, I received an email from a constituent that read as follows:
“Late last year I became a guarantor for my son so that he could secure accommodation with some friends for his second year at university; without me doing so, he would have lost the house. I had no real concerns about my son paying the rent as he had shown he was a hard worker in a variety of jobs he engaged with to supplement his student loan, which would have covered the rent anyway. The tenancy was due to start at the beginning of July. Tragically, two weeks ago he took his own life, leaving myself, my wife and his sister utterly devastated. On top of everything, I now find myself liable to pay the rent for his room for the entire length of his tenancy if a replacement tenant cannot be found…I wonder if there might be scope to look into the practice of expecting bereaved parents to continue in a role of guarantor to a loved one after they have died.”
I do not think anyone could read that email and think that what happened to my constituents who were facing the worst kind of pain was remotely acceptable. I contacted the letting agent who refused to budge, simply stating that they were following the contract that had been signed.
Florence Eshalomi
I thank my hon. Friend and neighbour for making such a powerful speech and reading out what must have been a difficult email to receive on behalf of her constituent. Does she agree that, sadly, many other tenants up and down the country might have had to go through that, and suffered in silence because they were grieving?
Helen Hayes
I agree with my hon. Friend, and I will speak in a moment about evidence I have received that this issue is more widespread than any of us might have imagined. I raised the issue at Prime Minister’s questions, and after that I was contacted by many people, including families who had experienced exactly that, as well as letting agents who told me that they explicitly did not use such clauses, and that such clauses were not necessary because the loss of rental income in the event of the death of a tenant is an insurable risk for landlords.
I am grateful to Members across the House who have supported my campaign, including 48 Members who signed new clause 10, and those who signed my amendment to the Renters (Reform) Bill in the last Parliament. I engaged extensively with two different housing Ministers in the previous Government, both of whom said that they were sympathetic but declined to take action in that Bill or support my amendment. I am therefore grateful to the Minister for Housing and Planning for his compassionate and rigorous engagement on this issue. He has listened and, more importantly, he has acted where his predecessors did not. Government new clause 15, tabled this week, bans the use of guarantor agreements in the event of the death of a tenant who is a family member. That is what my constituent asked of me, and I am proud that that is what we will achieve today. I hope my constituents will take some small comfort from knowing that by speaking out and contacting their MP, other families faced with the heartbreak of losing a loved one will not be pursued by a greedy landlord or letting agent, adding financial stress and hardship to an already unbearable situation.
New clause 15 does not go as far as new clause 10, extending protection only to bereaved guarantors who are related to the tenant. While that protection would have helped my constituent, and while I agree that institutional guarantors should not automatically be released from their responsibilities on the death of a tenant, the limitations of the new clause mean that there could still be hard cases in future—for example, a close friend who is bereaved. I therefore trust that the Minister will keep the situation under review to ensure that new clause 15 is as effective as he intends. As a consequence of the Minister’s engagement on this matter, I am content to withdraw new clause 10 and support Government new clause 15. I urge all right hon. and hon. Members to do the same, and to support this Bill, which will deliver the step change in regulation of the private rented sector that we have all been needing for far too long.
Jeremy Corbyn
It is a pleasure to follow the hon. Member for Dulwich and West Norwood (Helen Hayes), and I pay tribute to her for the work she has done in trying to alleviate the pain caused when someone dies and all the demands then descend unexpectedly on those who were rent guarantors. She has done a very good job on that and I welcome Government new clause 15.
My constituency, like other constituencies in London and most of our big cities, has a huge number of people living in the private rented sector, with probably more than one-third of the electorate living in private rented accommodation. Collectively, they face insecurity. Collectively, they are often stressed. Collectively, they are often paying high and excessive levels of rent. It is heartbreaking to see the number of people who make their home in the area, become active in the community and make a huge contribution to our community life in lots of ways, but then the rents go up and up, and they simply can no longer afford to stay. Anyone looking for private rented accommodation within the local housing allowance in most inner London constituencies would search for a long time and be unlikely to find anywhere remotely near that allowance. I see my friend the hon. Member for Bristol Central (Carla Denyer) nodding, and the same situation exists in many other cities across the country.
People on average earnings and working-class communities are simply being driven out by the greed of the private rented sector and the market that goes with it, with rents going up by 10%, 15% and sometimes 20%. That is why I intervened on the Minister earlier, and I am grateful that he gave way and acknowledged the real crisis happening day in, day out across the country. Long-term private sector tenants are at threat, because their landlords know this Bill is coming and that there will be greater restrictions—perhaps there should be more—on their raising of rents and doing no-fault evictions, so they are presently trying to evict large numbers of tenants. I meet many constituents who are going through incredible levels of stress about that. I realise that the Bill is not yet law and has to go through the House of Lords, and I am not clear what date it will be finally enacted; I just hope it is soon. I urge the Minister to consider any kind of urgent action and advice he can give to protect existing tenants in the run-up to the introduction of this legislation.
I pay tribute to the hon. Member for Liverpool Wavertree (Paula Barker) for the amendment she has tabled on rent levels. While there is much in the Bill that I welcome, it is sadly a bit of a missed opportunity. Although it restricts the ability of landlords to raise rents in the future, it does not protect those rents being at a reasonable level. Her amendment, which is a good step forward, would link all rent increases to a combination of wage levels and CPI and give local authorities the power to enforce that. We surely should return to that. I hope that the Government will accept one or other of the many amendments that talk about the ability to review this legislation a year on and two years on to see its effects on rent levels and, above all, on security of tenure and whether ways have been found to get around it.
New clause 9, tabled by the hon. Member for Bristol Central, concerns the protection of tenants with disabilities to ensure that they are not discriminated against, and it is important. It has been widely supported across the House, and I hope the Government will agree it, or at least introduce something similar on Report in the Lords if necessary. The hon. Member is representing an important and genuine need across the country.
Lastly, we have a housing crisis in Britain that is utterly beyond belief and utterly unnecessary. I talk to people every day where I live who are rough sleepers. They are walking around, spending the whole day trying to sell The Big Issue to raise £10 or £20 to pay for a bed in a night shelter that they can only access in the evening and have to leave in the morning. It is not accommodation, it is literally just that: a night shelter. Their life is searching for £20 in order just to survive. I am not saying that the local authority does not do all it can to help—it does. I am not saying there are not lots of housing charities that do the same—there are.
But we have a well known number of people living in destitution in our society, grotesque overcrowding in many council and housing association homes, and insecurity in the private rented sector. The Bill goes a long way in reducing insecurity in the private rented sector, but it must be a wake-up call for our society to invest far more in council housing and in sustainable, affordable social housing.
Alex Sobel
I express my gratitude to the Minister and the Secretary of State for tabling amendments on regulating the student lettings season, and on rent in advance. Both are issues that I have been campaigning on. Over a year ago, I went to Leeds University Union’s cost of living event, where those issues and others were brought home to me starkly. They were also brought home to me by the National Union of Students’ cost of living inquiry, and the all-party parliamentary group on students, which was led by our former colleague Paul Blomfield, and on which I served.
I really thank the Government for tabling amendments 18 and 53 on regulating the student letting season, building on the work of Paul Blomfield, who spearheaded work on this in his constituency of Sheffield Central. I will not press my new clause 4, and I urge Members to support those Government amendments. If there is no regulation of the letting season, students are pressured and intimidated by the rental market into signing tenancies with people they hardly know, sometimes nine months before they are due to move in. Students of all backgrounds are forking out deposits to hold properties. Care leavers, estranged students and students from low economic backgrounds are left to either spend money that they do not have or risk housing insecurity for the next academic year. The Government’s decision to limit the letting season to six months gives students the space and time to create healthy social relationships and save money for a deposit for the next academic year, drastically improving their mental wellbeing.
Government new clauses 13 and 14 are landmark measures that ensure that students are not subject to excessive and exploitative up-front costs by limiting rent in advance. That creates a fairer, more accessible rental market. For example, my constituent Olivia was once required to pay £2,500—six months’ rent up front—to move into a four-bed shared property. She is moving to Leeds to begin her masters. Leaving her without savings for a move to a new city is not how we should treat any person vulnerable to the rental market or looking to be an asset to the community. The Government new clauses will help prevent such unreasonable demands and alleviate financial pressure on tenants, so I am withdrawing my new clause 3 on limiting rents, and urge support for the Government new clauses.
My constituent Olivia’s up-front costs were so high because she could not get a guarantor. Now that we have set limits on rent in advance, we must deal with the other side of the issue: the requirement for tenants to provide guarantors. The practice can exclude individuals who cannot meet those demands, or limit their access to secure housing. Adults who earn their own income can be excluded from signing up to rent basic accommodation in a shared house simply because they are not related to someone who owns UK property. My new clause 11 would place tighter restrictions on the requirement for tenants to provide a guarantor, especially when a tenant’s rental history or income offer sufficient security. By refining those provisions, we can balance the legitimate interests of landlords with the rights and needs of tenants.
My new clause suggests that the need for a guarantor should be restricted when the following circumstances apply: when a reasonable assessment shows that personal income, including state benefits received and any other lawful source of income, is sufficient for the tenant to pay the full rent due under the tenancy; when arrangements are made for housing benefit or the housing element of universal credit to be paid directly to the landlord; when the landlord has entered into a contract of insurance, through which they are insured against non-payment of rent—that has been covered by other amendments—and in such other circumstances as may be prescribed in regulations by the Secretary of State. That gives the Government a wide avenue for implementing my new clause.
The expectation that tenants, despite entering into legally binding rental agreements, must secure a third-party guarantor undermines the very purpose of their rental contract. For many students, particularly those who cannot rely on family support, such as care leavers and estranged individuals, that requirement can make renting nearly impossible. The Bill provides a generational opportunity to raise standards of living in the UK to where they should be. As I will not push my new clause to a vote, I would welcome further discussion and engagement with the Minister as the Bill progresses on how we can change the reliance on guarantors in our rental markets. I know that he is open to that discussion.
In my constituency, 44.8% of constituents live in private rentals, compared with a national average of 19.4%. Leeds is home to a population of over 36,000 non-home students. The Bill is imperative to my constituents. Through its measures, I am hopeful that we can establish a rental market that promotes fairness, reduces inequality and strengthens communities across the UK. I am very happy to support the Government amendments.
Jessica Toale (Bournemouth West) (Lab)
I thank the Minister for introducing the Bill, and all hon. Members on the Bill Committee who gave their time to consider with gravity this long-overdue reform, which will provide greater security and stability for millions of renters across the country. The Bill is particularly important to my constituency, where more than 31% of households are in the private rental sector. That figure is as high as 55% in some wards such as Bournemouth Central, and up to 45% in the wards of Winton, Westbourne and West Cliff.
The private rental sector should provide people with flexibility and be a stepping stone to home ownership, and it should support our local economies, but for too many, as we have heard from many hon. Members, it exacerbates instability and adds financial stress, locking people out of building the savings that they need to get on the housing ladder, as well as adding to mental health issues. That is particularly salient in my constituency, where the cost of housing is disproportionately expensive, given the wages that people can command. The average rent and property price is above the national average in Bournemouth, but average wages are 5% lower than the national average.
The Bill is timely, because in recent months I have been deeply concerned about the growing number of residents who have been in touch to raise issues about housing, to the point that we are hosting three additional housing super-surgeries, aimed at providing constituents with the opportunity to share specific issues, and at giving them advice and guidance from many local organisations that specialise in these issues.
I want to raise a few issues relating to the amendments that many hon. Members will find apply in their constituencies. The first is poor-quality accommodation. In my constituency, one young woman and her daughter have been bounced from mouldy bedsit to mouldy bedsit while they wait for an appropriate social home. In the process, the woman’s daughter has developed asthma. I welcome the reforms relating to the decent homes standard and Awaab’s law.
Lots of people have been in touch who are being forced into homelessness by eye-watering rental increases or section 21 notices. The average increase last year for a one-bed flat in my constituency was 10%. Another young woman and her daughter were made homeless by a section 21 notice following an unaffordable rent increase. She has been unable to find anything that meets her physical and mental health needs—but in any case, she cannot meet the up-front cost of much private rental sector accommodation in our constituency. I welcome the amendment to address up-front costs. Her situation is compounded by long social housing waiting lists. I welcome the wider housing reforms that the Government are bringing forward, including the increased targets for social housing and the wider house building programme.
There are almost 20,000 students living in my constituency. I recently met student union representatives from Bournemouth University and the Arts University Bournemouth, who told me about the struggles their students face, from the stress of finding an appropriate place to live to the timetables for finding accommodation and the struggle to rent. Many students are forced to couch surf because they cannot afford the deposit money or do not have a guarantor who meets the requirements.
Bournemouth is one of the top 10 most expensive places to be a student in the UK; some 95% of the maintenance loan is eaten up by housing costs, leaving many students with about £4 a week afterwards. That is not a sustainable situation. I therefore welcome the measures to protect student tenancies and address the up-front costs for students. It is my hope that in the longer run, many students will benefit from these reforms, will fall in love with Bournemouth and want to stay, and will be able to find appropriate and affordable places to live.
As we have heard, good and responsible landlords have nothing to fear from these reforms. I welcome the measures to give landlords more clarity and a better understanding of their legal obligations, and to address repossession rights. The abolition of section 21, Awaab’s law and the up-front cost provisions will allow my constituents and many across the country to breathe a sigh of relief. I therefore welcome the Bill and new clause 13.
Jacob Collier (Burton and Uttoxeter) (Lab)
For years, renters have faced instability, insecurity and, in many cases, exploitation. Today, we are taking a decisive step towards confronting these injustices. It was a pleasure to serve on the Bill Committee; I believe that we will look back on the Bill as one of the proudest achievements of this Labour Government.
I am proud to support the Government’s new clause 13, which limits the security deposit that a landlord can demand from tenants to just one month’s rent. This change addresses one of the most significant barriers for renters in my constituency: the crippling up-front cost of high security deposits. Previously, landlords were able to demand deposits of up to six months’ rent, a practice that has often priced out renters and left many unable to secure a home. By capping deposits at just one month’s rent, we are making it far easier for tenants to move into their home without facing a financial burden that has long been a barrier to entry to the rental market. New clause 13 is a vital step in making the rental market more accessible and affordable, particularly to those who have been excluded from the market due to high costs. This change will ensure that renters are treated fairly and can more easily get the stability that they need, without facing financial hardship.
The Bill is just one part of a package of measures that support renters and tackle the housing crisis in this country. Those measures include getting on with building those 1.5 million new homes through planning reform; an industrial strategy that gives us the tools to build those homes; and the technical excellence colleges that will deliver skilled people. This Government recognise that the housing crisis is not a problem that can be solved in isolation.
As one of the younger Members of this House, I am part of a generation that feels that we have been trapped in renting. Recent data shows that under-30s are spending more than 30% of their income on rent, which is more than any other group. The people who told us to stop eating avocados and cancel Netflix were not serious about confronting the gravity of the situation. They failed my generation; it is this Government who are taking action today.
The previous Conservative Government had ample opportunity to enact meaningful reform, and I note that Conservatives continue to fail to stand up for renters. Despite their promises to abolish section 21 no-fault evictions—a leading cause of homelessness—they failed to deliver. Instead, under their watch, Parliament was clocking off early while the problems in the country mounted up. They retreated from their housing commitments, and prioritised the appeasement of powerful landlord interests over the welfare of millions of renters.
On Second Reading, the Leader of the Opposition said that resolving the housing crisis hinges solely on increasing housing supply and reducing immigration. Need I remind her that her Government did the exact opposite? In response to comments from the shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), let me note that the Government have already increased housing targets and acted decisively to address illegal migration. However, I reject the premise that renters rights’ should be contingent on these factors alone.
The protection and empowerment of renters is entirely independent of such matters.
As we heard from Shelter and Generation Rent in the Bill Committee, we need to rebalance the power between landlords and tenants. In recent years the balance has favoured landlords over tenants, but the Bill and the Government amendments introduce several key reforms designed to rebalance that relationship. For renters in my constituency, the Bill presents transformative change: families will no longer face the fear of sudden, arbitrary evictions and can truly make their rented properties their homes.
Deirdre Costigan (Ealing Southall) (Lab)
A third of people in my constituency live in private rented accommodation. That is already pretty high, and well above the national average of 19%, but in some wards, such as Southall Green, it rises to almost 50% of people living in rented homes. Ealing borough is what is known as super-diverse, with people from all over the world having made it their home. For many of my constituents in Southall, English is a second, third or even fourth language that they sometimes struggle with. That leaves them wide open to abuse by rogue landlords, and under the previous Government there was nothing they could do about it.
The Conservatives made promise after promise to renters but never delivered. In hock to vested interests, they reneged on every pledge they made to renters, and some of the amendments tabled by the Opposition today continue to prioritise the needs of bad landlords over those of renters.
In 2023, Generation Rent produced a report into renting by the British-Indian community, using data from renters in Southall. The report found that over a third had not received any of the six important documents they were entitled to from their landlord. A third stated that their landlord had threatened them with an unaffordable rent increase. Over half said that their rent had increased in the previous six months, with the average increase being £200 per month, and many were living in damp, overcrowded conditions. The Renters’ Rights Bill will ensure that vulnerable tenants such as those in Ealing Southall are able to go to the housing ombudsman for help. They will also be able to challenge arbitrary evictions and unfair rent rises.
I welcome the Government’s amendments today, which strengthen the Bill even further, particularly new clause 13, which will end the astronomical deposits often demanded from tenants in advance. That is a very important change, particularly in Ealing Southall, because where people face low pay and massive rent costs, it will reduce a barrier to them getting into good-quality, safe housing and ensure that we do not continue to see people sleeping on the streets.
The previous Government sat back while renters in my constituency were condemned to mouldy flats, huge rent rises and the threat of no-fault evictions, but Ealing’s Labour council took action. It introduced a new selective licensing scheme for private landlords, and these schemes were discussed in Committee. Selective landlord licensing schemes require private landlords to have a licence to rent out properties in designated areas of high deprivation or poor housing conditions. They have to meet certain conditions to obtain the licence, such as providing safe and suitable accommodation, complying with fire safety regulations and managing their properties in a responsible manner. In the absence of action from the previous Government, these schemes have allowed councils such as Ealing to enforce higher standards for renters, as the licensing fees and any fines raised from irresponsible landlords are ringfenced for enforcing standards. In Ealing it has also increased awareness for vulnerable tenants of the minimum standards to be expected in rented accommodation.
The previous Government were not big supporters of licensing landlords in this way. They preferred standing up for landlords, rather than standing up for renters. In fact, they changed the law to give the Secretary of State a veto on selective licensing schemes that covered more than 20% of a council area. It looks like the Conservatives still are not big supporters of these schemes, as one of the amendments they tabled in Committee would have removed selective landlord licensing altogether. That would be a massive backwards move, and I am glad the Minister agrees with me.
In fact, before Christmas the Minister announced that he would be removing the Conservatives’ veto, and councils will now be able to expand schemes such as the one in Ealing to the whole borough if they want to. I am delighted that the Government have taken fast action on this without waiting for the Bill to pass, and I look forward to more councils with poor housing and high deprivation levels being able to bring in successful licensing schemes such as the one in Ealing. I also welcome the Government amendments, which will give more power to local authorities to enforce renters’ rights and to pay for enforcement and investigation.
The Conservatives have proved today that they do not care about renters, and most of the points that they have raised are about protecting bad landlords—although so few of the party’s Members have turned up that I wonder whether they care about anything. By contrast, Labour believes that it is time we rebalanced the power relationship between landlords and tenants so that constituents such as mine know their rights and can enforce them, including the rights to fair rent, to safe homes and to secure tenancies. I welcome the real difference that this Bill and the Government amendments will make to the lives of families in Ealing Southall.
Steve Yemm (Mansfield) (Lab)
The reforms outlined in this Bill and the amendments are, of course, long overdue. When I stood for election last year, I promised that I would deliver on five missions for Mansfield, one of which was to fix our broken housing market and ensure that people have affordable homes to rent. Sadly, that mission is necessary because many of my constituents face the constant risk of eviction. They live in fear of massive rent hikes, or endure substandard and even dangerous conditions in their homes.
I will discuss two key aspects of the amendments. First, I support Government new clause 13, particularly in respect of rent and deposits in advance. I will read a few lines from a recent casework email that I received from one of my constituents:
“I saw a house listed for rent and paid a deposit and rent in advance to secure the property. There were a few things that needed doing, which the agency said they would let the landlord know about and get fixed. I received the keys and was shocked that the damp and mould was still there, the radiator in one of the bedrooms was left on the floor and the bathtub was still out of place. The agent told me that the gas engineers told them that ‘the pipes in the house are all botched’. Winter is around the corner and if the heaters were to stop working, I’d have to stay in the house freezing. I’m a nurse and it would not be ideal for me to be off work sick.”
My constituent further wrote:
“I tried every day to get an update and find out if the landlord had sorted out the problems. Every time I had to leave in disappointment. Expecting to move into the new house, I vacated my previous occupancy. I was so mentally, emotionally, physically and financially drained that I went to the agency and I gave them the keys back. I did not feel comfortable living in a house where the landlord is neglecting tenants. If I was to move in and something was to go wrong, he would never come out or get it fixed on time.”
Those are really powerful words from my constituent.
Following that, my constituent was denied any kind of refund for a period of months. They were only able to secure a refund due to a last-minute intervention by my office, after I had suggested that I would name the letting agent in my speech. The letting agent was kind enough to get back to my constituent and has provided them with a full refund today. That outlines the importance of Government new clause 13 and why I am pleased to support it, and it emphasises why the reform set out in the Bill and the amendments is needed. I understand that the decent homes standard outlined in the Bill will force landlords in the private rented sector to make their homes safe and secure, and to give tenants more avenues for financial redress when things go wrong, as in the case of my constituent.
My second point is that we have seen rents increase at a dramatic rate year after year, and it is time that people in the private rented sector got a better deal.
There are usually many applications from prospective tenants when a new property comes to market in my constituency, which often leads to bidding wars driving up the price that is paid to rent the property, pitting tenant against tenant. This leaves only one winner.
I am pleased that the Government have also set the target of building 1.5 million new homes in England over five years, which will make a huge difference. I recognise and welcome those measures.
Neil Duncan-Jordan (Poole) (Lab)
I would like to echo the comments of my neighbour, my hon. Friend the Member for Bournemouth West (Jessica Toale), and the references that she made to the housing problems in our area. Today marks a once-in-a-generation moment, with the biggest change to private renting since the Conservatives’ Housing Act 1988. The Thatcher reforms aimed to rejuvenate private renting by making it more attractive to landlords, but instead they helped to sow the seeds of the housing crisis we see today.
England’s 12 million private renters face some of the worst-quality housing in the developed world, with shocking levels of damp and mould and low rates of insulation resulting in health problems and unaffordable energy bills. Instead of producing competitive and affordable housing, decades of tipping the scale towards landlords has resulted in homes that are insecure, eye-wateringly expensive and often short term in nature. While renters in countries such as Germany enjoy secure, long-lasting tenancies with rights to redress when things go wrong, tenants in England can be put out on the street by a no-fault eviction if they complain about a leaky roof or a broken boiler.
I rise to speak in support of new clause 3, which would limit rent in advance of tenancy; new clause 7, which would limit proposed rent levels; and new clause 9, which covers the right to have home adaptations made to a property. We know that this legislation will end the exploitative bidding wars that drive up rental prices, stamp out discrimination on renting to families with children or those on benefits, and give renters the right to request pets in their home.
With section 21 finally consigned to history, tenants will also benefit from longer notice periods, giving them more security in their homes, and we will hold landlords accountable for health hazards in their properties. No longer should tenants and their families suffer damage to their health because a landlord refuses to act. However, to truly deliver a more secure future for renters in England, the Bill needs to close a loophole that would allow no-fault evictions to continue via rent hikes. Amendment 9, tabled by my hon. Friend the Member for Liverpool Wavertree (Paula Barker), would cap in-tenancy rent rises. It would introduce a cap on the amount a landlord can raise the rent of a sitting tenant, so that no one has to face a rent hike higher than wage growth or inflation.
Everyone deserves to have basic security in their home, whether they rent or own. People with mortgages tend to have relatively predictable costs. Tenants have no such peace of mind. Today, there is nothing to protect tenants from extortionate, unjust rent hikes. The Renters’ Rights Bill does not do enough to change that. Last year, a Government survey of landlords found that rent increases of 15% or more when renewing or extending a contract are common. Despite the Bill’s passage, renters who cannot afford extortionate rent hikes will continue to have no alternative but to move, fall into debt or face eviction. There is a real danger that landlords will continue to evict tenants or threaten them with eviction at will, with unfair rent increases taking the place of section 21 evictions.
The Bill’s provisions to allow renters the right to appeal to a tribunal that can determine a market rate increase are insufficient. By definition, market rates are already unaffordable for many renters. Only capping rent increases will give renters genuine security in their home and stop landlords threatening vulnerable people with unaffordable rent hikes or homelessness.
Beyond security, the biggest issue most renters face is the fast-growing cost of having a home to live in. The amount of income that families in this country are losing to rent is rapidly becoming unsustainable. Nearly two thirds of working renters in England struggle to afford their rent, according to recent research by Shelter. Rent produces almost zero social benefit. It takes money away from working-class people who could otherwise spend it in their community, and it passes that money to property owners. What simpler, more effective way could there be to ease the cost of living crisis for millions of people and put money back in their pockets than by limiting their largest outgoing?
Rent stabilisation measures are common across Europe. In France, the annual increase is limited to 3.5%. Meanwhile, in England, rent has been rising faster than wages for well over a year, and the average annual increase reported in December was 9.3%. A cap on rent increases has the support of housing charities, renters’ organisations and major unions. It also has strong public support. When it comes to the housing crisis, we must keep all options on the table, and I hope the Government will back these changes to the Bill.
Ultimately, we need to increase the supply of council housing at affordable rents. In my constituency of Poole, we have some of the highest rents relative to wages in the country. Change, therefore, cannot come soon enough for those renters, and this Bill is a welcome first step.
John McDonnell (Hayes and Harlington) (Ind)
I will address new clauses 5 to 7 and amendments 9, 5 and 6, which deal with rent controls.
Before I do so, I should say that I take a particular interest in new clause 9, tabled by the hon. Member for Bristol Central (Carla Denyer), which I have signed. I chair an unpaid carers group, and there is a real concern that even where renters have an assessment done for aids and adaptations, they cannot enforce it on their landlord, which leaves them vulnerable. They then have no choice but to move, with all the disruption that involves, particularly if they are caring for someone with significant disabilities.
I did not think that this was a contentious issue, and I hope the Minister will assure the hon. Member for Bristol Central that there can be further dialogue as the Bill goes to the House of Lords. If we have that dialogue, I think we can find something that will satisfy all concerned, to give strength to those with disabilities and those caring for them, while satisfying the Government about the ramifications of an amendment of this nature. If we can get that form of words, I would urge the hon. Member not to press her amendment to a vote. If it were voted down, it would send a message to the Lords that the Commons does not support it, whereas I think there is support in this House, but not necessarily for this form of words. Sometimes it is best not to snatch defeat from the jaws of victory. I think we might have something here, but I will leave that to the hon. Member’s judgment.
Briefly, on rent controls, my hon. Friend the Member for Ealing Southall (Deirdre Costigan) mentioned her constituency. Mine is next door, and I represent a working-class, multicultural community, where we have been going through a housing crisis for at least the last decade. I have lived there for 50 years and the crisis is on a scale that we have never seen before, caused, as others have said, by the selling off of our council houses. The irony here is that the same council houses that have been put into the hands of private landlords are now being rented back at very high rents to house the homeless people the council is placing in them.
With the Government’s policy of increasing housing supply and the 1.5 million new homes we are about to build, I hope that a large number of those homes will be social or council housing. As a result, we can start to tackle the housing crisis in my constituency. In the meantime, however, we will be dependent on the private rented sector.
The only reason I am speaking is the representations I have had from constituents, knowing that the Bill was coming up. I have also worked with Acorn, the Renters’ Reform Coalition and various other agencies. Those constituents have said, “Can you try to at least get across the plight we are facing at the moment?” That plight is dependent, to be honest, on landlords who are ripping them off. The concept of price gouging is emerging in all our discussions about the economy; well, here is an element of price gouging. With private rented landlords, particularly in London, we have seen profit ratios of anything between 5% and 20%. The argument is made that we can have a tribunal system. People can go to the tribunal, which will determine things on the basis of the market rent. In fact, the market rent is determined by what is almost an oligopoly of landlords in a particular area, who maintain high rents because they want to maximise profits.
The housing conditions in the private rented sector in my constituency are, in some instances, absolutely appalling. If a tenant complains, that is when the section 21 comes in. Indeed, tenants are terrified of complaining because if they get evicted, they probably face higher rent elsewhere. That is why we need a comprehensive system of rent controls. I do not see any other solution and I hope that, although the Government will not accept the amendments today, we can have a dialogue. That way, maybe between now and the Bill’s passage through the Lords or in future legislation, we can address the issue of rent controls.
The argument is very simple: we just want a system where rents are linked to wages or inflation. That way, people cannot be ripped off by higher rent increases. That is not rocket science. I am old enough to remember when we had rent controls, with a local rent officer who the local authority would send round. They would determine a fair rent and also what was fair in terms of wages and income for any future rental levels. Rent controls operate across Europe and it has not had an impact on the supply of private rented housing elsewhere. It is a system that could be readily introduced.
I worry that if we do not do that now, we will be back here in a couple of years’ time with the same problems. Although we want to build new homes at speed, we will still be dependent on the private rented sector and on some, but not all, landlords—we have good landlords as well—who are basically profiteering at the expense of homeless people.
Turning to my final point, the issue of developing a tribunal system was raised by the right hon. Member for Islington North (Jeremy Corbyn). The tribunal system needs to ensure that people are properly represented and have time to take on the system. Most of us with a trade union background will have dealt with employment tribunals over the years. They can be effective, but the only reason for that is that we have the might and organisation of the trade union movement. We do not have that in the rental sector to represent tenants.
Although I welcome the idea that we will have a thorough tribunal system that is effective in dealing with hard cases, it is not realistic to expect tenants in my constituency to utilise that without the resources to do so, particularly as we have lost a lot of our advice agencies as a result of austerity. That is why we will need to come back and discuss again the solution of rent controls, which my hon. Friend the Member for Liverpool Wavertree (Paula Barker) brought forward.
Amanda Martin
Good-quality, secure and decent rentals should not be too much to ask, and I thank those landlords who do provide that in my city and beyond. I welcome the Government amendments to this detailed Bill, which will help residents in Portsmouth North to rent homes that are both secure and decent.
Tom Hayes (Bournemouth East) (Lab)
There can be few places in our country that need this Bill more than Bournemouth East. A total of 33% of households in my constituency are in private rented accommodation, which is considerably more than the national average of 19%. In Boscombe West, a ward, 60% are private renting, and in East Cliff, where I live, it is 56%. Rents went up in Bournemouth, Christchurch and Poole by 9% in the year to October 2024, which is higher than the national average. Some 81% of respondents to Shelter’s Dorset survey in BCP said that they were struggling to pay their rent. As somebody who used to lead a mental health charity, I know the link between health outcomes, poor mental health and poor rented accommodation. For everybody living in poor rented accommodation in Bournemouth East, I know there will be a significant effect on health outcomes.
I want to talk briefly about the abolition of no-fault evictions and bring my constituents into the debate. My constituent Caroline from Boscombe had lived in overcrowded private rented housing with her two children with special educational needs and disabilities for 11 years before being given a section 21. Being forced to move at short notice has significantly negatively affected her mental health. The Labour Government’s abolition of so-called no-fault evictions in the Bill will go a long way to giving tenants like Caroline greater security.
I also welcome a decent homes standard now being applied to the private rented sector. My constituent Naomi, from Boscombe, recently contacted me about the repeated incidence of mould in her one-bedroom rented flat, which she shares with her partner and their 10-week-old baby. The flat also has dangerous loose floorboards, a leaking shower and fire doors that do not close. Her landlord continues to ignore her emails. The provisions in the Bill that apply the decent homes standard to the private rented sector will give renters like Naomi safer, better-value homes and remove the blight of poor-quality homes from our communities.
Mr Luke Charters (York Outer) (Lab)
My hon. Friend is making an excellent speech. May I raise the case of one of my constituents? He is a dad with a young daughter, and he has a chronic illness. Not only did he have many unfair deductions to his deposit at the end of his tenancy, but the landlord refused to fix the shower because they claimed it was some other sort of device—what a disgrace. Does my hon. Friend agree that we need to get through that Division Lobby, fight for our constituents and reform renters’ rights once and for all?
Tom Hayes
I never disagree with my hon. Friend, and his point shows why we need the Bill.
I welcome the Bill’s protections against unreasonable rent rises and rental bidding. My disabled constituent Tracey, also from Boscombe, got in contact with me about how a substantial hike in her rent acted as an effective eviction as she was unable to pay. Despite looking to use her personal independence payment towards her rent, she was forced to look for alternative accommodation, and we all know how difficult that is in the private rented sector for people with disabilities. I welcome the protections in the Bill against unreasonable rent rises because they will provide much-needed security for renters like Tracey who struggle to find appropriate accommodation in the rented sector to meet their needs.
I also welcome the introduction of a new ombudsman service, which will provide quick, fair, impartial and binding resolutions for tenants’ complaints about their landlord, bringing tenant-landlord complaint resolution on a par with established redress practices for tenants in social housing or consumers of property agent services. I welcome the move to make it illegal for landlords to discriminate against tenants in receipt of housing benefit or other benefits or with children when choosing to let their property. That particularly affects James in my constituency, who is homeless and cannot secure private rented housing because he is in receipt of benefits.
All of us who hold constituency surgeries week in, week out will know these stories. All of us have campaigned for better renters’ rights because we have heard those stories on the doorstep, and I commend the Government for bringing forward the Bill at such an early stage in this Parliament. We must of course make the point that not all landlords are bad, but the Bill is important because it weeds out those bad landlords so that the good landlords—those who care about their tenants and who provide an important duty to the housing market—can continue to have a good reputation, and so the overall market continues to have that good reputation.
I commend the Bill and the ministerial team for bringing it forward. I am thrilled that renters in Bournemouth and across Britain will finally, after many years of delay, get the renters’ rights they deserve—no, that they are entitled to.
Matthew Pennycook
Let me begin by thanking all hon. Members for their contributions. It has been a thoughtful and good-natured debate, and while there are many genuine points of difference and emphasis, there is a consensus across the House that reform of the private rented sector is long overdue and must be taken forward.
In the time I have available to me, I will respond to a number of the amendments and key arguments. In his contribution, the shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), suggested that Government new clauses 13 and 14 risk locking out of the rental market those renters who are on the financial margins and fettering landlords and tenants coming to fair agreements on tenancies in the assured regime that we are introducing. I gently say to him that he seriously downplays the imbalance between landlords and tenants, and the fact that requiring multiple months of rent from a tenant in advance when agreeing a tenancy is unfair, places considerable strain on tenants and can exclude some people and families from renting altogether.
Landlords will continue to be able to take a holding deposit of up to one week, a tenancy deposit of five or six weeks’ rent and up to one month’s rent in advance before a tenancy has begun. They will also be free to undertake the necessary referencing and affordability checks to give them confidence that a tenancy is sustainable for all parties. If and when they are not satisfied by the outcomes of pre-tenancy checks, options are available to tenants and landlords to ensure that rent in advance need not be used—requesting a guarantor or engaging in landlord insurance, for example. I hope that provides the shadow Minister with a degree of reassurance on that point.
The shadow Minister tabled a number of amendments—several of which we debated in detail in Committee. With regard to amendments 57, 58 and 60, I restate the argument that I made in Committee: fixed terms mean that tenants are locked into tenancy agreements without the freedom to move should their personal circumstances change, and compel tenants to pay rent regardless of whether a property is fit to live in, reducing the incentive for unscrupulous landlords to complete repairs. For that reason, the Government remain firmly of the view that there is no place whatsoever for fixed terms of any kind in the new tenancy regime that the Bill introduces.
A number of hon. Members referred to problems with short-term lets. The Government are cognisant of the impact that excessive concentrations of short-term lets can have on the affordability and availability of local housing and the sustainability of local communities. We are committed to monitoring that issue and, as the Liberal Democrat spokesperson, the hon. Member for Taunton and Wellington (Gideon Amos), knows, we are exploring what further powers local authorities need to bear down on it. However, putting an arbitrary deadline in law, as new clause 2 would do, is not the way to proceed.
Gideon Amos
I am grateful to the Minister for his response on that issue. Will he comment on the question of a use class order for second homes?
Matthew Pennycook
The hon. Gentleman tempts me to engage in an entirely different debate. I am more than happy to update him, at the appropriate time, with all the measures that the Government will take forward in response to that issue. He can be assured, however, that we are giving it serious attention, and this will not be a case of the Government kicking something into the long grass.
The Government are clear that we will not delay on giving renters the long-term security, rights and protections that they deserve by making the necessary and long-overdue transformation of the sector, contingent on a broad and undefined assessment of the possession process, as new clause 19 and amendment 56 propose. The shadow Minister knows that I fully agree with him that court readiness is essential to the successful operation of the new system. That is why my officials and I are working closely with the Minister for Courts and Legal Services and her team to ensure that the Courts and Tribunals Service is ready when the new tenancy system is brought into force.
The shadow Minister also pressed the Government to place in the Bill a legal requirement to publish an annual review of its impact on the availability of homes. He will know that the Government have published a green-rated impact assessment. We will, of course, closely monitor the impact of the Bill on the housing market, but setting an arbitrary deadline in law for doing so would, we believe, detract from that work. Although I do not begrudge him for tabling new clause 20 to make that point, he will know that no Government could accept such an amendment.
The Liberal Democrat spokesperson, the hon. Member for Taunton and Wellington, and several Members of his party raised the issue of military accommodation and tabled amendment 3. There is no dispute about that amendment’s objective—namely to ensure that all service accommodation equals or exceeds the decent homes standard. The Government have made that commitment. Where we do disagree is on whether the approach that we are taking in the Bill is appropriate for the unique circumstances surrounding Ministry of Defence accommodation. We do not believe that it is, for various reasons that we discussed at length in Committee, including the problems that local authorities have in inspecting accommodation that is behind the wire on sensitive MOD bases.
As the hon. Gentleman is aware, the Ministry of Defence is committed to reviewing its decent homes-plus standard for accommodation, with the aim of improving the standard of SFA across the estate, where it needs improvement, as part of its long-term strategy for service accommodation. That review will be informed by my Department’s work on housing standards, including our review of the content of the DHS, which Ministers in the Ministry of Defence are committed to aligning with. The Ministry of Defence will provide further information on the review of its target early in 2025.
Gideon Amos
The Minister is generous in giving way. On the question of accommodation behind the wire, to clarify, amendment 3 deals with service family accommodation. Service family accommodation is generally not behind the wire; it is on the street, where councils can access it.
Matthew Pennycook
That is only one of the issues; as the hon. Gentleman knows, we debated many others in Committee. I appreciate that there is a principled disagreement on this point. We share his objective, but we think that there is a different and more sensible way to go about meeting it. Addressing service accommodation through this Bill is not the way to proceed.
Calum Miller
I am very grateful to the Minister; I appreciate the time constraints that he faces. The critical question is when those in our communities who live in service accommodation can expect it to reach the standards that he and his colleagues intend to set out. I appreciate the co-operation with Defence Ministers, but can the Minister give us a date by which that standard will be in place?
Matthew Pennycook
I am sympathetic to the hon. Gentleman’s question and his desire for that information, but it is not for me to give a date from the Dispatch Box today; my colleagues in the Ministry of Defence will provide further information on the review of that target standard early this year.
The Liberal Democrat spokesman, the hon. Member for Taunton and Wellington, along with my hon. Friend the Member for Liverpool Wavertree (Paula Barker) and the hon. Member for Bristol Central (Carla Denyer), spoke in support of their respective amendments to introduce forms of rent control. I assure each of those Members that I entirely understand their concerns about the affordability of rent generally, and specifically the potential for retaliatory no-fault economic evictions. Once section 21 evictions are done away with, unscrupulous landlords will no doubt attempt to evict tenants who assert their rights by means of extortionate rent rises.
However, as we debated extensively in Committee, the Government sincerely believe that the introduction of rent controls in the private rented sector could harm tenants as well as landlords by reducing supply and discouraging investment. While I fully appreciate that there is a broad spectrum of regulation that falls under the title of rent control, there is, as we debated at length in Committee, sufficient international evidence from countries such as Sweden and Germany, cities such as San Francisco and Ontario, and the Scottish experience since 2017, to attest to the potential detrimental impacts of rent control. For that reason, we believe that we should proceed on the basis of the protections that the Bill provides against unreasonable within-tenancy rent rises, as well as wider action to improve affordability, not least support for the growth of the build-to-rent sector.
My hon. Friend the Member for Liverpool Wavertree also tabled new clause 5, which would place a duty on the Secretary of State to conduct a review of the tenancy deposit protection schemes and requirements. The contracts governing those schemes are due to end next year, and their re-procurement provides an opportunity for the Department to review their objectives and how they operate. I am more than happy to engage with my hon. Friend on that process; on that basis, I ask her to not divide the House on her new clause. I am also more than happy to ensure that she is closely involved in the development of the PRS database. We believe that there are good reasons for the detail relating to that database to be laid out in secondary legislation, rather than put in the Bill, as her amendment 7 stipulates. However, it is our clear expectation that the database will capture key information about landlords, and we recognise that there may be clear benefits in using it to collect a wider range of information, as her amendment suggests.
My hon. Friend also tabled new clause 6, which would require local authorities, if requested, to pay or guarantee the tenancy deposits of care leavers seeking to access the private rented sector. I am of the view that local authorities, rather than central Government, are best placed to assess the best way of supporting care leavers in their area. I reassure my hon. Friend that while local authorities maintain their ability to support care leavers in their areas, the Government are committed to putting in place the support that local government needs to do so effectively.
My hon. Friend the Member for Leeds Central and Headingley (Alex Sobel) made a strong case for new clause 11 on acting to limit guarantors. I appreciate fully that obtaining a guarantor can be difficult for some prospective tenants, and I understand the reasoning behind his amendment. However, I am also mindful that in some instances the use of guarantors can provide good landlords with the assurance necessary to let their properties to tenants who may otherwise find it difficult to access private rented accommodation. For example, there are those with a poor credit history—the kind of tenant who the shadow Minister worries our rent-in-advance amendments will harm. Having considered this issue in great detail, I ultimately concluded that limiting guarantors could inadvertently make life more difficult for certain types of renter. That said, I will keep the matter under review, and I am more than happy to engage in a dialogue with my hon. Friend about this in the weeks and months to come.
Several Opposition Members mentioned new clause 22, in the name of the hon. Member for St Albans (Daisy Cooper). The Government are clear that all landlords must keep their properties in a fit state, and that there need to be robust routes of redress when they do not. However, tenants can already take their landlord to court if their home is unfit for human habitation, and if the courts find that landlords have not met their obligations, they can award compensation, as well as requiring landlords to carry out repairs. For that reason, while agreeing entirely with the objective, I believe that the hon. Lady’s amendment is unnecessary.
I will briefly refer to two amendments on the amendment paper that were not spoken to by the Members who tabled them. My hon. Friend the Member for Nottingham East (Nadia Whittome) rightly called for protection from discrimination for renters who require home adaptations. The rental discrimination provisions in the Bill are specifically designed to protect victims of discrimination who may not be eligible to make a case under the Equality Act 2010, such as those who have children or are in receipt of benefits. People with a disability are already afforded protections from discrimination relating to the provision of housing or services under the Act. For that reason, we do not believe her new clause 24 is warranted, but I am more than happy to discuss the matter with her outside the Chamber.
My hon. Friend the Member for Warrington North (Charlotte Nichols) tabled amendment 11 to make rent repayment orders available for initial failure to be a member of the PRS landlord ombudsman or to register with the PRS database. She will recognise that we have significantly strengthened the RRO provisions in the previous Government’s Renters (Reform) Bill. However, I took the view that it would be inappropriate to extend rent repayment orders to non-criminal breaches of the kind that her amendment covers. Instead, local authorities will be able to issue civil penalties for the initial failures in question, with the possibility of higher financial penalties and RROs if landlords fail to sign up, having been fined.
Finally, I will mention the amendments relating to home adaptations—both new clause 9, in the name of the hon. Member for Bristol Central, and new clause 23, in the name of the hon. Member for Taunton and Wellington. Both amendments seek to require PRS landlords to permit home disability adaptations for assured tenants when these have been recommended in a local authority home assessment. The hon. Member for Bristol Central tabled the same amendment in Committee, and as we discussed then, the Equality Act already provides that landlords cannot unreasonably refuse a request for reasonable adjustments to a disabled person’s home. As I said in Committee, measures already in this Bill will improve the situation for disabled renters who request home adaptations. The abolition of section 21 notices will remove the threat of retaliatory eviction, empowering tenants to request the home adaptations they need and to complain if their requests are unreasonably refused. In addition, we are establishing the new PRS ombudsman, which will have strong powers to put things right for tenants where their landlord has failed to resolve a legitimate complaint.
I must say candidly to the hon. Lady that I remain somewhat unconvinced that these amendments are the way to address this absolutely legitimate issue—I recognise the problem she identifies—and for that reason, the Government will not be able to accept them. However, I can give her the assurance that we will commit to continuing to consider what more we may need to do to ensure that requests for reasonable adjustments cannot be unreasonably refused, including those recommended by local authority home assessments. I am more happy to engage with Members across the House, and to meet her, the hon. Member for Taunton and Wellington and other Members who have concerns on the subject, to discuss her amendment and the problem generally in more detail. I hope that, on that basis, she will consider not pressing her new clause to a vote.
Carla Denyer
If the Minister can confirm that the cross-party meeting will include the Chair of the Housing, Communities and Local Government Committee, and that it will take place before the Bill goes to the Lords, I will be happy to withdraw my new clause.
Matthew Pennycook
I will happily give the hon. Member that assurance, and I am more than happy to ensure that my hon. Friend the Chair of the Committee attends, as well as any other Member with an interest in this issue. It is important, and I understand the problem that the hon. Member outlines. There are reasons why we do not think the new clause is necessarily the best way to approach the issue, but I am more than happy to have a dialogue on that point.
In conclusion, today we are making targeted amendments that aim to ensure that the Bill operates as intended. In many cases, we think that the amendments pushed by hon. Members are unnecessary, because we think that the Bill strikes the right balance between the interests of landlords and those of tenants. On that basis, I hope the whole House can get behind the Bill this evening.
Question put and agreed to.
New clause 13 accordingly read a Second time, and added to the Bill.
Prohibition of rent in advance before lease entered into
(1) Schedule 1 to the Tenant Fees Act 2019 (permitted payments) is amended in accordance with subsections (2) and (3).
(2) After paragraph 1(1) (rent is a permitted payment) insert—
“(1A) But a payment of rent is a prohibited payment if—
(a) it is payable before the tenancy is entered into, and
(b) the tenancy is an assured tenancy.
(1B) This paragraph is subject to paragraph 1A.”
(3) For sub-paragraph (2) of paragraph 1 substitute—
“Increased rent
1A (1) If the amount of rent payable in respect of any relevant period (“P1”) is more than the amount of rent payable in respect of any later relevant period (“P2”), the additional amount payable in respect of P1 is a prohibited payment.
(2) That is subject to the following provisions of this paragraph.”
(4) After section 5 of the Tenant Fees Act 2019 insert—
“Other provision about rent in advance
5A Pre-tenancy payments of rent: prohibitions
(1) A landlord must not—
(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to the landlord in connection with an assured tenancy of housing in England,
(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to the landlord in connection with an assured tenancy of housing in England, or
(c) accept from a relevant person a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.
(2) A landlord must not—
(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connection with an assured tenancy of housing in England,
(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connection with an assured tenancy of housing in England, or
(c) accept from a third party a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.
(3) A letting agent must not—
(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to the letting agent in connection with an assured tenancy of housing in England,
(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to the letting agent in connection with an assured tenancy of housing in England, or
(c) accept from a relevant person a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.
(4) A letting agent must not—
(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connections with an assured tenancy of housing in England,
(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connection with an assured tenancy of housing in England, or
(c) accept from a third party a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.
(5) The Secretary of State may, by regulations made by statutory instrument, amend this section for the purpose of making provision about the descriptions of rent due in advance to which any provision of subsection (1), (2), (3) or (4) applies.
For this purpose “rent due in advance” means rent due before the period for which it is payable.
(6) Regulations under subsection (5)—
(a) may make different provision for different purposes;
(b) may make supplemental, incidental, consequential, transitional, transitory or saving provision;
(c) are to be made by statutory instrument.
(7) A statutory instrument containing regulations under subsection (5) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.
(8) In this section “prohibited pre-tenancy payment of rent” means a payment of rent that is prohibited by paragraph 1(1A) of Schedule 1.
5B Effect of a breach of section 5A
A term of an agreement between a letting agent and a relevant person which breaches section 5A is not binding on a relevant person.
Where a term of an agreement is not binding on a relevant person as a result of this section, the agreement continues, so far as practicable, to have effect in every other respect.”
(5) The Tenant Fees Act 2019 is further amended as follows—
(a) in section 6 (enforcement by local weights and measures authorities)—
(i) in subsection (1), in paragraph (b) omit “and” and after that paragraph insert—
“(ba) section 5A (pre-tenancy payments of rent: prohibitions), and”;
(ii) in subsection (3), for “or 2” substitute “, 2 or 5A”;
(b) in section 7 (enforcement by district councils), in subsection (1), for “and 2” substitute
“, 2 and 5A”;
(c) in section 8 (financial penalties), in subsection (1), for “or 2” substitute “, 2 or 5A”;
(d) in section 10 (recovery by enforcement authority of amount paid)—
(i) in subsection (1)(a), for “or 2” substitute “, 2 or 5A”;
(ii) after subsection (2) insert—
“(2A) But that obligation to pay the amount, or remaining part, of the prohibited payment is subject to subsection (3), unless it is a case where the payment is prohibited by paragraph 1(1A) of Schedule 1 (pre-tenancy payment of rent).”;
(iii) in subsection (3), for “But subsection (2) does not apply in relation to a prohibited payment” substitute “Subsection (2) does not apply in relation to the prohibited payment”;
(e) in section 15 (recovery by relevant person of amount paid), in subsection (1)(a), for “or 2” substitute “, 2 or 5A”.”.—(Matthew Pennycook.)
This amends the Tenant Fees Act 2019 so that rent in advance payable before the tenancy is entered into is a “prohibited payment” for the purposes of that Act. The new section 5A then also adds new prohibitions relating to that kind of prohibited payment.
Brought up, and read the First time.
Question put, That the clause be read a Second time.
The House divided: Ayes 372, Noes 114
[Division lists to follow.]
Question accordingly agreed to.
New clause 14 read a Second time, and added to the Bill.
Matthew Pennycook
I beg to move, That the Bill be now read the Third time.
It has been a real privilege to take this vital piece of legislation through the House. I want to thank everyone who has played a role in getting the Bill to this stage: my right hon. Friend the Deputy Prime Minister for her passionate commitment to improving the lives of England’s 11 million private renters; the Department’s Bill team who have worked tirelessly on the legislation for the past six months; my outstanding private office, including my fantastic private secretary Will Gaby, who has led the team on the Bill; the Clerks, Chairs and parliamentary counsel for facilitating its progress; the witnesses who gave evidence to the Committee; and hon. Members from across the House who provided valuable input today and at previous stages.
The current system for private renting is broken. While the Government recognise that the majority of landlords provide high-quality homes and a good service to their tenants, it remains the case that the private rented sector still provides the least affordable, poorest quality and most insecure housing of all tenures. This intolerable state of affairs is why renters have been demanding change for many years, and I am extremely proud that this Government have acted so early in the Parliament to deliver it.
The Renters’ Rights Bill will deliver on our manifesto commitment to overhaul the regulation of the private rented sector and to decisively raise standards within it. It is bitterly disappointing that despite not forcing a single Division in Committee, the Opposition decided today to set their face firmly against private rented sector reform on the basis of a series of specious and, indeed, spurious arguments. They may be intent on letting down England’s private renters once again, but this Labour Government will not put tens of thousands of them at risk of homelessness, nor will we prolong the uncertainty that responsible landlords across the country have experienced over recent years by hesitating. We will finish the job and give England’s 11 million private renters the greater security, rights and protections they deserve. I wish Baroness Taylor the best with moving the Bill forward in the other place, and I commend it to the House.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Kevin Hollinrake, who has 35 seconds.
Kevin Hollinrake (Thirsk and Malton) (Con)
I draw the House to my entry in the Register of Members’ Financial Interests.
It is not wrong, spurious or specious to stand up for 11 million tenants. We know that tenants and landlords are two sides of the same coin. As the Leader of the Opposition said, we agree that tenants need a better deal, but this Bill will not give that to them. The Minister is following in the footsteps of Scotland. The Bill will reduce supply and push up rent, and that is why we are against it—
Renters’ Rights Bill
Wednesday 15th January 2025
(1 year, 6 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Amendment Paper: Consideration of Bill Amendments as at 14 January 2025 - (14 Jan 2025)
Renters’ Rights Bill
Tuesday 4th February 2025
(1 year, 6 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 14 January 2025 - (14 Jan 2025)
Baroness Taylor of Stevenage
That the Bill be now read a second time.
Scottish and Welsh Legislative Consent sought.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I extend my thanks to the many noble Lords with whom I have spoken about this Bill, and to Members of this House and people outside it who have worked so hard to improve the private rented sector over many years. I am looking forward to the maiden speeches of my noble friends Lady Brown and Lord Wilson.
The private rental system needs to change. It currently provides the least affordable, poorest quality and most insecure housing of all tenures. The insecurity it engenders creates uncertainty in the lives of tenants and allows good landlords to be undercut by the minority of rogues and chancers. In short, the 11 million private renters and the 2.3 million landlords across England are being failed.
The Renters’ Rights Bill brings forward the most significant changes to the sector for nearly 40 years. The Bill will strengthen the security of tenure for tenants; ensure that they are paying a fair rent; guarantee a minimum standard that they can expect from a property; provide new robust avenues to redress; and more. The Government have worked closely with those across the sector to ensure that the Bill’s measures strike the right balance. I will set out some of these key measures.
As many noble Lords will be aware, the Bill will deliver the Government’s manifesto commitment to abolish Section 21 no-fault evictions as soon as possible, removing the threat of arbitrary eviction and granting renters the security and stability they deserve. Section 21 evictions can wreak havoc with tenants’ employment, schooling and lives in general. As leader of Stevenage Council, I saw at first hand the knock-on effects that arbitrary evictions can have on families’ physical and mental health, with more people pushed into inadequate temporary accommodation. The case that always sticks with me is that of the parents of a child with special educational needs, who fought and fought to get their child into a school near where they lived but were then evicted from the very property that was near to that school.
It is unacceptable that over 123,000 households in England are currently living in temporary accommodation. This includes 159,380 children—the highest number of children in temporary accommodation on record. Removing this threat will immediately improve the lives of millions.
The Government also recognise that the vast majority of landlords provide an excellent service, and it is vital to ensure landlords can reclaim their properties when they need to. To this end, new, clear and expanded possession grounds will be introduced. We will ensure these are as watertight as possible, so that they cannot be abused by landlords seeking possession for the wrong reasons. These robust grounds will ensure that there is no room for loopholes in the system, and tenants will benefit from longer notice and protected periods.
The new tenancy system will operate on the basis of periodic tenancies. This will support tenants who want to leave poor-quality homes or face circumstances such as domestic abuse. Tenants will be able to give two months’ notice at any point.
I know several noble Lords have raised concerns about the removal of fixed-term tenancies. To be clear, it is a core principle of this Bill, and this Government’s firm belief, that there is no place for fixed terms in the future assured tenancy system. Both landlords and tenants will benefit from a simpler system, with a single set of rights and responsibilities. Neither group should be locked into a fixed term if their circumstances change.
In designing the grounds, the Government took time to ensure the Bill works for everyone, including students. To meet this goal, a new possession ground has been created to allow landlords renting to students in HMOs to seek possession ahead of each new academic year, facilitating the yearly cycle of short-term student tenancies. To further protect the student market, private purpose-built student accommodation will be removed from the assured tenancy system in recognition of the limited market such accommodation focuses on, and the differences between purpose-built accommodation and “off-street” private housing rented to students. Providers must sign up to government-approved codes of practice, which will ensure homes are safe and good quality, to be removed from the assured tenancy system.
The Bill also makes changes to the system by which rent can be increased, preventing unscrupulous landlords from using unfair rent increases to evict tenants by the back door. Landlords will now be able to increase rents only once per year and they must do so through the Section 13 process. Tenants will be empowered to challenge egregious increases at the First-tier Tribunal, without fear of receiving a higher rent than the landlord initially intended.
To further support tenants trying to do the right thing, a mandatory repeated rent arrears ground will not be included in the Bill. We will also increase the mandatory threshold for eviction under the mandatory rent arrears ground from two to three months.
The Bill proposes new laws to end the cruel practice of rental bidding wars by landlords and letting agents. For too many tenants, rental bidding restricts their ability to make an informed choice about one of the most financially significant decisions they face. They are led to think they have found a property they can afford to rent, only to discover they would need to pay way over the asking price to secure it. Our reforms will end this practice for good. Landlords and letting agents will be required to publish an asking rent for their property and will then be prohibited from asking for, encouraging or accepting a higher offer.
Following amendment on Report in the Commons, the Bill will also limit the amount of rent in advance that a landlord can require after the tenancy has been signed but before the tenant has taken possession to a maximum of one month. That aside, landlords will no longer be able to include any terms in the tenancy agreement that have the effect of requiring rent to be paid prior to the rent due date. Tenants will retain the flexibility to make payments of rent in advance during the tenancy should they wish to do so. Taken together, these measures will prevent the small number of unscrupulous landlords setting tenants against each other or excluding altogether renters who are perfectly able to afford the monthly rent on a property.
Everyone in the private rented sector is entitled to a safe and decent home. This Bill will make it illegal for landlords and letting agents in England, Scotland and Wales to discriminate against tenants in receipt of benefits or because they have children. Local councils will have strong enforcement powers to tackle unlawful practices related to rental discrimination. Mortgage lenders and insurers will also no longer be able to impose restrictive discriminatory terms.
Pets can bring a huge amount of joy to people’s lives, and this cannot be restricted to those lucky enough to own their own home. We are committed to supporting responsible pet ownership in the private rented sector. The Bill will ensure that landlords do not unreasonably withhold consent when a tenant requests to have a pet in their home, with the tenant able to challenge unfair decisions. We know that some landlords are concerned about potential damage caused by pets. That is why the Bill will allow landlords to require insurance covering pet damage. I thank the noble Earl, Lord Kinnoull, and the noble Lords, Lord Trees and Lord de Clifford, for their fantastic expertise, which they have shared with us to ensure that these reforms will work as intended. We continue to work with them.
The decent homes standard, which applies only to the social rented sector, will apply to the private rented sector and be enforceable for the first time. This will ensure that privately rented homes are safe, secure and hazard free, tackling the blight of poor-quality homes. The Bill will also extend the application of Awaab’s law to the private rented sector, enabling the setting of clear legal expectations about the timeframes within which landlords must make homes safe when they contain serious hazards. We will launch a consultation on the content of the decent homes standard for social and privately rented homes in the coming months. We will also set out further information about the timescales for implementation in due course.
The Bill provides for the introduction of a new PRS landlord ombudsman service that will deliver quick, fair, impartial and binding resolutions for tenants whose landlords fail to resolve legitimate complaints. The ombudsman will support a number of the new measures the Bill introduces—for example, giving tenants further opportunity to escalate issues where a landlord has encouraged a bidding war or unreasonably refused a pet.
The Housing Ombudsman Service has extensive experience in tenant-landlord services and redress and is well placed to deliver streamlined redress for both private and social tenants. We said in opposition that we agreed with this approach, and we are still of that view. However, this is not a final decision. We will continue working to design the best possible service for users and, following a full value-for-money assessment, we will determine who is best placed to deliver a high- quality service.
This Bill also introduces a private rented sector database, through which tenants will be able to access information to inform choices when entering new tenancies. Landlords will be able to understand their obligations and demonstrate compliance, and local authorities will be able to use the database to target enforcement activity. We will continue to consider what information is necessary to collect to support more informed rental experiences for tenants, and to provide local authorities with a dataset which will support the enforcement of health and safety standards in the private rented sector.
The changes I have just mentioned have the potential to transform the experience of renting in England, but their success is contingent on effective enforcement. The Bill will strengthen local councils’ enforcement powers and introduce a new requirement for councils to report on enforcement activity. The Bill includes a staged enforcement framework for local authority enforcement. New maximum penalties of £7,000 and £40,000 will be introduced for initial or minor compliance and for serious, repeat or persistent non-compliance respectively.
The Bill will also significantly strengthen rent repayment orders. This will provide a stronger deterrent against non-compliance and further empower tenants to take action against landlords when they commit offences. More offences will be brought into the scope of rent repayment orders. Further changes include making sure superior landlords and company directors can be held liable, and doubling the maximum amount a landlord can be ordered to pay from one to two years’ rent. We are also doubling the period in which tenants and local authorities can apply for a rent repayment order and requiring repeat offenders to pay the maximum amount.
New investigatory powers will make it easier for councils to identify and fine unscrupulous landlords. Local authorities will be able to request information from third parties and enter business premises and—in much more limited circumstances—residential premises to gather evidence where required. The new powers contain safeguards to ensure that they are used appropriately and proportionately.
It is imperative that the reforms in the Bill can be handled by the courts and tribunals system; many noble Lords have expressed concerns about this and have raised them with me. I want to reassure noble Lords that we are working closely with the Ministry of Justice to ensure that the justice system is prepared for the implementation of this Bill. Most tenancies end without court proceedings being required, and the digitisation of the court possession process will make the process easier to navigate for landlords and tenants in those cases where they are. I will be meeting very soon with a number of noble Lords who have expressed interest in this digitisation process, and I look forward to that further engagement.
I know we all share a wish to see fairness and proportionality in any regulatory framework. We believe we have achieved that in our reforms, and I very much look forward to your Lordships’ scrutiny of the Bill. The Bill ensures that tenants can put down roots in their communities. They deserve to enjoy that stability, just as home owners do, and we should reward landlords who provide the excellent service that so many of them do. This will be the biggest change to the experience of renting in this country for generations. I believe the measures in the Renters’ Rights Bill are sufficiently comprehensive, robust and balanced to achieve that change, and give all tenants a better place to call home. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I declare my interest as set out in the register as vice-president of the Local Government Association. I very much look forward to the maiden speeches of the noble Baroness, Lady Brown of Silvertown, and the noble Lord, Lord Wilson of Sedgefield, and welcome them to the House.
The Renters’ Rights Bill is counterproductive. While the Government may have good intentions, they will drive landlords from the market—reducing choice and putting up rent for the tenants they seek to protect. While we discuss this Bill, it is important to remind ourselves who landlords are: around 45% own one rental property, with another 40% owning two to four. In many, if not most, cases these are not professional landlords; they may have gained an extra property when a family member has died or through marriage later in life, or perhaps they invested in a property or two to use as a pension. To expect them to be able to cope with all the costs and burdens placed on them by this Bill is at best naive. Many decent landlords and safe, quality homes will leave the rental market as a result.
We must absolutely deal with bad landlords, but in most circumstances there is no reason a good landlord would want to lose a good tenant. It is in their interest to keep a steady income from a reliable tenant who respects their property. Having an empty property is expensive, and there are significant fees and paperwork involved with finding a new tenant. While trying to protect and improve living conditions for renters, the Government should be very careful not to do the opposite and make it worse for them.
The last Conservative Government introduced our own version of this Bill, the Renters (Reform) Bill. It was first introduced to the House of Commons in May 2023 and eventually had its Second Reading in your Lordships’ House in May 2024, but was not taken any further before the general election. The Bill did not make quick progress because we wanted to take our time to get this right. We listened to representations from the sector and carefully considered the impact of our policies. We made changes during the Bill’s passage through the House of Commons, most notably on the readiness of the courts, and further changes were planned for the House of Lords, most notably to carve out student lets.
We recognise that some reform to our rental market was necessary to protect tenants from the abuse at the hands of rogue landlords, but it was always important to us that we balance the rights of tenants to live safely and peacefully in the homes they were renting with the rights of landlords, particularly with respect to their property rights.
The Government were trying to balance the see-saw, and I know we did not get everything right. Many felt that the measures introduced by the Bill went too far in favour of tenants and too far against the landlords in a way that would work to the detriment of the rental market, and I have sympathy with that. However, we listened to the concerns that were raised and we were making changes to the Bill as it progressed.
If the Renters (Reform) Bill did not quite balance the see-saw, the Renters Rights’ Bill tips it over. This is not the same Bill that the last Conservative Government introduced, and the Government are rushing it through without any care for the repercussions that will reverberate throughout the sector. Labour has abandoned our commitment to improvements in His Majesty’s Courts & Tribunals Service before abolishing Section 21 for existing tenancies, as well as our six-month implementation period before abolishing Section 21 for new tenancies. This means that our courts will not be resourced as they need to be. Labour has also abandoned our requirement for the Lord Chancellor to assess the courts’ possession processes before abolishing Section 21 for existing tenancies, which would have ensured that they were ready for the changes first.
Labour has abandoned our plans that would have stopped tenants being able to give notice during the first six months, to give landlords some predictability and protect them against tenants seeking to exploit these new arrangements for rolling tenancies such as holiday lets. Labour has abandoned our plans to make it easier to remove anti-social tenants, which we were changing from “likely” to cause a nuisance or annoyance to “capable” of doing so, making it much harder to evict those who deserve to be evicted. Labour has also abandoned our commitment to sufficiently carve out student accommodation, where it is essential that both landlords and tenants have the certainty of fixed-term contracts to plan for subsequent years.
Not only have the Government removed many of the safeguards and improvements for landlords that we put in the Bill but they have added many concerning measures of their own. They are increasing the mandatory eviction threshold for rent arrears from two months to three months, significantly increasing the loss incurred by landlords when a tenant is not paying for the property they are occupying. They are shortening the time limit for landlords to consider a pet, which we know to be a significant issue. They are rushing, in our opinion, the implementation for the private sector of Awaab’s law—a law that was designed for the social housing sector and that could have significant implications for smaller landlords if not implemented very carefully.
If that was not enough, Labour took the Bill even further, through the amendments it made in the House of Commons. It introduced amendments to include restricting the payment of rent in advance, which will hit most severely self-employed renters and those with bad credit ratings, where a landlord is now even less likely to want to take the risk on them. It introduced amendments requiring landlords to pay compensation to tenants when they possess their properties, burdening landlords with even more unfair costs, even if they have no choice but to take their property back and may have already spent a lot of money to do so.
Much has changed since the original Bill was introduced, and we must acknowledge the broader context that the Bill and the sector find themselves in. Landlords are leaving the rental sector at a higher rate than ever, with many citing rental reforms as their reason for leaving. Rightmove has estimated that 18% of homes up for sale were previously rented, compared with 8% in 2010. In London, where we know the problem in the rental market can be most acute, the situation is even worse: 29% of homes for sale in our capital city were previously rented out.
On top of this inflated package of rental reforms, landlords now have the minimum energy-efficiency standards to contend with. Ed Miliband, the Secretary of State for Energy Security and Net Zero, is requiring all private and social rented homes to meet EPC C by 2030. The industry estimates that this could cost the sector £25 billion—an average of £5,400 per home. This is a cost that many landlords, particularly those with only one or two properties, just cannot take.
Of course, this is set against a backdrop of ever-increasing taxation from a Government who do not understand how our economy works. All these issues compound to make our country an unattractive, burdensome and expensive place to be a landlord, however fair and decent one might be to their tenants.
There is always a balance to be found with legislation, and in this case respect for property rights is essential for investment and stability. I would expect the risk of legal challenge on this Bill to be very high. There will certainly be a few interested parties queuing up to challenge the Government over the rights to their own property. If the Government are not careful, and continue with such an aggressive pursuit of landlords, there is a good chance that their Bill will get stuck in the courts and not be able to benefit anyone.
In Scotland, similar legislation has resulted in the highest rent increases in the United Kingdom because of demand far outstripping supply. The Nationwide Foundation found that 70% of landlords and letting agents lack confidence in the future of the sector. This has led to a significant reduction in rental stock, which has made it much more difficult and expensive for tenants, especially those on low incomes, to find a home. We must learn from Scotland’s mistakes.
There will always be people who want, or need, to rent rather than buy their home. We must ensure that there is a stable rental market for them, and we will do all we can to convince the Government to think carefully about how they proceed. We intend to table amendments to address some of the most pressing concerns, including: the capacity and operation of the courts; student landlords, who need certainty of length of tenure and other mutually agreeable fixed-term contracts; some exemptions for smaller landlords, who are less able to weather these changes; the availability of insurance for damage caused by pets; consideration of the property rights of landlords; and the impact on the housing market. We will pursue these amendments for the benefit of landlords and tenants alike, because we know what will happen if we do not.
The Government’s own impact assessment acknowledges that tenants will see increased costs as a result of their policies, saying
“it is likely that landlords will pass through some costs of new policies to tenants in the form of higher rents—to offset those costs and maintain a degree of profit”.
Surely the Government cannot want this, and I hope that they will listen to the concerns being raised by the sector and by many noble Lords across this House before it is too late.
Baroness Grender (LD)
My Lords, the Liberal Democrats welcome the Bill and support the fundamental principles in it of rebalancing the relationship between landlord and tenant. We thank the Minister for the meetings so far and look forward to working with her to make progress. We also look forward to hearing the maiden speeches of the noble Lord, Lord Wilson, and the noble Baroness, Lady Brown.
We are particularly supportive of the measures to immediately ban Section 21 eviction notices. Frankly, this change cannot come soon enough for so many, and we owe it to the almost 1 million renters who have been on the receiving end of a no-fault eviction since the change was promised in the 2019 Conservative manifesto. They are only a small fraction of the vast numbers who have lived with the insecurities of the now most common form of tenure—assured shorthold tenancies—since they were first introduced in 1988. Given all the similarities to the previous Renters (Reform) Bill—in particular, on scrapping no-fault evictions—it was so disappointing to see the Conservatives in the other place attempting to block the Bill altogether. They need to deliver on their original promise. This much- heralded but delayed change by the previous Government remains nothing short of a scandal and has left a legacy for tenants that we should have uppermost in our minds during the progress of the Bill.
The promise to ban no-fault evictions followed by dither and delay made, if possible, the market even worse for tenants, prompting a 30% growth in Airbnb short-term lets and taking away even more security of tenure from other tenants. There is one small silver lining: the sector itself has had significant notice of this change and therefore time to prepare for no-fault evictions bans.
Tenants are aptly described as the
“People on the Frontline of Britain’s Housing Emergency”
in Vicky Spratt’s excellent book, Tenants, in which she outlines the ever-widening gaps between those who own and those who rent. All issues, from inequality to fuel poverty, mental and physical ill health, the cost of living and lack of social mobility, are impacted by insecurity of tenure—or a home that you simply cannot rely on. The direct link between being evicted as a tenant and homeless is well documented by, among others, the Local Government Association.
At the heart of this issue is lack of supply of suitable homes. We strongly support the Government’s ambitions to end homelessness, but that needs to be matched with greater ambition to build social and council homes for rent—150,000 per year, which was in our manifesto, along with a programme of insulation for all housing, a planning use change to control second homes and new powers for councils to halt right to buy based on local needs.
Of course, the elephant in the room with the private rented sector is rents, and we on these Benches regret the lack of progress on this issue. Although we welcome the ban on bidding wars, which in turn drive up rent, this Bill still does not deal with the chronic levels of rent increases. Private rent inflation may have slowed down, but it is still rising faster than the CPI. The Renters’ Reform Coalition, which I thank for its briefing, rightly highlights that this will continue to leave open significant increases in rent as a means to evict. As the Renters’ Reform Coalition makes clear, England’s rents as a share of disposable income are some of the highest in Europe, with two-thirds of in-work private renters struggling to pay. This Government’s housebuilding plans will not change the supply crisis for years and will not fix this rent problem. Amendments by our Liberal Democrat colleague Gideon Amos MP linked rent rises to the Bank of England base rate, and we will look at options, such as the CPI or national wage growth, in Committee.
Given the poor condition of so many private lets, with the 2023-24 English Housing Survey highlighting that the private rented sector has the highest proportion of non-decent dwellings at 21%, we welcome the extension of the decent homes standard and the introduction of Awaab’s law across the PRS. However, we have significant concerns about enforcement, which other colleagues will elaborate on. Likewise, we welcome the protections for renters who are on benefits and those with children.
Instability in this area cannot be overstated, given that a quarter of all private renters have lived in three or more homes in the past five years. Therefore, we welcome the 12-month protected period at the start of new tenancies, and we will continue to explore the possibility of another extended period of tenancy guaranteed as an incentive to landlords to build to rent.
We will look to improve the Bill—for example, by supporting those who serve the whole nation in our military and give the ultimate service. In the previous Parliament, our colleague Helen Morgan MP campaigned to ensure that MoD housing was included under decent homes. The Kerslake commission report, Homes Unfit for Heroes, commissioned by John Healey MP, lays bare how poor the standards are. I ask the Minister to let us know the possibility of including service accommodation in this Bill. We live in an uncertain world, and putting our Armed Forces and their families into shoddy and inadequate housing, which impacts health and morale, is a failure of our duty to them.
Finally, my noble friend Lady Thornhill will lead us in our attempts to improve and expand the database. The majority of landlords that we know about—the ones that will participate in this debate or have briefed us—are the ones we can see and who will immediately join the database and ombudsman scheme. They, like the majority of tenants, are responsible landlords—but we know so little. It is the landlords we cannot see about whom we have limited knowledge, information and transparency. A database can be either a tick-box exercise or a significant game-changer on this. I hope the Bill progresses and that it will be the latter.
Tonight, as we speak, a primary school child will be in their third rental in a year and will know the insecurity no child should have to bear: health-defining, future-defining and life-defining. We owe it to that future generation to get this right, but to do it soon.
Lord Best (CB)
My Lords, I thank the Minister for her introduction and for many helpful meetings on the Bill. I look forward to the maiden speeches of the noble Lord, Lord Wilson, and the noble Baroness, Lady Brown. I declare my housing and property interests as on the register, including that I have family members who own rented property.
The Bill introduces much-needed reforms to the private rented sector—the PRS—which I greatly welcome. However, I want to address a big question that I know is in the minds of a number of your Lordships: however necessary the reforms to the PRS, will the Bill lead to large numbers of landlords exiting the market? If a lot of landlords decide this kind of investment is no longer for them, what will happen to the rental market?
A mass exodus of landlords seems very unlikely. Property remains an attractive long-term investment in uncertain times. However, analysis by the consultancy Savills shows that a gradual reduction in private rental properties has already been under way in London. Despite the arrival of the new providers of Build to Rent apartments, it seems entirely possible that the Bill will lead to more landlords selling up.
Keeping up with the new legislative requirements not only necessitates use of proper, professional lettings agents but will mean substantial investment for properties in need of modernisation. Meeting the decent homes standard comes alongside a forthcoming duty to upgrade properties to higher energy efficiency standards. Many landlords, particularly those who have borrowed heavily in the hope of making capital gains, simply lack the resources to comply with important new demands.
I conclude that the PRS will get smaller, but this is not necessarily a negative outcome. The private rented sector doubled in size in the early 2000s and, despite a tougher tax regime, there are still some 2.3 million private landlords. Meanwhile, the expansion of private renting has led the sector to take on a role for which it is not well equipped. With the steep decline in social housing—the council and housing association sector is now barely half its former size—the PRS’s expansion has had to fill the gap. Yet, private renting is seldom the best option for those needing low rents, good quality and long-term security. Nor does the enlarged PRS suit the taxpayer: the sector’s higher market rents have propelled more renters into housing benefit at escalating cost to the Exchequer. The PRS has found itself performing a role in place of councils and housing associations, which suits neither the tenants nor the public purse. The Bill could help achieve some rebalancing between the private sector and the social sector.
Of course, an expansion of provision by councils and housing associations through the building of new homes is an essential part of the Government’s plans for constructing 1.5 million homes during the course of this Parliament, but as well as a substantial new-build social housing programme, this seems an important moment to promote the purchase and modernisation of previously privately rented property to house those on lower incomes. If there are more sales of privately rented properties, and if strong enforcement of the Bill’s new measures deters purchase by less scrupulous landlords, then the opportunity—indeed, the necessity—to switch property to restock the much-diminished provision by social landlords will emerge.
Some local authorities are already active in bringing PRS rentals, including former right-to-buy private rentals, into the social housing sector, not least to provide temporary accommodation for homeless families. Buying privately rented property can achieve a speedy solution to urgent, immediate housing problems, while also being there in perpetuity as genuinely affordable, secure accommodation. This is where the housing associations of the 1960s and 1970s came in, buying and modernising the properties of Mr Rachman and his like.
It is important to note that, sometimes, owner-occupiers will step in and do up the property. No doubt some sales will transfer the homes to larger landlords, who can achieve some economies of scale and introduce professional management. However, high interest rates and the less favourable tax arrangements now in place may inhibit these buyers. For sure, local authorities will need to be on their guard to prevent property acquisitions by rogue landlords who do not intend to comply with the new environment introduced by the Bill.
How can transfers to social lettings be achieved when this legislation is enacted? I suggest that the Government look at an exemption from capital gains tax for the sales of properties from private landlords to social landlords. Such support would pay for itself in reducing the need for ever-rising housing benefit payments. Such an incentive could propel the rebalancing between sectors after so many years of decline for social housing. If the PRS were to continue to shrink by about 2% annually, the outcome could be positive, with both an additional 500,000 home owners and 500,000 more social tenancies.
In conclusion, I look forward to raising some specific issues in Committee, including the regulation of lettings agents, the constraints on switching long-term lets to short-term letting, the content of the new property register and the basis for in-tenancy rent increases. For now, I welcome the positive contribution that the Bill will make.
The Lord Bishop of Lincoln
My Lords, I welcome this Bill and the commitment that the Government have made to tackling the pervasive insecurity and unaffordability of the private rented sector. I will be delighted to listen to the maiden speeches of the noble Lord, Lord Wilson, and the noble Baroness, Lady Brown.
Last week, my right reverend friend the Bishop of Chelmsford, the lead Bishop on housing, chaired a round table with a number of noble Lords and members of the Renters’ Reform Coalition. Although she is unable to be here today, I know that she is looking forward to contributing to the Bill as it progresses.
The Bill is an opportunity to strike a fairer, long-term deal that will benefit both landlords and tenants. We must heed the voices not only of tenants themselves but of landlords’ groups, which have expressed legitimate concerns about any potential negative consequences, however unintended, of the changes introduced by the Bill.
There are many things that the Bill gets right, including, to name just a few: the introduction of a private rented sector landlord ombudsman service; the expansion of provisions supporting tenants with pets—my cats and I are grateful; and the extension of Awaab’s law to the private rented sector. These are in line with the vision of the Archbishops’ Commission on Housing, Church and Community, which argued that good housing should meet the following standard and be
“sustainable, safe, stable, sociable and satisfying”.
However, I have some concerns about the Bill as it stands. First, it ought to extend the decent homes standard to all temporary and asylum accommodation. While I celebrate the Government’s decision to introduce a clause extending its scope to temporary accommodation following a consultation, I note that this change will be at the discretion of the courts on a case-by-case basis. This extension should apply to dispersed accommodation for asylum seekers, which is currently managed by accommodation providers on behalf of the Home Office. In a debate last week, my right reverend friend the Bishop of Sheffield correctly identified the need to move from the use of hotels to accommodate asylum seekers to dispersed accommodation sites in communities. This will require local government to be properly funded to provide support services for asylum seekers, especially children, to enable integration into local schools and communities.
I am also concerned about discretionary grounds for eviction, which could affect, for instance, tenants who are terminally ill. I welcome the opportunity the Bill provides to explore what are the remaining grounds for possession, where they need not be mandatory.
Finally, I turn to the topic of tied accommodation. I thank the Minister for her engagement with these Benches regarding the Bill’s implications for those in occupational tied accommodation, a concept which is well-defined in law. As the Bill progresses, I anticipate that there will be need for further conversations to ensure that charitable retirement housing schemes for those who spend their working life in tied accommodation are not inadvertently prejudiced.
Lord Wilson of Sedgefield (Lab) (Maiden Speech)
My Lords, I refer noble Lords to my entry in the register of interests. I thank all sides of this House for the welcome they have given me to the Lords. It has been a warm and gracious welcome, so thank you very much. I thank the offices of the Lord Speaker, Black Rod and the Clerk of the Parliaments, who worked with great professionalism to ensure that my introduction to this House went according to plan. I have discovered that the House of Lords is, like the House of Commons, a rabbit warren, only with red carpets. I therefore thank the doorkeepers for pointing me in the right direction.
I thank my noble friends Lady Smith of Basildon and Lord Kennedy of Southwark for their leadership. I pay tribute to my noble friends Lady Armstrong of Hill Top and Lord Hanson of Flint for sponsoring me. I have known my noble friend Lady Armstrong for almost 40 years. As MP for North West Durham, she introduced me to the House of Commons when I won the Sedgefield by-election. My noble friend Lord Hanson and I shadowed the Home Office between 2010 and 2015; my noble friend was the shadow Minister and I the shadow Whip. I remember us winning a couple of votes in Committee on one occasion—I emphasise that it was on only one occasion.
This year, 2025, is turning out to be an eventful one for the Wilson family. On 14 January, I became a grandfather for the third time, this time to a beautiful baby girl. On 20 January, I was introduced to this House, and, next month, my mother will celebrate her 100th birthday. Obviously a little tired after 100 years, mam is still as sharp as a pin and loves to reminisce. I will never forget how her face lit up when I told her I was to be a Member of the House of Lords. She leant forward in her chair, reached out for my hand and said: “And your dad was a miner”. Mam was born in 1925, in the colliery village of Fishburn, in County Durham. In 1925, this House was home to 26 Dukes, 29 Marquesses, 130 Earls and 73 Viscounts—none of them, as far as I am aware, the son or daughter of a coal miner.
My dad was brought up in Trimdon, another colliery village, just to the north of Fishburn, and my parents left school on the eve of the Second World War. Ambition and aspiration were restricted primarily to three occupations for men in those villages at that time: work on a farm, go down the pit, or join the Army. Dad’s first job was on a farm. Since he was in a reserved occupation, he joined the Home Guard, and would pick up his rifle and three rounds of ammunition from the vicarage to fend off any potential Nazi invasion. On 30 August 1939, his elder brother joined the Royal Artillery. Evacuated from Dunkirk, he would eventually see service behind the beaches of Normandy with the second battalion of the SAS. He was our rogue hero.
Careers for women in those villages at that time were also rare. Mam worked during the war in a fish shop in Billingham, on Teesside, and she still regales the family with how it was in old money: 1p for a bag of chips and threepence for a fish. Every night, the blitz came to Billingham. Every night, she took to the bomb shelter or hid under her neighbour’s reinforced kitchen table as the Nazis tried to destroy the town. By the time my parents married, dad was working down the pit, and he did so for the best part of 40 years. I grew up one of two sons on a council estate in Trimdon. It was a close-knit community.
I joined the Labour Party many years ago because I believe in ambition and aspiration. There is plenty of talent around, but opportunity for all is scarce. Equality of opportunity is central to a just society: an education that takes you as far as you want to go, a job which enriches your life and that of society, a society in which you are looked after when you are ill and where you live in a home not just a house, and where we all understand that the first duty of government is to defend the nation.
I had the privilege of representing Sedgefield for 12 years. The constituency had moved on from being a mining constituency. The area that was once the Sedgefield constituency boasts, at Newton Aycliffe, one of the largest business parks in the north-east. I am proud of the part that I played in ensuring that Hitachi Rail built its train manufacturing plant in the constituency, situated just a few hundred yards from where George Stephenson assembled Locomotion No. 1 some 200 years ago this September. I wanted to make sure that the opportunities that were not there for my parents were there for my constituents.
The 2019 election was a defeat for me and a defeat for Labour. That election was dire for the country. The electorate was confronted with a choice of Prime Minister which was not a choice between the lesser of two evils, as many thought, but was in fact, I am afraid, a choice between the evil of two lessers. It was a torrid time, but I am pleased and proud that Keir Starmer has turned Labour into a party that is once again serious about government—so serious in fact that we have formed a Government only five years after a massive defeat.
Of course, Tony Blair was my predecessor, and his leadership galvanised Labour to victory. I first met him in the bar of the Trimdon Community College at the time of his selection as Sedgefield’s Labour candidate in 1983, and I went on to work for him for many years. Tony had a big smile, big charisma and big ideas. However, so dreadful were Labour’s prospects in 1983 that, if you had said to me back then that Tony Blair would go on to form a Government that would keep the Conservatives out of power for 13 years and win three consecutive general elections, I would have replied, “Go away, pick up a pen and write a novel. You’ve a great imagination”. If you had said to me back then that I would be relaying this story in my maiden speech in the House of Lords, I would have replied, “I think that you have being drinking one too many pints down the Labour club”.
I want to end by returning to my granddaughter. Because of medical advancements, she will probably reach her centenary in 2125. What kind of world will it be? Will my granddaughter be able to afford to buy her own house, or will she only be able to afford to rent? Will she live in a society where we understand that we can go faster alone but only go further together? Will she live in a society where free speech is not just opinion but based in fact and founded on truth? Will our generation prevent another world war, so that my grandchildren can live to become grandparents themselves? Will the worst effects of climate change be stopped, or will it not even be safe for her to venture outside? In 2125, will there still be hereditary Peers in the House of Lords?
The task for us all, especially this Government, is to face the challenges that are moulding the 21st century, with all its contradictions, tragedies and opportunities, and to do so with belief, imagination and fortitude. Our responsibility is huge: to protect all that we believe in—human rights, democracy, the rule of law, equality of opportunity and our way of life. This Government need to be successful for the country and for the sake of all our grandchildren. It is my ambition and aspiration to ensure that I play my part in that.
Baroness Warwick of Undercliffe (Lab)
My Lords, I warmly congratulate my noble friend on a powerful and very moving maiden speech.
My noble friend is known for being one of the “famous five”, a group of local Labour Party members who helped Tony Blair to be selected as a Labour candidate in 1983, as he indicated; the rest is history. My noble friend stepped into those very big shoes when he won the Sedgefield constituency, but he clearly showed that he could fill them. He was immensely proud, as he said, that he had been instrumental in bringing a Hitachi Rail factory to Newton Aycliffe.
The House will have realised how equally proud he is of his northern industrial heritage. A Sedgefield lad born and bred, he still lives in his constituency and he showed us the love that he has for it, for that heritage and for County Durham. However, he was too modest to say that he is working on a PhD on its culture and class issues. My noble friend’s background and solid life experiences will ensure that he makes a formidable contribution to this House. I know that he will be given a warm welcome.
I supported the previous Government when they sought to reform the private rented sector to the benefit of tenants, and I support my Government now in ensuring that reform happens. I was really disappointed that the Conservative Party has refused to support the legislation, when both pieces of legislation have the same aim. The Government have developed comprehensive protections for tenants and, at the same time, recognise the contribution made by responsible landlords who provide quality homes. It is clear that great care has been taken in the drafting of this Bill to avoid unintended consequences. Of course, there are ways in which the Bill can be improved, and we have been briefed by Citizens Advice and Shelter, as well as by several organisations representing different interests in the PRS and those involved in student housing, but all expressed general support for the Bill and its aims.
I believe this legislation has the power to transform the private rented sector into a place where tenants can access safe and decent properties at a fair price in the knowledge that, unless their landlord has good reason, it is a place they can call home for as long as they like. It also presents an opportunity for the vast majority of good landlords to establish longer-term tenancies and to show that the minority of bad ones have no place in the sector.
In the Bill, there are issues about the Courts & Tribunal Service, the removal of fixed-term tenancies and enforcement capacity—to name only some aspects. In the time we have, I will focus on a few: first, the impact on social landlords; secondly, the new ombudsman and the role of agents in helping to get that right; and, thirdly, student accommodation. If we are truly to solve the housing emergency, we need to deliver the complementary goals of increased supply and stronger regulation that will ensure that homes are built and maintained at a high standard. This Bill is key to the second half of that equation.
In the social housing sector, it is clear that much has been done by the Government already to allow social landlords to gain access to properties in need of essential redevelopment and improvement works. Regeneration can restore pride in communities and in places that have been left behind, so I am pleased that changes in this legislation will not impede housing-led regeneration and redevelopment.
I know there are concerns that some of the proposed changes to rent increases might impact on social landlords’ ability to increase rents in a harmonised way and affect their ability to deliver repairs and maintenance. There are also concerns about accessing the First-tier Tribunal. I hope the Minister will be willing to meet the National Housing Federation to discuss these.
I turn now to the very welcome proposal for a new ombudsman for the private rented sector, and I declare an interest as the chair of the Property Ombudsman scheme—TPO. It is right that all renters, whether in social or private rented housing, can access quick, fair, impartial and binding resolutions for complaints about their landlord. Can the Minister clarify whether a PRS ombudsman would apply to social landlords’ market rent tenancies?
In the private rented sector, TPO has been dealing with complaints against letting and managing agents for over 20 years. It dealt with 70,000 inquiries last year. That has taught us that tenants’ complaints often include not just the agents but the decisions and actions of their landlords as well. For example, where there is a cost to repair a property, landlords need to authorise payments and instruct agents to carry out the work. From a tenant’s point of view, the agent and the landlord are one and the same, so letting agents will have an important role in delivering the objectives of the legislation.
Whether the decision be that there is one combined ombudsman for the PRS and social housing sector or two separate ombudsmen, it needs to be clear that the purpose of the ombudsman is to provide clarity to tenants on where to go for redress. This will be a new concept for the 50% of PRS landlords who do not employ agents. Can the Minister provide some clarity on how they will be engaged with the process?
I welcome the proposed landlord database. Agents will be required to use the database to check whether the properties that landlords ask them to market are registered as well as that the landlord is registered with the new PRS ombudsman. Can the Minister please clarify whether the database is intended to be a one-stop shop that agents and tenants can use to check the property is registered and compliant and that the landlord is registered for redress?
It is a complex area, with the potential for tenants to find themselves lost and frustrated. A lettings dispute can involve on average five different unresolved issues. Will the Minister consider how the database could be developed to help tenants triage multiple issues to ensure that serious hazards are referred to local authorities, landlord issues are directed to the new ombudsman, agent issues are referred to the Property Ombudsman and rent issues are appointed to the First-tier Tribunal?
Joint investigations will be required and both ombudsmen will need to be able to refer cases to local authorities for enforcement, especially when homes fall short of the decent homes standard and Awaab’s law. Just as the Property Ombudsman now works with redress providers and trading standards, a joined-up approach will be required to ensure that the new system works for both tenants and landlords.
I raise a final issue: the impact of the Bill on student housing. The Government have said that they will exempt purpose-built student accommodation from the decision to end fixed-term tenancy agreements. They subsequently included off-street accommodation, where most students live in their second and third years. Unfortunately, as far as I understand it—although it was not clear from the Minister’s introduction—this will not apply to one- and two-bedroom apartments, yet these account for a third of all student housing. The university sector believes that this is likely to cause confusion and disruption for students and could lead to landlords exiting this market because of the uncertainties. If that is the case, will the Minister agree to look at this again?
This is a complex Bill that will have an interesting Committee stage, but I assure the Minister that the organisation that I chair—the Property Ombudsman—is ready to offer its substantial experience of the PRS to help ensure that the Bill works for tenants, landlords and agents.
Lord Willetts (Con)
My Lords, I congratulate the noble Lord, Lord Wilson of Sedgefield, on his excellent maiden speech, its eloquence and his extraordinary personal story. This afternoon, behind the Bench of Bishops, we may have seen another constitutional function emerge in this House: the Bench of Blairites. I welcome the noble Lord and appreciate what he said about his predecessor as Member of Parliament. He also spoke eloquently about opportunity, and that is a test against which the measures in the Bill should be assessed.
I thank the Minister for her willingness to engage in discussions with all of us across the House. In her opening speech, she referred to genuine problems with the private rented sector, the difficulties for people in employment if they lose their accommodation and the incredible difficulties for parents with a child at school if they face the uncertainty of losing the place where they live. She ended by saying that she hoped this legislation would help tenants put down deeper roots in the community.
That was all very eloquent, but it revealed a way of thinking that simply does not reflect the reality of student accommodation, for which these concerns do not apply. There are over 1 million students in the private rented sector and a long-standing problem, preceding this Government, is that, although access to private rented accommodation has been crucial to the growth of higher education in this country, the housing department has never really understood higher education and the education department has never understood the importance of private housing. I fear that this legislation is an example of that phenomenon.
For example, students receive maintenance loans in three separate payments during the year. Many rents historically have been structured around the payment of maintenance loans. There is now an assumption of a monthly rental payment model and no scope for landlords to offer tenancies structured around maintenance loans. Have there been any conversations with the education department about changing arrangements for the payment of maintenance loans so that they match the envisaged new payments of rents? Those are the kinds of practical issues that matter and are acute if there is no understanding of the problems facing students.
Students have genuine grievances. At the All-Party Group for Students last week, all of us from both Houses were left in no doubt about their unhappiness, which was sometimes about the quality of student accommodation and sometimes about the role of guarantors, for example. But few believe that the Government’s proposals, as they stand, will make these problems significantly better. Indeed, there is a danger of landlords exiting the system.
The Government have already made some welcome concessions. First, there is the exemption for purpose-built student accommodation. This is estimated to cover about half a million students out of the 1.2 million in private rented accommodation. It is the most expensive and is heavily regulated—quite rightly. There are significant constraints on its supply and on its further provision.
We have recently had the famous ground 4A exemption, which means that landlords can repossess a rented property in advance of the new academic year. This applies to landlords of HMOs with three or more bedrooms. As the noble Baroness, Lady Warwick, said, this does not cover the many smaller landlords of smaller student accommodation with one or two bedrooms.
It is estimated that, of the 1.2 million students in the private rented sector, half a million or so are in purpose-built accommodation. There may be another 300,000 or 400,000 in the larger HMOs, and there could well be 200,000 to 300,000 in the smaller private landlord arrangements for which there is currently no special recognition. Will the Minister consider, for example, extending this exemption beyond large HMOs to all private landlords?
More radically, will the Minister consider the case for continuing to allow 12-month academic year tenancies —a system which has worked well overall? Does she recognise that there are other risks with some of the provisions in the Bill? For example, upfront payments may now be much harder to require. However, there will be the increased use of guarantors. Requiring a guarantor for a student from a low-income background is very tough, as is requiring a UK guarantor for an overseas student.
Perhaps the housing department is fed up with special pleading on behalf of students, but I think the crucial criterion is one of opportunity, as we heard in that excellent maiden speech. In the purpose-built accommodation—PBA—the rents for students average about £190 a week, in contrast with about £130 a week charged by small private landlords. We could end up with a system where the more expensive accommodation sector grows and is exempt. By and large, this is more expensive and occupied by the affluent students. In future, low-income students might find it harder to access the diminishing amount of lower-rent accommodation. Maybe they are supposed to stay at home and become commuter students. Some people want to see that. A very good social rule of thumb is that the more affluent someone’s family and the higher their social class, the greater the distance they go away to university. The low-income students will be staying at home and commuting, while the students from affluent backgrounds will pay high rents in high-quality, purpose-built accommodation a long way from home. If we end up with this, it will not be meeting the opportunity challenge. I very much hope the Minister will accept that her proposals need to be assessed as to whether or not they promote educational opportunity in our country.
Lord Etherton (CB)
My Lords, I too congratulate the noble Lord, Lord Wilson of Sedgefield, on his impressive and, in many respects, quite moving speech. Before I turn to the two matters of substance on which I wish to address the House, I should draw attention to the fact that my husband has a small portfolio of rental properties.
First, I will briefly address the matter of court process. We all know that there will be many more contested possession proceedings by landlords following the enactment of the Bill and the abolition of Section 21 no-fault evictions. It would not be right to abolish no-fault evictions without adequate speed and resources for dealing with the increase in contested proceedings.
As the noble Baroness, Lady Scott of Bybrook, said, that might lead to such discontent on the part of small investors that they would be induced to leave the private rental sector. Any significant reduction in PRS accommodation would, as we all know, be disastrous at the present time. The Government need to demonstrate that measures have been or will be put in place which will help to secure that court claims by landlords for possession of residential properties will be disposed of in a timely and efficient way. I appreciate that the Government are well aware of this imperative and are thinking of how to address it. As the judge who had responsibility for the introduction of small money claims online, I would be very happy to give any assistance on this aspect that might be thought to be useful.
I turn now to the principal matter on which I wish to address the House, which is the issue of financial penalties. There are several respects in which the financial penalty provisions in the Bill are, I would say, wholly unsatisfactory. The penalties that can be imposed by a local housing authority for breaches of the requirements of the Bill fall into two categories: up to £7,000 and, in some cases, up to £40,000 where the local housing authority is satisfied that the landlord has committed a specified crime.
The first problem is the mishmash of the standard of proof where the penalty is £7,000 or less. The new Sections 16I, 16J, 16K and 16L, introduced into the Housing Act 1988 by Clause 17, which include prohibitions relating to the misuse of possession grounds and not giving a written statement of tenancy terms, enable the local housing authority to impose a penalty of £7,000 or less if satisfied “beyond reasonable doubt”—that is the criminal standard—that the landlord or other relevant person has contravened the prohibitions.
By contrast, Clause 42 provides that the local housing authority may impose a fine not exceeding £7,000 if, “on the balance of probabilities”—the civil standard—it is satisfied that there has been a breach of a rental discrimination measure relating to children and benefit status in Chapter 3 of Part 2 of the Bill. There is no explanation in the Explanatory Notes as to why this is a different standard of proof from that introduced in Clause 17.
Again, Clause 59 allows a local authority to impose a financial penalty on a person if satisfied “on the balance of probabilities”—the civil standard—that the person has breached the requirement in Clause 58 that an advertisement or offer must include a specific amount of rent payable under the letting and impose a prohibition against inviting, encouraging or accepting an offer of rent which exceeds the proposed rent. Again, in contrast, a local housing authority may impose a financial penalty of £7,000 or less only if satisfied “beyond reasonable doubt”—the criminal standard—that the person has breached an obligation under regulations for landlord redress schemes.
These are sufficient examples, although there are others, of the Bill specifying different standards of proof for the same level of financial penalty, £7,000 or less, without explanation either in the legislation or in the Explanatory Notes of the reason for this. One has to question whether the employees of a local housing authority, who have no legal training and no criminal trial experience, can properly and accurately swing from one standard of proof to another.
The Bill will provide for local housing authorities to impose a higher fine of £40,000 if satisfied that a relevant offence has been committed. This is the case, for example, in relation to the new provisions introduced by Clause 17 of the Bill, which I have just mentioned, and the provisions concerning financial redress schemes, which I also mentioned.
It is not right for the employees of a local housing authority who have no legal training and no criminal trial experience to be free to impose a financial penalty of larger sums—up to £40,000—on their assessment of whether the ingredients of a criminal offence had been committed. A good example of the dangers of this is the ability of a local housing authority to impose a financial penalty of up to £40,000 where it is satisfied beyond reasonable doubt that an offence has been committed under Section 16 of the 1988 Act, where the landlord relies on a ground in Schedule 2, knowing that they would not be able to obtain an order for possession on that ground or being reckless as to whether they would be able to do so.
Another example is the power of a local housing authority under Clause 92 to
“impose a financial penalty on a person if satisfied beyond reasonable doubt that the person has … committed an offence under section 93 … of knowingly or recklessly providing information to the database operator which is false or misleading in a material respect in purported compliance with a requirement imposed by regulations under Chapter 3 of Part 2”.
The mental state of “recklessness” in criminal law is an extremely difficult one and has given rise to case law. It is something less than intention but more blameworthy than carelessness. Recklessness will arise if the accused consciously—that is, looking at the matter subjectively—takes an unjustified risk. Such difficult concepts should play no part in this legislation, which will mostly affect landlords who own one or, at most, very few properties for rent.
It should certainly not be left to local authority employees to reach their own conclusion on the application of “recklessness” in criminal law. The only state of mind that should be capable of giving rise to an offence under the Bill is “intention”—that is to say, actual knowledge or actual intention of the landlord to do the matters comprising the ingredients of the offence. That is clear, easy to understand and fair. It is what good legislation should be.
Lord Shipley (LD)
My Lords, I, like my noble friend Lady Grender, welcome the Bill. I thank the Minister and her colleagues for getting the Bill to this stage after several years of waiting. I agree with her that the Bill brings forward the most significant changes in the sector for 40 years.
I congratulate the noble Lord, Lord Wilson of Sedgefield, on his outstanding maiden speech and I look forward to hearing the maiden speech of the noble Baroness, Lady Brown of Silvertown.
A key difference of this Bill when compared with the Renters (Reform) Bill of a few years ago is that Section 21 is to be abolished before court reforms are delivered. Anything further that the Minister can tell us about how processes in the courts can be speeded up would be helpful. There will I think be significant discussion of that in Committee.
That said, the Bill takes us in the right direction. My party conference a few years ago debated Section 21, and two conclusions emerged. Conference wanted repeal of Section 21 and it wanted to protect good tenants from bad landlords. But it also wanted to protect good landlords from bad tenants. So, as the Bill progresses, I hope we can assess it against those criteria.
I suggest that there needs to be a third test. There are lots of solutions proposed in the Bill, but we must beware of just solving one problem when, in so doing, we create another. One example is restrictions on taking rent in advance: should it be one month or two months? On the face of it, one month in advance plus a deposit would seem to be sufficient. Yet some prospective tenants might find it easier to pay more rent up front, particularly those from overseas who have difficulty providing traditional affordability checks. So Committee will be important in assessing the policy of one month’s rent up front, which I understand was a late decision by the Government.
Another example of unintended consequences would be in relation to student housing. The noble Lord, Lord Willetts, has amply covered that issue, and I think there are problems there. Purpose-built student accommodation is rightly exempt from the Bill, and ground 4A allows student houses—that is, houses in multiple occupation—to be reclaimed to prepare for the next yearly intake of students. That exemption is the right approach, but what about the wish of many landlords to extend ground 4A to one-bedroom and two-bedroom houses and flats? They are not HMOs, but the removal of fixed-term tenancy agreements may worsen things for landlords renting out such accommodation because two months’ notice given midway through the academic year could lead to a loss of student accommodation, as landlords might then decide to leave the student housing market altogether and release those one-bedroom and two-bedroom accommodation units on to the wider private rented market. We must use Committee to examine that issue further.
Clause 98 and Schedule 4 refer to the decent homes standard. The Government are introducing a decent homes standard into the private rented sector for the first time, and I fully support their wish to do so. However, timeframes for improvements and more information on who will be responsible for resourcing them are needed, because one-fifth of homes in the private rented sector do not meet the decent homes standard. The Government will need to be clearer about the minimum standards that will be shown on the private rented sector database, which I strongly welcome because it will bring key information together in one place and can be used to assist with enforcement and rent repayment orders.
I remind the House that I am a vice-president of the Local Government Association because I want to say that, for the decent homes standard to be met, it would help if licensing schemes could provide a way for local authorities to inspect privately rented housing without the need for a tenant to have complained. As we know, many tenants are discouraged from complaining. In the Housing Act 2004, local authorities can create selective licensing schemes to improve poor standards, but they cannot require the physical state of a property to be improved as part of that licence. That is an issue for us to examine further in Committee, which I hope to be involved in doing.
Another question that I have is about market rents. Market rents have to be defined, and there may well be problems in doing so because the market is different across the country. Rental increases will be limited to once a year, but tenants would benefit from clarity on what level of rent increases would be appropriate. I suggest that uprating in line with CPI would be an appropriate method. Again, I look forward to examining that further.
There have been a number of claims at Second Reading today that restrictive regulation will reduce the supply of rental homes. I am not sure that is true. At the moment, there may be some signs of it, but we will have to wait a while until we see exactly what the circumstances are. I accept that we have to be careful about assessing whether the prohibition of fixed-term contracts increases the number of landlords choosing to offer short-term lets outside the private rented sector.
At its heart, this Bill is about standards in the private rented sector. It is not about pursuing good landlords but about pursuing bad ones and improving standards. For that reason, I strongly support the Bill in its overall intentions.
Baroness Fookes (Con)
My Lords, I realise that this is a wide-ranging Bill, but I want only to deal with one small aspect of it, which the Minister kindly referred to in her opening remarks: the value of allowing tenants to keep pets as the general standard. She was kind enough to mention the noble Earl, Lord Kinnoull, and the noble Lord, Lord Trees, as having given her valuable advice on this topic, so I shall be interested to hear what they have to say later in this debate and interested too to see whether any of my comments chime with what they say.
My first interest in this was when I was an MP—heaven alone knows how many years ago now—but I remember feeling saddened and indeed angered by the blanket refusal of many landlords to allow someone to keep a beloved pet. I can remember one constituent who refused to go into suitable accommodation without their pet. Others would succumb to this because they were desperate and had to give up their pet. There has been, over these many years, a lot of hidden unhappiness, needless unhappiness, for people who so value the companionship of animals. I think we now realise more clearly than ever before the mental and physical health which can accrue from having a pet. I hope that this is a good moment in which to set the matter straight.
Sadly, it seems that there are still many landlords who, without this Bill, will not allow pets to be kept. I was startled by Battersea Dogs & Cats Home saying that the second-most common reason for people giving pets back to it related to housing. It added that only a very small percentage of landlords ever indicated that they were happy about pets being kept. There remains a great deal of work to be done on this score.
I understand that there are those who worry about the possible unhappy implications of very noisy dogs, damage to furniture and perhaps aggressive dogs, but these can be exaggerated. In any case, the idea of insurance being required, if the landlord so wishes, is a very sensible approach. I hope that that will help towards sensible pet ownership.
On the other hand, I have some reservations about the adequacy of the two clauses which deal with this—Clauses 12 and 13. For a start, it is obviously proper that landlords should not withhold their consent unreasonably, but there is no indication whatever about what unreasonable behaviour might constitute. I know full well that it is impossible to list every eventuality in the Bill, or even in delegated legislation, but I am concerned that there seems to be no way of dealing with this. The Minister may have something in mind: perhaps some official guidance which is outside the law but which gives clear indications. I would not expect to deal with anything so detailed tonight, but I would be very happy if we could have correspondence on this matter and these other matters at a later stage or, indeed, have that unusual and valued thing, an actual meeting.
In addition, I am concerned that we are creating another unfairness because social housing is not included. I can understand why if we are not dealing with social housing, but it is going to look rather odd if we have a right in one sector that is not available in another, very comparable sector which, for the average person, will seem to be exactly the same. I wonder whether there is any way in which we can deal with that issue.
I have some reservations on these matters, but, overall, I am delighted that we have at last got where I would like to have got—what?—50 years ago. Anyway, better late than never.
The Earl of Kinnoull (CB)
What a genuine pleasure it is to follow the noble Baroness, Lady Fookes. Oddly, in my decade here, I think it is the first time that I have followed her. I say those words warmly and very much hope that I will not disappoint her with what I am about to say, but I am directionally with her.
I congratulate the noble Lord, Lord Wilson of Sedgefield, on a very compelling, moving—I am going to borrow that word again—and thoroughly eloquent maiden speech. I am very grateful to him for sharing all those memories with us; it was a wonderful thing. I look forward to the speech of the noble Baroness, Lady Brown, which is coming up next—she should not worry, as there are about five minutes between me and her.
I remind the House of my entries in the register of interests, in particular as a trustee of various Scottish entities which are engaged in letting rural properties. I have, in a much smaller way, three rural properties that I let. Noble Lords should remember that, in Scotland, Section 21 has already been abolished, so I have some experience of life beyond this Bill, which may be helpful to the House later.
I will cover two brief subjects now. The first is the great importance of smooth judicial and administrative processes, both to the landlord and the tenant. Secondly, I will cover the topic of pets and pet insurance.
On the first area, I am very grateful to the noble and learned Lord, Lord Etherton, who has done all the heavy lifting for me. I do not want to repeat things that he has said, but he underlined the challenges and the crucial importance of having clarity, efficiency and speed within the administrative and court processes. I note that almost everything contained in the Bill is a new process in some way.
When the Minister kindly came to the Cross-Bench meeting, I think she had more questions from us than almost any other Minister recently. She would have felt the interest in this particular area within that meeting. I am grateful in advance for her help in getting going a meeting with interested Cross-Benchers to discuss the detail of the court processes and the IT system that will support these, which I believe is in progress of booking at the moment.
The construction of the new processes for courts and the ombudsman, which will, I hope, provide clarity, efficiency and speed, is something that I do not feel will be particularly easy or can be done particularly quickly if, that is, we are to start in the new era smoothly. This inevitably means that the commencement provisions of the Bill will need to take account of this if Parliament is to be confident that it has done its part in making sure the new system is fully operational as it becomes live.
I turn to my second and final area: the provisions about pets and pet insurance. Here I am grateful again to the Minister for arranging a discussion with interested officials on the Bill team. I have also had the benefit of discussions with former colleagues and others within the insurance industry. The rural letting market in Scotland is one where you would expect a pet. The Scottish market, at least in my experience, copes with the problem of pet damage in a very simple way. Pets are discussed with the landlord, who therefore understands what pets are involved. Assuming that all are agreeable— I do not remember any instance where things were not agreeable—market standards are for deposits of up to two months’ rent. On leaving the property, the deposit is then used to deal with any pet damage. No insurance is involved, and the system has the benefit of being very simple. I think there may be lessons there, which I will come back to.
Insurance, generally, is against things that are unlikely; it is never against things which are inevitable. The puppy has not been born that does not chew, and it is inevitable that dogs will cause some damage to a home. Other pets will cause damage to homes—for instance, to fitted carpets. It is not surprising, therefore, that, to date, no comprehensive pet damage insurance policy exists in the UK market. I was responsible for many years for underwriting operations in continental European countries and I never came across any similar insurance there either.
Various UK insurance brokers, no doubt in response to the provisions of this Bill and spotting a potential opportunity, are attempting to interest insurers in providing some element of cover. The insurance risk carriers to date—that is, not the insurance broker intermediaries—have shown no interest. I spoke to the head of personal lines of a UK FTSE 250 insurance group, and they indicated to me that they would have no appetite to develop such a product. I was not surprised, having had a similar role in the past.
The one insurance product that is currently on the market is not available to tenants and covers only accidental damage. It gives an example of a covered event: a dog might tear down the curtains in a house, and that action might damage the wall in some way, and it is the wall which is then repaired. This is, as a percentage of the actual loss cost likely from pet damage, very small. The language of the Bill suggests that insurance will be available both to tenants and to property owners, and that the coverage of the products will extend to all risks of physical loss or damage to the property. However, this is not wholly clear, nor are the insurance limits that might be needed clear, in any of the Bill documentation.
Within the Bill, the landlord has the right to require the tenant to go and find such insurance before the tenant would be allowed to have the pet on their premises. Currently, neither the landlord nor the tenant would know exactly what to set out to buy, and there is no product available. I am all for the presumption that pets can be inside a rented home, for all the reasons contained in the Explanatory Memorandum and which were given again in the Minister’s excellent opening speech.
As things stand, I regret, the insurance provisions of the Bill do not work. I hope to continue working with the Bill team to explore the insurance options, remembering that risk transfer into the insurance markets is complex and expensive. I strongly think that we should take a look at the Scottish solution. Where people have asked for a pet, the landlord should have the ability to ask for the comfort of perhaps two additional weeks of rent deposit. I hope the Minister might agree to meet to talk through this potential option in the future.
Baroness Brown of Silvertown (Lab) (Maiden Speech)
My Lords, I draw attention to my interests in the register. It is an absolute pleasure to be part of this very well-informed debate this afternoon, and to follow on from the noble Earl, Lord Kinnoull. I am not sure that we are going to agree on the clauses within the Bill about pets, but I can inform the House that Cara the dog is going to be delighted by the contribution of the noble Baroness, Lady Fookes, and I intend to tell her all about it when I get home tonight.
I am very grateful to my sponsors, my noble friends Lady Smith of Basildon and Lord Kennedy, for their enormous support. I thank the House staff most sincerely for their help in getting me around the place; they have all been so massively kind.
I grew up in Silvertown in east London. My parents both worked on factory floors and my home was a council flat overlooking the dying docks. All the opportunities I had as a child were founded on that security of tenure, the affordable rent, the stable school and the local library, from which I borrowed and read incessantly. These resources were just vital. They shaped my life and they have informed my career.
After being the first in my family to go to university, I worked as a residential social worker, which gave me some invaluable insights into the vulnerabilities of young people. I then went on to work for the London Borough of Waltham Forest in a number of social policy roles.
I became a councillor in the London Borough of Newham in 1988 and held that role until my election to Parliament in 2005. During that time, I focused on culture. I saw it as a way of providing opportunities for young people that might not be available to them at home. I fought for the Olympics to come to Stratford, which at that time was blighted by swathes of disused industrial land. I cannot say that all the changes have been positive—there has been a severe lack of affordable homes—but there are also genuine opportunities to combat social exclusion that have been created too, particularly by the cultural offer.
Following my election to the other place, I argued constantly for social homes and action against child poverty. Since 2017, I have been highlighting the appalling exploitation of children by organised criminals, particularly in county-lines drug dealing. We simply must recognise that the same child can be both a perpetrator of appalling violence and a victim of grooming and exploitation. It was therefore music to my ears to hear our new Government committing to take strong action on this with the forthcoming crime and policing Bill.
As we know, Parliament is not only about representing but also about governing. My career on the Labour Front Bench began as a Whip. I was in fact the Whip in charge of the landmark Equality Act 2010. I remained a Whip in opposition and joined the Home Office team, working on fire and then policing but also on topics I knew embarrassingly little about, such as recreational drugs. I recall one very memorable occasion when our now Prime Minister sat alongside me chortling as I was enlightened about the various uses of poppers. He suggested I went away and watch “Breaking Bad” as homework.
It is hard to speak about this period without reflecting on Brexit and the threats that assail us from Putin’s far-right Russia and the rise of divisive authoritarian nationalism, around the world and here at home. My only notable rebellion was to vote against the triggering of Article 50, but, as we know, it passed and plunged us into a maelstrom of chaos, insecurity and vulnerability. I simply could not bring myself to vote to make the people I represented poorer. Now I intend to do all I can to mitigate the damage Brexit has caused and to get us working again on shared challenges alongside our European partners.
After 2019, I took the prisons and probation brief, focusing on issues affecting women that are now being ably taken forward by my noble friend Lord Timpson. My next reshuffle was the luckiest because it brought me to the role of shadow Minister for Africa. My focus was twofold: to address the serious problems of Africa’s present, including the brutal generals’ war in Sudan, the Horn of Africa drought and the conflicts in the Sahel and the Great Lakes. But I also wanted to ensure that we were not distracted from the resourcefulness and leadership of Africa’s people and from the massive opportunities for progress. I want to pay tribute to my dear friend the Foreign Secretary and to my noble friend Lord Collins for their passionate commitment to this very agenda.
I believe that Africa is rising, despite all the challenges of insecurity, despite climate heating and despite unfair treatment by the global financial system. I genuinely believe that historians will look back on this century and say that it was Africa’s. I believe that we as a country will be stronger, fairer and more prosperous if we act as a valued partner to our African friends and not behave like a blinkered patriarch who thinks themselves noble for offering crumbs from the table.
I intend to continue to work on the causes that have defined my career and life, a flavour of which I hope I have given today. I hope you will agree that it is utterly fitting for me to make my maiden speech on this Bill, which promises to deliver a sea change in the balance between renters and landlords.
Sadly, the housing crisis has deepened in Newham, even as our borough has grown massively. Much of that blame lies with policies that encouraged a poorly regulated and unaffordable private rented sector to expand without limit. The damage done by housing insecurity and disrepair is life-shaping. It disrupts education, employment and both bodily and mental health. It is why ending child poverty remains more of a rallying cry than a reality. Families cannot access good work and contribute fully as equals in our society without a decent, secure home like the one that we had in Silvertown. That base was essential for me getting here today, and I support the rapid progress of this Bill into law so that many young people have these very same opportunities in future.
Baroness Lister of Burtersett (Lab)
My Lords, it is a pleasure and a privilege to follow my noble friend Lady Brown of Silvertown, both to welcome her to your Lordships’ House and to applaud her warm, passionate, insightful and compelling maiden speech—not at all dry, as she told me she feared it would be.
My noble friend says that she intends to continue working on the causes that have defined her career. That is good news because, as we have heard, these causes have been wide-ranging and important. They include culture, Africa, women in the criminal justice system, and children, including child poverty. I look forward to working with her on child poverty in particular, as the Government’s child poverty strategy takes shape. She rightly made the link between child poverty and housing insecurity and disrepair, thereby underlining the importance of the Bill, to which I now turn.
When we debated the Bill’s predecessor, I was able to give it only a very lukewarm welcome, as it contained so many flaws and holes. It is good to be able to welcome this Bill unequivocally, especially as it was approved in the Commons as a result of the Minister listening to and acting on some of the suggestions made. But there is still, of course, room for further improvement. I am grateful to the Renters’ Reform Coalition and others who have briefed us on the further changes needed
“if the legislation is to deliver on the government’s ambitions to address the ‘insecurity and injustice that too many renters experience’ and ‘decisively level the playing field between landlords and tenants’”.
Before turning to some of these changes, I will say a word about context. I do not pretend to have expertise in housing law, but I came to the issue from my long-standing concern about poverty and the insecurity it creates. As the Joseph Rowntree Foundation report published last week made clear, high housing costs are
“a major driver of poverty … leading to a risk of compromised living standards, insecurity and at worst, homelessness and rough sleeping”.
It explains that private renters in particular are pulled into poverty by high housing costs. Shockingly, around half of private renters are in poverty only after their housing costs are factored in. On average, private renters in poverty spend around 60% more on housing costs than social renters in poverty. The situation is made worse by the continued freezing of the local housing allowance and the impact of the benefit cap, which I hope the Government will eventually address.
It is thus not surprising that the latest Bristol University financial fairness tracker survey found that parents of children living in rented accommodation were especially likely to face serious financial difficulties or to be struggling. As well as having issues with damp, mould and condensation, around half had needed to borrow money just to meet their daily living expenses.
Given the poverty that results from high housing costs in the private rented sector, I am very sympathetic to the calls from the Renters’ Reform Coalition for more decisive action on affordability. As Shelter underlines, there is a real risk that the security that the welcome immediate abolition of Section 21 aims to provide will be undermined by unfair rent hikes designed to force tenants out. I believe that the coalition makes a good case for a cap on in-tenancy rent increases. I do not really understand why the Government are opposed to this. It is not the same as rent controls, although I admit that I think there is a case for them. Ministers suggest that the answer to an unreasonable rent hike is for the tenant to challenge it at a tribunal, but how realistic is this? After all, the Minister in the Commons himself described this as an “onerous process”. I hope this can be looked at again, together with the coalition’s suggestion of a national rental affordability commission to investigate effective methods to make renting more affordable.
The other main concern of the coalition that I want to take up is the need to strengthen the very welcome anti-discrimination provisions in the Bill that would outlaw any ban on renting to families with children and those in receipt of social security. There are two main issues here. The first concerns landlords’ right to demand a guarantor. The fear is that this could be used to circumvent the Bill’s anti-discrimination provisions. Although it is welcome that the Bill was changed in the Commons to prevent landlords demanding multiple months of rent up front, as a Shelter housing champion and long-standing private renter pointed out at a briefing last week, rent in advance and guarantors are two sides of the same coin. Some of those in the most vulnerable circumstances are least likely to be able to find a guarantor, so the coalition suggests limits on the situations in which a landlord can demand a guarantor, which seems reasonable to me.
Barnardo’s and others recommend that all English local authorities should be required to offer guarantor and rent deposit schemes to care leavers, and that care leavers should be added to the groups that are specifically protected from discrimination by landlords. I hope the Government might also be open to the addition of other groups to the list of those who must not be discriminated against, particularly disabled people, prison leavers, and refugees and other non-UK passport holders—this points to the abolition of right to rent, which can lead to racial discrimination. I ask my noble friend: will those with no recourse to public funds receive the same protection as social security recipients?
Although I welcome that the Bill does not include the change to the definition of anti-social behaviour contained in the previous Bill, it does make eviction on grounds of ASB easier. This would be to the detriment particularly of survivors of domestic abuse and disabled people, who are vulnerable to ASB complaints. Justice encourages us instead to press for better training and resources for the police and local authorities to investigate and fully respond to ASB complaints.
I will raise the question of Home Office accommodation, mentioned by the right reverend Prelate and raised with me by London Councils. It argues that the Bill should include such accommodation so as to ensure that asylum seekers and refugees benefit from the decent homes standard, also called for by Hibiscus on behalf of black and minoritised women; otherwise, London Councils argues, the Bill could give rise to a two-tier system in which a small minority of rogue landlords might be incentivised to procure poor-quality accommodation for use as asylum accommodation.
On the basis of the extensive evidence it received from London authorities about the poor standards of asylum accommodation, London Councils contests the Minister’s assertion in Committee in the Commons that extending the Bill’s provisions to asylum accommodation is unnecessary. This is an issue I hope to pursue in Committee, and I wonder whether my noble friend the Minister would be willing to meet London Councils’ parliamentary officer to discuss what is involved.
In conclusion, as I said earlier, the Minister in the Commons did act on some of the concerns raised there. I know that my noble friend the Minister is a good listener, so I hope we might be able to make further improvements to the Bill in this House. In this way, we can turn what is a good Bill into a potentially ground-breaking one that achieves the Government’s aims of decisively levelling the playing field between tenants and landlords, and providing much greater genuine security to tenants.
The Earl of Leicester (Con)
My Lords, I refer your Lordships to my property interests as set out in the register, specifically a large and historic portfolio of houses in Norfolk, 93% of which are leased to local people and key workers, all living in and contributing to the local community year-round. I say this because it is really important—due to its popularity as a holiday destination, North Norfolk District Council lies third in the rankings, behind Westminster and Kensington and Chelsea, for second home ownership. I could increase my income, like many of my neighbours do, by renting these out as holiday cottages, but I do not because I am acutely aware of how crucial they are to maintaining the social fabric in a rural community where property prices and demand are sky high and where there is very little public provision.
The Labour Government intend to transform the experience of private renting through introducing reforms that level the playing field between landlords and tenants. For them, abolishing Section 21 and restricting the use of Section 13 notices, while increasing many other safeguards for tenants, will allow for the growth of communities and reduce the risk of homelessness. Clearly, from what I have just said, I too am pro-community and anti-homelessness, which is where the Government and I are aligned. Where we differ, however, is in our understanding of the true effects that these reforms will have on the private renting market, particularly in rural communities.
In the rural private housing sector, this Bill will lead to a decrease in the number of properties available in an already struggling market. The Country Land and Business Association has surveyed its membership and found that 44% of rural private landlords are planning to sell or change the use class of their properties in the next two years. During that same period, only 21% are planning to build new properties. I am no economist, but I understand supply and demand. A diminished supply of properties will inevitably lead to a price increase for consumers. In fact, that has already been occurring. Since April 2018, there has been a net loss of properties in the rural private rented sector. In a poll, nearly 90% of rural private landlords gave changes to PRS tenancies as a cause for their decision to change use class. More specifically, 57% of CLA members cited the removal of Section 21 as the reason for the net loss, as did a greater number in Scotland, where it has already happened.
Despite my talking predominantly about rural areas, these same issues will also develop in urban regions. Not only will these changes lead to supply issues and thus price rises but the lack of supply will ultimately add strain to housing associations and municipal housing.
The rural economy differs from that of other sectors. Rural business owners commonly offer accommodation within their employment packages. It is a vital part of their ability to attract staff in—let us say—the tourism or hospitality industries. Following the passing of this Bill, especially with the absence of Section 21, I fear for the crucial ability of landlords to remain flexible and adaptable to their ever-changing business needs. Specifically, I am adamant that the new grounds for possession that refer strictly to “agricultural” landlords and workers must be broadened to include the 85% of rural businesses which are not involved with farming or forestry. If accommodation cannot be recovered quickly from previous employees, this economic system will break, but I wonder whether this Government care or even understand this. They have not shown a great understanding of the rural economy thus far.
I want to mention the provision to allow tenants rights to keep a pet. I wholly understand the benefits a pet can bring to family life, enhancing the mental health of those who are lonely, for example. Indeed, we benefit from having three family dogs and, I joke not, a recently deceased parrot. He died three weeks ago and, coincidentally, was called Basil.
I should mention, as set out in the register of interests, that I am a trustee of SongBird Survival, a charity that funds scientific research identifying the reasons for declines in the number of songbirds. The charity has funded work with Reading University’s Dr Hugh Hanmer showing that cats can travel long distances and can affect the natural environment beyond their home range. It also funded work with Exeter University’s Professor Robbie McDonald and Dr Sarah Crowley in 2019 and 2020 studying the drivers and facilitators of hunting behaviour and options for management of said cats. Conservative estimates ascribe 90 million deaths of songbirds to cats per annum. As a result of this real threat to biodiversity, landlords should be allowed to ban cats from some of their properties which are in particularly sensitive rural areas; for example, near SSSIs or NNRs.
There are also very serious issues with the Bill related to student accommodation, but I will let others speak more eloquently on that.
Present, chronic court backlogs, along with the generally underresourced judicial system, will cause a crisis in people’s access to justice. Dispute resolution firm Excello Law said that in this Bill:
“The risk to both tenants and landlords is the existing backlogs in the court system. Trying to obtain possession orders will be protracted, causing uncertainty and delays for both landlords and tenants”.
More than 4.5 million households will need tenancy agreements updating; letting agent staff and landlords will need to undertake training, and insurance and mortgage providers will need to adjust policies and rates. I hope the Government pay attention to that and allow time for it to happen before the Bill becomes law.
Overall, rural or not, I stand by the fact that landlords want to keep tenants. They do not want voids, which are very expensive. I balk at the sentiment brought by this Bill, which assumes that private landlords in this country are, on the whole, bad. They provide a very valuable service which often—through mere geography —housing associations or councils are unable to provide; indeed, they complement them. The vast majority of landlords are excellent people, who are human and want to develop a relationship with their tenants. I have concerns that provisions in the Bill pertaining to challenging rents at tribunal where there is no downside for the tenant could put pressure on those trying to foster positive relations as more vexatious claims are pursued.
This Bill will penalise the whole sector, and the ramifications will be felt across the country for years, putting extra pressure on already-struggling housing associations and the diminishing number of municipally owned council houses. It is not difficult to imagine a world in which, through this Bill, the Government exacerbate the problems of 11 million private renters, 2.3 million landlords and, ultimately, themselves.
Lord Thurlow (CB)
My Lords, I congratulate the two maiden speakers on their inspiring, eloquent and very interesting speeches. I want to inform the noble Lord, Lord Wilson, that he and I share something in common—I am sorry to see that he is not in his place. My grandfather was the vicar of Sedgefield more than 100 years ago. Furthermore, he also sat in this Chamber, so we have two special causes to celebrate together.
The Bill is big and ambitious, with far-reaching implications not only for occupiers and landlords but for the surveying profession—I should declare that I am, and was for decades, a chartered surveyor, working in this space to some extent. I also have two buy-to-let flats and advise a property development company that develops entry-level housing in England. The surveying profession will be involved; the Courts & Tribunals Service, as we have heard, and the ombudsman services will be dramatically affected. Social services will also be involved, as will, most of all in my opinion, local authorities. That said, I support most of the clauses in the Bill; it is a very welcome addition to the statute book.
Turning to those concerns, this Bill is going to frighten landlords. The noble Earl, Lord Kinnoull, informed us of what has happened in Scotland. That is an excellent market test of what is going to happen here in England and Wales. I too live in Scotland. A nationwide firm of estate agents which specialises in letting property closed its office nearest to where I live after Section 21 was abolished in Scotland. I spoke to them about this, and they said that they did it simply because the market dried up for landlords or they withdrew. They closed their department. All those landlords either sold their properties—most of which would have become second homes—or turned them into holiday accommodation and Airbnb-type alternatives. The only losers were the tenant community, and they have nowhere else to turn—there is a terrible shortage of housing. Do not let us fall into that trap and let that happen here.
Ending fixed-term leases is a mistake. They do not have to be long leases, but there are a lot of enterprising individuals who want to criss-cross the country: they are on secondment; they are on a consultancy project; they might be digital nomads, moving between centres of excellence in their field. They know they are going to be somewhere for three or four years. There is no reason why they should not have a fixed-term contract. The landlord would appreciate it and benefit, and, of course, they would, too—they could call it “home”.
I am concerned about, as we have heard from the noble and learned Lord, Lord Etherton, the courts and tribunal services and the delays likely to result from the logjam of huge increases in the numbers of referrals and complaints. We underestimate the pressure on the ombudsman’s services as these new rules come into play; there will be an awful lot of call on their services.
The impact on local authorities is principally one of resourcing. They have a big role to play in this Bill; there are going to be legions of surveyors having to be trained up in the decent homes standard and the implications of the ability to operate Awaab’s law. There is going to be a significant increase in the need for computers, IT and digital recording, which will include ongoing maintenance. We are a country of some 50 million people—we are not a country like the Nordics, New Zealand or others, where they are dealing with 10% of the size of our population—and these recording systems are immensely expensive to maintain. We are asking local authorities to become policemen, and that is not their role. They will have to enforce the new rules and regulations, which is going to be culturally difficult and will require a lot more employment, training and resourcing. Who is going to pay for it? We know that the local authority system is basically bust financially.
Finally, I do not think that it will work to prohibit rental bidding. Unless I have misread the Bill—I apologise if that is the case—I think that all a landlord has to do to prevent being caught out on rental bidding is to quote an unreasonably high rent, way above estimated rental value, and let the market do its work through a Dutch auction and gazumping, or whatever else it might be. But perhaps I have missed something in the Bill.
In conclusion, I support most of the clauses of the Bill. I am concerned that some will not work, and I am certain that others need review, but I look forward to Committee very much indeed and to discussing all these matters.
Lord Truscott (Non-Afl)
My Lords, I congratulate the noble Lord, Lord Wilson of Sedgefield, and the noble Baroness, Lady Brown of Silvertown, on their excellent and passionate maiden speeches. As other noble Lords have said, they were an inspiring couple of maiden speeches.
I declare an interest as a landlord of over two decades and a former renter in the private rented sector for some 16 years. The Bill before your Lordships’ House has much to commend it. I support ending arbitrary evictions under Section 21, and the imposition of a decent homes standard and Awaab’s law in the PRS. Of course, as ever, with these and other elements of the Bill, the devil is in the details and how they are implemented.
On Section 21, as has been noted, the courts will have to be ready to deal with the expected increase in workload. I welcome HMG’s commitment to the digitisation of the court process, but this must be made an urgent priority.
However, my main concern with the Bill is the impact of moving to periodic tenancies only, with a ban on longer terms and upfront payments. Both those measures, as we have heard, will have a significant unintended impact, which will reduce the availability of homes, increase rents and affect the financial viability of the PRS as a whole.
The inability to negotiate upfront payments, as we have heard, will hit the self-employed, foreign students, those with a poor credit history and vulnerable people. It also risks a legal challenge under common contract law. No one has yet satisfactorily explained to me the benefits of moving to periodic tenancies and scrapping assured shorthold tenancies; it seems a solution in search of a problem.
Two reasons have been given by Ministers—and I thank the Minister for her engagement on this Bill: first, to enable those suffering domestic abuse to be able to leave; and, secondly, to enable tenants to leave unsatisfactory properties and give them additional flexibility to perhaps move to a new job or area, both while giving two months’ notice. In the first case, someone suffering domestic abuse is unlikely to give two months’ notice. In fact, charities dealing with abuse have told me that it is the abuser who stays in the home as the victim flees. In the second case, most ASTs, in my experience, have a six-month break clause, allowing enough flexibility for most tenants.
As for unsatisfactory homes in the PRS, that is exactly the reason for the decent homes standard, Awaab’s law, the ombudsman, the database and rent repayment orders. Any bad landlord providing sub-standard accommodation will find themselves subject to up to £40,000 in fines and swingeing rent repayment orders, payable to the local authority or the tenants themselves.
I found the Government’s impact assessment of the PRS very negative. It is, in fact, the most popular form of rental tenure, compared to council or other social housing. I recall being a councillor in Essex, where I represented what was once the largest council estate in Europe, and, believe me, the tenants were not very enamoured of the local council or the housing provided. Later, when I was a renter in the PRS, I moved 10 times in 16 years, but only one of those was a forced move, when my landlords discovered that they could make more money renting to Americans in the summer than to me all year round. In any event, most tenants do not intend to stay in the PRS for life, and many stay in a tenancy for just one year—and that is particularly applicable to students.
I understand the need for security. For five years I worked for a national charity and housing association providing housing for young homeless people and people with mental health issues. The idea was to provide homes and stability for vulnerable people, but two-month periodic tenancies are not the answer. Tenants will have less security, not more, as instead of a one or two-year tenancy, if mutually agreed, landlords will be able to give notice at any time, up to four months if reoccupying or selling their property. Why cannot reasonable people agree a fixed term, with a break clause if required? Incidentally, the majority of tenants want fixed-term tenancies.
Another unintended consequence is that landlords will increase rents, because tenants will be able to move out at short notice and many costs for the landlord are front-loaded, such as cleaning and referencing each time. The risk of voids or vacancies will increase, and landlords will increase rents to cover the added risk.
There may or may not be a mass exodus of landlords from the PRS; some will wait and see, but up to 70% are considering selling up—that is a fact. It is also true that the PRS has doubled in size since 2002. That was an era when buy-to-let mortgages were introduced, money was relatively cheap and baby boomers invested their pensions in the PRS—but those days are over. The issue is not whether there is a mass exodus from the PRS; it is that supply is not keeping up with demand, which will continue to be the case for the foreseeable future.
Even if the Government’s housebuilding target of 1.5 million homes is met, it does not mean that affordable homes will be built where people need them. What is needed is a commitment to build more affordable and social housing in the right places. Build to rent is expanding, but at nowhere near the scale to take up the slack. More regulation of the PRS is welcome, but if the costs associated with it spirals, including the cost of new EPC regulations, investing in the PRS will simply no longer be viable.
Costs have already spiralled for existing landlords, with around 40% of landlords paying double or even up to quadruple for their mortgages. For those new PRS investors that there are, they are increasingly chasing yields of 8% to 9%—impossible in the south but available in the north. That will create a regional imbalance. Some argue that if landlords leave the PRS that will be a good thing, as more property is opened up for first-time buyers. That will happen in many instances, but in many others, landlords will gravitate to ultra-short lets, as we have heard from other noble Lords. They are far more profitable and virtually unregulated; a register will not make a blind bit of difference.
Once purely periodic tenancies are introduced, the line between ultra-short lets and long-term lets will become blurred. In many cities and coastal resorts, long-let availability for local residents will simply disappear. In many apartment blocks, the sense of community will be lost. It is already happening. In some apartment blocks in London, 90% of flats are Airbnb. Even in Camden in London, for example, short lets can be four times more expensive than a long let, and hence much more profitable. Airbnb will try to say that its accommodation is being rented out by old grannies. The fact is that Airbnb and other ultra-short-let platforms are being increasingly dominated by professional landlords, who often avoid tax, as, unlike with estate agents, their rental income is not registered with HMRC. Local communities and all of us suffer as a result.
Baroness Janke (LD)
My Lords, I declare my interest as a vice-president of the LGA. I congratulate the noble Lord, Lord Wilson, and the noble Baroness, Lady Brown, on their eloquent maiden speeches. I am sure from these speeches that the breadth and depth of their experience will add greatly to the work of this House, and I look forward to working with them.
We support the objectives of the Bill and see it as a major step towards a safe, secure and affordable private rented sector. Having a home is something many of us take for granted—a place of refuge, security, comfort, safety and reassurance—yet for so many people, including large numbers of children, this is a far-off dream. In my own city of Bristol, 54% of people in the misery of temporary accommodation have dependent children. What kind of start in life is this for them?
The severe shortage of social rented dwellings means that more and more renters are now dependent on private rentals. Shelter reports that there has been a net loss of 24,000 social homes per year since 1991 through the right to buy and demolition. New build has replaced less than half of them. In the meantime, the private rented market has more than doubled since 1980, with unaffordable rents leaving renters struggling to make ends meet, with many ending up in debt and homelessness. As others have said, there is a desperate shortage of, and need for, social homes at affordable rents.
Most landlords fulfil their responsibilities and treat tenants with respect and consideration, but where exploitative and irresponsible landlords fail to comply with standards and conditions required, it is right that early enforcement powers to fine and sanction are provided in addition to legal redress, which may take much longer.
Many of the proposals in the Bill will be welcome to renters, but what is missing is any form of rent stabilisation. As we have heard from other noble Lords, the high rents in the private sector place a huge burden on renters—one-third of renters spend half or more of their income on rent. They are often intimidated from challenging increases by fear of eviction and being made homeless. Even with the banning of Section 21 evictions, landlords can still force eviction through rent hikes that tenants cannot afford. Without some form of rent control, tenants will still not be protected from summary eviction and the threat of homelessness.
Various ways of pegging rents have been mooted, such as to inflation, wage growth or the Bank of England base rate. There needs to be a framework which allows reasonable predictability for rent so that tenants can budget and not be priced out by rent hikes. Rent controls are well-established in European and other OECD countries. This is by a combination of local and national measures, and I hope that the Government will perhaps look at some of these as we progress with the Bill.
The Bill gives tenants the right to challenge unreasonable rent increases, but many tenants will feel unconfident or intimidated in challenging their landlord at a tribunal. So I hope that, through the process of the Bill, the Government will give some thought to measures for the stabilisation of rents.
The CAB tells us that one in four of the complaints it receives is about disrepair, damp, mould and excessive cold. Making the decent homes standard a legal requirement is essential. Renters often experience horrific conditions of disrepair, damp and even infestation with vermin, and they survive on a knife edge of insecurity with the constant fear of being forced into homelessness. I am sure that those of us who have been councillors who have already spoken in this debate are well aware of some of the dreadful conditions that people live in, with landlords who repeatedly fail to carry out effective repairs and maintenance work. The online database publishing information on private rented sector dwellings and landlords could be a very powerful enforcement tool, depending on what information is to be included about landlords’ records and the condition of dwellings.
However, bringing unfit properties up to standard may be costly, and effective enforcement will pose very serious challenges for cash-starved local authorities. Local authorities’ budgets have been cut to the bone and, if they are to enforce compliance, they will need the resources to do so. Tenants must be confident that the law will be enforced promptly and not be buried in lengthy bureaucracy. This will be essential for the success of this legislation, and the Government must give assurances that enforcement will be fully funded.
The banning of discrimination against benefit recipients will help people with disabilities who are on benefit. Evidence shows that people of colour are more likely to be in substandard accommodation and that black and Asian people are more likely to be denied the right to a safe and secure home. It will be essential for anti-discrimination measures to be rigorously enforced.
However, problems of accessibility remain. Private rented dwellings are often too small to allow a wheelchair or accessible bathrooms and kitchens. People are having to remain in hospital as the needs caused by injury or illness cannot be accommodated in their private rental property. Renters have had adaptations refused by landlords. Access rights are human rights for tenants, and they must be guaranteed in law, so I hope we will make some progress on this in Committee.
As my colleagues have said, Liberal Democrats also believe that accommodation for service personnel should comply with the same decent homes standard and that the accommodation of refugees and asylum seekers should be on the same principle, as in an amendment tabled by Liberal Democrat colleagues in the Commons.
We welcome the first steps that the Bill is taking to provide a fairer private rented sector, with clear rights and responsibilities, and with sanctions and redress for non-compliance. The private rented sector is the second-largest tenure in the UK, yet privately rented homes are the most insecure, most expensive and the lowest quality of any tenure. Reform is long overdue.
Baroness Jones of Moulsecoomb (GP)
My Lords, I, too, declare my interest as a vice-president of the Local Government Association. I offer a very warm welcome to the noble Baroness, Lady Brown of Silvertown, and the noble Lord, Lord Wilson of wherever it was—
Baroness Jones of Moulsecoomb (GP)
Sedgefield—unforgettable, obviously.
I want to point out to the noble Earl, Lord Leicester, that he is not going to beat me in a competition between who has more in common with the noble Lord, Lord Wilson, because my grandfather was a miner in south Wales. In fact, he was killed in a mining disaster, the largest there has ever been in Britain. I also grew up on a council estate until I was 18 years of age and left home for college.
I love so much about this Bill. It ends no fault evictions, it helps to protect tenants from damp and mould and it makes it easier for renters to keep pets. I support those things 100%. Of course, the Government have responded well to suggested amendments, such as stopping excessive demands for rent up front. I am even hopeful that the Minister might give me a positive response to an amendment which I will table later, tabled by my colleague Carla Denyer MP in the other place, which talks about the needs of people with disabilities, both visible and invisible. It would be absolutely wonderful to get something in the Bill to improve the situation for disabled renters in the private rented sector, and to send a message to those landlords who lock them out of the sector that it is not acceptable that so many people struggle to get permission for the most basic of adaptations, or face discrimination in renting in the first place.
The Bill is not perfect, but it is the kind of legislation I was hoping this Government might put forward, and I would like to suggest some big ideas about what the Government should do next. The big things that are missing, and the main reasons why many young people are choosing to vote Green instead of red these days are rent controls and an end to the right to buy. We need a living rent to match the living wage. This would be similar to the living wage scheme that we Greens proposed and got the Mayor of London, Ken Livingstone, to agree to 24 years ago.
There would be a national commission to decide the living rent with input from local authorities and mayors. It would examine factors like local income in different areas, the size of properties and local market conditions, plus the condition of the properties themselves. We should not have a situation where an estimated one in 10 tenants is spending 60% of their income on rent.
With rents going up rapidly year by year, this is not just an issue of a few hotspots; rents went up by over three times the rate of inflation last year. The question is: why? How does that happen? I have heard all the arguments about it being due to population growth and shortage of supply, but, when you look at the actual figures for the last few decades, you find that housing supply is not just keeping pace with but increasingly outstripping household formation. The houses have been built, but they have ended up in fewer hands; that is the root of the problem with our housing market.
Rents have gone from being 10% of income to an average of around one-third of income. One clear reason why the brakes have come off rents in the private sector is right to buy and the decline in social housing. Rents have risen rapidly, along with the country’s benefits bill. If the Government want to increase the supply of housing, why do Ministers not take up the challenge: invest in social housing and “build, baby, build”. Why do Ministers not invest in a future of good-quality social housing that cannot be sold off, thereby creating decent homes for the younger generations, who are increasingly worried that they may never have the security and quality of life that their parents’ generation had?
The long-term solutions to rising rents are: ending the chokehold on supply from greedy developers who are land-banking, and dealing with the property speculators who buy ghost flats in London and leave them empty all year. While the Government are thinking through what steps they can take to deal with these rich property developers, who restrict the housing market to get even richer, Ministers can and should act to reform the rental market with sensible and locally sensitive limits on what people can charge.
The inequality of housing has become a huge generation divide, as other noble Lords have said. Some 11 million people are renting. We have one generation—going on two generations—who, unless decisive action is taken by this Government, will never be able to earn enough to have a mortgage and are straining to afford their rent. That is not to mention the sharp rise in the number of families with children staying in temporary accommodation for more than five years.
This Bill will definitely help—there is no doubt about that—but, equally, it does not touch the roots of the problem. I would like to hear from the Minister whether social housing is a high priority. I have asked questions on the issue of housing, and in response Ministers talk about affordable housing. I am not talking about just affordable housing; I care very much about social housing. That is where I grew up for my first 18 years and I think other people deserve that as well. So I urge Ministers to consider the steps needed to fix our housing crisis, just as we would all expect from a concerned Labour Government.
Lord Tunnicliffe (Lab)
My Lords, I find myself in an unusual situation, almost feeling that I am making a maiden speech. After 16 years on the Front Bench, being a freed-up Back-Bencher is a bit of a shock: you are free to think, but there is nothing you have to do. Reflecting on advice I received from a Conservative Peer when I first came into the House, it was put to me that the role is one of scrutiny, and the advice I received was to do that thoroughly. He said that the way to do it thoroughly was to choose a Bill and see it through from beginning to end—and I have chosen this Bill.
To equip myself to participate, I have read around the Bill, particularly the Library briefing, but I do recognise that I have much more to learn. Nevertheless, it seems that this area has three problems: price, quality and security. Over recent years, rent increases exceeding wage increases has made people poorer: in particular, it has made poor people poorer. The Bill would seem to make a modest impact, at best, on that.
On quality, the Bill would seem to make a more significant input. Clearly, from the news stories that one hears from time to time, the issue of quality is important to the minority of tenants who find themselves with rogue landlords who ignore their obligations.
It is security that seems to be the problem that is most comprehensively covered by this Bill, and I am very pleased by that. Insecurity must be very difficult to live with. I cannot really understand it. My experience of renting goes way back to when I was a child in the late 1940s, the 1950s and the early 1960s. I lived in a council house; it was not a wonderful palace but it was perfectly adequate. In those days, rents were controlled and there was security of tenure. The day-to-day thinking about it was not in any way significantly different from owning your own house.
Since 1968, I have been privileged to live in a house that I have owned—or, at least, have owned in some sort of relationship with a building society—so to feel what it is like to be an insecure tenant today is very difficult. I cannot find a better word than “horrible”; I guess that is how it must be. There is the anxiety of not knowing where you are going to sleep next week or next month, the depression it must bring and the mental health problems that come with it. This leads to things beyond the problem of renting, such as homelessness and rough sleeping—and one has to recognise that rough sleeping leads to early death.
It has even changed the pattern of our behaviours in society. Nowadays, two-wage families are starting either not to have children or to have them very late, which is exacerbating the growing demographic crisis in this country. I am sure that, by the end of this process and after scrutiny, I will be convinced to support the Bill, but we must hit the price problem: we must build the 1.5 million houses we have promised and we must build the right sort of houses.
Baroness Eaton (Con)
My Lords, I offer my thanks to both the noble Baroness, Lady Brown, and the noble Lord, Lord Wilson of Sedgefield, for their enthusiastic and energy-driven speeches, which were very infectious. They will help to drive me along and give me the energy to do all the things that will come along to all of us. They are both very welcome.
I must declare my interests as a vice-president of the Local Government Association and as a part-owner of rented property in Bingley, west Yorkshire.
The renters Bill aims to ensure that those renting homes from landlords across the nation have a safe, secure place to live, managed by a landlord who is reasonable, responsive and reactive when problems in their rented home occur—something I am sure that we all wish to see. However, I do not believe that this Bill will necessarily achieve that. I have spoken with a range of stakeholders in the rental market prior to the debate, including those in the built-to-rent sector, which has the potential to deliver up to 10% of this Government’s overall housing targets. The built-to-rent sector—if it is given the policy environment to deliver new, net, additional, high-quality, long-term rent homes—would do a great deal to achieve the housing targets that we need.
It appears to me that the built-to-rent sector is particularly susceptible to the clauses in the Bill, in its current form, that pertain to open-ended tenancies with two-month notice periods, where renters can serve notice to leave their home on day one. This is because built-to-rent homes can be moved into quickly, as they benefit from shared amenities such as wifi and concierge services, among others, that make them very attractive places to live. Renters can move in with just their suitcase and some groceries, and without the need to set up the water meter and internet provider, or deal with the utility providers.
The Government have put on record their support for bringing more institutional investor landlords into the rental market and driving up standards across the market, both of which are laudable goals, alongside the building of new homes. However, allowing renters to immediately serve notice to leave their rented home on day one of their tenancy will have a detrimental impact, particularly on the build-to-rent sector’s ability to secure investment, both domestic and foreign, to deliver the homes that this Government want to see built.
To reiterate, this measure increases the risk of short-term renting by those looking to take advantage of the legislative issues that the Bill creates, and prevents those who truly want to put down roots in the area where they rent their home doing so, while also having an impact on future housing supply. That is not what this Government intend, I am sure, and is certainly not supportive of the Government’s growth agenda or housebuilding targets.
I want the Bill to put in place the ability for renters to serve their two months’ notice only after they have rented their home for a minimum of four months, thereby discouraging those who would use the Bill in its current form to take advantage of the facilities and high-quality homes that build-to-rent landlords provide. I am well aware of the need to ensure that renters are not trapped in unsafe, mis-sold, damp or mould-ridden rented homes, and such exemptions should of course be included in any amendments made to the relevant clauses in Committee.
An additional potential consequence of the Bill that has been raised with me and that warrants consideration in this place is the impact on housing supply due to the incentive the Bill presents to renters to challenge their landlords’ rent increase when served a Section 13 notice. I add at this point that the fact that Section 13 notices have not yet been digitised is an issue that, in this day and age, needs urgent attention. Section 13 notices being challenged by any and all renters simply to delay a rent increase will serve to achieve only one goal: discouraging landlords looking to provide rental homes and investors looking to create new rental homes. These delays in landlords being able to achieve reasonable increases in their rent from renters will mean that less investment is available for these landlords to build the new homes we need.
The Government cannot expect institutional landlords and investors to deliver new high-quality, sustainable homes if they face so much uncertainty and delay about the rent they might reasonably receive. I strongly support an amendment to the Section 13 clause of the Bill to ensure that legitimate rent challenges from renters are progressed through the courts at speed—we have heard a lot of attention being drawn to the difficulties of the court process at the moment—while rent challenges that have no legitimacy and are being lodged simply to delay fair and reasonable rent increases are deterred.
Some opinions that landlords should focus on are the ability for a failed rent challenge in the court to bring the date of the original rent increase back into effect with a payment plan put in place that is achievable for the renter to pay off over a reasonable period, or giving the courts the ability to increase rents past the point proposed on the Section 13 notice if the increase is below market rate and is subsequently challenged by the renter.
The Government have some laudable ambitions, and improving the lives of renters while delivering new homes are clearly two that many in this and the other place will rightly support. However, the Bill as it stands leaves too many loopholes open for some to exploit, at the expense of those who the legislation is being put in place to protect.
Lord Carter of Haslemere (CB)
My Lords, what wonderful maiden speeches we have heard today. I heartily endorse the congratulations given to our new Peers.
Having read the debates in the other place describing the horror stories of damp dripping down walls, mould, infestations, faulty electrics and landlords who just do not care, I welcome the principles behind this Bill. As recorded in the register, I have dabbled with being a landlord myself, and know that nothing is more important than the safety and well-being of tenants. The majority of landlords take their responsibilities seriously, but for far too long a minority of rogue landlords have been able to exploit loopholes in legislation to treat tenants in, frankly, a horrific and wholly unacceptable way. The Bill must put an end to that and provide tenants with the security and certainty they deserve.
Our overall objective must be providing enough safe rented accommodation for all, thereby helping to end homelessness. However, homelessness, in our context, can arise in two very different ways: first, by unscrupulous landlords evicting tenants who have the courage to point out problems in their rented properties; but, secondly, by imposing excessive blanket regulation which causes conscientious landlords to sell up. Both must be prevented if we are to reduce, and perhaps one day eliminate, homelessness.
A delicate balance therefore has to be struck here. There clearly needs to be tighter regulation, but the last thing we want is good landlords being deterred by this Bill from staying in the sector. This would drive up rents and empower those bad landlords who simply ignore the rules. We need to be honest about this reality and not allow well-meaning ideology to trump what is in the public interest.
Therefore, it is alarming to hear the leader of the Opposition in the other place say that 47% of landlords either attempted to sell a property in 2023 or were thinking of doing so, with the biggest reason being their fear of new laws. Good landlords provide a vital service. The private rented sector is essential for those who cannot yet afford a mortgage, young people and those who need to move for work purposes. Landlords giving up rental properties will not help the people who need to rent, and there are an awful lot of them.
What is the answer to getting the balance right? For me, the way to do it is by targeting the new regulatory regime at the unscrupulous landlords, not by using the blunt instrument of blanket regulatory burdens, which will deter good landlords from continuing and risk increasing homelessness. We heard in the other place that four-fifths of landlords are conscientious and want to look after the well-being of their tenants—and, of course, their properties. Yes, there needs to be tighter regulation to target the minority of landlords who give that label a bad name, and many of the measures in the Bill seem entirely appropriate. The question is, rather, how are they to be enforced, by whom and against whom?
Ideally, where there is a dispute, we should be maximising the powers of a judge, arbitrator or ombudsman to adjudicate on the specific circumstances of each case to determine how the regulatory regime should fairly apply in that case. Although I suspect it will not happen, I would drop some of the provisions which may otherwise drive good landlords out, while applying a tighter regulatory framework than currently, so as to ensure greater fairness for tenants. It is a question of getting the balance right.
On the good landlords side of the balance, allowing rent arrears to accumulate over three months before enforcement action can be taken risks intimidating those landlords into leaving the sector, with all the undesirable consequences which will ensue. A landlord is not a charity, and some depend entirely on the rent to pay mortgages or for their daily living costs. The relationship between tenant and landlord has to be a two-way street. Similarly, banning landlords from obtaining rent in advance will create greater risk for landlords and make them risk-averse in selecting tenants. This can only be detrimental to the latter. I also think that any current objections to fixed-term penalties and existing periods of notice are mitigated if there is a mechanism for ensuring that the ombudsman has the power to decide, where a tenant has a complaint, whether a landlord is giving notice for the right reasons.
On the tenant’s side of the balance, the Bill is spot on as to what the reasons for eviction—horrid word—must be. Similarly, I see nothing wrong with being able to challenge rent increases if those increases are being used as a disguised way of forcing the tenant to leave, beyond the reasons permitted in the Bill. Nor do I think that the reference to open market rents being imposed on landlords is unreasonable, provided that there is a detailed explanation of how this will be assessed. I also welcome the extension of Awaab’s law to the private rental sector, to force landlords to address conditions such as faulty electrics, mould and damp.
Finally, I welcome the provisions dealing with landlord redress schemes, registration and the ombudsman, provided there is clarity about how overlap with enforcement by local authorities and the courts will be avoided. The ombudsman scheme is where the focus should be, since consideration will then be given quickly and cost-effectively to the specific circumstances of the case, provided of course that the ombudsman’s office is resourced well enough.
There is lots of promise in the Bill, but it needs to be honest and laser-focused on what is in the all-round public interest: the interests of good landlords as well as of tenants. The effect of the Bill on the housing market and its effect on homelessness then need to be monitored closely. A commitment by the Government to report to Parliament annually to that effect, even if not enshrined in the Bill, would be welcome.
Lord Marlesford (Con)
My Lords, I declare my interest, as in the register, as a Suffolk farmer with rented residential properties. I have been running our rural business for over 50 years. I have also been particularly concerned to protect and, where possible, enhance the beauty of rural England. I served three terms as a countryside commissioner for England and Wales, five years as chair of the Council for the Preservation of Rural England and 20 years as president of the Suffolk Preservation Society. I therefore look at this Bill mainly through rural eyes.
I am afraid that I see this Bill as fundamentally flawed. Allow me to explain. Last year, I welcomed the new Government and wished them well, in the national interest. Since then, they have got into choppy waters, mainly by pursuing policies that were internally contradictory to their main objectives, particularly economic growth. We are seeing this again with this Bill. The drafting suggests a dislike, or at least a distrust, of the private rented sector. Yet this sector accounts for some 18% of the whole rented sector.
To increase the number of houses is one of the Government’s objectives. We all recognise that there are some very bad, even evil, landlords. I fully support all parts of the Bill dealing with this, including the abolition of Section 21. However, the central point in the Bill is the abolition of the assured shorthold tenancy. Of course, Mr Gove’s Renters (Reform) Bill also did this. This policy and the deporting of migrants to Rwanda were two of the most stupid things that the last Government did.
From the 1960s right the way through to the 1980s, rural housing was subject to severe constraints on both tenancies and rents. Rents set by the rent officer were extremely low, often providing zero return on capital and cash flow that was not enough even to keep the houses properly maintained. As mechanisation of farming continued, more and more houses became available to farmers. The big leap forward came in 1988 with the introduction of the assured shorthold tenancy. John MacGregor was the Secretary of State for Agriculture and Nick Ridley was at Environment—two fine Tory Ministers. The AST gave security of tenure through mutual agreement to both tenant and landlord for an initial period of six, 12 or 24 months, with annual rent reviews and the option of renewal on a rolling two-monthly basis. The AST has worked very well for 36 years. It seems batty to abolish it now; surely this is a case of “If it works, don’t fix it”.
The Conservatives changed the lease term to six months, in Committee in the Commons. This Government are jealous of that and have brought it back to just two months, virtually a non-term. As the courts in England are overwhelmed, it is extremely difficult to see how this can be policed. I very much took the point made by the noble and learned Lord, Lord Etherton, about how the judicial review of these very high penalties of up to £40,000 can be done. It is not really for local authorities to impose such things. Sums of that size are a judicial matter. The proposed tribunals to adjudicate on rents will be as restrictive to, and much more costly than, the rent officer. Traditionally, the private rented sector has used the RPI rather than the CPI for annual rent reviews. Meanwhile the Unite union is agitating for the CPI, as others have mentioned today, and wage increase rents if they are lower.
Finally, I urge the Government to recognise that the private rented sector in housing is part of the capitalist system. Landlords are a form of entrepreneur. While their profession must certainly be monitored and called to account, with appropriate penalties for abuse, it must be allowed to attract investment. The rents at the moment are barely adequate to provide a return on capital, low as it may be. There are few properties which produce a taxable rent of 3%. Most of them are 2% or less.
I recognise that there are those, some of them in the Government, who dislike private landlords. However, I suspect that even the Chancellor would recognise that there are no economic resources available to replace the system. The Government have housing targets to reach. These are imperilled by the present Bill. Let us hope that the experience and expertise of your Lordships’ House will allow it to be improved.
Lord Cashman (Non-Afl)
My Lords, as a non-affiliated Member of your Lordships’ House I congratulate the Government on the Bill before us. Having listened to the contributions thus far, wiser counsel will come from other noble Lords on improving and revising the legislation. I can only offer a narrow but, I believe, important perspective on an overlooked sector.
I particularly wish to associate myself with the comments and contributions of the noble Baroness, Lady Lister of Burtersett. I also heartily congratulate my friend, the noble Lord, Lord Wilson of Sedgefield, on a deeply moving and important maiden speech, along with the noble Baroness, Lady Brown of Silvertown. She reminded me of Silvertown, where my mother used to buy second-hand clothes for us as children from Rathbone Street market. Their contributions gave us memories that empower us, especially when dealing with legislation that is to effect positive social change.
As I have said, I am no expert in this field, but as the Minister will know, I have taken a keen interest in the paucity of rights for people who live in houseboats. I declare a personal interest in that friends of mine are currently moored at Chelsea and are deeply affected by developments there. I am grateful to the Library for the extensive research that it undertook on my behalf in relation to the rights, or rather lack of rights, of houseboat dwellers. My focus is residential houseboats moored on the Thames and other inland waterways in England and Wales, and not canal boats, which are currently part of a review being undertaken.
I have been informed by colleagues in the other place and the Minister, for whom I have the highest regard, that a simple amendment which would extend the rights enjoyed by mobile homes under the Mobile Homes Act 2013, which amended previous legislation, would fall outside of the scope of the Bill before us. I am grateful to the clerks for their initial advice, but I take this opportunity to inform the Minister and others that I will return to this subject and, I hope, with an amendment that achieves the necessary protections and falls within the scope of the Bill.
I believe that the rights and protections afforded by this Bill and other Acts of Parliament apply to residents of houseboats because such houseboats have tenancies. Their licences are precisely that: a means of renting mooring fixed either to a pier or to the riverbank. Yet those living on houseboats have absolutely no security of tenure. Although they pay council tax, energy bills, water bills and insurance bills, they do not have the same statutory rights as other tenants. This must be addressed. They have no protections when the owners of moorings propose to increase fees or, more worryingly, as we have seen at Chelsea, little redress when the owners of moorings propose not only to increase fees or develop the sites but to refuse to renew their licences or, indeed, review their tenancies. The situation faced by houseboat owners and residents is not dissimilar to that faced by mobile home residents, but while there is now legislation designed to provide some protections to mobile home residents, there is nothing designed to apply to residential houseboats.
That is the sad reality facing houseboat owners at Chelsea Reach, a historic community that dates back to the 1930s, and other sites that have faced or are about to face development or disappearance. This scenario is played out on moorings the length and breadth of the country as people fight to retain their homes and, if and when they are evicted or are unable to remain because of excessive increases in charges and licence fees, have to physically remove their homes and often dispose of them.
Previous Governments have declared that the issue is not “big enough” to legislate for and that it is not widespread. However, the problem is spreading as developers circle sites; the problem will grow, and evictions and homelessness will grow with it. From Vauxhall to Chelsea, to the Isle of Wight and beyond, people have had to face the choice of battling through the courts, with all the costs that go with it, for basic protections or quitting their moorings and taking their homes with them—or, in some instances, taking a sledgehammer to the interior of their houseboat to prevent the bailiffs taking the property.
There is a moral imperative for the Government to take action. I will not go on at length, but it is enough to say that it is often necessary to take preventive action to stop a small wrongdoing from becoming widespread. I urge the Government to work with me and others—and I ask the Minister for that assurance—to see how we can amend the Bill to afford the same rights to those houseboat owners and residents as afforded to those covered by the Mobile Homes Act 2013.
In conclusion, let us extend those basic rights, with the accompanying criteria, so that people can enjoy permanent and ongoing tenancies; security of tenure; protection from harassment; written agreements; conditions of residence; and pitch fee protection. I contend that what I am asking for on behalf of others is reasonable and moderate. I ask the Government to commit to delivering these basic rights to these forgotten and often overlooked residents.
Lord Black of Brentwood (Con)
My Lords, like my noble friend Lady Fookes, I want to address the issue of pet ownership. It is one that I have raised a number of times in this House, and I am delighted that the Government are now tackling it.
We are a nation of pet lovers. There are around 13.5 million homes with dogs as pets in the UK and around 12.5 million homes are graced by a cat—mine included. My husband and I have been blessed with the company of several cats—Destino is the incumbent—for 30 years and understand only too well the old adage that a cat is what makes a flat or a house a home. We have always been lucky to own our own home, but the companionship offered by pets should not be a privilege limited only to those who can do so, as the Minister quite rightly said in her opening remarks.
That is becoming a pressing issue as we increasingly become a nation of renters, many of whom want to own a pet cat or dog yet, at the moment, simply cannot. The second most common reason that animals are relinquished to the wonderful Battersea Dogs & Cats Home is housing, with only 8% of private landlords currently listing their property as pet-friendly, while an unacceptable 33% of private landlords who do not currently allow pets in any of their properties say that nothing would persuade them to do so.
Cats Protection’s Cats and Their Stats report in 2024 found that over half a million households who would like to have a cat do not have one because their rental agreements forbid it. As a result, Cats Protection took in the equivalent of three cats each day last year where owners had to make the gut-wrenching decision to give them up. These are not just dry statistics; wanting a pet and being told you cannot have one impacts people’s health and well-being, not least older, often lonely, people for whom a pet is a lifeline.
There are thousands of heartbreaking stories of people taking that most difficult of decisions to give up their beloved pet to a shelter when they cannot find somewhere pet-friendly to live. That includes cats like Zeke, who arrived at Battersea just 24 hours before his first birthday after his owners were faced with that unenviable decision whether to find an alternative rental property that would allow pets or to give up their beloved animal altogether. Take Anna and her husband who, after selling their home, had to find a short-term rental with their newborn son and two cats. That young family found it so difficult to find a landlord who would allow cats that they ended up living in a tiny converted garage.
Pets truly are members of the family. It is hard to overestimate the health benefits that pet ownership brings. Research by Mars Petcare has found that pet ownership saves the NHS around £2.5 billion each year in the UK, with pet owners making 15% fewer visits to a doctor for health reasons. That is partly the result of the physical health benefits of owning a dog but also the result of the significant mental health support that all pets provide.
As the Bill progressed in the other place, we heard arguments opposing the inclusion of the pet provisions due to concerns that pets cause damage to properties, but evidence suggests that these fears are exaggerated. Research commissioned by Battersea with the universities of Huddersfield, Sheffield Hallam and Brunel found that renting to tenants with pets is in fact commercially beneficial for landlords.
I welcome strongly the pet provisions in this Bill which seek to prevent landlords being able unreasonably to refuse a pet request from a tenant. I also recognise that improvements have already been baked into the Bill, including reducing the amount of time that landlords have to respond to a pet request. This change will make a meaningful difference for both tenants and shelter organisations dedicated to rehoming animals.
However, there is room further to strengthen the Bill’s pet provisions to create a fairer balance between the needs and rights of both tenants and landlords. I aim to bring forward proposals to do so in Committee. As has happened in countries such as France and Canada, where similar legislation has been passed, providing guiding principles on what constitutes unreasonable grounds for a landlord’s refusal to a pet request would be a positive step. While no piece of legislation can feasibly detail all scenarios, as my noble friend Lady Fookes outlined earlier, without such guiding principles I am concerned that the legislation will leave loopholes open for landlords, giving too much leeway to deny the majority of pet requests, in turn placing an unnecessary burden on tenants, the ombudsman and ultimately the courts.
I also believe that, once permission for a pet has been granted, it should remain in place for the duration of the tenancy; otherwise, there is a risk of landlords revoking consent later down the line, undermining the stability and security for renters and their pets.
Additionally, while I have no doubt that this legislation will make a real difference for those tenants in situ who wish to acquire a new pet, it will not act as enough of a sea-change for those with existing pets who are looking for a new place to rent, with landlords simply shuffling prospective tenants to the bottom of the list.
I strongly support the pet provision aspects of the Bill because they mark the start of a long-overdue culture shift which will mean that more tenants can own a pet in rented homes, with incalculable benefits not just for their own health and for the pets, but for society as a whole. With more people renting than ever, and more wanting to own a pet, this legislation is a tremendous opportunity to unlock thousands of homes for pet owners. I hope we can make the small necessary amendments to it in Committee to ensure that we deliver for all those who want and deserve that most precious gift in life—the unconditional love of a pet.
Lord Cromwell (CB)
My Lords, I add my thanks to the Minister for the way she introduced the Bill. I also congratulate our two maiden speakers on their highly relevant, interesting and insightful maiden speeches. Finally, I declare that some of my family members let three residential properties, although I do not.
There are many elements to the Bill, and perhaps the most referenced tonight is the removal of Section 21 notices and the objective of providing tenants with greater security of tenure. These notices certainly encouraged supply of rental accommodation but have been abused by some landlords in so-called no-fault evictions of tenants. The pendulum of legal rights is now swinging towards tenants. Some landlords may not like it, but it is the Government’s policy and, with their substantial House of Commons majority, it will become law. I believe that most have now accepted that inevitability.
That said, there is evidence that this impending change is already leading to a reduction in the supply of property to rent while, at the same time, demand remains high and increasing. I will not delay the House further with figures today, but even the most enthusiastic advocates of ending Section 21 can claim that, at best, the supply of rented accommodation is flat. I therefore ask the Minister to clarify specifically whether the Government’s view is that ending Section 21 notices is expected to increase the supply of rented accommodation.
A related area of concern is the reversion to landlords having henceforth to go via the courts in Section 8 processes to regain possession of their property. Logically, this means that courts will have more cases than currently, as was confirmed by the noble and learned Lord, Lord Etherton, along with his other concerns, and was also raised by the noble Earls, Lord Kinnoull and Lord Leicester, and the noble Lord, Lord Thurlow.
While new tenant rights will take almost immediate effect, there is very little confidence that the already clogged court and tribunal systems will somehow be simultaneously transformed, apparently by using the magic of digital and AI, into swift and effective delivery mechanisms. I therefore ask the Minister to bear down, in the interests of both landlords and tenants, on the specifics and, in particular, the timetable for this seemingly miraculous transformation.
On a more positive note, and contrary to the tone around the Bill, there are many occasions when landlords and tenants have positive relationships. Consequently, both want to establish longer-term arrangements. This runs immediately into the difficulty that fixed-term tenancies have sometimes been used to trap tenants, but it does not have to be that way, as the noble Lord, Lord Truscott, touched on.
I plan to table a positive amendment that would enable tenants and landlords, if requested by the tenant after four months of occupancy—when they should have been able to size up their landlord and the property; of course, the reverse also applies—to go forward to mutual benefit on a longer-term basis, crucially without removing the tenant’s ability to depart on two months’ notice. This, like other aspects of the Bill, will apply only to some landlord-tenant circumstances, but the Bill needs to make such agreements at least possible. If it does not, informal or verbal agreements will develop outside the legislation, and these tend to end in tears. Tenant groups with which I have discussed the draft amendment have written to me to confirm that they think it has the potential to help tenants have greater security in the context that I have described.
I may also table amendments in two other areas that we might consider in order to maintain a better balance between landlords and tenants. The first is the case of rent arrears: the Bill requires three months’ arrears, plus four weeks’ notice, plus—according to the Ministry of Justice—some seven months for court processes. This will make rental properties unrentable and unavailable for almost 12 months, which is too long.
Secondly, where the landlord seeks to sell a property under the new ground 1A, the evidence shows that the period of 12 months to prove the property has been marketed is twice the length necessary. With suitable evidential safeguards—again, crucial—the property should be made available to rent after just six months. Both these amendments address the need to sustain rather than contract the supply of suitable rental accommodation.
I have two final points. First, as we seek to make these adjustments to the landlord-tenant relationship, the fundamental—on which many have touched—is a mismatch between supply and demand. As long as the housing stock available to rent is so out of kilter with demand, systemic problems of non-availability and methods of rationing—overt or unspoken—will remain. In particular, landlords will be even more selective than they are now about who they choose to rent to—and they still have a choice.
Secondly—and I have raised this before—while the Government assure us, in exactly the same way as the last Government did, that most landlords are good, the real target for improvements in standards of accommodation and tenant rights should be, as we were reminded by the noble Lords, Lord Shipley, Lord Thurlow and Lord Carter, the minority of bad ones. These individuals, and in some cases gangs, do not care for written agreements, the decent homes standard or legal niceties; their activities are based on force, extortion and neglect.
The Bill risks—do I dare say this?—helping mainly middle-class renters to gain and assert their rights. Unless we get much more serious about enforcement, which means properly resourcing it against truly exploitative landlords, life for those at the bottom of the housing ladder, where the direst needs and worst poverty coexist, will remain untouched despite this well-intentioned Bill—as it presently stands.
Lord Tope (LD)
My Lords, I am another vice-president of the Local Government Association. More particularly, because of what I want to say tonight, I am co-president of London Councils, the body which represents all 32 London boroughs and the City of London. I was also a London borough councillor for 40 years and leader of that council for 13 years. Not surprisingly, therefore, I am going to speak about the situation in London, although I recognise that many of the points I raise apply in most, if not all, cities and towns throughout the country.
London is home to an estimated 2.7 million private renters. Rented properties now account for 31% of homes in the capital. I am told that the closest regional average is just over 19%. Home ownership, therefore, is unaffordable for many London residents, and there are extremely long waiting lists for social housing. As a result, having access to safe, secure and affordable private rental property is vital for very many people living in London. London Councils welcomes many of the measures in the Bill and supports the Government’s aim to deliver a fairer, more secure and better quality private rented sector. In particular, it strongly supports the abolition of Section 21 no-fault evictions, which really cannot come soon enough.
The Bill proposes a range of significant new regulatory and enforcement responsibilities for local authorities. These include responsibility for enforcing the decent homes standard in the private rented sector and a duty on local housing authorities to enforce landlord legislation in their area, which, of course, means every one of the 32 London borough councils.
According to the English Housing Survey for 2022-23, London had 134,000 non-decent private homes, accounting for 12% of the market. Raising these to the decent homes standard will need significant investment, and will be costly and resource-intensive for boroughs to enforce. London boroughs forecast a funding shortfall in 2025-26 of £500 million. I am not going to ask the Minister to commit to the full funding, because I have been doing that for the last 40 years and I know the answer I will get, but will she commit to working with local authorities to produce a full new burdens assessment in relation to the Bill so that we have a real and realistic idea of the actual resource needs to implement it?
I want to turn to Home Office accommodation for refugees and asylum seekers. In the other place, the Government argued that it was not necessary to bring that within the scope of the Bill because such accommodation is already regulated to what they describe as a “high standard” by the asylum and support contracts, enforced by the Home Office. Evidence from London borough local authorities—I am sure that local authorities in other parts of the country would bear this out too—consistently demonstrates that the view expressed by the Government in the other place is simply not the reality. Extensive feedback from London authorities provides widespread evidence of poor standards across asylum accommodation. Enforcement action is often slow when contract breaches and other issues are identified, and I am told that a number of barriers remain in implementing effective enforcement action. The sub-contracting model of the Home Office providers results in a lack of accountability and misalignment between Home Office and local authority standards. London local authorities report that responses are slow, and that residents spend hours at a time waiting to get through via the helpline. In some instances, there is evidence that complaints are not properly recorded.
The exclusion of Home Office accommodation from the provisions of this Bill will inevitably result in a two-tier system, which will be particularly serious in London. Extending the provisions of the Bill would assist in creating uniform standards and give statutory bodies greater powers to take effective enforcement action. London Councils is therefore seeking to extend the provisions under Awaab’s law and the decent homes standard to include Home Office-contracted accommodation, including initial, contingency and dispersal accommodation. It asks that the powers of the proposed ombudsman be extended to include asylum seekers. Having an independent ombudsman would give people seeking asylum greater agency and trust in the asylum system.
London Councils is raising very important issues, drawn not from expectation but from actual experience, and no doubt the same is true in many other towns and cities in the country. I ask the Minister not simply to dismiss them as unnecessary but rather to take them away and give careful consideration to how best they can be met within the provisions of this Bill.
Lord Davies of Brixton (Lab)
My Lords, I congratulate my noble friends Lord Wilson of Sedgefield and Lady Brown of Silvertown on their excellent maiden speeches. I am sure that the House will benefit from their membership.
It is a pleasure to follow the noble Lord, Lord Tope; he has covered a number of the points that were going to be included in my speech and I agree with everything he has said. My views on housing are very much governed and guided by my experience as an inner-London borough councillor. However, I am not just going to talk about London; I also want to talk about older renters.
A Venn diagram shows that there is considerable overlap, with a higher proportion of older renters in London than anywhere else in the country. This is a particularly difficult issue which needs to be addressed. There is a crisis in London’s housing, driven by a combination of soaring rents, the lack of affordable housing and growing insecurity for tenants. With 2.7 million private renters, making up 31% of the capital’s housing market, many Londoners are struggling with rising costs, poor housing conditions and the threat of eviction.
Older renters in London are particularly vulnerable in this crisis. Many are long-term tenants on fixed incomes, facing significant rent hikes, leaving them at risk of eviction and potential homelessness. Unlike younger renters, older tenants often struggle to relocate due to mobility issues, limited financial means and a shortage of suitable age-friendly housing. Additionally, age discrimination and strong competition in the private rental sector make it harder for older people to secure new tenancies. This is a growing issue. Research from the charity Independent Age estimates that, over the coming 25 years, there will be a fourfold increase in the number of older renters.
Urgent action is needed, including rent controls, greater legal protections and stronger enforcement against rogue landlords. Without intervention, London’s rental market will continue to push vulnerable groups, especially older people, into precarious and unstable living conditions. Given the extent of the crisis in London, I make no apology for highlighting the views of London Councils, emphasising the points made by the noble Lord, Lord Tope, and by the Mayor of London on what is needed in addition to what is in the Bill.
The mayor and London Councils have broadly welcomed the Renters’ Rights Bill as a crucial step towards improving the private rented sector in the capital. However, they have highlighted key areas where further government action is needed to address the capital’s severe housing pressures, growing homelessness and stretched local authority resources. We will need to address the issues they have raised during the Committee stage.
The mayor and London Councils support the abolition of Section 21 no-fault evictions, which have been a major driver of homelessness in London: 5,000 Londoners faced homelessness due to Section 21 evictions in the last fiscal year, which is an 18% increase on the previous year. Greater protection for tenants is set out in the Bill, but the mayor, for example, has also called for rent control powers to be devolved to London, while London Councils, as we have heard, supports strengthened tenant protections against sudden rent increases through a fairer tribunal process and an extended notice period of two months.
Both bodies have expressed concerns about the new regulatory and enforcement responsibilities being placed on local authorities. Councils will be responsible for enforcing the decent homes standard in a private rental sector where 134,000 properties failed to meet this standard. With London boroughs already facing a £500 million funding shortfall for the forthcoming year, additional enforcement duties will be unsustainable without government funding. London Councils has urged the Government to undertake a full new burdens assessment to ensure councils can implement the reforms effectively.
We also need stronger protections against rental discrimination. They call for the regulation of guarantor requirements, which discriminate against older people, who find it more difficult to obtain such guarantees, in addition to migrants and low-income renters. The Bill should also ensure better access to compensation for renters who have faced discrimination, with a lower burden of proof for claims.
I am running out of time, so I will just emphasise the point made by the noble Lord, Lord Tope, and my noble friend, about extending protection to asylum accommodation. The mayor and London Councils have highlighted the substandard conditions in Home Office-provided asylum accommodation. We need an extension of the decent homes standard to cover asylum accommodation, the application of Awaab’s law and the new renters’ ombudsman to cover asylum housing, ensuring that asylum seekers and refugees receive the same legal protections as other renters.
Lord de Clifford (CB)
My Lords, I congratulate the noble Lord, Lord Wilson of Sedgefield, and the noble Baroness, Lady Brown of Silvertown, for their passionate and moving maiden speeches. This Bill will be welcomed by tenants, not only to improve security of tenure of their homes and the quality of properties being rented to them.
The Bill encourages tenants to seek redress against poor landlords for issues they have with their properties, such as repairs, unfair rents and unfair evictions. It increases the reliance on courts, local authorities and ombudsmen to decide on these issues, as has been covered by many Peers. Currently, all these are under pressure, and I look forward to hearing from the Minister what plans are in place to deal with this increased workload.
Also, with the increase in reliance on these bodies, is there a risk that the complexities for tenants on who to contact increases? There are currently 10 organisations that they could contact about these issues. Some clarification for tenants in future would be useful.
Change always creates uncertainty, and this Bill certainly does for landlords, who are already making decisions based on this Bill and its many unintended consequences, some of which I will address.
I welcome the need and reason to give notice to protected tenants, but I ask the Minister for clarification on an issue that came forward to me: if a landlord has a rented property under a shorthold tenancy and has the need to employ a carer for themselves or for a carer to live in that property, could they give notice under ground 5E with only four weeks’ notice? This issue was raised with me—I do not expect an answer tonight.
I am sure that the tenants’ rights and protections to challenge punitive practices such as rental bidding will be circumvented by landlords and letting agents by increasing the asking price of the rented property, especially when the demand is in certain areas, therefore again putting tenants off from putting in offers, as was already mentioned by the noble Lord, Lord Thurlow. The principle of being allowed to take rents in advance is welcome, but one simple rule does not work for a sufficient number of tenants—mainly those who do not have credit history. For example, overseas individuals and families coming to this country to work or study, individuals starting new businesses with less than three years’ worth of accounts, and students with no guarantor may all have the funds to pay rent in advance, but they cannot due to this Bill and will be overlooked in preference of those tenants with regular incomes. I ask the Minister: has any amendment been considered on how we can help these types of prospective tenants?
The reduction of the effective minimum term of three months for tenancies means more uncertainty for landlords. Landlords and letting agents will incur most of the costs of letting a property at the beginning of the tenancy and will therefore be out of pocket on a regular basis. Why do the Government feel the need for such a short starting period to tenancies? Do not landlords deserve some protection for the cost of moving a tenant into a property?
Pet ownership has increased in the past five years, and the importance of pets to individual families has also increased, so the right to request a pet is helpful and welcomed. Would it not be wise to first define a pet in the Bill? Could I suggest that a term such as “companion animal” is used? In the veterinary profession, this category typically includes dogs, cats, birds, rabbits and other small mammals. I think that this would help within the Bill. I thank the Minister for noting my interest in this area as well.
It is acknowledged that pets bring additional dirt and increased wear and tear to properties and, on occasion, cause damage and infestation of fleas. That is why holiday letting markets charge extra amounts when pets are allowed. The Bill has tried to address this concern by asking tenants to pay for pet insurance; as pointed out by the noble Earl, Lord Kinnoull, this product does not exist. I look forward to further discussions on this point with the Minister and in Committee.
There is a shortage of supply of rental properties, and there has been for many years, especially in rural areas, as covered by the noble Earl, Lord Leicester. With the changes in the Bill, rural landlords in areas with good communication to major cities and holiday destinations are changing the use of properties to holiday lets or renting to city weekenders on a common law tenancy basis, which gives the landlord a lot more flexibility. This further reduces the availability of affordable supply of property to local individuals, workers and families, and this is an area we need to address. I look forward to contributing further to the Bill in Committee .
Lord Howard of Rising (Con)
My Lords, I declare an interest as an owner of rented property. The last Government introduced a Bill to reform the rental market; it was a rotten idea then, and it is a rotten idea today. Although I believe it is extremely well intentioned, it will undoubtedly do more harm than good. I am constantly amazed by the belief of Governments, in the face of evidence and common sense, that they can improve things by intervening in a market that works. Last week, I quoted the late Milton Friedman:
“If you put the federal government in charge of the Sahara Desert, in five years there’d be a shortage of sand”.
If this Bill is enacted, then, in five years, there will be an even greater shortage of rented accommodation than there is at present—that is, if anything more than a token market remains.
Landlords are already creaking under the weight of tax and bureaucracy, and the rental market is shrinking. Rented accommodation will always be needed, as a number of noble Lords have pointed out, but the policies the Government are proposing will result in a further reduction of the amount of rented property available. Decreasing supply coupled with the increasing demand will serve only to push up costs for new tenants.
The Government’s tortuous manoeuvring around rent controls will not work. Under the Bill, any tenant who disagrees with a rent increase can go to a tribunal. At that tribunal, rent can only be reduced: it can never be increased beyond the landlord’s proposal, however modest that proposal may have been. It is a win-only bet for the tenant. Even if a proposed rent increase is ruled acceptable, the tenant does not have to start paying it until the tribunal has concluded. Who knows how long that could take? At best, the tenant gets a rent reduction, at worst a delayed rent increase. Why would every tenant not appeal on every possible occasion? The tribunals will be swamped and the delays will become unreasonable.
There is another problem with rent tribunals. The tribunals’ job is to determine what the market rent should be and to ensure that rent increases do not exceed it. If rents never go above an existing market rate, the market rate will not change; it will stay exactly the same. To state the obvious, landlords let their premises in return for rent. To create a situation where the return on investment is static because the rent never goes up, but costs go up, can result only in a reduced supply of rental accommodation.
In Berlin, in 2020, they introduced a law to maintain rents at 2019 levels for five years. Because of that law, the number of new rental properties coming on to the market fell by almost half and the scheme ended after less than two years. Similar legislation in Scotland has resulted in a significant reduction in rental stock and the highest rent increases in the United Kingdom. In Ireland, because of the shortage of rental accommodation, foreign students ended up sleeping in tents. The evidence of the harm that can be done by Governments trying to interfere in the market stares us in the face.
There are many problems in the Bill and I have commented on only one of them so far. To burden landlords with some of the other suggestions in the Bill will only accelerate the landlords’ exodus from the market. As my noble friend Lady Scott said, around 90% of landlords are individuals, of whom nearly half own only one property. Many of them will not have the resources to cope with the Government’s new demands. I remind the Government that landlords already have considerable overheads to maintain their properties: gas safety test certificates are needed every year; electrical installation condition reports are required for each new letting, or every five years; energy performance certificates are obligatory; and the demands of what they must achieve increase every year. Landlords are legally required to vet their tenants, and tenants can complain to their local authority if rules are not complied with.
Those are some of the costs of bureaucracy that landlords face already. The Bill makes the burdens worse. Demands will include limiting deposits to one month’s rent. The existing five weeks in no way covers the damage caused by a bad tenant. Landlords will not be able to refuse pets, despite the almost inevitable damage. I would say to the noble Lord, Lord Black, that I have never refused a pet, and they have invariably cost me money way over and beyond any deposit. I will never refuse one either, by the way.
Fixed-term tenancies are to be abolished, even where they are in the interest of both parties, such as the majority of student accommodation. The threshold needed to be breached for eviction for anti-social behaviour or rental arrears is being raised. Up to now, the ability to use Section 21 ensured that tenants behaved in a neighbourly manner.
There will be much to deal with in Committee. I will spare your Lordships any more today.
Lord Desai (CB)
My Lords, let me first say congratulations to the two maiden speakers. Let us hope that they enjoy being in your Lordships’ House.
I start by saying that we have a very distorted housing market. Among all the countries of Europe, we have the highest amount of home ownership—two-thirds of houses are home-owned. If you look at home ownership, social housing and private rental, you see that private rental is the stepchild of the country. When I first arrived in this country 60 years ago, there was a very healthy rental market. Indeed, until I arrived here, I had lived only in rental houses, in two different countries, in four different cities. The idea of owning a house was never there. After my first two attempts at renting flats, which I was very lucky with, everybody screamed at me, “Why are you renting?” They said I must buy, because mortgage payments were tax deductible so I really should stop all this tenancy business and buy.
We have subsidised home ownership outrageously. The only asset I know of on which you can make a profit and pay no capital gains tax is an owned house. If you have a housing market like that, it is no wonder that anybody who can at all afford to have a mortgage, even at the age of 12 or 13 or whenever, will get a mortgage from the bank of mum and dad. They will take a loan and buy a house.
We are, basically, leaving the rest of the population in two different categories. Those who are local, and qualify under the terms of the local council, get social housing. New Labour, unfortunately, did not build any social housing, so we do not have as much social housing as we used to. The people who are left, who cannot have social housing and do not have the money to buy a house, are in the category of private rental tenants. They are either transients, such as students who will be there for only two or three years and who do not really mind about the rent, or new arrivals in this country—immigrants—or people who are very poor but unable to get any social housing.
You have to look at the category of people trapped in the private rental category, who are, relatively speaking, in the worst-off section of society. We do not have what we used to when I first arrived here: comfortable three-bedroom houses for rent. We used to have unfurnished rentals.
The noble Lord, Lord Best, who is not in his place, mentioned Rachman and Rachmanism. He was an exploitative landlord, and the whole scandal about Rachman basically made people very hostile to this. Steadily since then, since 1965 to now, we have expanded one part of housing with subsidies but starved the private rented sector.
I do not want to talk about the details of the Bill because a lot of people have already done so, but we have to do something about the generous tax treatment of owned houses. In my view, this discourages people from investing in stocks and shares, as stocks and shares are taxed for capital gains but you are not taxed for capital gains in housing. We invest far too much in bricks and mortar and not enough in productive capital because our tax system is totally distorted. Anyway, that is not what the Bill is about. It is about the one- fifth of the population who are trapped in private rentals.
Importantly, if you are going to index rents, you should not index them to the consumer prices index. I urge the Government to ask the Office for National Statistics to construct a housing costs index. Landlords may have to pay for repairs and so on, which are different kinds of costs from the consumer prices that go into the consumer prices index. Landlords may find that it costs much more to repair a property or keep it in good shape than buying bread or sausages. We ought to do at least that little thing in favour of the universally disliked landlords. That might improve the performance of the Bill.
Lord Inglewood (Non-Afl)
My Lords, like a number of other speakers, I begin by referring to my entry in the register of interests. I declare that I am a landlord of some rented properties on my own account, and I am a landlord in a capacity as trustee for quite a lot more.
At the risk of stating the obvious, but I think this is rather important, houses are wasting assets. They always need refreshing and maintaining, and that is a predicament that affects everyone in this country in one way or another. They are also, and I think this is also significant, a crucial part of our national infra- structure. While we have heard a lot recently about the failures to properly maintain our national infrastructure —the railways, roads and water systems—we do not really think about housing in that context, but of course it should be thought of that way. If you want to look at an example of what happens if you do not carry out proper maintenance on buildings, you need go no further than the building where we are this evening, which is an absolute scandal.
Although we sometimes might have thought to the contrary today, the private rental sector is not homogenous, and there clearly has been abuse, which the Government are right to address. Nevertheless, as is also clear, the private landlord/tenant process is an essential element of our housing scene in this country and, as the previous speaker has just said, quite distinct from owner-occupation. Getting it right as much as we can in the real world—I say that because I want to contrast it with the kinds of desktop studies that sometimes accompany debates of this sort—is crucial for individual families’ well-being and the wider provision of housing in the country taken as a whole. We must not throw out the metaphorical baby with the bathwater.
However, we cannot do that unless we start from the presumption, which has to be based on realism about the real world, that both landlords and tenants are not scheming crooks. Still, there must be usable mechanisms that can cut in quickly and unequivocally against tenants and landlords if roguery is suspected. It is a question of balance. Some of the changes in the Bill seem desirable and move in the direction of improving that balance, while others perhaps go in the opposite direction. As we shall be discussing those in more detail at later stages, I will not go into them now. All I will say as a landlord is that if the rent is not paid, it has the same effect as opening a wallet and taking cash out of it, and trashing a house or flat is the same as trashing someone’s car. They are not victimless activities —on the contrary.
From the tenant’s point of view, security of tenure is clearly an important aspect, and I have considerable sympathy with the proposals to end no-fault eviction. However, market rent is a very slippery concept, as the noble Lord, Lord Desai, touched on. Where I live, in the north of England, rent levels in Cleator Moor are very different from those in Chelsea. That has a considerable bearing because, where landlords are being expected to improve houses at the behest of the Government, you find that building costs have recently been increasing, as far as I can see, way ahead of inflation, so the whole thing gets into a muddle if we are not careful. There is an important question for the long run: if the code by which private landlords are expected to operate turns—de facto, not necessarily de jure—into some kind of housing benefit, what are the consequences and implications of that?
It is one of the mysteries of the world we live in that the land and housing market does not appear necessarily to follow the rules that are generally thought to apply under the wider laws of economics; we have to look only at the Government’s recent experience with calculating profitability in agriculture to see that. When there is a conflict in this sort of context between experience and theory, the experience of the real marketplace must always be right.
Simply repeating historic mantras is not very helpful in this context. What is needed is a complete rethink from first principles about a whole range of both the subject matter of the Bill and the inexorably connected flanking measures. The noble Lord, Lord Desai, has been doing a bit of that, as did the noble Lord, Lord Best, earlier in the debate. If we do not do that, we will end up simply going down a cul de sac.
As I have said already, the whole housing sector, just like other infrastructure, is a wasting asset. That has to be at the centre of our thinking and has to be understood by Governments—not only this Government, but Governments of all political persuasions—and the private rental sector is an integral component of that. My belief is that the only way it can function in the national interest is if it works for both landlords and tenants. That depends as much on the balance within the legislation as it does on the specificity of each and every element of it. If the arrangements—taken together with the Government’s involvement outside but having a bearing on this market—do not achieve that, the Bill will simply become an Act that fails.
The Earl of Lytton (CB)
My Lords, I have to declare a personal and professional interest with the private rented sector since 1968. Members of my family are also private rented sector landlords. I thank the Minister for introducing the Bill so cogently, and I add my tribute to our two excellent maiden speakers.
My professional training, which started in 1969 or thereabouts, involved an understanding of the Protection from Eviction Act, the Rent Acts, the rent officer service, rent assessment committees and fair rents. That regime, I know for certain, created a severe attrition of the private rented sector. The statistics show that it fell from 31% of homes in 1961 to under 10% in 1991, with substantial value write-downs in the process. The 1988 Act brought some relief and brought in shortholds. The emphasis was on the “short” bit; that was what it was intended to do, and you could not let for more than five years in the early stages. It has continued pretty much uninterrupted, under several subsequent Administrations. Even so, the proportion stood at 9.7% of homes in 2000.
The Government have been strident in their insistence that under the Bill no rent controls are planned, but I see the ability to challenge above-market rents, and the allied pressure for CPI pegging of rents and the whole question of affordability, to amount to the same principle of fair rents under the 1965 Act, give or take a bit, and likely to have very similar outcomes. At any rate, I believe that it is a distinction without a real difference, and could be adjusted and altered at the stroke of a pen.
The market will take note of this, looking at the headwinds and the new obligations under this Bill. My take is that the private rented sector is now destined for material decline. Halving it to the sub-10% of homes it was in 2000 seems a least a possible medium-term prospect. There will be no rush to the exit, just a steady attrition, with probably the 45% of the PRS in the buy-to-let component leading the way.
Does it matter, in what is actually a highly interconnected and joined-up housing sector, where people can move from one to the other? If the noble Lord, Lord Best, is right—I am glad to see him in his place —the surplus would be hoovered up by social landlords and new companies to be let at affordable rents— I assume this means an absolute maximum of 80% of market rent. However, having bought the property, which may need work and improvement, at market levels, to then let at a 20% discount, with rising costs and current interest projections, and the added duties, risks and so on, strikes me as improbable. I would like to know where the model for this is. Maybe he is right and giving incentives to sell to the sitting renter—those of them who have the cash—would be a way forward.
If these properties are released in dribs and drabs on to the general housing market, they cannot fail to have a dampening effect, likely over an extended timeframe, on the growth in housing values and the viability of new-build rollout because of the interconnected nature of the sector. I remind your Lordships that the CBRE suggests that there are at least 1 million consented residential plots that have not been built out and are sitting there waiting to go.
If I am right here, and we are moving to a higher proportion altogether of social rented property, then, again, the pressure on homes to purchase might, by that token, reduce. Good, I hear noble Lords say, but be careful what you wish for. Year-on-year increases in house prices are, in large part, what underpins our economy. From the Treasury at one end, with the tax revenues in sight, through developers and constructors, and local authorities to first-time buyers at the other end hoping to build equity in their home, this is all about money supply, banking, consumer spending and so on.
I am no fan of a model based on inventory rather than productivity—a point that the noble Lord, Lord Inglewood, almost touched on. I consider, in any event, that it will only end in tears, eventually. But it is such an important driver in our post-industrial, service industry-based economy, where we in the UK have about the fifth or sixth highest exposure to property-related debt in the world, that it cannot be ignored.
So, what about the inventory valuation that sits behind this? Has anybody done the calculations? I see this Bill as having the potential to trigger much larger events in a system of very many moving parts. I hope it is not an adverse trigger. I would hate things to get back to the stage we were at in 2008. This is why I would prefer a less iconoclastic reform, despite all the ills and abuses in the existing private rented sector, which I readily acknowledge. I would like to see choice, flexibility, freedom to transact, ease of entry and exit and all the mobility that this implies. That also implies a fair balance. It is a world of complementary needs. We should remember, too, that after 2008 the expansion of the private rented sector was able to absorb a lot of the pain that would have otherwise resulted from that debacle. But I am afraid that I see a bulky document, inherently encapsulating more cost, risk and delay and a transactional drag while it all beds in.
We have to stop conflating the problems within the private rented sector with other matters such as social inequality, lack of affordability, housing costs, high and inward migration, employment problems, income distribution and so on. We have to remove it from that—
Captain of the King’s Bodyguard of the Yeomen of the Guard and Deputy Chief Whip (Baroness Wheeler) (Lab)
Excuse me. Will the noble Earl please wind up? The advisory time is seven minutes.
The Earl of Lytton (CB)
I am actually finished. If I am right, there is little that can be done with this Bill. None the less, I will engage in order to try to improve it. Like my noble ancestor Lord Byron, I deny nothing but I doubt everything.
Lord Northbrook (Con)
My Lords, I first declare my interest as a rental property owner. I support certain aspects of this Bill but have major reservations on other parts of it. On some issues the Bill strikes the right balance. This is agreed by the National Residential Landlords Association and the Large Agents Representation Group. These issues include provisions to establish a decent homes standard, applying Awaab’s law sensibly, tackling discriminatory practices faced by benefit claimants and families with children, protecting guarantors when a tenant dies while renting a property, and efforts to end bidding wars. These parts of the Bill are welcome.
Before I look at the Bill’s problems, I would like to take a step back and examine the background to the English residential letting market. First, there are not enough private rented properties to meet demand. The noble Baroness, Lady Taylor of Stevenage, has acknowledged that demand is currently outstripping the supply of properties available to let. According to the latest English Private Landlord Survey, the number of landlords looking to sell properties is increasing: 31% of landlords plan to cut the number of properties they rent out. Landlords selling properties is not good news for tenants. This is a leading reason that tenancies end, according to the Government’s homelessness data.
The leading countryside organisation, the CLA, states that that the rural private housing sector is shrinking, with 44% of countryside landlords planning to sell or change use class in the next two years. This compares with only 21% planning to build in the same period. Some 90% of those planning to leave the sector gave changes in private rented sector tenancies as the first cause. The second cause was the proposal to increase minimum energy efficiency standards to energy performance certificate C. The third cause was the abolition of Section 21, which I shall now move on to.
The courts are already facing huge backlogs. Ending Section 21 will put an even greater strain on them. They will need to consider and process possession cases where landlords have good cause, under the Section 8 process. The other place’s Housing Select Committee has previously warned that the courts will be overwhelmed without reform. Government data suggests that it takes a court an average of just over seven months to process Section 8 possession cases. This is from a case being accepted to the property being repossessed and includes cases related to anti-social behaviour and serious rent arrears.
As far back as September, the Housing Minister in the other place said that the Government are working
“to ensure that the court system is ready at the point that the new system comes into effect”.
However, since then, no clarity has been provided by the Government about what the courts being ready means in practice. This is especially concerning given that the Minister told the Public Bill Committee in the other place that the court system is “on its knees”. A clear resource plan must be put in place before reforms take effect. The Law Society has rightly warned that
“without investment for housing legal aid and the courts, the bill will not achieve its aims”.
Despite representing the most significant reforms to the private rented sector in over 30 years, no clear implementation plan has been developed or published. Such a plan is vital to ensure that the sector understands what is expected of it and when. Sufficient time needs to be allowed to prepare for changes. I therefore ask the Minister: which parts of the Bill will be implemented at what stage?
I now move to the problems of the legislation regarding the tribunal system. The Bill is set to allow tenants to challenge above-market rent increases at the property tribunal. The ruling cannot decide that a proposed rent increase should be higher than what was proposed by a landlord, and tenants can take rent determinations to a tribunal free of charge. Based on the measures in the Bill, there is no clear reason as to why a tenant would not take an increase to the tribunal. This is irrespective of whether their challenge would be successful, not least because the only way to test if a rent increase was at market rates or not would be to go to the tribunal.
At the Second Reading of the Bill in the other place, the Housing Minister told MPs that the Government
“do not want the tribunal overwhelmed”.—[Official Report, Commons, 9/10/24; col. 413.]
However, it is not clear how this will be achieved. I suggest that, to prevent the property tribunal being overwhelmed with rental appeal cases, tenants should first be able to establish from the Valuation Office Agency whether a proposed rent increase is within market rates or not. This would make use of the VOA’s experience on local market rents and reduce waiting times for cases that need to be decided by the tribunal.
The next problem is Clause 9. The effect of this could see a number of otherwise suitable applicants shut out from the private rented sector. The clause prohibits any form of rent in advance other than the first month’s rent, which is only payable after the tenancy agreement has been entered into. While the Government’s intentions behind seeking to prevent large amounts of rent being paid in advance are understandable, limiting this ability may close off the private rental market to certain groups who most struggle to prove their ability to sustain a tenancy, including covering their rents. Those most likely to be affected are international students and overseas workers who have no credit history in the UK, as well as those employed on a short-term or variable basis with income that fluctuates. Those from overseas are also most likely to struggle to secure a UK-based guarantor for their rent.
In addition, I ask the Minister how guarantors will work under the new legislation. Given the end of the fixed-term tenancies, it is unlikely that a guarantor would be willing to guarantee a tenant’s rent indefinitely. The Bill’s potential to close off the market from those overseas is in direct contrast with the Chancellor’s ambition to encourage more high-skilled workers to UK and the Education Secretary’s recent message welcoming international students to the country.
I have two other issues. The first is ensuring that the database of private housing works. Chris Norris of the NRLA, which represents 100,000 landlords, said:
“It makes no sense that whilst planning to create a national database of private landlords, the Government now wants to make it easier for councils to license landlords as well”.
How do the Government plan to prevent the two schemes duplicating each other? A failure to do so risks them becoming nothing more than cash cows at the expense of landlords. The database must make it easier for responsible landlords to demonstrate compliance with all their obligations.
My second and final issue is the uncertainty for landlords over gaining repossession of one or two-bedroom properties let out to students. Can I ask the Minister why the new possession ground 4A will not apply to these?
Lord Trees (CB)
My Lords, I congratulate the noble Baroness, Lady Brown, and the noble Lord, Lord Wilson, on their excellent maiden speeches and welcome them to the House. I declare an interest as a part-owner of two rental properties—although without beneficial interest—as a veterinary surgeon and as co-chair of the All-Party Parliamentary Group for Animal Welfare.
I want to concentrate in this debate on the issue of keeping pets. I thank the Bill team for the useful discussions we have had. Currently, the Bill has limited descriptions of three important areas. First, what is a pet? They are described in the Bill as
“an animal kept by a person mainly for … personal interest, … companionship, … ornamental purposes”,
which, basically, could be any animal. Secondly, what is damage? I will say a bit more about that later. Thirdly, there is what is reasonable or unreasonable, as referred to by the noble Baroness, Lady Fookes, earlier.
With respect to the definition of pets, clearly there are different considerations of welfare, public health, damage, hazards and consequences to others between keeping one budgerigar or five Alsatians. Most species of pet are likely to cause no problems, the most popular pets, dogs and cats, are unfortunately those in respect of which the greatest problems might occur. There is a balance to be struck between three variables: the welfare of the pet, the well-being of pet owners and the possible negative impact on others.
In considering the trade-offs, the first point I want to make is the difference between assistance dogs and other dogs. Assistance dogs are protected by the Equality Act 2010 and are known as auxiliary aids to disabled people. They are not legally regarded as pets, but Assistance Dogs UK still receives reports of obstacles to people with assistance dogs being able to access private rental accommodation. Given the high degree of training of the dogs and of the owners, and the benefit to the owners of such dogs, I suggest there is a clear argument in favour of a tenant’s right to have an assistance dog in private rental accommodation. However, there is an issue, as there is no official recognition of assistance dogs. There is a need for some central registration of such animals and owners to unequivocally identify them—perhaps analogous to the provision of blue badges for preferential parking for people with certain disabilities.
With regard to the welfare of pets in private rental accommodation, such pets are covered by the same animal welfare protections provided under the Animal Welfare Act 2006 and other legislation for animals in any other accommodation, so there is no issue regarding the welfare of the animals.
From the pet owner’s perspective, there is much evidence of the value of pets to human well-being. A 2016 report, Companion Animal Economics, estimates that owning a pet reduces costs to the NHS by £2.5 billion per year through reduced numbers of doctor visits. Furthermore, there are well-known health benefits, including improved mental and physical well-being by reducing feelings of anxiety and depression and increased physical activity on the part of owners.
With respect to damage, this is not fully defined in the Bill, but it clearly applies to physical damage of furniture and fittings. Certain pets—notably dogs—can do considerable damage to furniture or fittings, especially when confined in accommodation without supervision. I suggest that the figures for costs quoted in the impact assessment of £12 per year for landlords and £7 per year for pet-owning tenants are far too low.
However, the negative effects of dogs and cats potentially go beyond physical damage. Of considerable consequence, and unconsidered by the Bill, is the contamination of housing with other allergens of pet origin and infestations, particularly of fleas. These may have considerable consequences for follow-on tenants and landlords. Flea infestation of dogs and cats is common, and it is a considerable problem in accommodation. There are now very effective products for dogs and cats to prevent and control fleas, but of course it is up to the owners to administer them appropriately.
Fitted carpets and central heating provide ideal habitats for fleas. Most of the flea life cycle is in the environment where the eggs, larvae and adults are. The adults can survive for some considerable time without feeding. In a property that is infested but has been left empty for some time, when a person goes in there, the fleas will pounce on them for a feed as well as any animal. Only this weekend, I was in the butchers in my village in Perthshire and I mentioned what we were doing today. He told me about his girlfriend’s experience with a cottage she rented in the village. The previous tenants had dogs and cats. She went into the empty cottage, turned on the central heating, and the place was hoaching—as we would say in Scotland—with fleas. They had to get rid of all the carpets, sand the wooden floors and varnish them.
Another direct witness experience came, while we were preparing this, from my researcher, who has friends who rent out a property in Canterbury. The tenants had done a runner and not paid, and when they went into the property it was highly infested. It took five fumigation attempts over four months by professional pest controllers to get rid of that infestation and cost the landlord nearly £1,000.
If insurance or a deposit arrangement can cover that, that is one thing. But my understanding is that insurance may be difficult to secure, particularly for insect infestation. I will leave this issue to noble Lords who are much more expert in this area than I am, including my noble friend Lord Kinnoull, but I suggest that this is an important issue to resolve. Surveys show that 40% of landlords are unwilling to accept tenants who own a pet. Problems such as this, unless resolved, may encourage more and more landlords to abandon the rented sector.
Finally, I ask the Minister: what assessment have His Majesty’s Government made of the likelihood of insurance provision or alternatives? Assistance dogs should be given special regard in the provisions of the Bill, so will His Majesty’s Government consider establishing a register of assistance dogs and keepers to enable them to be identifiable by landlords?
Baroness Thornhill (LD)
My Lords, I too congratulate the noble Lord, Lord Wilson, and the noble Baroness, Lady Brown, on their entry to the House. I really enjoyed both their speeches. I felt they were delivered with passion and with that which is always welcome in this House—humour. I thank the Minister, who has been very generous with her time in answering our many and varied queries.
This has been a very lengthy and informed debate, and at times somewhat heated. I was reminded—if I needed to be—that we are indeed a nation of pet lovers. Coming at this stage in the batting order and knowing that we all now really just want to hear the Minister’s responses to our very wide-ranging concerns, I have ruled out a lot of facts and details that noble Lords have diligently provided. I am aiming to be succinct, I hope, and not too repetitive.
First, I thank from our Benches the very many who have sent us briefings, particularly the Renters’ Reform Coalition—especially Generation Rent and Shelter. For the landlords—and let us be honest, the majority are good landlords—I thank the National Residential Landlords Association, Propertymark and LARG. They all welcome the Bill in different ways but see unintended consequences. We must explore these, and seek to remedy them and strengthen the Bill, which will be our task over the coming months.
As many have said, we too are pleased to receive the Bill. On the whole, there is much to be welcomed, such as the abolition of Section 21, which has been trailed so much and for so long that it is very much taken for granted. We do not accept the plea from landlords that we should wait until the courts are ready; they should be by now as they too have had ample notice. My question to the Minister is: are they ready?
That said, we do think there are other legitimate concerns from the landlords’ side, as was very well expressed by the noble Baroness, Lady Scott, in her detailed contribution. We will join that ride on the see-saw. In particular, we ask the Government for a timeline of the many and various aspects of the Bill to provide certainty, because that is what has been missed in all this. The sector—tenants and landlords—need certainty for all parties, so that we do not jeopardise the Bill’s key objectives in haste or unpreparedness.
It must be said, and has been said by several noble Lords, that a lack of supply of homes for social rent over decades has brought us to this crisis point. The noble Lord, Lord Best, outlined this particularly well. This has created an entire cohort of renters who would have previously been housed in social housing but are now struggling in the private rented sector. They can often be the most vulnerable and financially challenged, and in need of additional support. Our real concern is that despite the Bill they may well still be at the sharp end of renting, unable to access the rights enabled in the Bill and vulnerable to being threatened by the least scrupulous landlords—as was passionately and forcefully expressed by the noble Lord, Lord Cromwell. We also have concerns for these residents around eligibility checks and guarantors. We need the issues raised by landlords to be fully answered to protect these renters.
The Bill relies on tenants to challenge their landlord across a range of issues, not just regarding rent rises but on unfit properties and repairs, as we have heard. Of course, the Bill gives tenants more rights. We applaud that but doubt whether the residents about whom we are most concerned will have the means or the motivation to take advantage of the new rights. Can the Minister outline any changes that will be brought in, possibly in other ways, to support tenant advocacy, as is the case in the social rented sector? The noble Baroness, Lady Warwick, pointed out just how complex the current system is. It will deter even the hardiest tenant.
The Bill is clear that a database could be a great aid to tenants in this regard. We believe that it has the potential to be a game-changer, as outlined by my noble friend Lady Grender. We regret that the detail of its contents is to be left to secondary legislation. We seek for some clear criteria to be enshrined in the Bill to ensure that it really is fit for purpose. In particular, we would support failure to register on the database becoming a breach of duty which would count towards a rent repayment order. That would provide a real incentive to register, in addition to the heavy fines indicated in the Bill.
On renters repayment orders, we are pleased that the Bill introduces six more offences that constitute a breach, but we feel that this is somewhat neutered by the First-tier Tribunal’s powers. It appears that it must be satisfied beyond reasonable doubt that one of these offences has been committed, as this is the criminal standard of proof—it is a very high bar. I listened intently to the nuanced and detailed response of the noble and learned Lord, Lord Etherton, on this.
It is clear that every one of us is concerned about whether the measures in the Bill would lead to a drop in supply. It is strongly claimed by the landlord sector— I believe that evidence from Scotland has actually been mixed—but is contested by others, as there may be different reasons why some of the baby boomer owners have decided that they have had enough and want to sell up.
What is in no doubt is that there are legitimate concerns about the flight of landlords to more lucrative short-term lets, such as Airbnb. This concern is heightened in the Bill by the measure to abolish fixed-term tenancy, which, while a welcome measure for many, could have unintended consequences. Therefore, we feel that some provision for a review should be built into the Bill, no matter what it ends up being, because the rhetoric on both sides of this argument needs to be tested against reality. As the supply side is the crucial issue, can the Minister tell us when there will be a level playing field between both rental sectors, as the Airbnb side is far less regulated at present and there are no incentives to encourage landlords back? Several noble Lords will say that the Bill actually does the opposite.
The Liberal Democrats support build to rent. Supply of this and social homes is vital to climb slowly out of our housing crisis. We can no longer rely solely on the landlord owning between one and five properties, which has been the main market for decades, thus we will explore means to incentivise more build to rent. We also want to keep the smaller landlords in the game, and we should acknowledge that repossession of one’s property is a legitimate concern. They should be reassured that the grounds for repossession have been strengthened, but grounds 1A and 1B still remain a cause for concern. We believe that the threshold for sale and moving in a family member should be higher than at present, as this could still be a fig leaf for an illegal eviction—for once the tenant has moved out, who will in fact check that the house is sold or the family have moved in?
This leads us to the legitimate questions that have been raised by several noble Lords about the capacity and resource readiness of local councils and other agencies to deal with the Bill. Enforcement and the capability of enforcement are big issues; without effective enforcement, the Bill fails.
We were very pleased that the Government have been bold enough to extend the decent homes standard and Awaab’s law to the private rented sector. Many noble Lords supported this measure, but let us not underestimate it; it is not easy, having spoken to both landlords and tenants, to judge who is at fault. I feel that there is more debate to be had there, but we know in our hearts that the consequences can be fatal.
We are in no doubt that it will be a leap for many landlords who genuinely want to improve their properties, but it is a mountain to climb, as too many of our properties are non-decent—or is it indecent?—which is quite shocking for such a wealthy country. What we are concerned about is the reality shown to us by numerous case studies, including from Citizens Advice, that any property improvements resulting from public money have been shown to result in the landlord immediately asking for higher rent from the very tenant whose financial situation gave rise to the eligibility of the landlord to receive the grant and add value to their property in the first place. This cannot be right. We will look to explore this unfairness further in Committee.
We have heard from several noble Lords, and we were shocked to learn, that Ministry of Defence properties are exempt from the Bill. The argument has been put forcibly by others, but I will just say that our service families deserve, at the very least, the same as everyone else.
A key issue mentioned by several noble Lords—especially memorable was the contribution of the noble Baroness, Lady Lister—is the whole notion of affordability. We know that, in many parts of the country, rent is simply not affordable. My noble friend Lord Tope outlined the incredibly difficult situation in our capital city, but elsewhere too people are paying a far higher percentage of their income on simply putting a roof over their heads. This is not sustainable. The evidence and detail of this is irrefutable. We support the measures in the Bill to try to give some stability to rent increases, as many people are stretching themselves to the maximum to pay rent and the year-on-year increases implicit in the Bill—which do not keep up with wage increases and the cost of living—are simply unsustainable.
We are sceptical about how the First-tier Tribunal will work and the amount of work it may or may not end up with. We do not agree that its criteria to agree on a fair rent should be market rent, precisely because of the dearth of supply. We would like to work with the Minister to find a way forward on rent increases that is fair to both landlords and tenants.
Although we are not as pessimistic as some, we are not without a degree of scepticism about the unintended consequences of the Bill and whether the see-saw is balanced or broken. But we will work constructively to get it over the line.
Lord Jamieson (Con)
My Lords, I declare my interest as set out in the register, particularly being a councillor in Central Bedfordshire. As a fellow north-easterner, I congratulate the noble Lord, Lord Wilson of Sedgefield, on his excellent maiden speech, and also on his mother’s impending 100th birthday. I also congratulate the noble Baroness, Lady Brown of Silvertown, on her passionate maiden speech. I share her concerns for children. I also thank the Minister for the time that she has given noble Lords to explain the Bill. I thank the many groups and people who have written to us and sent us submissions on the Bill.
We all want everyone to have a safe, secure and affordable home. The question is whether this Bill will deliver this or whether it risks undermining a key housing sector to the detriment of landlords and tenants alike. The Minister has argued that the Government have no choice but to introduce this Bill to reform the private rented sector. However, this assertion does not hold up under scrutiny.
While the Renters (Reform) Bill was originally conceived by the previous Conservative Government to address long-standing issues in the private rented sector, in its current form the Bill risks doing more harm than good. Comparing this Bill with its predecessor, the Renters (Reform) Bill in 2023-24, we see some striking differences. The changes proposed by the current Government threaten to destabilise the private rented sector. This is a sector that has seen remarkable growth in recent years, now housing nearly 19% of all households —some 4.6 million people.
Rather than providing the stability renters need, this Bill risks exacerbating the very problems it seeks to resolve. According to Scotland's Housing Network, 16% of landlords are scaling back their supply, and 12% are considering leaving the sector altogether. Scotland shows that the overregulation proposed here has pushed landlords out of the market, reducing housing supply and leaving renters in a worse position, with the highest rent increases in the UK. While these reforms are meant to protect tenants, they threaten to leave them with fewer choices and higher costs.
The Renters’ Rights Bill has been said by many in this Chamber—including the noble Lords, Lord Best, Lord Thurlow and Lord Truscott—to risk introducing a series of provisions that are set to significantly disrupt the private rented sector. It is a well-established fact that private landlords, when faced with increased regulation, often choose to exit the market. This is not just speculation: research from the National Residential Landlords Association in 2023 revealed that one in four landlords were considering selling at least one of their properties due to increased regulation, with many citing the Renters (Reform) Bill as a major factor. According to the English Private Landlord Survey 2024, 31% of landlords planned to decrease the number of properties or sell them altogether, compared to 16% in 2018.
Get Living, a significant player in the build-to-rent sector, has expressed serious concerns about how these changes could undermine long-term investment in rental homes. Savills, Hamptons, Zoopla and others warn that the provisions in the Bill could exacerbate the housing crisis. This is a concerning trend that will directly impact housing availability. As more landlords leave the market, there will be fewer rental homes, and it will be tenants who feel the effects of this most acutely. Moreover, by reducing investment in the rental sector, these reforms could also undermine the Government’s targets for housebuilding.
The previous Conservative Government worked hard to increase housing stock, delivering 2.5 million homes between 2010 and 2024, with 1 million of these delivered during the last Parliament. If the proposed changes in this Bill push landlords out of the market, it will risk reversing the progress on housing delivery.
Further data from Oxford Economics paints a grim picture: only one in eight renters can afford to purchase a home in their area. For many, the private rented sector is the only viable option, but these new regulations are forcing landlords to sell their properties, tightening an already overstretched market. Will the Minister explain why this Bill seems to accelerate the exodus of landlords from the market? What steps do the Government intend to take to reverse this damaging trend?
An issue that has been raised by many noble Lords is Section 21 and its impact on the courts system. I was particularly struck by the words of the noble and learned Lord, Lord Etherton, and the noble Earl, Lord Kinnoull. The previous Conservative Government were clear in their approach: any abolition of Section 21 would come only after significant reform of HM Courts & Tribunals Service. This would have ensured that the court system was ready and able to process cases efficiently and fairly. Unfortunately, the Bill abandons that commitment, rushing forward with the abolition of Section 21 without first addressing the ongoing strain in our courts.
Our court system is already under immense strain. Landlords are facing significant delays when seeking possession of a property, and these delays would only worsen with the proposed changes to Section 21. The First-tier Tribunal is already overwhelmed with challenges related to rent increases; currently, it can take up to 10 weeks for the tribunal to make a decision. Introducing additional cases to this already overburdened system risks further delays, which would ultimately harm both tenants and landlords alike.
Moreover, the legislation includes provisions enabling tenants to challenge rent increases more easily. While the right to challenge unjust rent hikes is important, the process outlined in the Bill could overwhelm our already stretched court system. As highlighted by my noble friends Lady Eaton and Lord Northbrook, a system that allows all rent increases to be appealed with no downside risks flooding the court system. How will the First-tier Tribunal manage the added burden of rent appeals, when it is already struggling with its current case load?
The abolition of Section 21 repossessions means that responsible landlords will be forced to rely on the courts to process legitimate possession cases. However, as the Housing Minister himself admitted in the Bill Committee in the other place, the UK court system is “on its knees”. While the Minister correctly argues that “court readiness” is essential to the successful operation of the new system, which I assume refers to the abolition of Section 21 and the resulting shift in the equilibrium of the renters’ market, His Majesty’s Government have yet to clarify what “court readiness” truly means in practical terms. What resources will be allocated to ensure that the courts are properly equipped for these reforms? The Law Society has rightly warned that
“without investment in housing legal aid and the courts, the Bill will not achieve its aims”.
Student lets have been raised by many noble Lords. The Bill exempts purpose-built student accommodation from the requirement to end fixed-term tenancies, a provision that we agree with. However, this exemption will not apply to other forms of student accommodation, such as private rental properties where second- and third-year undergraduate students typically reside. This Government have abandoned our commitment to sufficiently carve out student accommodation, where it is essential that both landlords and tenants have the certainty of fixed-term contracts to plan for subsequent years. What about master’s and PhD students, who often require longer-term accommodation, typically in smaller, privately rented properties? According to data from accommodationforstudents.com, one- and two-bedroom properties make up one-third of all student housing. The provisions for purpose-built student accommodation should be extended to include all student properties, ensuring the smooth operation of the entire student housing market and protecting the annual cycle of student rentals.
In conclusion, the need for more homes in the private rented sector is urgent. Savills estimates that, by 2031, we will need as many as 1 million additional homes for private rent to keep up with rising demand. How, then, can we afford to risk policies that may drive landlords out of the market and make this shortage even worse? As the noble Earl, Lord Lytton, said, how do we strike the right balance between protecting tenants and maintaining a healthy rental market that supports investment and meets the needs of renters across the country? It is crucial that the Government listen to the voices of landlords, housing experts and tenants who have raised concerns about the impact of the Bill, and we intend to table amendments that address some of the most pressing concerns. Ultimately, we must ensure that the policies we put in place strengthen, not weaken, the system that provides homes for renters, while also supporting landlords, who are crucial to meeting the nation’s housing needs. The future of our rental market depends on striking that balance.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank all noble Lords for their excellent contributions. It has been a very interesting and thoughtful debate, and it has been a pleasure to listen to the contributions with the expertise that we have around the House. At times, I felt a bit like Doctor Dolittle, as the debates ranged from fleas, to parrots, to packs of Alsatians— I will come on to pets in a moment.
First, I congratulate my noble friends Lord Wilson of Sedgefield and Lady Brown of Silvertown on their outstanding maiden speeches. The noble Lord, Lord Wilson, made very moving references to the history of our industrial heritage and his own family’s part in that. I congratulate him on his new grandchild and wish his mum a happy 100th birthday.
I was very pleased to hear about the East End heritage of the noble Baroness, Lady Brown. That is where my own family came from, with my dad’s family growing up in Bethnal Green and then Walthamstow, in Highams Park where I spent a great deal of my childhood with my granny. I welcome both noble Lords to the House; we all very much look forward to working with them. All three of us are examples of the social mobility which should be everyone’s opportunity, not just in our country but, as the noble Baroness, Lady Brown, pointed out, across the world. Safe, secure, affordable housing is part of that social mobility, so it is very appropriate for today’s debate.
I will endeavour to respond to all the points raised by noble Lords. There was a great deal raised in the debate, so, if I miss anything, I will of course write to noble Lords afterwards. We can also have many further discussions in Committee on these points.
Before I get on to those specific points, as others have said, it is a bit disappointing, bearing in mind that this builds on the Bill brought by the previous Government, that the Conservatives voted against this Bill in the Commons. To the remarks of the noble Lord, Lord Howard, about my Government’s competency on housing, I hope he was listening to what many other Peers said about the housing crisis, because it is his party that has presided over that, not mine.
I will go into some more detail on the Bill and the points that noble Lords have made. There were some very important issues raised, to which we will give much further consideration in Committee. Abolishing Section 21 was mentioned by many noble Lords, but by the noble Baronesses, Lady Scott and Lady Thornhill, and the noble Lord, Lord Cromwell, in particular. It is one of the Government’s most pressing objectives to remove Section 21 from the statute book as soon as possible. The new tenancy system for the private rented sector will be introduced in one stage. At this point, it will apply to all private rented tenancies and existing tenancies will convert to the new system, including those that currently have a fixed term. New tenancies signed after the date will also be governed by the new rules: thereafter, no private landlord will be able to serve a new Section 21 notice. This single date will prevent a confusing two-tier system and give all tenants security in their homes immediately.
As the noble Baroness, Lady Thornhill, said, I am very grateful for all the briefings we have received on this and to all those organisations that have campaigned so hard and for so long on behalf of both landlords and tenants. I reassure noble Lords that we will work closely with all parts of the sector, including the courts, to ensure a smooth transition to the new system, and we will provide sufficient notice ahead of implementation.
The noble Baronesses, Lady Eaton and Lady Thornhill, and the noble Lords, Lord Howard, Lord Cromwell and Lord Marlesford, made points about the abolition of fixed terms. I understand the concerns about that but, as I made clear in my opening speech, this is a core principle of the Bill and a change this Government believe is fundamental to providing security of tenure. It was also the policy of the last Government and stands as a core foundation of our tenancy regime. We just do not accept that fixed terms offer the best structure for renters. They oblige them to pay rent regardless of the standard of the property or whether it is best for their circumstances, and they restrict renters’ freedom to move if they need to.
These changes do not pose any threat to good landlords who operate fairly and comply with the rules. Tenants do not move house unless they absolutely have to, because of the cost and upheaval. If they leave, they will be required to provide two months’ notice, giving landlords time to find new tenants. We are not prepared to lock tenants in for longer, which would prevent them leaving properties with dangerous hazards or even in situations of domestic abuse.
Several noble Lords—I will go through the list, as there was quite a lot of them—mentioned the potential impact of these reforms on supply in the private rented sector. They include the noble Lord, Lord Best, who was a bit more positive about this, as well as the noble Baronesses, Lady Scott and Lady Thornhill, the noble Lords, Lord Willetts, Lord Shipley, Lord Thurlow, Lord Carter, Lord Howard, Lord Cromwell, Lord Northbrook and Lord Jamieson, the noble and learned Lord, Lord Etherton, and the noble Earl, Lord Lytton. I understand the concerns about supply; we have considered it very carefully. While we understand that the new system may spark a period of adaptation, we do not believe that the reforms will lead to the sort of landlord exodus that some have mooted. The sector has doubled in size since the early 2000s, and there is no evidence of an exodus since the reform has been put on the table. In addition, the recent 2023-24 English Housing Survey indicated that the size of the PRS has remained broadly stable since 2013-14.
Our proposals will make sure that landlords have the confidence and support they need to continue to invest and operate in the sector. The noble Lord, Lord Best, made some good points about the potential for PRS properties to return to social housing; I would like to think that that might be the case, but we will wait to see whether that happens. Some local authorities are already starting to buy up private property that comes on the market.
Noble Lords raised the issue of the affordability of properties, including my noble friend Lady Lister—who made a very powerful intervention, and I am grateful to her for that—the noble Lords, Lord Truscott and Lord Desai, and the noble Baronesses, Lady Thornhill and Lady Janke. We recognise the affordability pressures faced by those living in the private rented sector. The Renters’ Rights Bill works to strengthen tenants’ rights as a whole. Stronger powers to challenge excessive rent hikes complement the increase in security through the abolition of Section 21 evictions. Tenants will no longer be too frightened of eviction to challenge bad behaviour. The Bill takes practical steps to help renters, by ending unfair bidding wars, preventing landlords demanding large amounts of rent in advance, and tackling rental discrimination. We hope that that will help.
My noble friend Lady Lister raised the issue of local housing allowances. To deliver our commitment to build more affordable homes, we have had to take some difficult decisions to address the challenging fiscal context. The Government currently spend around £30 billion annually on housing support, and the April 2024 one-year local housing allowance increase will cost an additional £1.2 billion in 2024-25 and approximately £7 billion over five years. However, we will keep this under review and continue to look at it.
The noble Baroness, Lady Scott, and the noble Lords, Lord Truscott, Lord Marlesford, Lord Northbrook and Lord Jamieson, the noble Earl, Lord Kinnoull, and others raised concerns about the strain on the court system. It is a serious concern, and we take it seriously. We do not believe that it is appropriate to tie in the implementation date of these urgently needed reforms to what could be a subjective assessment of court readiness. I reassure your Lordships that we are working very closely with the Ministry of Justice to assess the impacts of our legislation on the courts and tribunals, and to ensure that the justice system is prepared for the implementation of the Bill more generally. Our discussions with the MoJ cover a range of options for managing the impact of these and our other housing reforms, including mitigations to help avoid disputes arising in the first place, thereby keeping away some of this from the courts, and to manage the risks that are associated.
After my many years in local government, I was not at all surprised that noble Lords raised the issue of local government resourcing. The noble Baronesses, Lady Eaton and Lady Thornhill, and the noble Lords, Lord Tope and Lord Davies, rightly pointed out that strengthening the enforcement framework will count for little if local authorities do not have the resources to act. Some local authorities already enforce effectively, but we acknowledge the resourcing challenges that many authorities face.
It should be noted that local authorities will not need to enforce the full set of reforms until later down the line, as measures in the Bill do not all happen at the same time. In the first instance, we want to pursue a “polluter pays” approach, which will see bad landlords meet the costs of the enforcement against them. We are supporting that by extending and increasing civil penalties, which will be ring-fenced for that enforcement. However, I accept that more must be done. In accordance with the new burdens doctrine—I think that the noble Lord, Lord Tope, asked about that—we will ensure that additional asks on local authorities as a result of our reforms are fully funded. We will look hard at how best we can further boost capacity and capability, to create that sustainable funding system over the longer term.
A number of noble Lords raised issues around extending the provisions in the Bill. The noble Baronesses, Lady Grender and Lady Thornhill, particularly referred to MoD accommodation, although I think other noble Lords raised this as well. The Government strongly agree that we should allow dedicated military personnel and their families safe and decent homes. However, bringing that accommodation within the scope of the Bill is not the right way to achieve that. The decent homes standard is already used by the MoD as a benchmark for service family accommodation. It has a policy that no homes fall below the decent homes standard and, if they do fall below this level during occupation, works are undertaken to restore them to the minimum standard.
The MoD has developed its own higher defence decent homes plus standard, its target standard for all service family accommodation, and MoD Ministers are committed to reviewing that target standard as part of the new military housing strategy for service accommodation, with the aim of improving the standard of service family accommodation across the estate. This is in line with the recommendations of the Kerslake review, which was mentioned by noble Lords, and the House of Commons Defence Committee’s recommendations in its report into service accommodation, which was published at the end of last year. The MoD will provide further information on this review early in this year.
On the extension to Home Office accommodation mentioned by the right reverend Prelate the Bishop of Lincoln, the noble Baroness, Lady Lister, and the noble Lords, Lord Tope and Lord Davies, the contracts the Home Office has with providers of asylum accommodation should already require it to meet the decent homes standard. I have heard the messages from noble Lords and I will have further negotiations and discussions with colleagues in the Home Office about that. I have also seen the briefing by London Councils and, again, I will discuss that with Home Office colleagues. On temporary and emergency accommodation, we need to think about that and I will come back to that in Committee, if that is okay.
I thank the noble Lord, Lord Cashman, for his persistence in raising the issues of houseboat owners and residents. We recognise that the occupants of residential boats have the benefit of protection under the Protection from Eviction Act and wider consumer protection legislation, but they do not enjoy the same level of tenure security as those in the private rented sector. This Bill is focused on reforming the assured tenancy regime. Houseboat owners fall outside the scope of the assured tenancy regime, but we will consider what further action might be necessary to provide house- boat owners with greater security in their homes.
I move on to pets for a moment and some very interesting contributions on this subject from the noble Lords, Lord Trees, Lord Carter and Lord Black, the noble Baroness, Lady Fookes, and other noble Lords. I say to the noble Baroness, Lady Fookes, that I am very happy to have a meeting with her. The guidance may come from the outcomes of the appeals and our consideration as we go through Committee, but I thank her for her contribution. Very little can be done to evoke the same sense of joy, as the noble Lord, Lord Black, outlined, as a beloved family pet. We do not believe that experience should be denied to those who are not able to own their own home and, for this reason, we are introducing the right. There are reasonable limitations to that, but these measures will end the choice between having a pet or a rented home and ensure that everyone in England can benefit from the great companionship that having a pet brings.
I hope we can continue to work with the noble Earl, Lord Kinnoull, on the insurance issues. They were also raised by the noble Baroness, Lady Scott, and by the noble Lords, Lord de Clifford and Lord Trees. Landlords will be able to charge reasonable costs of insurance. We listen to the concerns that insurance products will not be available to cover the risks of pets, but there is currently a reduced demand for landlord pet insurance as many landlords simply refuse to allow pets. So we hope the market will respond to the increased demand for these products. To the noble Lord, Lord Trees, I say that I will take up his point about assistance dogs—that is an issue,
I think we have covered pets. On the issues around students, which many noble Lords have raised, we have introduced a new ground specific to the so-called typical students: those living in shared houses who sign up each year. This will preserve the annual cycle of student housing. I understand the issues raised by noble Lords and no doubt we will come back to this in Committee, but we must be very careful not to leave a loophole here. We do not intend this to capture every student—far from it. For example, I do not think that it is right for a parent who lives alone with their children to be evicted just because they are studying at university. Those tenants should have the same security as everyone else. To the noble Baroness, Lady Scott, my noble friend Lady Warwick and the noble Lords, Lord Willetts and Lord Shipley, we can discuss this further, but we need to proceed with caution here.
A number of noble Lords spoke about ground 4A being too narrow. The Government recognise the impact that the new tenancy system will have. While we believe the ground covers of the majority of the market, there is not a one-size-fits-all solution. We think it is reasonable that the ground will apply to full-time students in larger house-share situations. Students studying part-time alongside work or who live in smaller properties should enjoy the same security as other tenants.
The noble Baronesses, Lady Eaton and Lady Janke, and the noble Lords, Lord Northbrook and Lord Marlesford, raised rent increases. The Government are clear that this will stop a minority of rogue landlords who try to use rent increases as a means of back-door eviction. Measures in the Bill will ensure that this does not happen. All rent increases will take place via the Section 13 process, so the tenant can challenge them if necessary. That is really important in giving tenants the assurance that they need. We will allow only one rent increase per year and will increase the required notice to give tenants longer to prepare for rent increases.
The noble Lords, Lord Shipley, Lord Howard and Lord Inglewood, all raised the issue of rent appeals. We will give tenants greater confidence to challenge unfair rent increases at the First-tier Tribunal by ensuring that the tenant will not pay more than the landlord originally asked for, following a tribunal determination. We are going further. We will end the practice of backdating rent increases, to prevent tenants being thrust into debt. To protect the most vulnerable tenants, in cases of undue hardship the tribunal will be able to delay the start of the rent increase for up to two months. Taken together, these measures ensure that tenants have a right of appeal, and prevent rent increases being used as a back-door route to eviction.
The noble Baronesses, Lady Grender, Lady Jones and Lady Janke, and my noble friends Lady Lister and Lord Davies spoke passionately about rent controls. This is an important topic for me to clarify. The Government have no plans to implement rent controls. Doing so may hinder rather than help the market. The evidence strongly suggests that controls would have a long-term negative impact on housing supply, discouraging investment and leading to declining property standards. Heavy-handed controls tend to mean higher rents at the start of a tenancy and can make it harder for tenants to find a home. They also encourage the growth of unregulated subletting, as seen in countries such as Sweden, where rent controls have been introduced. These can leave the most vulnerable tenants exposed to even higher costs and minimal protections. That is not to say that the Government do not care deeply about affordability. We are helping with the practical steps of ending bidding wars, prohibiting requests for large amounts of upfront rent and empowering tenants to challenge unreasonable rent increases.
Noble Lords have suggested that the rent-in-advance provisions will make it harder for some tenants to access the private rented sector. We have heard the arguments that requesting large amounts of rent in advance can give landlords the confidence to let. However, for the majority of renters, who do not have access to large cash reserves, these requests are simply too big a price to pay. In terms of guarantors, landlords and agents will have the final say on who they let their property to.
We are clear that landlords should consider a tenant’s individual circumstances when negotiating the rental. They are free to agree rental conditions within the law that best enable a sustainable tenancy. Landlords will be able to continue to take a holding deposit of up to one week’s rent and a tenancy deposit of five or six weeks’ rent.
I see my time is drawing to a close, so I am going to conclude my remarks. I knew I would not get through all the issues, but I will respond in writing to all noble Peers who have taken part in the debate to answer the other questions. I reiterate my thanks to your Lordships for engagement with the Bill to this point. As the Bill progresses, I am very happy to accommodate any request from noble Lords for additional briefings, wherever possible and helpful.
The Renters’ Rights Bill honours our Government’s manifesto commitment to overhaul the regulation of the private rented sector. I believe these reforms take great strides in empowering tenants, giving them greater security and stopping them from being exploited. Landlords will also be supported, and rogue operators who tarnish the reputation of the good ones will be driven out. It is important to reiterate that the intention is not to demonise landlords or tenants; they both want stable tenancies with well-maintained properties and regular rent payments. I look forward very much to working with your Lordships during the passage of this important Bill, and I commend the Bill to the House.
Baroness Taylor of Stevenage
That the Bill be committed to a Committee of the Whole House, and that it be an instruction to the Committee of the Whole House that they consider the Bill in the following order: Clauses 1 to 4, Schedule 1, Clauses 5 to 31, Schedule 2, Clauses 32 to 74, Schedule 3, Clauses 75 to 101, Schedule 4, Clause 102, Schedule 5, Clauses 103 to 146, Schedule 6, Clauses 147 to 149, Title.
Renters’ Rights Bill
Tuesday 22nd April 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-I(b) Amendments for Committee (Supplementary to the Marshalled List) - (22 Apr 2025)
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we start the debate on the first group, following a number of questions, the Chief Whip has asked me to remind the House of the protocol on declaring interests. Noble Lords should declare any relevant interest at each stage of proceedings on a Bill. This means that, in Committee, relevant interests should be declared during the first group on which a noble Lord speaks. Declarations should be specific and brief. Members should briefly indicate the nature of their interest and not simply refer to their entry in the Register of Lords’ Interests.
Amendment 1
Baroness Scott of Bybrook
“Purpose(1) The purpose of this Act is to improve the ability of renters in the rented sector to obtain secure, fairly priced and decent quality housing.(2) The Secretary of State must, in taking any actions under the provisions of this Act, have regard to this purpose.”Member's explanatory statement
This amendment would place a duty on the Secretary of State to have regard to the purpose of the Act, namely, improving the ability of renters to obtain secure, fairly priced and decent quality housing.
Baroness Scott of Bybrook (Con)
My Lords, I rise to move Amendment 1 and to speak to Amendment 261 in my name. I am delighted to be opening the first day of Committee on the Renters’ Rights Bill and declare my interest as vice-president of the Local Government Association.
The clause I am proposing would place a statutory duty on the Secretary of State to have regard to the purpose of the Bill when exercising powers under this legislation. In debating this amendment, we seek to test and clarify what the Government are attempting to solve and to understand more fully whether the measures that will be implemented by this legislation will achieve the Government’s intended results.
The “purpose” clause narrows how the Minister can use the discretionary powers afforded by the Bill. The clear benchmark set out in this clause would ensure that the Government must have regard to improving the ability of renters to obtain secure, fairly priced and decent quality housing. We believe the Government must be clear on the Bill’s purpose, and this amendment gives Ministers the opportunity to provide that necessary clarity.
Renters and landlords alike are following the Government’s planned changes very carefully, so it is crucial that Ministers are clear from the beginning of Committee on what they intend to achieve with this Bill. Clarity from Ministers will enable us to scrutinise the Bill much more effectively as we test each part of it against the Government’s intentions as we progress with Committee stage.
This group of amendments also gives us an opportunity to debate the Bill’s impact on the rental sector. Noble Lords across the House agree that we must protect tenants and ensure that they enjoy security, stability and decent housing conditions at a fair price. In order to achieve this, we need a functional market with sufficient supply of good quality homes to meet the growing demand for secure housing.
Ensuring the availability of homes will underpin the obtainability of accommodation and ensure that rents are affordable. Any legislation in this area must tread a difficult but essential line between these interests. Only by striking the right balance with this legislation can we hope to achieve an efficient and effective rental market that delivers the safe, secure, decent and affordable homes renters need. From these Benches we regret to say that the Bill does not achieve that balance. It has become increasingly clear that it will not serve to enhance the availability of homes but risks the supply of rental properties in the market, driving up costs for renters at a time when we have already seen significant increases in the cost of renting.
The surge in rents beyond inflation has been driven by limited housing supply, and rising mortgage costs, maintenance expenses and property taxes. We on these Benches sincerely hope that the effects of this Bill do not add to that list, further exacerbating the challenges faced by renters. Rather than making houses more affordable, this legislation risks increasing burdens on landlords, discouraging them from remaining in the rental market and ultimately reducing supply at a time of rapidly growing demand. In economic terms, this can only mean one thing: higher housing costs for renters.
A survey by Paragon, based on responses from over 500 landlords it works with, paints a clear picture of the real-world consequences of this Bill. A striking 65% of landlords said that they were more likely to reduce the size of their portfolios. An overwhelming 79% said that they were likely to increase rents. Why? Not out of preference, but as a direct response to the pressures introduced by the Renters’ Rights Bill. This is not speculation; it is data-driven and must give us pause for thought.
Lord Shipley (LD)
My Lords, I remind the Committee that I am a vice-president of the Local Government Association.
I listened carefully to the noble Baroness, Lady Scott of Bybrook. I can see the merit in a clause defining the Bill’s purpose, and Ministers will advise us on that—except that the whole Bill defines its purpose.
I noticed that the noble Baroness, Lady Scott, used the word “secure” several times in her speech, confirming that:
“The purpose of this Act is to improve the ability of renters in the rented sector to obtain secure, fairly priced and decent quality housing”,
as in subsection (1) of the proposed new clause in Amendment 1. I do not understand how the noble Baroness can propose an amendment that talks about the security of decent-quality housing at the same time as Amendment 8 proposes that small landlords—that is, those having fewer than five properties—could continue to be able to issue Section 21 no-fault notices.
I have to assume that it is now the Conservative Opposition’s intention to withdraw Amendment 8, for otherwise I do not see how, in all honesty, a statement can be made in Amendment 1 that the objective is for secure, decent-quality housing in the private rented sector when for many properties no-fault evictions would be allowed to continue under the Conservatives’ Amendment 8.
Baroness Thornhill (LD)
My noble friend Lord Shipley has eloquently kicked things off for our Benches. I will make a few general comments about how we will conduct ourselves during the course of the Bill.
We do not agree with the assertions made by the noble Baroness, Lady Scott of Bybrook. We think that the intentions in the Bill are perfectly clear. Whether it will live up to those intentions only time will tell, which is why we too would be looking at reviews. In fact, the noble Baroness’s Amendment 261 is very similar to my own Amendment 263, so I will reserve comments on reviews until we discuss that group.
I say to the Minister that we really want the Bill to go through, and for that to be done professionally and swiftly, in a well-scrutinised way, so we will not be making Second Reading-style speeches or commenting on every single item and amendment. I would therefore like the Minister to take it that silence means we agree with the Government’s position. However, we will probe, challenge and seek evidence and reassurances, and I think the Minister would expect no less from us.
We all know that the main problem is the shortage of homes, particularly social homes. The Bill is not intended to solve that problem. It has to be seen as part of a suite of policies that the Government are trying to bring in—and, to use the same phrase again, only time will tell. However, landlords have cried wolf before—over the Tenant Fees Act, I believe—and Armageddon did not happen. That is not to say we should not take their concerns seriously, nor that the Government should not monitor and review, but the most important thing in the Bill is the abolition of Section 21. That was promised by the noble Baroness, Lady May, when Prime Minister, back in the mists of time, so it is long overdue. It is time that we cracked on with this, and we will do our bit to ensure thorough scrutiny but swift passage.
Baroness Eaton (Con)
My Lords, I declare an interest as vice-president of the Local Government Association and as part owner of rented properties in Bingley, West Yorkshire. I support Amendment 261, tabled by my noble friend Lady Scott of Bybrook, with its proposed new clause:
“Review of the impact of the Act on the housing market”.
Specifically, I welcome the proposed addition of a review of the impact the Bill will have on requests for social housing. The vast majority of landlords in this country are good, honest people who do a real service in maintaining Britain’s housing supply and providing decent homes to people before they start the journey of getting on to the property ladder, but the reality is that, with the ever-increasing regulation placed on landlords, not least the abolition of Section 21 no-fault evictions, which has already been mentioned, the signing of tenancy agreements will become more of a risk.
In reality, landlords will no doubt be more reluctant, under the new burdens placed on them, to take on more vulnerable tenants—for example, those who enter the market for the first time, without references, and those in receipt of housing benefit. Amendment 261, on reviewing the impact the Act will have on social housing, is necessary because local authorities and housing associations are going to come under pressure as never before to provide social housing, either because supply in the private rented sector will become more challenging to access or because rents are likely to spiral out of control under these proposals. I therefore support fully the amendment tabled by my noble friend.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her Amendments 1 and 261, and the noble Lord, Lord Shipley, and the noble Baronesses, Lady Thornhill and Lady Eaton, who have spoken in this short debate. I will keep my response to Amendment 1 short, as the purpose and aims of the Bill were debated in full at Second Reading. I agree with the noble Lord, Lord Shipley, that the Bill is perfectly clear in what it sets out to do.
The private rented sector has grown significantly over the past 20 years and is now used by over 11 million renters in England, with the support of 2.3 million landlords. I should say that most of those landlords are very good landlords who look after their tenants very well. Despite this growth, it still provides the least affordable, poorest quality and most insecure housing of all tenures, and that just cannot continue. A functioning private rented sector can provide a secure stepping stone for aspiring home owners, as the noble Baroness, Lady Eaton, said, and flexibility for those who want it, but the chronic insecurity embedded in the current tenancy system fails both those tenants looking for a stable home for their families and those landlords who are undercut by the rogues and the chancers who we know are there—they may be few, but we know they are there. This is a drain on aspiration. Reform of the sector is central to our opportunity mission, so that all have the chance to achieve their potential.
Although I understand the aims of the amendment, I do not believe that it is necessary. The Government made a clear manifesto commitment to transform the experience of private renting by levelling the playing field decisively between landlords and tenants—the very balance that the noble Baroness, Lady Scott, was talking about. This Bill delivers that promise. As I outlined at Second Reading, the Bill will strengthen the security of tenure for tenants, ensure that they are paying a fair rent, guarantee a minimum standard they can expect from a property, provide new robust avenues to redress, and much more. The noble Lord, Lord Shipley, referred to the attempts in later amendments to reintroduce Section 21 evictions. We will debate those when we get to them but I will say that 83% of landlords have five properties or fewer, so those amendments would be significant and really take the guts out of the Bill. The aims I set out align with the purpose in the noble Baroness’s amendment and lie at the heart of all our current and future decision-making.
The Government also recognise the work done by the majority of landlords, who provide safe and decent homes for their tenants. Both these issues of balance were mentioned by the noble Baroness, Lady Scott, but I was surprised at her assertion that the Bill would not achieve that balance. It is a very similar Bill to the one which she herself brought forward a few months ago.
We have been clear that good landlords have nothing to fear from these reforms. The Bill will bring much-needed certainty to the sector after years of inaction and delay. The noble Baroness, Lady Thornhill, commented on the Armageddon that we hear about; I remember hearing something similar many years ago during the discussions on the minimum wage. I understand landlords’ concerns and I hope we can address them as we scrutinise the Bill, but I am sure we can continue to debate the aims and impacts as we make our way through the 300-plus amendments tabled for debate.
Baroness Scott of Bybrook (Con)
My Lords, I thank noble Lords for contributing to this group. I can assure the noble Lord, Lord Shipley, that we will debate my Amendment 8 later. I particularly thank the Minister for her reply. While the Government’s ambition to improve outcomes for renters is a worthy goal, and one that I was proud to champion during my time in government, we feel that this Bill fails to account for the serious consequences the measure will have on those who provide the much-needed homes. The fact is that renters need a market that encourages landlords to enter it, not leave it.
These concerns, as I have said before, are not mine alone; they have been echoed right across the industry. From Savills to Propertymark to UniHomes, all have highlighted significant issues. We on these Benches will emphasise in the days ahead the need for balance—one that ensures that tenants are properly protected, while keeping the sector attractive enough for landlords to continue providing homes to rent, as my noble friend Lady Eaton clearly communicated. The recent survey by Paragon highlights just how far this Bill falls short of that balance. It found that only 4% of landlords support the proposed changes. Perhaps more strikingly, 73% of landlords believe the legislation will do more harm to renters than good.
It has become increasingly clear that, in the Government’s ambition to strengthen tenant security, they have been blind to the implications for those who provide the rental homes this country so desperately needs. The Government should think hard about this balance and consider what these reforms will do to the market on which millions rely. This Bill piles unprecedented pressures on landlords, fuelling concern, uncertainty and a fear of financial burdens. Simultaneously, these changes are likely to make it even harder for tenants to find accommodation. The selection process will become more stringent, and the grounds for possession are weakened. The availability of homes will decrease and, in turn, rent will take a larger share of tenants’ income. The Government would do well to remember that the rental sector exists only because individuals are willing to invest in property and make those homes available to others. The strength of the rental market rests on keeping these people in the market.
Landlords are not just participants; they are the backbone of the rental market. Their voices must be heard as part of this conversation, as they will provide the homes our tenants need into the future. If this Bill is to protect tenants, we must ensure that we have the landlords to supply them. By piling on excessive regulation, we are in danger of pushing good landlords out and empowering rogue landlords who simply ignore all our rules. We recognise that reform of our rental market is necessary to protect tenants from abuse at the hands of these rogue landlords. This was made clear in the previous Renters (Reform) Bill, but it was always important to us that we balance the rights of tenants to live safely and peacefully in the homes they are renting with the rights of landlords, particularly their property rights. If that Bill did not quite balance the seesaw, this Bill tips it right over. This is not the same Bill that the last Conservative Government introduced, and the Government are rushing it through without any care for the repercussions that will reverberate throughout the sector.
I urge the Minister to listen carefully to the concerns raised throughout Committee to ensure that we can enhance the availability of homes, alleviate the burden of unaffordable rent and deliver security for our tenants. Members across the House agree that renters need a better deal, but we do not believe that the Bill is the answer to this. However, I beg leave to withdraw the amendment.
Lord Truscott
Member's explanatory statement
This amendment seeks to allow fixed term tenancies of up to 12 months, as an alternative to the abolition of fixed terms.
Lord Truscott (Non-Afl)
My Lords, I come to improve this Bill, not to bury it. In doing so, I declare an interest as a landlord and a former private rented sector tenant of a combined 40 years’ standing. The Bill’s intention is laudable: to provide more security for tenants, to abolish arbitrary evictions under Section 21, to deal with the minority of rogue landlords, to establish an ombudsman and a useful database, and to introduce the decent homes standard and Awaab’s law to the PRS. I support all these measures. However, His Majesty’s Government should beware of the unintended consequences of the application of parts of the Bill, which would lead to less, not more, security for tenants, and higher, not lower, rents.
Before I expand on this, I make no apologies for my amendment. Your Lordships’ House is a revising Chamber; our job is to revise and improve Bills which come from the other place. To broadly paraphrase the late noble Lord and MP Francis Pym, large majorities do not always get things right. Your Lordships’ role is, rightly, to use your collective expertise to point out where a Bill has gone wrong and where it can be bettered.
My amendment argues for fixed-term tenancies of up to 12 months; they could then revert to rolling, periodic tenancies, or another 12-month tenancy could be agreed. This would give tenants more security than the current Bill does, not less. Under the Bill, tenants will have no security after the first 12 months. They could be evicted for a whole host of reasons, including the landlord re-occupying or selling the property. However, if a landlord and tenant were free to agree annual 12-month tenancies, the landlord would not be able to regain possession over this period, so the tenant could have security for many years, renewable annually. This suits both tenants and landlords.
A majority of tenants actually want longer fixed-term tenancies in order to have more security, to allow their children to attend local schools, to be near to work and to build links within a community. So, why are the Government so adamant that fixed-term tenancies should be banned, and assured shorthold tenancies, which normally have a six-month break clause, abolished?
Let me be clear: I opposed the ending of fixed terms and the abolition of ASTs under the last Government and remain consistent in opposing them under this one. I have been at a loss to discover who came up with the idea of moving exclusively to periodic tenancies with two months’ notice. As the noble Lord, Lord Marlesford, who is in his place, said at Second Reading, it is a batty idea. Incidentally, taken together, we have almost 100 years’ experience of the PRS, so we know of what we speak. Another Peer with many years’ professional experience of the PRS asked the Minister in a briefing meeting why the Government were moving to periodic tenancies with no fixed terms and two months’ notice on the tenant’s part—they found it inexplicable.
I thank the Minister for her engagement on the Bill. I am aware of her extensive experience in and leadership of local government. However, the Minister’s lines to take, both here and in the other place, do not hold water. First, there is the often-quoted example of domestic abuse. This is a very serious issue. However, to say that two months’ notice is required if someone is facing domestic abuse is simply not the case. It is the victim who flees, often with no notice at all, and the abuser who stays put, as domestic violence charities will confirm. The abuser will hardly make themselves homeless by giving two months’ notice, so the type of tenancy in these circumstances is irrelevant.
Secondly, the Minister has opined that fixed tenancy must go so tenants are not trapped in unsuitable or hazardous conditions, or if their circumstances change—but this is one of the main points of the Bill. The database should show the history of the property and the landlord, whether it is safe and well-run. A decent homes standard and Awaab’s law will be imposed and regulated. If any landlord is reckless enough to provide substandard accommodation, they can face fines of up to £40,000 and rent repayment orders of up to two years—enough to bankrupt most landlords. If properly regulated, such behaviour would be extremely rash and worthy of action. Very few, indeed, would risk it.
Under current assured shorthold tenancies, as I mentioned, there are usually six-month break clauses, which allow for most changes of circumstances. There is thus no logical reason to abandon fixed-term tenancies. From the tenant’s point of view, it will make their tenancies less secure and more expensive. From the landlord’s point of view, it will increase costs and uncertainty. We have heard before how a lot of the landlord’s costs and time are front-loaded into new tenancies. Landlords will have to factor this, and the fact that a tenant can give notice at any time, into rental prices.
What will this mean in practice? First, if a tenant moves in, they can give notice on day one and move out in two months. You may ask, “Why should they?” At the moment, short lets can be four times more expensive than long lets. For example, anyone moving to a city centre or coastal resort will be able to move to a form of Airbnb at a fraction of the present cost. Rentals for local residents will become even more expensive and rarer than they are already. The line between short lets and long lets will be blurred and, in effect, disappear. Many landlords will gravitate to ultra-short lets, as they are more profitable and virtually unregulated. According to Foxtons, there are already 150 pieces of legislation covering long-let homes but virtually none for Airbnb.
Secondly, those landlords who stay in the dwindling long-let business—and it is a business—may find that tenants move out over the winter, when properties are traditionally harder to let, and will face higher voids as a result. To cover the risk of higher turnover and the expected voids, rents will have to go up.
In answering why fixed terms, even with a break clause, are anathema to the Government, I ask that the Minister does not roll out the same stock answers on domestic violence and flexibility in the case of unsatisfactory accommodation. That is a non-answer. The Norman Lamont MP puppet in “Spitting Image” said, unfairly lampooning the noble Lord, Lord Lamont, “If you repeat things often enough, people will believe it”—but not in this House, I hope. I beg to move.
Lord Shipley (LD)
My Lords, I have Amendments 4 and 5 in this group, which are purely probing amendments to enable the Minister to explain clearly the Government’s rationale for abolishing fixed-term tenancies. In Amendment 4 I lit on a six-month period and Amendment 5 relates to two months, and I note that the noble Baroness, Lady Scott of Bybrook, has a period of three months in this group.
The noble Lord, Lord Truscott, warned of unintended consequences, and it is almost inevitable with a Bill of this kind that there will be unintended consequences almost whatever we do. However, in this situation we have to avoid it happening unnecessarily. I can envisage that there may be situations where a very short tenancy is wanted by both tenant and landlord. As I said, I have proposed two-month and six-month periods and the noble Baroness, Lady Scott of Bybrook, has proposed three months. The reason is that it would reduce paperwork and the procedures would become much easier. However, in the context of periodic tenancies—which is what the Government are doing— I understand that it is actually quite difficult to fit in a very short-term system such as that, even though it might be in the interests of the tenant, with the agreement of the landlord, to have that kind of tenancy. So I hope that the Minister will explain clearly why that should not be permitted under this Bill.
I will add one further factor that we will debate on a future day: the issue of paying rent up front. There are those who have real difficulty in securing the credit rating necessary to persuade a landlord to give them a tenancy. In some cases, it is very much in the interests of the tenant to be able to pay more than one month up front. I understand how the Government have finally decided not to have two months as a limit on upfront payment, plus a deposit, and have brought it down to one month. However, I think, as the noble Lord, Lord Truscott, advised us, that we have to be very careful about unintended consequences.
We need to think carefully about the wish of a tenant to pay for a short-term rental up front at the start of the tenancy. Can the Minister see any means whereby the Government, through this Bill, could be more flexible in situations of that kind?
Lord Marlesford (Con)
My Lords, I support the amendment from the noble Lord, Lord Truscott. I must declare my interest: I am a Suffolk farmer and have been for 50 years and I have seen quite a lot of changes during that time. Historically, there have been ups and downs, so in recent years I have turned increasingly to the private rented sector as a means of diversifying from agriculture when agriculture has been in such difficulties.
I can remember the days when there were rent officers and the whole system was gummed up. Now, assured shorthold tenancies are—lamentably—being abandoned in the Bill. Under that system, there was a resurgence of interest. I, for example, have converted redundant farm buildings into houses. I have fitted houses into spaces where there were no houses, but they fitted well into the particularly attractive and beautiful village which I am fortunate and privileged to live in. All these things are a very important part of the overall scene.
I warn the Government that there is a danger of them proscribing or prescribing practices in the private rented sector that are the practices that make it work. It is a very flexible sector. It is a vulnerable and fragile sector and, when we debate these issues in Committee, we are going to find cases where it can be clearly demonstrated that provisions in the Bill should be modified to avoid the danger of reducing the supply of privately rented accommodation.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Truscott, for leading this group and all noble Lords who have contributed to the debate. My amendment aims to probe the Government on the proposed abolition of all fixed-term tenancies and to strike a fair balance between the rights of tenants and the legitimate interests of landlords.
While the Government’s desire to strengthen tenants’ security is, of course, a commendable objective, we must take a moment to reflect on the variety of tenancy arrangements that currently support different groups within the sector. In light of that diversity, it is reasonable to ask why the Government has chosen to pursue a one-size-fits-all approach through the proposed abolition of all fixed-term tenancies.
I have listened to contributions from the Committee and there is obvious and widespread concern about this element of the Bill. I thank the noble Lords, Lord Truscott and Lord Shipley, for their thoughtful amendments. Taken together, they seek to challenge the blanket removal of fixed-term tenancies and reintroduce much-needed flexibility into the current very rigid clause. In our opinion, the proposal to allow fixed terms of up to 12 months presents a pragmatic middle ground, maintaining a degree of security for tenants while giving landlords the certainty needed to plan for their future use.
Amendment 6 focuses specifically on protecting very short-term lets of up to three months. These arrangements are critical to people on, for example, probationary employment contracts, to vulnerable individuals in temporary relocation and to professionals on short-term placements. We should not be undermining access to housing for those who rely on flexible short-term arrangements. In removing fixed terms entirely, we risk cutting off access to the rental market for these groups—precisely the kind of unintended consequences this House should seek to avoid. I have also tabled this amendment to give Ministers the opportunity to indicate whether they would be willing to take a more limited step of retaining the current arrangements for very short tenancies.
Industry stakeholders have all echoed these concerns. Propertymark has warned that the removal of fixed-term tenancies could have a destabilising effect on tenants with lower incomes or poor credit histories, many of whom rely on guarantors, who in turn require the certainty of a fixed term. Without that structure, such tenants might find themselves excluded from the market altogether.
What does the future look like for these tenants? These are students without parental support, young adults leaving care, or individuals with health conditions whose employment is irregular. These individuals rely on guarantors to secure housing, but those guarantors require a legal assurance of a fixed term. Without that, the door to a rental home quietly shuts behind them. Imagine a single mother working two part-time jobs, trying to secure a home close to her children’s school. With no guarantor willing to sign an open-ended agreement, she is told again and again, “Sorry—no fixed term, no tenancies”. These are not hypotheticals. These are people who will be locked out of the system, possibly entirely.
Propertymark notes that fixed terms provide security for tenants and a guaranteed rental income for landlords. These arrangements are often actively sought by tenants, including nurses on temporary hospital placements, families wishing to remain in a school catchment area, and individuals from overseas needing time-limited accommodation. The Government will argue that tenants will still have flexibility because they can terminate their rental agreements at will. However, this misses the point. Flexibility is not the same as stability. Tenants need the assurance that their home will not be taken away at short notice, especially when they are in transitional stages of their life.
For landlords, the certainty of a fixed term allows them to plan and manage their properties effectively. Without it, many will choose to exit the sector, once again reducing the overall availability of rental homes. The supposed flexibility of a non-fixed-term tenancy could ultimately leave both tenants and landlords with far less stability than they need.
The abolition of fixed-term tenancies could provoke many landlords to reconsider their position in the market altogether. For home owners who currently rent out their properties on a fixed-term basis, this change in policy, which removes the ability to offer a defined tenancy period, will reduce landlord confidence. As a result, some home owners may choose to leave their properties vacant rather than face the uncertainty of an open-ended arrangement.
Why are the Government not listening to landlords, the very individuals who are primary maintainers of the private rented sector? Landlords are not just participants; they are the backbone of the housing market. Their voices must be heard in this conversation. There is a growing sense that these concerns are being overlooked, and one must ask whether this stems from a principled policy position or from a deeper ideological reluctance to recognise the legitimate role that landlords play. Without the ability to plan for future use or to rely on a defined tenancy period, landlords may well choose to exit the market. If this happens, we risk not only reducing the supply of homes but destabilising the rental sector as a whole, undermining the very intention of the Bill.
Taken together, these warnings from industry stakeholders should give the Government pause for thought. They remind us that while reform is necessary, it must be proportionate and carefully balanced to deliver a market that ultimately benefits renters. The Bill gives us the opportunity to modernise our rental system but, in doing so, we must take care not to discard what works. In removing fixed terms altogether, the Bill risks sweeping away short-term lets that serve a very specific and vital purpose.
These are not theoretical cases; they are everyday realities for many people navigating work, family or education. If we are to build a fairer rental system, we must ensure that it remains flexible and accessible to all, including those whose housing needs are necessarily short-term. That is what Amendment 6 in my name seeks to protect. I hope the Minister listens to voices across the House and calls from industry experts to recognise the diversity of the rental market and to support my amendment, which offers the necessary flexibility and common sense.
Lord Carrington (CB)
My Lords, I will speak to Amendment 173 in this group. I declare my interest in the private rented sector, with cottage lettings in Buckinghamshire and Lincolnshire. I thank the noble Lord, Lord Truscott, for tabling Amendment 173, and I am very keen to support it.
The reasoning behind my support is twofold and comes from the desire, which is shared by most, that this Bill be an opportunity to make sizeable reforms to the PRS—not only in tenant security but in improving housing and its management. This is predicated on the need, first, to encourage private long-term institutional investors into the PRS and, secondly, to differentiate between the private rental sector and short-term holiday lets, typified by Airbnb.
The Bill’s proposal that tenants should be able to give notice after only two months of occupation, rather than the four proposed in the amendment, severely limits these objectives as the addition of a two-month notice period means that a tenant might be in residence for only four months, rather than six months, which is the key to bank finance and institutional investment. It is also a question of the balance of fairness between landlord and tenant, as the costs of establishing a tenancy, renovation and redecoration need a longer timeframe for payback than that which the current suggestion would provide.
This is also an important financial point: lenders to the PRS are concerned that mortgage payments will be missed if the revenue stream ends in under six months and will therefore be wary of lending to the sector. The downside to this, over the longer term, is the risk of tenants being trapped. To deal with this issue, a tenancy agreement should include exceptions for mis-selling, poor or unsafe living conditions, breach of PRS ombudsman regulations, death, domestic abuse, et cetera, during the first four months.
It is very important to use this opportunity to increase the supply of housing in the PRS and, at the same time, to increase the standard of the product to conform with the decent homes standard and to raise the standard of management. The key to this is encouraging institutional investment and build-to-rent investors.
BTR—build to rent—is distinct from the broader PRS because BTR homes are new builds which have been constructed specifically for the rented sector, reflecting the priorities of modern renters and funded by institutional investors. BTR results in rental-focused developments that are owned and managed by a single, professional, accountable landlord. This mitigates against many of the issues plaguing the PRS, such as poor-quality homes, unscrupulous landlords and poor value for money. Bringing in private sector institutional investors will increase the rental housing stock and provide high-quality, energy-efficient homes available for long-term rent at affordable cost. However, long-term institutional investors such as pension funds are looking for predictable returns over the long term and are therefore anxious to avoid the risk of short-term tenants, which the Bill may encourage.
The second major issue that arises from serving a two-month notice on the landlord from day one of the tenancy agreement, rather than after a four-month period, as suggested, is that it risks opening a back door to misusing rental homes for short-term two-month lets. If a renter can sign their tenancy and submit their notice on the same day, tenants will be able to use a property meant for long-term rent for short-term purposes. This loophole risks undermining the work done to reduce short-term lets and their social consequences. Legally, a landlord would have no ability to prevent abuse or to prefer a long-term renter and their family. The result would be the loss of rental homes, with fewer local homes available for local residents.
The risk of this misuse is particularly high in the institutional and build-to-rent sector, because of the turnkey attractiveness of these homes. They are built so that they are easy to move into and out of, with good furnishings, free wifi and high-quality facilities.
With this loophole, a landlord could not be sure if their tenant proposed to stay for two months or a significant period. The short-term letting problem represents a barrier to investment in the delivery of new rental homes, as lenders, institutional investors and developers would have no certainty about the occupancy levels and revenue base underpinning the scheme. To address this, in 2023, the Levelling Up, Housing and Communities Committee recommended this same amendment that we are suggesting now.
Failure to address this issue will result in a significant loss of investment in new rental homes, as well as an inadvertent upward pressure on rents, particularly in cities, making it harder for people to find homes that they can afford. For the sake of an expanding and healthy PRS, which satisfies a clear market demand for the rental sector, I urge the Minister to consider and accept this amendment.
Baroness Taylor of Stevenage (Lab)
My Lords, before I speak to these amendments, I should have, at the beginning of the debate, thanked all noble Lords for their engagement in the work that we did before we got to Committee. I have been very grateful for the attendance at drop-in sessions and for the one-to-one meetings that we have had with different Members from across the House. The noble Lord, Lord Truscott, referred to the value of scrutiny in this House; I truly value that scrutiny and engagement, which have been a great help in the early stages of the Bill. The comments that I make are made with due and careful consideration of what noble Lords say in the Committee today and what they have said to me in our meetings prior to that.
I thank the noble Baroness, Lady Scott, and the noble Lords, Lord Truscott, Lord Cromwell and Lord Shipley, for the amendments, and the noble Lords, Lord Marlesford and Lord Carrington, for their comments on them. These amendments all seek to introduce fixed terms into the Renters’ Rights Bill.
Lord Cromwell (CB)
The Minister namechecked me. I did not have an amendment in this group. My amendments are in the next group and are not about fixed-term tenancies.
Baroness Taylor of Stevenage (Lab)
That is my mistake, and I apologise to the noble Lord, Lord Cromwell.
Amendment 2, tabled by the noble Lord, Lord Truscott, would allow landlords to create fixed-term assured tenancies of 12 months or less. As I set out during the debate at Second Reading, our Government are clear that there is no place for fixed terms in the future tenancy system. Landlords and tenants all want the same thing in the private rented sector: long-term tenancies, well-maintained properties and the rent paid —on time, we hope. That is the balance that we seek to strike.
A core principle of the future assured tenancy regime is that all tenancies will be periodic. As the previous Government also advocated, the removal of fixed terms is fundamental to improving tenants’ rights and ensuring that they can hold their landlord to account. Fixed terms just do not offer the best outcome for renters. They can oblige tenants to pay rent for substandard properties and restrict them from moving house if they need to. All the examples that the noble Baroness, Lady Scott, gave are of those who need secure tenancies—they need them for themselves and their families, and for the communities that they live in.
The noble Lord, Lord Truscott, mentioned that I have been a local government leader. My experience with social housing tenants who have long-term secure tenancies makes it clear to me that they help them to stabilise life for their families and to develop the communities we know that people prefer to live in.
I was not going to mention domestic abuse, but I am afraid that the noble Lord, Lord Truscott, and his dismissal of it has provoked me into doing so. Domestic abuse is just one reason to not have this type of tenancy, and I may come back to that later. Just this lunchtime, I met the person I set up the Stevenage domestic abuse service with, and that situation is getting worse, not better. We do not want people to be trapped in properties that they do not want to stay in.
I do not believe that this amendment would offer tenants more choice. In reality, initial fixed terms would become just another way that tenants would be forced to compete in a difficult market. I understand that there are concerns from landlords about the impact of removing fixed terms. However, the move to periodic tenancies does not pose a threat to good landlords—in fact, it will make it easier and simpler for them to operate by preventing them being locked into a fixed term.
Amendments 4, 5 and 6, in the names of the noble Lord, Lord Shipley, and the noble Baroness, Lady Scott, would allow for short fixed-term assured tenancies. The amendments would allow assured tenancies to contain a two-month, three-month or six-month fixed term. As I have set out, the Government do not believe such changes are necessary. Where a tenant wishes to live somewhere for a short period of time, the Bill allows them to serve notice at any point as long as they provide two-months’ notice. If one of these amendments were accepted, it is likely that short fixed-term tenancies would become the market norm, forcing fixed terms on to tenants who may not be looking for a short-term let and reducing flexibility for all tenants. In addition, tenants already need to give two months’ notice to landlords. Having two-month or three-month fixed terms would not add anything meaningful to this position, and would be contrary to our aims to simplify an overcomplicated system.
The noble Lord, Lord Shipley, referred to the issue of rent up front, which I am sure we will debate under future amendments. The point is that it cannot be required as a condition of taking on the tenancy. If, once the tenancy is in place, the tenant chooses to pay rent in advance—and it is their choice—they will be able to do so.
Amendment 173, in the name of the noble Lord, Lord Truscott, would prevent tenants serving notice to end the tenancy within the first four months of a new tenancy. This, coupled with the two-month notice period, would effectively lock renters into tenancies for six months. I have been clear today that the Government will not support any amendment that seeks to lock tenants in for any period of time. Tenants must have the flexibility to end tenancies when they need to. The noble Baroness referred to people whose jobs change; that might be the case, and to be locked into a fixed term would prevent them doing that. The Bill still requires tenants to provide two months’ notice when ending an assured tenancy, which will give landlords time to find new tenants.
I heard the points from the noble Lord, Lord Carrington, about build to rent. I do not think there is a case for treating that differently, but no doubt we will return to this in future debates. I look forward to meeting with the noble Lord tomorrow to discuss his concerns in more detail.
It is very unlikely that tenants will move unless they absolutely have to. Moving house is costly and comes with significant upheaval. In practice, tenants will usually be asked to complete a series of steps in order to enter into an assured tenancy, and that will include referencing checks, committing for two months and paying up to five or six weeks’ deposit, none of which they are likely to do if they are looking for a very short-term tenancy.
Finally, I turn to the intention of the noble Baroness, Lady Scott, to oppose the Question that Clause 1 stand part of the Bill. Clause 1 will prevent the creation of tenancies with a fixed term under the future assured tenancy regime. As I have already set out, the Government do not support the retention of fixed-term assured tenancies under any circumstances. The move to fully periodic tenancies is critical to strengthening tenants’ rights and enabling them to hold landlords to account.
To be clear, fixed terms force renters to pay rent regardless of the property’s condition. This disincentivises landlords from resolving repairs and can force tenants to remain in poor-quality housing. They also reduce flexibility for tenants to move when they need to—for example, if they have had a relationship breakdown or because they need to take up a new job. I am sorry to the noble Lord, Lord Truscott, for coming back to it, but they can prevent tenants leaving potentially dangerous situations such as domestic abuse.
Clause 1 will therefore ensure that all assured tenancies are periodic in future. The tenancy will roll from period to period until either party ends it. It will be prohibited to include a contract term that tries to create a fixed term, and any such term would be legally unenforceable.
As I have already explained, good landlords have nothing to be concerned about with these changes. They will not have to wait until the end of a fixed term to access some of the possession grounds, and a simpler set of rights and responsibilities will also make it easier for them to understand and follow the rules. The removal of fixed terms was the policy position of the previous Government, in which the noble Baroness, Lady Scott, served, and it is the policy position of this Government.
Clause 1 is essential to delivering a strengthened and more secure tenancy system. It will improve the ability of tenants to move house and challenge poor practice. For all the reasons I have set out, I kindly ask that noble Lords do not press their amendments.
Lord Northbrook (Con)
Will the Minister deal with the points made by the noble Lord, Lord Carrington, about institutional investors and their reluctance to invest when there is a minimum tenancy of only two months, and about lenders who are not prepared to lend to the sector? Does she feel that the institutional investors are an important part of the sector or are they not relevant?
Baroness Taylor of Stevenage (Lab)
I responded to that in an answer I gave to the noble Lord, Lord Young, at Question Time. Yes, institutional investors are important, but it is important that we do not create an idea that these are two-month fixed tenancies; they absolutely are not. They are assured tenancies with a two-month notice period on the part of the tenant. Most tenants will not want to take up a tenancy and go through all the procedures they will need to—as I set out—just to have a tenancy for two months and then leave it. Most tenants want a long-term tenancy where the landlord maintains their property and they pay their rent on time. That is how the system works. I do not think it will deter institutional investors from having the confidence they should rightly have in investing in build to rent, or any other form of rental investment, as a good investment. It is a steady source of income and, with a tenant with an assured tenancy, they will be more assured of that, not less.
Lord Northbrook (Con)
I apologise; I failed to declare my interest as a private landlord of rental property in Hampshire.
Lord Truscott (Non-Afl)
My Lords, I thank all noble Lords who have taken part in this debate. Coming back to the point from the noble Lord, Lord Shipley, I am still concerned about the unintended consequences of parts of the Bill. I am not sure the Minister entirely convinced me on that, particularly on issues such as, for example, the move towards ultra-short lets that is taking place before our eyes. Some blocks of flats in London are 90% Airbnb. There is a big shift in the professionalisation of ultra-short lets. That is one impact of ultra-short periodic tenancies of two months that will be more or less impossible to police in large cities and resorts.
The noble Lord, Lord Marlesford, gave us the benefit of his 50 years’ experience in the PRS and expressed similar concerns. The noble Baroness, Lady Scott, and the noble Lord, Lord Shipley, asked the Minister what the rationale behind abolishing ASTs is. We heard some of the familiar arguments but, again, I was not entirely convinced. Domestic abuse is an extremely serious subject but I cannot imagine anyone who is in fear of their life checking their tenancy agreement before fleeing their abuser. I know the Minister mentioned one case, but the domestic abuse charities I spoke to say it is the abused person who flees, more or less at the drop of a hat, and the abuser who stays in situ.
A number of noble Lords expressed their disquiet about the abolition of fixed terms, not just in terms of flexibility—although there is an argument that asks whether we are saying that six months’ flexibility is so awful that we must have two months’ flexibility instead. Under assured shorthold tenancies, people can have a break clause of six months and can move out, which suits most people and has certainly been my experience. I am sure we will come back to this at a later stage.
The noble Lord, Lord Carrington, made some strong points about fixed terms as well, and made a powerful case for a six-month minimum, rather than two months, to give stability to both landlords and tenants. We should think not just about tenants’ rights, which are very important and an important part of the Bill, but about the impact on the market of introducing two-month tenancies. It is undoubtedly the case that, in a number of areas, people occupy what were previously long-term rentals for short-term purposes. We will come on to discuss Airbnb later but, for example, 40% of the properties in the village of Salcombe in Devon are Airbnb or equivalent. If you ask the people of Cornwall, you will find that they are losing a lot of long-term rentals to short-term holidaymakers, and all the rest.
The two are linked. This Bill will be linked to what is already happening to the housing market and what will happen in the future. Once you introduce two-month periodic tenancies, it will be almost impossible to police. How will you know whether someone takes on a tenancy in a city centre—for example, a tourist—stays for a month, not two months, and then moves out? Who will police it? I am concerned that there will be a huge shift to ultra-short tenancies, which will undercut the long-term rental market and impact primarily on people who need long-term rental homes.
We have had a good debate. No doubt the Committee will come back to this issue in future amendments but, for now, I beg leave to withdraw my amendment.
Lord Cromwell
Member’s explanatory statement
This amendment and another in the name of Lord Cromwell seeks to ensure on the face of the Bill that the tenant is able to request (after four months of occupancy) a voluntary extension agreement with a specified term. The tenant would retain the ability to leave on two months’ notice, and the landlord would voluntarily limit rights of recovery to the anti-social behaviour and not paying rent grounds, thereby incentivising an uninterrupted occupancy.
Lord Cromwell (CB)
My Lords, if I may coin a phrase, now for something a bit different. My Amendments 3 and 12 act together. They initially caused some bafflement—even suspicion—among other noble Lords, the Minister, and tenant groups with which I have discussed them. I am grateful to all of them for the opportunities this provided to look at my amendments for hidden or unintended consequences. I will therefore take a few minutes to explain what Amendment 3 is not, and then what it would achieve.
The amendment is not about creating a fixed-term tenancy, which some initially seemed to suspect. I know that several amendments in the previous group were put down with that intention or effect, but this is not one of them. It would not create a fixed-term tenancy as the tenant would not be required to stay for a fixed term. This would be in harmony with the Bill, one pronounced—one might say red line—objective of which, as we heard just now, is to prevent tenants being trapped in a fixed term. Nothing in the amendment would diminish that. In fact, it explicitly states that the two- month notice period by the tenant would apply.
That explains what the amendment is not. So, what would it achieve? When this Bill becomes an Act, where landlords and tenants have good relationships, as many do, and wish these to continue in the form of longer-term agreements, that will no longer be possible to achieve with a fixed-term tenancy. This amendment therefore starts from the perspective of a tenant who wishes to increase their security of tenure over a longer period while retaining their right to leave on two months’ notice.
The amendment would work as follows: a tenant in occupation for, say, four months—by which time they should have had the opportunity to assess the property, the landlord and any other arrangements—could propose to the landlord an extension of the tenancy for a period that the tenant suggests. However, and this is crucial, the tenant would retain the right to leave on two months’ notice, thereby avoiding being “trapped” and remaining compliant with the Bill. As I hope is now clear, this is therefore not a fixed-term tenancy in disguise.
Under such an agreement—and this is the greater security that the tenant would obtain—it is the landlord who would limit their right to take back their property only to cases of non-payment of rent or anti-social behaviour, not to cases where the property is being sold or the accommodation is required for a family member. The landlord would thus forgo two of the four grounds for recovery set out in the Bill. The landlord could decide to agree to this request from the tenant and, if so, it would be put in writing.
Colleagues have asked me why any landlord would sign up to such a tenant-favourable agreement. That is why I would like to clarify the benefits of this extension arrangement. As mentioned, the tenant would not only benefit from the greater security of tenure but would retain their right to depart after two months—a double benefit. The landlord would be giving the tenant an incentive to remain for the extension period they have requested. Why would the landlord want this? It is because a change of tenant almost inevitably involves a period without rent and a range of associated costs, including fees for letting and inventory agents, possible disputes about damage, deposits, redecoration, et cetera. In short, landlords hate voids and disputes, all the more so as the Bill now means that they are likely to have to go to the overburdened courts system in order to obtain their property, with all the antagonism, delay and expense that that involves.
To be clear, an extension agreement as per this amendment would not guarantee the landlord an income stream over time—that would get us back into trapping—but it would increase the probability of a tenant remaining and, therefore, a regular flow of income from a long-term tenant. While both could benefit, crucially, the power would remain in the tenant’s hands rather than in the landlord’s.
I invite noble Lords to stand back and recognise that this Bill creates a new landscape, one in which the rights and options available to landlords and tenants are rebalanced in favour of tenants. In that context, this amendment would enable in the specific—and indeed common—circumstances where landlord and tenant objectives were aligned the landlord to incentivise a tenant to remain as in the interest of both parties. I underline again that such arrangements would be at the tenant’s initiative and that neither tenant nor landlord could apply any compulsion on the other party.
As I mentioned at the start, this amendment caused some initial suspicion. Representatives of landlords, who like fixed-term tenancies and initially thought that I was seeking to retain them, soon backed away when they saw that the amendment would retain the two-month notice period for tenants. Tenant representatives —and, I have to say, the Government—have had the reverse reaction: initially suspicious that this might be some kind of loophole to create a fixed tenancy. I am sorry to labour the point, but I hope that it is now clear that it is no such thing. It would reflect the new balance of power that this Bill introduces to residential lettings. It would be a win-win opportunity, mainly for tenants but also for landlords seeking to retain tenants. I am much encouraged by tenant groups who have written to me on reflection to confirm that they think this amendment has the potential to help tenants gain greater security in the context that I have described.
In conclusion, the purpose of the amendment is to ensure that the arrangement I have outlined is made possible without interfering with any other aspects of this Bill. It would apply only in some positive landlord-tenant circumstances, but the Bill needs to make such agreements possible. It has no reason to block them. If it does—and this is important to note—informal or verbal agreements will develop outside the regulations, and these tend to end in tears.
Landlord and tenant bodies alike understand the new landscape being introduced by this Bill and recognise the benefit of this amendment. Further, I have been encouraged by legal advice that it should be included in the Bill so that it is confirmed as an available and legal option for relevant landlords and tenants.
I apologise for this quite lengthy exposition of the amendment, but I hope it has been helpful both in explaining the mechanics and in allaying misapprehensions about what should be a valuable addition to the Bill. I look forward to the Minister’s response.
Baroness Thornhill (LD)
I have to confess to the noble Lord that I had written down exactly what he said—that these are not two nice amendments to bring in fixed tenancies by the back door—but then I thought, “He’s actually just creating a new ground for repossession”. What I am concerned about from the previous debate and this one—and I urge the Minister to clarify this—is that there seems to be an idea that rolling tenancies are unstable. I have several friends who are landladies, and we have had discussions about this over one or two glasses of wine and—believe it or not—they are not fazed by this. They have not reacted hysterically, because their attitude is, “My tenants like to stay long term; I’m a good landlady”; they do not see that that is a problem. But clearly there is a problem because we have had the reaction. I say to the Minister that the messaging has somehow got lost that this is not a less secure tenancy and that, in fact, the expectation is that the tenancy will roll on, and I believe the Government have tried to make the paperwork and things easier for that to happen.
If that messaging was correct, I do not see why a tenant would need incentivising to stay if everything was going okay. So forgive me if I sound perplexed: I thought I had a clear view about this, but the noble Lord has kind of knocked me there. I think it is because of the messaging that we have had about the instability of rolling tenancies, whereas I believe that that is not the case. I would be very interested in what the Minister has to say on that. I appreciate that the noble Lord’s speech was not long; it was engaging oratory and got the little grey cells going.
Lord Cromwell (CB)
Perhaps the noble Baroness and I should discuss this over a few glasses of wine also, although I do not drink—but she can have the wine. I do not think the amendment creates a new ground for repossession; it gives the tenant greater security of tenure by removing half the causes for which a landlord could serve notice—I think that is what we will have to discuss over the glass of wine. It applies in special circumstances, where a landlord does not anticipate the need to sell or the wish to move in a family member but wishes to incentivise their tenant, who could leave at any moment on two months’ notice, to stay longer. So they say, “I’m prepared to give you greater security of tenure as an incentive to remain and continue paying the rent”. It is not more complicated than that, but I am glad that I managed to lift the bafflement and look forward to a chat afterwards perhaps.
Lord Jamieson (Con)
My Lords, before I start, I ask the Committee to note that I am a councillor in central Bedfordshire and therefore have an interest. I welcome the opportunity to speak to this group and to express my thanks to the noble Lord, Lord Cromwell, for raising this amendment and explaining it so carefully. I am quite grateful that I understood all along that the tenant was still eligible for the two-month notice period.
These amendments offer a clear and practical framework for tenants to request a voluntary extension agreement after four months of occupancy with terms that, as the noble Lord said, provide greater certainty and predictability for both parties. This would allow people the freedom to make a mutual agreement and choice that benefited both sides. As Conservatives, we believe that the Government’s role is not to overregulate or restrict but to create the conditions for stability, co-operation and choice. The amendments do exactly that: agreements built on mutual respect rather than compulsion.
Under the proposals from the noble Lord, Lord Cromwell, tenants would enjoy security of tenure for an agreed period. Landlords in turn gain the reassurance of occupancy, with their right to recover their property during the term limited to cases of anti-social behaviour or non-payment of rent. These are reasonable safeguards that encourage constructive relationships and stability in the rental market and will benefit both tenants and landlords.
This approach complements the amendments in my name and the name of the noble Baroness, Lady Scott, which we will discuss in due course. Together, they reflect a shared principle that flexibility, where it is entered into freely and transparently, strengthens rather than undermines tenant protections. We often speak in this Chamber about empowering tenants, but that empowerment must include the ability to make informed choices and enter into arrangements that suit tenants’ lives, reducing the risk that they will be forced to move. Voluntary extension agreements offer a proportionate and sensible way of achieving that aim without diluting the core purpose of the Bill. I hope the Minister will give these proposals the thoughtful consideration they deserve as we continue to shape a Bill that is fair, flexible and fit for the realities of today’s rental market. We look forward to working constructively with the noble Lord, Lord Cromwell, as he considers his approach ahead of Report.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Cromwell, for his amendments relating to mutually agreed voluntary extension agreement in tenancies and I thank the noble Baroness, Lady Thornhill, and the noble Lord, Lord Jamieson, for their contributions as well. Amendments 3 and 12 would allow a form of agreement where tenants can leave the tenancy by providing two months’ notice and landlords could gain possession only for rent arrears or anti-social behaviour. Tenants would be able to request this after four months of the assured tenancy and the landlord would have to agree in writing.
I am grateful to the noble Lord, Lord Cromwell, for meeting me to discuss his proposals. No wine was involved, but other beverages are available. I have considered his amendments carefully and the points he made about their potential efficacy. One of the reasons the Government do not want to reintroduce fixed terms or anything like them is that they add complexity into the system. Having a simple, single system of periodic tenancies will make it easier for both parties to better understand their rights and responsibilities.
Having looked at the noble Lord’s proposal, I say that it is not clear that it will be of much benefit to either party. The noble Baroness, Lady Thornhill, rightly referred to the nature of assured tenancies, and I think there has sometimes been a misunderstanding—perhaps concocted—of what an assured tenancy is. It is a permanent tenancy unless the landlord uses the grounds included in the Bill or the tenant gives two months’ notice. It is not a two-month tenancy; it is a permanent tenancy with two months’ notice on the part of the tenant. If both parties wish the tenancy to sustain for a certain period of time, nothing in the Bill prevents this. The Bill already prevents landlords using the key possession grounds for moving and selling within the first 12 months of a new tenancy. This provides tenants with additional protections for a period of time. Landlords can also communicate their plans to tenants if the tenants need that additional reassurance. It is also unclear what this model would offer to landlords, given that the tenant could still leave at any point, so it is very unlikely landlords would agree to it. For the reasons I have set out here and in previous debates, I hope the noble Lord will withdraw his amendment.
Lord Cromwell (CB)
I thank the Minister for her comments and for the very helpful meeting we had about this amendment. I have tried to strike a balance in my amendment between not going near a fixed-term tenancy and producing something that is of benefit to landlords. I can only tell her that, from my experience of talking to people, they are often keen to find incentives for a tenant to stay, because it is a costly and time-consuming business to change them. Therefore, I do not think one should dismiss too lightly the idea that landlords might forgo some rights in order to encourage a tenant to stay on: in fact, I have seen that in practice.
One should never drink alone, so if the noble Baroness opposite is going to have a glass of wine, perhaps the Minister would like to join in and the three of us could have a useful chat about this. I think there is something here that does not undermine the tenant’s ability to get out in two months but gives an incentive in that marketplace for the landlord to encourage a tenant to remain for the long term. The tenant will decide how long that term is, because they will be the one requesting an extension. It could be 10 months or two years: that is entirely a matter for them. So, I do not want to give up on this at this point. I will withdraw the amendment, but I suggest that we have a further chat to see whether there is something that can be worked up from this particular nugget.
Baroness Scott of Bybrook
(1A) For the purposes of this section, a tenant who meets the student test when a tenancy is entered into has the same meaning as in Ground 4A.”Member’s explanatory statement
This amendment would allow student tenancies to remain as fixed tenancies to provide the certainty that both student tenants and student landlords require.
Baroness Scott of Bybrook (Con)
My Lords, I shall speak also to Amendments 44, 45 and 46 in my name.
Although it may have been some years ago, and not all Members of your Lordships’ House chose to go to university, many noble Lords will no doubt recall their own experiences as university students. For those whose memories may have begun to fade, it is likely that a son, daughter or even grandchild is at university today or has recently been at university. I raise this point because those of us who fall into this group will recognise that students have distinct and unique housing needs that set them apart from all other groups. Most students rely on a combination of maintenance loans, part-time jobs and, increasingly, the support of the bank of mum and dad—or even granny—to meet their costs during their studies. Proximity to campus is essential both for academic engagement and to reduce the burden on transport costs. Students typically require leases of nine to 12 months, aligned to the academic calendar. I stress flexibility as an increasing number of tertiary education providers are now offering 18-month courses, moving away from the traditional three-year model. For many students, this marks their first experience of independent living. They are often unfamiliar with housing laws and lack the knowledge that only life experience can bring.
Although the exact legal framework for the exemption requires further clarification, the Government, by virtue of attempting to exclude purpose-built student accommodation from the ban on fixed-term tenancies, have accepted the unique position of students, and we welcome that. However, we feel there is more work to be done.
The Explanatory Notes assume that purpose-built accommodation tenancies are not assured. StudentRent puts this drafting down to a confusion with university halls, which use non-exclusive licences. In reality, most PBSA providers issue exclusive assured shorthold tenancies, meaning that, unless the Bill is amended or exemptions are extended, the agreements will become invalid once the new law takes effect. Could the Minister please use Committee to clarify this? If we cannot reach a reasonable position in Committee, we will have to return to the issue on Report.
In their drafting of the Bill, the Government have missed the opportunity to exempt all types of accommodation. As noble Lords will know, it is common that, after the first year, students often move out of purpose-built student accommodation and into HMOs or other types of property in the private rented sector. Amendment 7 in my name would ensure that student tenants could keep their desirable fixed-term tenancies, no matter what type of accommodation they find themselves in. We must not allow a two-tier system to emerge, where only those who can afford the most expensive purpose-built accommodation are granted the stability of fixed-term tenancies; that would be a perverse outcome from this legislation. It is vital that we resolve this as soon as possible.
Fixed-term contracts provide students with clear start and end dates that not only make financial planning more straightforward but ease the burden of day-to-day administration tasks that can be particularly challenging for those experiencing independent living for the first time, all while managing the demands of their academic studies. Perhaps most importantly, fixed-term agreements provide rent certainty for the entire duration of the contract. That certainty is not only reassuring for students but essential for their families, who rely on clear and predictable costs in order to budget effectively and support their children through higher education. Furthermore, knowing precisely when a tenancy will end helps students avoid disruptive mid-semester moves, which can have a detrimental impact on their studies and exam preparation.
While stability is vital, so too is flexibility. It is on this point that I wish to speak to Amendments 44 and 45. The current provisions acknowledge in part the need for student landlords to regain possession by the end of the academic year, under ground 4A. However, this fails to take into account those students whose studies do not follow a traditional academic calendar. It is important to stress that, under the current model, it is exceptionally rare for student landlords to need to resort to eviction proceedings. In practice, the challenge is far more likely to arise when students wish to leave their tenancies early. The proposals as they stand do not fully address the consequences of such scenarios.
Lord Willetts (Con)
My Lords, I shall speak to Amendment 40 in my name. This is the moment when students and higher education enter the housing and rental market debate. I am never totally sure whether the department responsible for housing welcomes this interruption from the higher education sector, but I hope the Minister will accept it in the spirit in which it is meant. I declare an interest as a visiting professor at King’s College London, and a member of the council of the University of Southampton.
I understand the arguments that the Minister makes about the need for tenants to have security and be able to put down roots in the long term, but so many of her arguments for this legislation do not apply to students who are seeking reliable accommodation for an academic year. The model that she proposes is clearly not in their interests.
If I may say so to the Minister, the link between housing policies and higher education is very important. The previous Labour Prime Minister, Tony Blair, set a target of 50% of people going to university. There are different views about the target; I do not personally believe in targets, but nevertheless that 50% target was achieved and it was achieved only because of the use of the private rented sector. It is impossible to have imagined that that target would have been secured without the way in which the private rented sector has developed for student accommodation. This is not just a historic achievement; if the Government have opportunity as one of their core objectives, it is surely important that students who could benefit from higher education have that opportunity, and that includes being able to access accommodation that meets their needs.
The Government have clearly accepted that there is a need for some special arrangements for student lets. The exact form they take is open for discussion. My noble friend Lady Scott made very powerful points in support of her proposed amendments, which try to secure that. The Government have made some concessions to recognise the student market. There is already one exemption from the legislation, which is for purpose-built student accommodation. That tends to be high-cost and involves students making a very early commitment. It is possible almost at the beginning of the previous academic year for the student to enter into a special academic year contract in this high-cost, purpose-built accommodation. To put it crudely, the Government are looking after the elite: the students who plan a year ahead, can afford the high rents and go into the —by and large—very high-quality purpose-built accommodation, which often has business investors behind it.
There is now a second category that has been added, and that is ground 4A, which is essentially for HMOs with three bedrooms or more in the private rented sector. They are also now going to be exempt from the burden of the legislation, with a different start date for making a commitment—about January before the academic year starts. That is the next group— I feel it is a bit like that famous “three classes” sketch, since we have got a second group that will now be looked after.
But that leaves a third group for whom the Government are not currently providing any exemption. These are students in smaller accommodation, maybe one or two-bedroom properties, for whom none of the special exemptions are going to apply. It is therefore very odd that, in the Government’s model to tackle this problem, you could have three university students who are friends and are in three totally different rental regimes because of the structure of the exemptions which the Government are trying to offer.
What I am attempting in the amendment in my name—I welcome the support of other noble Lords—is to say that these smaller rented accommodations of one or two bedrooms should also be exempt from the general provisions of the Bill and instead be recognised as academic accommodation, with its special needs. What do we know about these students in one- or two-bedroom properties? The evidence is limited. There seem to be quite a few of them. There are different estimates as to how many students in the rented sector are in these smaller accommodations. One estimate is 24%; another is a third. Several hundred thousand students are currently in this sector. So, if landlords pull out from it because there is no way they can be confident of being able to offer a tenancy for an academic year and the accommodation enters the mainstream market, several hundred thousand students currently renting in this sector will lose out.
One view is that they may be students who go for particularly low rents. I do not know. An alternative account of these students is that this smaller accommodation is basically for students who wish to live more quietly. It is less social. One suggestion is that it tends to be final-year students who move out from the bigger, more crowded accommodation so that they can properly study and revise for their final year. The Government’s education policy appears to be, “It is okay to have a special arrangement if you are going to be in a large, sociable environment, but if you want to move into a studious, quieter environment, we are ceasing to recognise that you are a special student and your kind of accommodation is going to go”.
I very much hope that the Minister will recognise, as the Government have already made concessions, that we need a wholehearted attempt to preserve an academic year student rental market. My attempt to extend the exemption on ground 4A to one- and two-bedroom accommodation is an attempt to do that. The interesting proposals from my noble friend Lady Scott are an ingenious attempt to do that.
Finally, and briefly, I will refer to another amendment that attempts to do that: Amendment 189, in the name of my noble friend Lord Young of Cookham, who is in the Chamber but currently appears unable to participate in this consideration of his excellent amendment. It is another attempt to resolve this issue with an ingenious proposal that there should be a special code of conduct for private sector residential landlords letting to students. If landlords sign up to that code of conduct, they would then be exempt.
To be honest with the Minister, I do not have particularly strong views about exactly which mechanism should be used but I hope that at the end of the consideration of these amendments, she will accept that there needs to be a wholehearted recognition that the student academic market is different and, instead of slicing it into these particular sectors—some parts of it to be recognised and others not to be—there needs to be a complete solution for students renting for academic terms because, otherwise, the Government’s commitment to opportunity will be in jeopardy.
Baroness Wolf of Dulwich (CB)
I have added my name to Amendment 40 in the name of the noble Lord, Lord Willetts, and declare an interest as an academic employee of King’s College London. As such, I am acutely aware of the accommodation and living costs that students face if they study away from home. London is particularly expensive, as I am sure noble Lords have noticed, and the level of maintenance loans available and the total absence in England of maintenance grants mean that many UK students conclude that a London degree is simply out of reach.
At King’s, we manage to offer first-year undergraduates a place in hall and we have an affordable accommodation scheme that helps a subset of students obtain accommodation at below market rates, and other universities are similar. However, over time we have seen our student body change. On the one hand, we have far more international students, many of whom are able to afford the rents charged in high-end, purpose-built student accommodation or to pay market rents in the private sector; on the other hand—this is far less well known—we have seen a strong growth in the proportion of our UK students whose families live in or close to London who live at home, and a corresponding decline in the number of UK students who are in student accommodation in London.
If your family lives in the London area, you can live at home and be a commuter student and still have access to a huge range of institutions and degrees, but that is not true for people in a very large part of the country. You do not need to believe that young undergraduates should all go away to do their studies to be aware that for many people, it is absolutely central to social mobility and to their future. If it is only wealthy students who can move geographically, our best faculties and specialist degrees will not be able to recruit the best students.
Baroness Warwick of Undercliffe (Lab)
My Lords, briefly, I support Amendment 40, to which I added my name. I am concerned to ensure that we do not inadvertently damage further the student accommodation market. There is already a very severe shortage in student housing. The proposal to end fixed-term tenancy agreements could have such an impact. I have received very detailed briefings from UniHomes—supported, I know, by Unipol—Universities UK, HEPI and other organisations intimately involved in student housing.
Purpose-built student accommodation will be exempt from this decision, but student accommodation provided by the private rented sector is not offered that exemption. I know that the government objective, which I fully support, is to deliver security and stability to tenants, but I do not believe that the Bill, as it stands, will deliver that for all students. As the noble Lord, Lord Willetts, pointed out, on average, private sector accommodation is cheaper than purpose-built accommodation, so it is an important source of housing for domestic students who are economically disadvantaged. I hope that the Minister will recognise that possibility and not jeopardise such provision, as many think this might. It would be worth considering granting the exemption granted to purpose-built student accommodation to the student private rented sector in total. Other suggestions have been made and I hope that the Minister will consider them all to ensure the stability of student accommodation.
Lord Shipley (LD)
My Lords, along with the noble Lord, Lord Willetts, and the noble Baronesses, Lady Wolf and Lady Warwick, I have signed this amendment. I spoke about this issue at Second Reading.
The noble Lord, Lord Willetts, reminded us that there are three totally different rental regimes for students: purpose-built accommodation, including large blocks; the HMOs, which are larger properties in the private rented sector; and the smaller private rented sector accommodation. The noble Lord was absolutely right to say that the achievement of so many young people in going to university has been dependent on the availability of accommodation in the private rented sector. From my time in Newcastle upon Tyne, I know how fundamentally important the PRS was to the growth of the universities in the city. I think the Government accept that a special arrangement is needed for an academic-year contract, but that has to include those in one-bedroom or two-bedroom properties; they also need to be exempted as part of ground 4A, which currently restricts the exemption to houses in multiple occupation.
The Government have Amendment 202 in this group, and I am keen to hear what the Minister will say about that and to what extent she feels it will help us solve the problem. There is a danger that unscrupulous landlords will define properties as being for students when they are not, in order to bypass the impact of this Bill when enacted. I thought a lot about that and believe that the Government can mitigate that possibility. It might be done through the register; there may be ways of delivering a solution by that means. It occurred to me that it may be possible to use non-liability for paying council tax as the basis for a system for identifying those who would qualify for Ground 4A. It would require local authority co-operation and proactive management of the private rented sector, but it can be done—and it needs to be done because students are very important to the lifeblood of many cities and towns across the country. Having a vibrant private rented sector for them to use matters.
If the Government decide that the smaller private rented sector properties do not need additional help, the likelihood, given that students would be able to give two months’ notice under the revised terms of this Bill, is that landlords will decide to stop letting properties in the private rented sector to students, or to reduce their exposure to the student-letting market.
It is a complex area. I recall the Minister saying when she summed up at Second Reading that there are difficulties and issues that have to be considered. I hope that, once she has replied and we better understand the intention of Amendment 202, we can produce something much better when the Bill is on Report.
Lord Best (CB)
My Lords, I rise to move Amendment 266 in my name and that of the noble Lord, Lord Shipley. This is my first intervention in Committee, so I declare my interests: my wife owns privately rented property; I am a vice-president of the Local Government Association and of the Chartered Trading Standards Institute; I am currently chairing an inquiry into intergenerational housing, and I am on Business in the Community’s Blackpool housing advisory board.
My Amendment 266 in this group concerns student housing, but it is on a slightly different tack. While there are strong grounds against a general option of fixed-term tenancies, separate arrangements are justified for student accommodation, as indeed the Government acknowledge. My amendment is a modest tweak to the change already made by the Government to exclude student housing, except in smaller accommodation, from the prohibition on fixed-term tenancies. It would address a rather different issue. It would exempt certain purpose-built student accommodation from the private rented sector licensing schemes of local authorities, which enable councils to inspect and enforce standards for private rented property. This exemption for PBSA accommodation is justified because these schemes are already subject to high levels of scrutiny and compliance through government-approved codes of management. I am grateful to the British Property Federation for bringing this issue to my attention.
As the noble Lord, Lord Willetts, and many others have eloquently explained, purpose-built student accommodation is an important part of the rented market. It provides 724,000 beds throughout the UK, split between university owned and privately owned. There are nearly 200,000 more beds, mostly privately provided, in the pipeline. Without this sector, students would have to rely on, and would put more pressure on, the wider private rented sector, where satisfaction levels are rather lower. Lack of suitable accommodation is a major problem for students and for universities. Removing barriers to tackling the undersupply of student housing is also important in easing the strains on the rest of the private rented sector.
Local authority licensing can definitely help raise standards for the PRS, but its value does not extend to that part of the PBSA sector, which is already heavily regulated. The sector has government-recognised codes of practice under which members are inspected on a regular rolling programme, which covers the property’s condition, management and regulatory requirements. Because of the level of scrutiny required by these codes, a 2019 government-commissioned independent review found that licensing was not required for purpose-built student accommodation. It said:
“This accommodation, as a normal condition of operation mandated by the attached University, is required to implement a strict, Government recognised code of management practice … Such a code holds the accommodation to much higher standards of management and condition than any licence conditions could reasonably achieve. Properties are rigorously inspected on a regular basis (typically three times per year)”.
This MHCLG review concluded:
“Given that these properties are already highly regulated, and equivalent properties managed by Universities (to an almost identical code of practice) are exempt from licensing, licensing of such properties is manifestly redundant and extremely expensive for the operators”.
In relation to the expense for operators, local authorities can operate a licensing scheme charge on average of £700 per license, but they can charge up to £1,200, and since these fees are often charged per unit, not per scheme, not per building, a scheme of several hundred units—for example, studio flats—can incur costs in excess of hundreds of thousands of pounds. While some local authorities already offer exemptions or discounts for PBSA providers that adopt these codes of practice, this is not standard practice, and many local authorities do not offer any reduction in licensing charges. This is not really fair. PBSA was never a target for the licensing scheme, and the cost and time incurred by the licensing process does not add any benefit for students. Exemption from licensing would remove an unnecessary expense for providers, saving some of them hundreds of thousands of pounds and improving the viability of PBSA schemes.
Lord Fuller (Con)
My Lords, I declare my interest in a family business that rents properties in Norwich in some small way to students. I suppose I ought to declare that I have been a student in both houses and halls, albeit more than 40 years ago.
This is a well-intentioned Bill—indeed, the Conservatives introduced something thematically similar in the previous Session—and it includes some modernisations to rebalance the relationship between the landlord and tenant, and particularly to regulate agents who act as intermediaries between the parties, but this is not the same Bill we encountered before, and in respect of students—I am bound to say of all students, including apprentices—it is pregnant with unintended consequences.
As it relates to students, it denies the obvious fact among the cohort of potential tenants that there is an annual rhythm to the demands and needs that runs from December to August annually. I was particularly taken with the noble Lord, Lord Cromwell, who has just left his place, and I was going to offer to buy him a drink in that round in the bar with the noble Baroness, Lady Thornhill. He tells me he does not drink, so it would have been a cheap round, but there we are. As a principle, efficient markets exist to align with consumer needs, and this Bill will disrupt the ability of the market to satisfy those needs of the many hundreds of thousands of students, not all of whom are fresh out of sixth-form college, to align the certainty of their living arrangements with the reality of their daily lives and particularly with their friends.
The consequence of the Bill, if enacted, is that students will pay more because the supply of rental properties will reduce by discriminating against private landlords. It will reduce the choice of landlord because it lays down in statute the sole type of landlord counterparty that students can contract with if they wish to have the certainty of an annual let, and thus it reduces the competitive pressure among landlords to keep prices down, so students will pay more.
By restricting the student let to a certain class of building, it creates monopoly powers for that expensive specialist provider that my dear noble friend Lord Willetts mentioned, so students will pay more. It will also create an overheated market in September every year because the landlord can guarantee the availability of his house only if the previous people have given notice. So, in that overheated September market, guess what? Students will pay more.
It is not just cost; the consequence of the Bill means that students will be more inconvenienced. It means that second and third-year students, the sort of people who do not necessarily want to live in hall, must fly back from a world trip, working abroad or whatever to sort out a house they could have done earlier. It is harder for friendship groups to get the certainty of a house with their friends. I do not believe that in this debate thus far we have considered the importance of cohorts of friends, who are not related and do not have the family ties that you often get in most tenancies, so you are at the mercy of the person who just wants to cut and run. If there is a joint tenancy among six friends, for example, in a larger house, and one of them wants to go, what does that do? Does it break the tenancy? How does that work? It disrupts the whole group. I believe that in the case of students, the discipline of a group of friends coming together has some value to the market.
Of course, by focusing everything in September, it makes the chaos of clearing even more chaotic than it already is. It prefers the established students from good backgrounds, with parents with sharp elbows as a means to execute draft contracts more quickly; those sorts of families also make it easier to provide the guarantor. I remember when my daughter was at Newcastle. She had taken up with a group of friends who were going to live in Jesmond, and there were six of them in the house. The landlord sent round a contract that made me jointly and severally liable for the entire rent for all of the people, none of whom I had met. Fortunately, I was last on the list. I noticed that Viscount Boyne, a former Member of this House, had signed before me; it gave me a certain comfort to know that we were going vicariously to rely on each other.
Although this Bill introduces protections for current students, it disadvantages people in the second or third year who are not yet in houses but might want to be. Not everybody wants to live in halls, particularly PhD or mature students. I have been there: you tire of the freshers running up and down the corridor in the night because they have come back late from the pub. If you want to have that quiet enjoyment of a property, you should not be forced into a student block with added charges and expensive rents.
This Bill, if enacted, will also introduce new discriminations that have not been mentioned thus far. I am thinking about foreign students. Let us not forget that foreign students underpin the university sector; at the moment, they are keeping our universities afloat with their extra fees. Foreign students who do not have a credit history, for whatever reason—there are cultural reasons that I will dwell on in a moment—will be prevented from paying up front. They will become unrentable; they will find it very difficult to get a place. Of course, these are the people whom the universities need to balance the books. The difficulty of getting guarantors and the right-to-rent checks are in and of themselves sometimes a barrier and a discrimination against foreign students.
I am thinking in particular of women students from Arab countries. I have two tenants in our own business whose mothers have come from those parts of the world in order to live with their daughters for cultural reasons. They want the annual tenancy agreement to give them in certainty their own way, so they can sort it out once then have the comfort of leaving their daughters—they tend to be daughters—while knowing that they can come back. It is an irony that, later in the Bill, Amendment 190 has a huge amount about discriminating against pets while here we are allowing discrimination against the cultures of women and girls from other parts of the world.
I regret to say that all this in aggregate means that the landlords who have specialised in renting to students, many of whom add pastoral care to the portfolio, will fall away. My wife has acted as a mother, so to speak, to many of our students, helping them with council tax bills and acting on their behalf with utilities—especially those students for whom English is not their first language and who are trying to make a way in a foreign country. All this will go because you cannot have the certainty of a contract between landlord and tenant. Why should it be for the state to determine a narrow monoculture of what constitutes acceptable student accommodation? What happened to the ability of consenting adults to work out their own decisions?
Government Amendment 202 has the absurdity of defining a building that is “occupied by students”, which excludes dwelling houses that are occupied by students. It then it requires halls specifically built for students and meeting the Unipol code of standards to be licensed even though they exceed the standards. How does this pettifogging bureaucratic interfering help the people whom it purports to assist?
When I explained to my daughter last weekend what I was going to say, it took her about 10 seconds to realise that a complicated secondary market will now develop between potential students and landlords, with informal, unregulated contracts and options—as well as fees to secure tenancies in the most desirable households with the most commodious landlords— in a way that harms exactly the sort of people the Government are trying to help: the ones who are the first in their family to go to university. By preventing more than one month being paid at a time, you will end up with more complicated escrow arrangements, fees, more expense, delay and obfuscation, as well as all sorts of connivances between cohorts of outgoing tenants with incoming tenants—on risk, of course—lining up the next year based on good friendships this year. We are formalising in statute nepotism between years to the exclusion of those who are trying to make their way.
The student market is complex, and it should reflect the world as it is. For many students, that is not the monoculture of catered halls of residence. They prefer to be in the town, close to pubs and universities. Destroying this market does not help anybody. It is full of the law of unintended consequence—a law that makes it harder and worse for the brightest and best people who want to get on, and difficult for anyone in higher education to know where they stand. They will all pay more, and this will make it easier for landlords to exploit a hot market every September.
It is just another example of Labour preferring big business, the operators of these large student schemes, over the nobility of the small family business. There is one silver lining, however: teaching students at a formative moment in their lives the adverse effects of the dead hand of the nanny state telling them what they can and cannot do is more likely to drive them to and promote the cause of capitalism than it is socialism.
Lord Evans of Rainow (Con)
My Lords, I will speak to Amendments 42 and 43 in my name. These amendments probe why the Government believe six months is a suitable cut-off for 4A, the new ground for possession, being available to landlords.
Unlike my noble friend, I declare I did not go to university, so I am not familiar with freshers running down corridors. However, I have three children, two of whom have gone to university—the first people in my family to go to university. They tell me that their experience of the accommodation was very straight- forward and it was of good quality in their eyes. I also declare an interest in that I have a third child who is currently studying for her A-levels, so I am hoping that she will go to university. I look forward to a similarly straightforward situation in terms of accommodation.
Students like to get their accommodation sorted at the beginning of the year, away from the exam period. If tenancies cannot be agreed early on, this will lead to uncertainty on living arrangements and add to the stresses that students face. Most tenancies begin in July, and therefore the hunt for student accommodation will begin during exam periods. Can the Minister tell the Committee whether the Government consulted students and, if so, to what extent? Have the Government even considered the impact on students? It is very important that, at exam time, they are focused on their exams. Landlords like the certainty that their accommodation will be filled. Have the Government consulted landlords and, if so, to what extent? As my noble friend just said, the larger organisations that run this are one thing, but have the many family-run businesses also been consulted?
More broadly, the combination of ending fixed terms, introducing a two-month notice period and restricting rent payments in advance could disrupt the traditional student housing cycle, making it harder for students to secure accommodation early and reliably. We argue that the student model does not fall comfortably within this Bill, and that the student model is one that existed for some time for many years—successfully, in my experience. This change aims to discourage landlords from signing up students for tenancies months in advance, which is currently common practice, and I would be grateful if the noble Baroness could reassure me on those points.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, and the noble Lords, Lord Willetts, Lord Evans, Lord Young—albeit that his amendment was very ably proposed by the noble Lord, Lord Willetts—and the noble Lord, Lord Best, for their amendments, and the noble Baronesses, Lady Wolf and Lady Warwick, and the noble Lords, Lord Shipley and Lord Fuller, for their comments during this debate. All these amendments seek to revise or introduce provisions in the Bill related to students, and I say well done to King’s College for having its team approach to this Bill in the Chamber today.
We do not expect that removing fixed terms will have a destabilising effect on the student rental market. New possession ground 4A will give landlords confidence that they will be able to regain their property to move in other students in line with the academic year. If tenants leave a tenancy early, the landlords will be able to find new tenants to take their place. The end of a fixed term does not automatically give the landlord possession. Landlords still have to follow the correct possession procedure. If fixed terms remained in the future, landlords would still need to follow the correct possession procedure.
Amendment 7 would allow fixed-term assured tenancies if the tenant was a student at the beginning of the tenancy. It would not be either right or fair for students to have less flexibility than other tenants just because of their educational status. Students who drop out of university could be required to pay rent for the rest of the fixed term, which could potentially reach thousands of pounds. All renters, including students, should have access to the benefits provided by the Bill.
The opportunity referred to by the noble Lord, Lord Willetts, is, as he rightly said, the meeting between housing and higher education. As someone who undertook a degree as a mature student with three children and a full-time job, I say that we simply must not assume that all students are the same. This is the opposite of elitism. It is ensuring that all student circumstances are taken into account and that those who need the greater stability that assured tenancies offer can have that option.
We have introduced a new possession ground to allow the cyclical nature of the student market to continue and provide landlords with confidence. This strikes the right balance and, in our opinion, is the much better approach. Referring to the question from the noble Baroness, Lady Scott, about tenancies in halls, the Government intend that any new purpose-built student accommodation tenancies created after transition will be exempted from the assured tenancy system following transition, as long as the landlord is signed up to a government-approved code of conduct. I hope that answers her question. For these, reasons I ask the noble Baroness to withdraw her amendment.
Amendment 40 seeks to expand ground 4A, which allows student tenants living in HMOs to be evicted in line with the academic year. It would allow students living in self-contained accommodation—one-bedroom and two-bedroom properties for example—to be evicted each year, and it seeks to address the concerns of some noble Lords that the existing scope of ground 4A does not cover all student properties. We have thought very carefully about the design of ground 4A. Limiting it to HMOs captures the bulk of typical students—that is, groups living in a house share. Meanwhile, students who need more security of tenure, such as single parents living with their children, postgraduate couples living together who have put down roots in an area, or families containing students, will be protected.
The core principle of the Bill is that tenants should have more security in their homes, and we think it is right that these groups should not be exposed to potential eviction using ground 4A. Self-contained one-bedroom and two-bedroom homes are also easier to let to non-students than student HMOs are, so, if a landlord cannot gain possession in line with the academic year and the tenants leave in the middle of the next one, the landlord is highly likely to be able to let the property out to non-student tenants. The noble Baroness, Lady Wolf, referred to student accommodation in London, and I imagine that there are other places where costs are prohibitive, such as Cambridge and Oxford. However, the Government’s action to increase supply is critical here. It is only by increasing supply that we will be able to stabilise rents. I do not think that the action proposed in the amendment would have that effect.
Amendments 41 and 45, taken together, seek to remove the requirement for a landlord intending to rely on ground 4A to give prior written notice to the tenants. This would mean that landlords renting to students in HMOs who satisfy the student test would be able to rely on ground 4A without giving tenants written prior notice, before the tenancy was entered into, of their wish to be able to recover possession using ground 4A. We cannot accept these amendments. The core aim of the Bill is to enhance the security of tenants in the private rented sector, including students. The prior notice requirement in ground 4A is key to this. If tenants are liable to be evicted through no fault of their own simply because of their student status, they must be informed of this reduced security before entering into a tenancy. Amendment 45 is purely consequential on Amendment 41, removing a later reference to the paragraph that Amendment 41 removes, and I therefore ask the noble Baroness, Lady Scott, not to press these amendments.
Amendment 42 tabled by the noble Lord, Lord Evans, seeks to allow the use of ground 4A in student tenancies agreed up to nine months in advance, rather than the six months in advance limitation that is currently in the Bill. Noble Lords will be aware that we introduced this measure in response to engagement with stakeholders and Members in the other place—I hope that answers the noble Lord’s question about consultation. They were concerned that students are often rushed into important decisions around accommodation before they have formed friendships or had time to properly judge a property’s condition or location.
This measure was intended to act as a strong disincentive to landlords who seek to sign students up to contracts early in the academic year. Increasing the time limit to nine months will push early sign-ups to too early in the academic year—before Christmas for a tenancy beginning in July. This entirely undermines the point of the deterrent. Six months strikes the right balance, allowing those who want to to agree a tenancy well in advance before exam season, but not too early before students have formed firm friendship groups, for instance.
Amendment 43, also tabled by the noble Lord, Lord Evans, goes even further and would extend the time limit to 12 months. For the reasons I have highlighted previously, we are of the view that six months is the right balance. Very few students sign contracts more than a year in advance, and this amendment would essentially destroy the entire premise of the provision, which is designed to prevent students being pressured into contracts too early in the academic year. For these reasons, I ask the noble Lord not to move these amendments.
Amendment 44 seeks to remove the restriction on the use of ground 4A to the summer of the traditional academic year. This would mean that students on a traditional term date, who are the majority, could be evicted in the middle of the academic year through no fault of their own. We recognise that the intent of the amendment is to ensure properties are available for students starting their courses on non-traditional dates, such as in January. However, we are content that supply will be available for these groups as previous groups on the same cycle would leave at the end of their courses, so there will be students leaving in January and students starting could take those properties. It would be wrong to expose all students to eviction in the middle of their academic year simply because, for example, a landlord found a group with different term dates who were willing to pay more. For these reasons, I ask the noble Baroness not to move this amendment.
Amendment 46 would allow landlords to evict approved English apprentices, as defined in the Apprenticeships, Skills, Children and Learning Act 2009, using the student possession ground 4A, provided all conditions for relying on that ground were met. Ground 4A was designed to capture the most typical students, such as those living in groups and away from home, on an annual letting cycle. Apprentices tend not to live that way, as they earn an income and are much more likely to live in a home they expect to stay in. I am therefore of the view that apprentices should enjoy the same security of tenure as other tenants and not fall under the scope of possession ground 4A. For that reason, I ask that this amendment not be moved.
Amendment 189 seeks to remove the private rented student tenancies from the assured tenancy system. I know there has been a lot of concern and debate over this at Second Reading and today. It would achieve this by allowing the Secretary of State to create or approve a code of conduct for student landlords and then allow landlords signed up to the code to offer tenancies that are completely removed from the assured tenancy system. This is the wrong approach: it would be wrong for students renting off-street housing, often indistinguishable from the property next door, to have an entirely different set of rights from their neighbours.
I understand that the noble Lord, Lord Young, is seeking to create consistency between private student landlords and landlords of purpose-built student accommodation, which we will exempt from the assured system through regulations. However, these are very different types of accommodation. Purpose-built student accommodation can often be rented only to students due to the nature of the property, and to be exempted in the future a private PBSA landlord will need to be signed up to the government-approved code of management practice. This code is managed by Unipol, an established organisation.
Other private rented accommodation let to students is significantly more diverse and often indistinguishable from other houses in the area. It would be wrong to remove the protections of the assured system. Other students renting privately should not be locked into fixed-term contracts or open to eviction without good reason. In addition, there currently exists no government-approved code that is relevant to such accommodation. Developing this would take a great deal of time and is likely to delay implementation of the Bill. We recognise that the student market has a cyclical business model and have therefore introduced ground 4A, allowing landlords to evict full-time students from HMOs in order to house incoming groups in line with the academic year. Ground 4A addresses the issues that the various amendments tabled by the noble Lord are, in effect, seeking to address. As such, I ask him not to move this amendment.
Amendment 266 seeks to exempt private purpose-built student accommodation from discretionary licensing where the landlord has signed up to a code of practice for managing such accommodation. Although codes of practice offer students assurance that a good standard of management is being met by their landlords, they are not tailored to addressing local issues in the way that licence conditions under licensing schemes are. Membership of the codes is voluntary, and members have an incentive to comply to ensure they can continue to present an attractive offer to students. While a failure to adhere to code standards can result in a landlord being removed from a code, licensing allows for stronger action to be taken where necessary. For example, local authorities can issue a financial penalty where there has been a serious breach of licence conditions.
We recognise that licensing can place a greater burden on landlords with large portfolios, such as those operating private purpose-built student accommodation. That is why local authorities already have discretion to streamline licence application processes and fees for such landlords. We trust local authorities to take a proportionate approach and work together with code operators and providers of these types of accommodation to make sure that licensing schemes remain focused on tackling the issues they were designed to address. I therefore ask the noble Lord, Lord Best, not to move his amendment.
I turn to government Amendments 47, 188 and 202. Currently, university-managed accommodation is exempt from the assured tenancy system, while private purpose-built student accommodation usually is not. Government Amendments 47, 188 and 202 would allow private PBSA to be subject to the same exemption, recognising that the two share many similarities. Students do not move into their accommodation expecting long-term residence, and it is right to ensure that this accommodation is available to new cohorts of students each year.
We intend that the exemption will apply only to private PBSA that is a member of the government-approved code of practice, which sets vigorous standards for the management of property and the relationship between managers and student tenants. If their membership of the code ends for any reason, so does their exemption. There will be no delay in requiring them to provide assured tenancies to new tenants. Although there is an existing power in the Housing Act 1988 to exempt PBSA landlords, it would have required government to frequently update secondary legislation with a list of landlords, causing a duplication of work between code administrators and officials and a lag in the link between code membership and exemption status.
We are also proposing an amendment to an existing power in the Housing Act 2004 that clarifies that educational establishments exempt from HMO licensing can be specified by reference to code membership and that the power can be exercised in the same way for private purpose-built student accommodation in future. The amendment also allows the scope of an exemption to be narrowed to certain groups of building, or building manager, within the membership if required.
Baroness Scott of Bybrook (Con)
My Lords, I am very grateful to all noble Lords who have spoken in what I consider an extremely important debate and contributed thoughtfully and constructively with their insights.
First, I would like to recognise the contribution by my noble friend Lord Evans of Rainow, who tabled Amendments 42 and 43. On these Benches, we believe the limitation may, as my noble friend said, inadvertently push the hunt for student accommodation into the January exam season and disrupt a vital time for many students up and down this country.
Baroness Scott of Bybrook
Member's explanatory statement
This amendment would allow small landlords, who are less likely to have capacity to fund legal proceedings, to continue to be able to issue Section 21 notices.
Baroness Scott of Bybrook (Con)
My Lords, I rise to speak to Amendment 8, standing in my name. At its core, the private rented sector exists only because individuals are willing to invest in property and rent it out to others. The rental market depends on landlords, many of them small-scale, independent operators who choose to let their homes to others. These are not large corporate entities with huge legal teams and financial buffers; they are ordinary people with one or two properties, often let out to supplement their pension or as a long-term investment for their families.
Let us be clear: the most recent English private landlord survey shows that 45% of landlords own a single rental property and a further 38% own between two and four. That means that over four-fifths of landlords operate on a very small scale, far from the image of large institutional landlords. These landlords form the backbone of the rental sector. Yet, under the proposals in the Bill, particularly the removal of Section 21 without sufficient alternative safeguards—this is to answer the question by the noble Lord, Lord Shipley—we risk driving them out of this market altogether.
That is why I rise to speak to Amendment 8, standing in my name. This amendment proposes a targeted and reasonable exception that landlords who let fewer than five properties—those very small-scale landlords we have spoken of—should retain the ability to use Section 21. This is not about denying renters their rights or undermining the central aims of the Bill; rather, it is about recognising the limitations that smaller landlords face. Unlike larger letting organisations, smaller landlords do not have the resources or the legal support to navigate complex procession proceedings. For them, the loss of Section 21 without workable and efficient alternatives could be and will be the final straw. These individuals are not villains of the piece; in many cases, if not most, they are providing much-needed homes in areas of acute shortage. They do not have the resources to engage in lengthy legal proceedings every time they need to regain possession of their property, whether due to personal financial need or a change in family circumstances or to exit the sector entirely. If the Bill removes Section 21 without offering small landlords a workable alternative, the risk is clear: many will simply choose to leave the market. They are already, altogether.
We know this is already happening: the National Residential Landlords Association found last year that one in four landlords were planning to sell at least one property, many citing rising regulation and uncertainty about future reforms. As these landlords exit, we are left with fewer homes to rent, and the tenants feel the consequences most sharply.
The experience in Scotland offers a sobering lesson. There similar reforms were introduced with the intention of improving tenant security. Yet, as we have seen, they had the opposite effect: a sharp increase in landlords exiting the market and the highest rent increases in the United Kingdom as demand rapidly outpaced supply. Research from the Nationwide Foundation has found that 70% of landlords and letting agents lack confidence in the future of the market. The evidence from Scotland demonstrates that the type of over-regulation proposed here will drive landlords out of the market, reducing housing supply and ultimately leaving renters worse off.
Amendment 8 offers a simple, balanced solution. It allows the Bill to move forward with its tenant protections intact, while acknowledging the distinct position of small landlords and giving them the breathing room that they need to continue letting their homes. If we are serious about building a rental system that is fair, functional and fit for the future, we must ensure that it works for tenants and landlords alike. Amendment 8 does not undermine the principles of the Bill; it strengthens it. It recognises the diversity within the landlord community and offers a sensible, proportionate safeguard for those who make up its majority by allowing small landlords to continue using Section 21 when and where no viable alternative yet exists. We protect not only their role in the market but the long-term interests of renters themselves. I urge the Government to take this amendment seriously and consider whether the future of the private rented sector truly lies in squeezing out the very people who keep it afloat.
Lord Jackson of Peterborough (Con)
My Lords, it is a pleasure to speak in this very important debate in Committee and to support my noble friend Lady Scott of Bybrook on this amendment. The amendment is about fairness between tenants and landlords, and practicality. It is about the alternative that the Government are offering smaller landlords who are in the situation where they feel it prudent to give notice and seek possession of their own property under Section 21 and Section 8 of the Housing Act 1988. In particular, it is about the bureaucratic and onerous burden and court costs that will fall upon smaller landlords.
Let us look at the figures. Almost half of landlords—45%—own only one property. For the avoidance of doubt and for full transparency, I declare myself to be a landlord; I own one property, which was my matrimonial home, as listed in the Register of Lords’ Interests. Some 83% of landlords are small landlords, and so would be covered by this amendment, in that they own fewer than five properties.
We understand the proper commitment by the Government, as outlined in the manifesto, to abolish Section 21 no-fault evictions, for laudable reasons. We are all committed to the same thing—that good-quality private sector housing should be available in a fair way, to as many people as possible— and we accept that the Government have a mandate to make tenancy reforms. Notwithstanding that, unfortunately, as the previous Administration found, much of the efficacy of that policy will fall upon the reliability or otherwise of the court system and its ability to expedite possession claims in a timely and efficient way.
His Majesty’s Government’s own figures, as at quarter 4 of 2024, show that seven months is the average time taken to process and enforce a Section 8 possession case—especially around the thorny issue of rent arrears and anti-social behaviour. The LGA and the Law Society have raised this issue. The Law Society in particular notes the potential
“increase in contested hearings in the short term, as landlords that would previously have used”
Section 21, because it was less costly and less onerous, will now
“have to show good reason for eviction”.
On page 65 of the impact assessment, the Government, rather elliptically, reference “non-legislative changes” to improve the court system, but they do not give any detail. That is an important issue, as we are being asked to support the Government’s proposals. How do the Government intend to manage the increased demand? The Housing Minister in the other place used the word “ready”, saying that the Government would not take any precipitous action until the court system was ready. What does “ready” mean? This is a problem the previous Government faced and, as the Minister knows, they resiled from going ahead too fast with this policy because the court system was not fit for purpose. What specific measures will be used to deal with the existing backlog in Section 8 claims arising from landlords seeking to take possession? Let us make no mistake, the failings of the court system have the potential to undermine what would be laudable reforms and could have the perverse effect of encouraging landlords, especially smaller landlords, to exit the private rented sector.
Tenants themselves do not have much faith in the court system. Figures provided in 2023 by Citizens Advice show that only
“23% of tenants feel confident applying to court. 99% of tenants whose landlord has taken an unreasonably long time to complete repairs did not bring a claim for disrepair to court … 54% … said they did not … because of the complexity of the process … 45% … said they were put off by the length of time involved”.
It is also the case that the abolition of Section 21, particularly in respect of smaller landlords, will have an impact on the hitherto good relationship between many tenants and landlords, turning it into a much more litigious and disputatious situation. Many of those landlords will not be prepared to give tenants the benefit of the doubt if they fall on difficult financial times or have less benign economic circumstances. Those are the real-world consequences of this policy and one of the issues that this amendment seeks to address and ameliorate.
Lord Empey (UUP)
My Lords, I declare an interest on the register in regard to this matter.
The Government cannot take this legislation in isolation. As a country, we are taking policy actions that diminish supply and increase demand. Our population is increasing—and that is a deliberate decision. The net effect of that, of course, is that, with local authorities not building properties in the manner and at the rate that they used to, we are creating circumstances where we have a perfect storm of increased demand and reduced supply. The supply is reducing, and the Bill will have the perverse effect of reducing it even further.
We have to take a holistic view. It is not simply a question of dealing with tenancies in isolation; we have to look at the big picture. As we have heard from the noble Baroness, Lady Scott, in her proposal, the vast majority of these people are small-business people. Most people in the sector have these properties as part of what they deem to be their pensions. But equally, we all want to see fairness. We know that “landlord” is almost a dirty word. Historically, we have had Rachman and suchlike tainting the whole sector. There has been a steady drip of measures over the years mitigating against provision in the rented sector, such as interest no longer being offset against tax for people who are doing buy-to-lets and so on. Regulation has increased—some of it very necessary for health and safety, but the burden is going up.
Clearly, in places such as London, there is massive demand that is basically impossible to meet. Unlike countries such as Germany, where the rented sector is totally different—in many cases it is the norm that people rent properties and do not own them—we are in a different place. We concentrate on private ownership of our own properties, so rental is different. Reference was made to assessment. I ask the Minister: has an assessment been made of the impact on the supply of properties?
The number of properties will, I expect, continue to diminish, and that puts extra pressure on local authorities. The LGA has been explicit about that. This is increasing homelessness, and we have the pressures there and the pressures from immigration and from asylum seekers. Yet we are taking measures—whether in this sort of legislation or others—that mitigate against people taking on a private property to rent. Unless somebody can make a profit out of renting, why would they bother? Then you have all the hassle of going through the courts, not getting paid, et cetera.
On the other side of the coin, there are properties that are in a very poor state. We have seen examples of landlords who do not maintain them properly. Nobody wants that, and the Government clearly have a mandate to make change. However, I am far from convinced that the fairness that we all want to see, and which the Government have a right to insist upon, is necessarily achieved by the measures in this Bill. While the proposal from the noble Baroness, Lady Scott, and the noble Lord, Lord Jackson, may or may not be to the Government’s liking, at least one can see where they are coming from and why they are doing it.
If the Government are not prepared to adopt that, let the Minister come forward with a coherent mechanism that a landlord can use if they happen to have a tenant who is not abiding by the rules. It does not have to be Amendment 8; it could be something else, but let us see it, get it on the table and discuss it, so that the consensus whereby we all wish to see improvements can be achieved. There is no point having a Bill the perverse effect of which will be to reduce supply. Nobody will gain from that. I ask the Minister kindly to address that in her summing up.
Lord Murray of Blidworth (Con)
My Lords, I too support the amendment tabled by my noble friend Lady Scott of Bybrook. I should say that my wife owns a one-bedroom property which she is in the process of selling, in part because of the potential effects of this Bill and the reasons so eloquently outlined by the previous three speakers.
As a young barrister, I used to practise landlord and tenant. I used to go around the country defending and prosecuting cases of repossession or otherwise, or resisting possession claims for properties. I know how long and painful the process is to try to repossess a property in circumstances where a tenant has not paid rent. I also know the pain that that can inflict on a small landlord who is using the rent to pay the mortgage and to pay the maintenance on that property.
As the noble Lord made abundantly clear in his speech a moment ago, not all landlords are of the Rachman ilk, with thousands of properties under their belt, and out to do down the tenant. As the noble Lord, Lord Jackson, said, in so many cases, this is a relationship of happiness and contentment. The landlord looks after the property and uses the rent money to pay the mortgage on the property and maintain it for the tenant. The tenant has the flexibility of being able to leave that property when they wish, and they do not have the burden of maintaining it. It is an important flexibility within the labour market.
The abolition of Section 21 will have a very damaging effect on our housing market. I say that because the court system is simply not ready for a situation where the only grounds upon which you can take back a property in a circumstance where a tenancy has failed would be by bringing proceedings for non-payment of rent or for some other breach of the tenancy. Those sorts of proceedings take a very long time to work their way through the court system. I recall, as a young practitioner, there still being cases under the 1977 Rent Act where the rent had stayed the same as it was in the 1970s and the tenant was effectively irremovable. It was a nightmare for the owner. It was a rigidity in the housing system, which was ended by the use of Section 21 notices.
To describe those notices as being no-fault evictions is very much only half the story. As the noble Baroness, Lady Scott, pointed out, the purpose of Section 21 notices is to enable an agreement to rent a property to come to an end, perhaps because you want to live in the house yourself, or you want to sell the property because you need the money for some other purpose. Section 21 serves a vital role in the housing market and its abolition is something we would all come to regret.
I therefore strongly urge the Government to consider carefully an exemption for small landlords of the type suggested by my noble friend in this amendment. This is worth very careful consideration. We have not heard enough about the readiness of the court service to implement this abolition.
Baroness Thornhill (LD)
Before I comment on the noble Baroness’s Amendment 8, I would like to apologise for my cough, which laid me low for most of the recess. I am conscious that, especially when my noble friend Lord Shipley was speaking, I was struggling. I offer my apologies for that.
Would it be impolite to call this a wrecking amendment? Yes, it would be impolite, but, from our Benches, it certainly feels like one. As was mentioned previously in an earlier group, if this amendment were accepted, it would affect around 85% of rented homes. In effect, it would completely gut the legislation of one of its key objectives. We on these Benches cannot agree with that. We entirely support the abolition of Section 21.
That said, I have listened to the many reasoned and reasonable responses, and the noble Baroness, Lady Scott, clearly believes, as do many others, that the provisions of this Bill will involve more landlords and tenants going to court. The readiness of the courts for this legislation was one of the reasons why the previous Government rowed back on that. It is reasonable to ask the Minister for the Government’s assessment of the readiness of the courts and for the impact assessment that has been made. We are concerned that failings in the courts will undermine the main principles of the Bill.
Baroness Scott of Bybrook (Con)
My Lords, first, I assure the noble Baroness, Lady Thornhill, that this is not a wrecking amendment. It is trying to find a solution which does not potentially destroy the private rental market. If it is destroyed in any way, only one group of people will be affected, and that is the tenants.
I am grateful to noble Lords who—
Baroness Taylor of Stevenage (Lab)
My apologies, but does the noble Baroness not want to hear first from the Minister on the amendment?
Baroness Scott of Bybrook (Con)
Well, the noble Baroness knows what I am going to say, so that is that.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for moving Amendment 8, and the noble Lords, Lord Jackson, Lord Empey and Lord Murray, and the noble Baroness, Lady Thornhill, for their comments. This amendment would allow fixed-term initial tenancies where the landlord lets fewer than five properties. As I am sure the noble Baroness would expect, the Government cannot accept this amendment. It would be neither fair nor justified for some tenants to have fewer rights, simply because the landlord happens to have a smaller property portfolio at the point at which the tenancy is entered into. All tenants must enjoy the benefits of the new system and the flexibility that periodic tenancies provide.
I have already commented on the likely impact on the market under Amendment 1. As I mentioned earlier, the noble Baroness referred to changes to the law in Scotland, which was very different in the important matter of rent controls. I met with the Scottish Housing Minister during the recent British-Irish Council and discussed this with him in order to learn lessons from what happened in Scotland.
The English Private Landlord Survey shows that 83% of landlords have four properties or fewer. Accepting this amendment would mean fixed terms remaining available for half of all tenancies. This would clearly fly in the face of what this Bill is trying to achieve. It would definitely break the manifesto commitment that we have already clearly set out and which we stand by.
It is also important to clarify that retaining fixed terms would not preserve the Section 21 eviction process, although this is a common misconception. Nor would it automatically retain the accelerated court procedure used for Section 21 claims, which allows cases to proceed without a hearing. If this amendment were accepted, landlords would still be required to seek possession using one of the grounds in Section 8 of the Housing Act 1988, for which the accelerated court procedure is not available. The removal of Section 21 evictions is the cornerstone of this legislation, and the Government will not accept its reintroduction to reduce court costs or for any other purpose. The noble Lord, Lord Murray, was a Minister in the last Government. I remind him that his Government also had the policy of removing Section 21 evictions. The noble Lord must have had a memory lapse in the Chamber this afternoon.
The noble Lord, Lord Jackson, referred to the cost of court possession hearings for smaller landlords. We are confident that the Bill does not levy unfair new costs on landlords. However, it is reasonable to expect landlords to ensure that their business model covers the possible cost of possession cases proceeding through court. The current accelerated court procedure is not a guarantee of avoiding court proceedings or the associated costs.
I will comment briefly on the points made by the noble Lord—
Lord Murray of Blidworth (Con)
Can the Minister give us a rough estimate of the legal costs of repossessing a flat on the grounds of non-payment of rent, from beginning to end of the proceedings?
Baroness Taylor of Stevenage (Lab)
I am sure the noble Lord has a figure in mind. I will write to him; as he would expect, I do not have that figure at my fingertips.
The availability of court hearings is vital for tenants’ access to justice, especially in the new system whereby landlords must always evidence that grounds are met. We are working closely with our colleagues in the Ministry of Justice and HM Courts & Tribunals Service to make the possession process more efficient and easier to understand. The noble Lord, Lord Jackson, made a very good point. It can be difficult for both landlord and tenant to understand the process. They may be deterred from accessing the legal redress to which they are entitled because of difficulties in understanding how it works.
We are also committed to digitising the process. I can reassure the noble Lord that we are working closely with the MoJ to make sure that the justice system is fully prepared to implement the Renters’ Rights Bill once enacted. I am not going to guarantee end-to-end digitisation of the whole court system—that is way beyond my remit in this Chamber—but we are working on it in relation to renters’ rights. This includes a commitment to digitising the county court possession process to create a modern, efficient service for court users. I was reassured to find that this is being built on to an existing system, rather than being created from scratch. Work is proceeding at pace on that.
The noble Lord, Lord Empey, and the noble Baroness, Lady Thornhill—
Baroness Scott of Bybrook (Con)
Will all these changes to the court system, and digitisation, be totally in place before this part of the Bill is enacted?
Baroness Taylor of Stevenage (Lab)
I was just about to respond to the point made by the noble Lord, Lord Empey, which may answer that question. As usual, we are working with the Ministry of Justice to complete a justice impact test. This will identify the additional burdens on the justice system arising from new policies in the Renters’ Rights Bill, and it will ensure that the system is fully prepared for any increase in workload. I hope that reassures the noble Baroness.
Lord Empey (UUP)
The Minister made the valid point that tenants with different landlords should not be treated differently. If a landlord owns 30 or 40 properties, and one or two are caught in a dispute and no rent for them is coming in, that is manageable; but if they own only one or two properties, 100% or 50% of their income goes. I accept that the Minister has a valid point about the treatment of tenants; but given that the majority of landlords own single or small properties, there is a specific issue. Can the Minister say whether she has had any communication with local authorities? They are the people who would have to pick up the pieces if there is a diminution in supply. Has the Minister given any consideration to that?
Baroness Taylor of Stevenage (Lab)
I will respond to that in two ways. First, the work that has been done on the court system is both for landlords and tenants. We want it to work for both sides, so that when a landlord needs to seek possession they can do that quickly. I think any landlord’s business model should account for the possibility of a slight break in rental payment, but obviously we want to resolve these issues as quickly as possible, and to do the same for the tenants. There needs to be quick access to recourse if they need it, and we will do that.
Secondly, in respect to the point about local authorities, I have covered extensively the Government’s assessment of whether this will have an impact on supply issues. I reiterate that the Bill’s impact assessment has received a green rating from the Regulatory Policy Committee. We do not believe there will be a sustained or significant impact on supply, but we will monitor that very carefully once the Bill is passed.
I hope I have answered all noble Lords’ points on this but, for the reasons I have set out, I hope the noble Baroness will withdraw her amendment.
Baroness Scott of Bybrook (Con)
Again, I apologise to the Minister. First, I assure the noble Baroness, Lady Thornhill, that it is not a wrecking amendment but one trying to find a workable solution that does not potentially destroy the private renters’ market as the only people who will suffer from that will be tenants in the future.
I am very grateful to the noble Lord, Lord Empey, and to my noble friends Lord Jackson of Peterborough and Lord Murray of Blidworth for their thoughtful and constructive insights into how we deal with this issue. Across the Committee there is clearly a shared ambition to improve the private rented sector for tenants, and I believe today’s discussion has shown that doing so must include supporting the landlords who make the sector possible.
As I set out earlier, Amendment 8 is a carefully considered proposal aimed at safeguarding the position of small landlords—those who let fewer than five properties and who make up the overwhelming majority of the sector. These are not large-scale investors or corporations. They are individuals, often couples, pensioners or families, who rent out a single property or two as a way of securing long-term stability for themselves. This amendment is not about undermining tenant protections. It is about recognising that those protections will be meaningful only if the rental homes remain available in the first place.
The removal of Section 21 without adequate alternatives risks pushing small landlords out of the market. As we have heard, this is not hypothetical, it is already happening. Once again, I will talk about Scotland, because I do not believe—and nor do the people in the industry who I have spoken to—that this was just about rent control. In Scotland, it has been made clear what can happen when reforms are introduced without properly accounting for market balance. There has been a sharp reduction in landlord numbers, escalating rents and a shrinking supply of rental homes. This is not the future we want in England for our tenants and is exactly what this amendment seeks to prevent.
Recent findings from the Paragon Bank, based on a survey of over 500 landlords, reinforce this concern for us. An alarming 65% of respondents indicated that they are now more likely to scale back their property holdings as a direct result of current and proposed reforms. This is a clear indication of the potential real-world consequences of the Bill if the needs of small landlords are not adequately considered. Amendment 8 offers a modest but vital safeguard. It enables the Government’s reforms to proceed while providing breathing space for the small-scale landlords who play such a crucial role in meeting the housing needs of this country.
To conclude, I urge the Minister to listen carefully to the issues raised in this group and to give serious consideration to Amendment 8, not as a dilution of the Bill’s aims but as a necessary and constructive contribution to its long-term success. I beg leave to withdraw the amendment.
Lord Jamieson
(1A) During a fixed term tenancy agreed under subsection (1), the landlord shall not be entitled to increase the rent as provided for by section 15.”Member’s explanatory statement
This amendment would allow fixed term tenancies to continue if both the landlord and the tenant agree.
Lord Jamieson (Con)
My Lords, in moving Amendment 9, in the name of my noble friend Lady Scott, I will speak also to Amendment 13, in my name and that of my noble friend. These amendments are grounded in a very simple but important principle: when landlords and tenants reach mutual agreement they should be trusted to make arrangements that reflect their individual needs and circumstances. This debate is not about fixed-term tenancies for their own sake; it is about preserving the ability of landlords and tenants to enter into legitimate, mutually agreed contracts that reflect flexibility and choice. If both parties are in agreement, there should be a legal mechanism to support such tenancies.
Amendments 9 and 13 introduce a degree of flexibility into the framework of the Bill, without in any way undermining its core objectives to enhance tenant security and stability in the rental market. Without these amendments the Bill risks reducing the security of tenants. Amendment 9, tabled by my noble friend and supported by noble Lords across the House, would allow fixed-term tenancies to continue, but only where both the landlord and tenant have freely and mutually agreed to such an arrangement.
The Renters’ Rights Bill seeks to strengthen the position of tenants in the rental market. I support these aims but, in our efforts to provide stronger protections, we must also ensure that we do not inadvertently remove tools and options that serve tenants well, particularly where those arrangements are entered into voluntarily and in good faith. Under this proposal the landlord would agree to suspend certain grounds for possession and refrain from rent increases during the fixed term. It strikes a careful and fair balance, giving tenants greater security and predictability while allowing landlords to plan ahead with confidence.
Amendment 13 in my name would ensure that landlords and tenants retain the ability to vary terms of the tenancy by agreement. This is a modest but important provision ensuring that necessary flexibility is not lost under what would otherwise become a rigid and inflexible structure. We cannot predict the future and need to allow scope to enable a tenant and a landlord to mutually agree changes to their agreement to reflect this; for instance, where they both wish to see modifications to the property or to enable a temporary subletting where a tenant is going to be away for a time.
Beyond the immediate relationship between landlord and tenant, this also speaks to something bigger. A modern, dynamic workforce depends on geographic mobility. Working-age adults must be able to move for the opportunity, whether it is a job, an academic course or to support a family. Scrapping the option of a mutually agreed fixed-term tenancy risks restricting that movement and, in turn, limits potential.
We believe that flexibility drives productivity. The economy cannot flourish if people are locked out of areas of opportunity simply because the housing arrangements no longer accommodate short-term needs. This is not just about following a job, it is about making it possible to succeed, wherever life takes you. When we support mobility through flexible, fair rental agreements, we open the door to a future where success is not defined by the postcode of your birth but by your ambition, determination and ability to seize opportunity.
These amendments do not seek to weaken tenant protections—quite the opposite. They create opportunities for tenants to request greater security and encourage landlords to provide it willingly and transparently. In a rental market as diverse and complex as ours, this kind of voluntary flexibility is not just welcome, it is essential. If the Bill is to be a true Renters’ Rights Bill, it must include the right to choose through mutual agreement the housing arrangements that best work for each individual and their family. That is what these amendments seek to enable, and I hope the Minister will give them careful and serious consideration. I beg to move.
Lord Carrington (CB)
My Lords, I declare my direct interest in the private rented sector with lettings in Buckinghamshire and Lincolnshire. I am pleased to support the amendment from the noble Baroness, Lady Scott, and the noble Lords, Lord Truscott and Lord Jackson, and I congratulate the noble Baroness, Lady Scott, on her damascene conversion following the previous Renters (Reform) Bill. I hope we will achieve the same with the current Minister. I will not repeat their well-argued points in favour of the amendment but will make the following additional points and reiterations.
I approach the PRS from a rural background, where the average length of a tenancy is around seven years. There is little churn, in view of the long-term nature of the accommodation in rural areas. As a result, assured shorthold and fixed-term tenancies are popular. This is somewhat different from the urban PRS to which this Bill is largely directed. I cannot understand why the Government would object to the continuation of the freedom to contract for a fixed term if both parties agree, particularly as it provides flexibility and certainty to both. The landlord gets his guaranteed rent and the tenant can negotiate additional conditions such no rent reviews for a certain period, improvements and security for the term.
In Germany there are two types of tenancy: indefinite and fixed-term. Fixed-term tenancies have move-in and move-out clauses and neither party is obliged to renew. Minimum rental periods in Germany, whether indefinite or fixed, can be up to two years. The German system shows that the assured and fixed-term tenancies can work well together. The ability to contract for a fixed term also has the effect of reducing rental pressure in the overall market as longer-term tenancies act as a natural brake on rising rental costs as there are fewer opportunities to increase the rent.
Another major advantage of retaining fixed-term tenancies is that it gives confidence to buy-to-let lenders and to institutional investors, because mortgage payments are more secure, as is the financial return to the institutional investor. These are the types of landlord we should now be encouraging if the PRS is to grow and the problems of bad individual landlords are to be minimised, because they tend to employ professional management and to produce a better product. I urge the Government to look again at this matter.
Lord Truscott (Non-Afl)
My Lords, it is a pleasure to follow the erudite speech of the noble Lord, Lord Carrington. I remind the Committee of my interest as a long-standing landlord and former tenant in the private rented sector.
Why do the Government insist that they know best when a majority of both tenants and landlords want fixed tenancies? That is a fact. The Minister quoted surveys earlier, but opinions have been sought and that is the case for both tenants and landlords. The Minister has never really explained why the Government think they know more and better than the people primarily affected. Is it a case of groupthink? I support Amendments 9 and 13, proposed by the noble Baroness, Lady Scott of Bybrook. The Government should not, in my view, interfere in an agreement between two or more consenting adults.
Lord Jackson of Peterborough (Con)
My Lords, I support the amendment tabled in the name of my noble friend Lady Scott of Bybrook, to which I have added my name. I will make some general observations. This amendment is helpful because it encourages a mutually agreed arrangement, where appropriate, between landlord and tenant, in order to avoid disruption, delay or litigation where they might otherwise arise, to the mutual benefit of both parties.
The noble Lord, Lord Truscott, is right to say that the wider philosophical argument is that the abolition of fixed terms will provide greater security for tenants and retain flexibility, but it is a surprising one, because a number of key issues undermine it. The abolition of a contract of a particular type in this way is an obvious infringement on the freedom of parties to agree such terms as they wish. On principle, it should be implemented only on the most cogent and urgent grounds, and no such grounds exist across the whole private rented sector.
There are also some situations in which tenants as well as landlords clearly benefit from fixed-term tenancies. Examples are student lets, lets related to fixed-term job postings or projects, and moving to be within a particular school’s catchment area. It obviously does not help tenants in these situations to be prohibited from obtaining the security of a fixed-term let. And landlords who are inflexible in their approach to the term of a tenancy and who are prepared to offer only a fixed term will do so at their own cost, as they will find that there is a smaller pool of potential tenants than for landlords who are flexible in their approach. This market-driven discouragement to fixed-term tenancies already exists and will continue to do so.
The stated aim in this legislation of enabling tenants to leave poor-quality properties is poorly thought through. The first point to make in this regard is that it will usually be apparent to a tenant before moving in whether a property is of poor quality. If a tenant moves in full knowledge of that want of quality, the fairness of allowing them to move out mid-term is not obvious. It may be true that, sadly, tenants often do not have a choice, but if it is, leaving mid-term is unlikely to be an option, for the same reason. It is better to find ways to coerce landlords into making living conditions better. However, such cases can be legislated for by the simple expedient of implying into a lease a warranty that a property is fit for habitation—a test already enshrined in statute in the Defective Premises Act 1972. If a tenant can show that that warranty has been breached, he or she may terminate immediately and leave, free of future liabilities.
In any case, parties can and already often do agree break clauses in fixed-term tenancies. There is no reason why they should not continue to do this, particularly if changes in circumstances, such as a job not working out, can be anticipated. This is also fairer to the landlord, since it alerts the landlord to a possible change in circumstances in advance.
Secondly, although circumstances sometimes change unexpectedly, that is true for both sides and giving tenants free rein in this regard while landlords have none is inherently unfair. In practice, if circumstances change unexpectedly—for example, a tenant loses their job or an income-earning partner ceases to be able to work or passes away unexpectedly—few landlords would be likely to insist on a tenant seeing out their term. It is not in their interest to have a tenant who cannot pay the rent. Most will be prepared to negotiate an early exit in such circumstances and instal a tenant who can. The rare residue of cases where a tenant has suffered a change of circumstances and wishes to leave but a landlord is unwilling to allow them to do so can be met by legislation stopping far short of an outright ban on fixed-term tenancies where hitherto there has been mutual agreement between the parties.
Finally, there is a point to be made about the concept of seeking to protect the rights of tenants in residential tenancies without regard to the wider context of how the legislation impacts on the pool of properties available for tenants. The abolition of fixed-term tenancies means that many landlords in the PRS will prefer not to let at all rather than be limited to letting on a periodic tenancy. Preparing a tenancy for a let involves a considerable amount of time and effort. If tenants can simply come and go on a whim, that time and effort will go unrewarded and fewer people will undertake it. That will reduce the size of the sector and so drive down tenant choice—to the detriment, rather than the benefit, of tenants. Tenant protections are worth obtaining only if the sector remains attractive to both landlords and tenants, as the noble Lord, Lord Empey, said earlier. The proposed abolition of fixed-term tenancies fails to achieve that balance, particularly if there was agreement previously.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Jamieson, for moving the amendment in the name of the noble Baroness, Lady Scott, and I thank the noble Lords, Lord Carrington, Lord Jackson and Lord Truscott, for their thoughtful interventions in this debate.
Amendment 9 would retain fixed terms in the future assured tenancy system. Landlords and tenants would be able to agree to include a fixed term in tenancy agreements under which the landlord could not use the grounds for selling, occupation or redevelopment or increase the rent during the fixed period. Amendment 13 would remove the restriction on varying or adding new tenancy terms covering fixed terms or rent periods. I have already set out today why the Government will not accept amendments that would reintroduce fixed terms. I hate to disappoint the noble Lord, Lord Carrington, on the Damascene conversion front, but that is not for me today. Allowing the option of fixed terms only creates the illusion of choice for tenants. In an oversubscribed market, tenants often feel they must sign what is required of them by landlords.
The noble Lord, Lord Truscott, referred to groupthink, with reference to fixed-term tenancies and the purpose of the Bill. I prefer to refer to democracy. We set out an intention in relation to renters’ rights and received a strong electoral mandate for that, which we are now putting in place. So it is not groupthink; it is a democratic mandate that we have to deliver what we have set out in the Bill.
Fixed terms do not place equal requirements on both parties. In reality, landlords retain the ability to end the tenancy when the tenant is at fault, but tenants cannot leave the tenancy for any reason, even if the property is not safe to live in.
The amendments would also create a legal ambiguity about what new contractual terms could cover. The noble Lord, Lord Carrington, raised the issues of rural tenancies—I know we will return to that in future groups—and investors, on which I have already commented so I will not repeat my comments around that. For the reasons that I have set out here and in previous debates, I hope the noble Lord will withdraw the amendment.
Lord Jamieson (Con)
My Lords, I am grateful for the thoughtful contributions made by my noble friend Lord Jackson and the noble Lords, Lord Carrington and Lord Truscott, and for the response from the Minister.
What has emerged from this discussion is a shared recognition that flexibility and tenant protection need not be opposing forces. That is a view held not just within this Chamber; across the housing sector, there is broad concern that eliminating the ability for landlords and tenants to enter fixed-term agreements by mutual consent risks overlooking the real-world complexities of today’s rental market. Propertymark has warned that fixed-term tenancies—when agreed freely—offer tenants a sense of security and help landlords to plan with certainty. It notes that these arrangements are particularly valued by renters with lower incomes, as they offer both predictability and peace of mind.
However, we must not overlook that predictability is just as important for landlords. When there is a clear start and end date, both parties benefit from a secure timeline. For tenants, that means a guaranteed period of stability. For landlords, it means reliable income and the ability to plan financially without the fear of an abrupt vacancy. By contrast, rolling tenancies without the option of a mutually agreed fixed term introduce a level of uncertainty. Tenants may leave with just two months’ notice, potentially leaving landlords with no income and limited time to find a new occupant. This kind of unpredictability is not just inconvenient; it undermines the landlord’s confidence and may discourage future investment in the sector, as the noble Lord, Lord Carrington, mentioned, given the difficulty of getting buy-to-let mortgages.
These concerns are not hypothetical. In a recent survey of more than 900 landlords, nearly two-thirds said they planned to leave the sector, reduce their portfolio or shift towards short-term or holiday lets, citing this Bill as a central reason. A key concern on this side of the House is the availability of rental property. We remain concerned, and we have not received assurances from the Minister on that score. Many feel that their voices have not been heard during this process and their legitimate concerns have been too easily dismissed.
Of course we must listen to those who raise valid concerns about the historical misuse of certain tenancy models, but these amendments are not about reinstating the past. They are about creating a future where arrangements are respected and supported. This is not about rebalancing the system in favour of landlords but about recognising that trust and stability can emerge where both parties are empowered to agree terms that reflect their own needs.
We cannot afford to ignore the very real concern that excessive rigidity will push landlords out of the market and make it more difficult for tenants, leaving behind a smaller, less responsive and more expensive private rented sector. If a student, contract worker or family navigating a temporary relocation agree on a fixed term that suits both parties, should we really prevent that flexibility? That is precisely what Amendments 9 and 13 in my name seek to preserve. The ability to fix a term by agreement, or to vary the terms of a tenancy, where both parties consent, reflects the real needs of the modern, mobile and diverse rental landscape. It ensures that, where there is mutual understanding, the law does not become an unnecessary barrier.
I say again that this is not about exceptions to the Bill’s purpose but about contributions to it. The right to housing includes the right to enter into fair agreements that are mutual, transparent and freely chosen. That is also why I have included a probing amendment on why the Government are seeking to end certain types of assured tenancy. I hope the Minister will give these proposals the careful consideration that they deserve. There will still be time for a Damascene conversion as the Bill proceeds. I thank all noble Lords for the richness of today’s debate. With that, I beg leave to withdraw the amendment.
Lord Davies of Gower
“unless the tenant holds a rank under Section 13 of the Police Act 1996 when the tenancy is entered into.”Member's explanatory statement
This amendment would allow fixed term tenancies for all ranks in the police to continue reflecting the fact that the police are often deployed away from their usual place of residence.
Lord Davies of Gower (Con)
My Lords, I refer noble Lords to my entry in the register.
There are situations where both tenants and landlords would benefit from a fixed-term tenancy, as the amendments with numerous exemptions set out. Examples include families seeking stability in a school catchment area or workers on long-term contracts. If all parties agree, there should be a legal provision for such tenancies, providing clarity and peace of mind.
This is not about fixed-term tenancies for their own sake; it is about maintaining a legitimate contract that reflects openness and flexibility. Enabling the mobility of working-age adults across the length and breadth of the nation is essential for economic growth. A modern, dynamic workforce needs the freedom to move, to adapt and to pursue opportunities wherever they may arise. Scrapping mutually agreed fixed-term tenancies will hinder that mobility, as has been acknowledged right across your Lordships’ House.
In this amendment, I seek to demonstrate that police officers often need to move right across the country and, like those in many other occupations, would benefit from a fixed-term tenancy. Relocation can provide officers the chance to expand their skills. I was speaking earlier to my noble friend Lady Manzoor, who pointed out that junior doctors and nurses, for example, rotate for specialist training. In respect of police officers, sometimes officers are moved to work on high-profile cases—if they possess particular qualifications, for example. Specialist skills are needed right across the country and need to remain fluid. Officers move to new roles to expand their own personal experience, and we need this mobility. This should apply to police officers of all ranks, of course. I am thinking particularly of provincial officers who come to London, for example, to work on the national units that are based here, such as counterterrorism. I ask the Minister to give due consideration to this amendment, which is vital if we are to maintain a flexible, experienced and, indeed, rounded police service. On that basis, I beg to move.
Lord Moynihan (Con)
My Lords, Amendment 11 in my name would allow fixed-term tenancies for professional sports athletes to continue. The Minister who has come in to take the Statement knows well that I view all proposed legislation through the lens of somebody passionate about sport and promoting the best interests of sport and recreation. I declare my interests as a former Minister for Sport in another place, as chairman of the British Olympic Association during the run-up to London 2012 and during 2012 and, possibly most importantly, as a Leeds supporter still celebrating the success yesterday of our promotion back into the Premier League.
Mention of Leeds is relevant, because the many professional sports men and women to whom my amendment refers include our professional footballers. They include professional rugby union players, many of whom are on contracts that run, in effect, from July through to the following June, so their housing is critical in that context. Professional athletes and their coaches, and people on the contracts that I mention in my amendment, are concerned about the ending of fixed-term tenancies, due to the potential for disruption and uncertainty in their professional and personal lives. Disruption and uncertainty, to all of us who are keen on sport, are the enemies of performance, and one thing that we really need to do and concentrate on in promoting our professional sports men and women and their interests is to ensure that that is not the case in their domestic arrangements and in their housing.
Fixed-term tenancies provide a degree of stability. They give the mobility often required by sporting careers. Ending these fixed terms, particularly with shorter notice periods, will be challenging for athletes and professional coaches who need to adjust quickly to new locations and potentially face difficulties in finding suitable housing, impacting their overall well-being and their performance. This applies not just to footballers, rugby union players or rugby league players, but to all professional sportsmen, all professional coaches and their entourages. The theory of marginal gains comes to mind: it is very relevant in this context. This is where you get small yet very significant improvements which can lead to substantial results, and one of the key points in that is to have a stable arrangement, a fixed-term tenancy, for housing that lasts throughout that contract; namely, in this case, a year.
In summary, my concerns are, first, about mobility and career. Professional sport is often characterised by frequent moves, and fixed-term tenancies provide a framework for a predictable schedule, allowing athletes and coaches to establish roots and plan their lives in a stable environment. Secondly, there is the uncertainty and disruption. The prospect of ending fixed-term tenancies, especially with potentially shorter notice periods, will create uncertainty and disruption for professional sportsmen, and this can be particularly challenging for athletes and coaches who need to adjust quickly to new locations, potentially facing difficulties finding suitable housing. Thirdly, there are the financial implications. While a fixed-term tenancy may provide a degree of stability, the costs of moving and finding new accommodation can be significant, and the uncertainty of ending fixed-term tenancies could also impact financial planning. Finally, there is the impact on performance, which I have mentioned, where the stress and disruption associated with moving can affect an athlete’s or a coach’s performance. Finding suitable housing, especially in new areas, can require time and effort, potentially impacting training and preparation.
There are clearly benefits from periodic contracts, but in professional sport, such a move can and will be disruptive. I argue that we must protect the unique needs of professional sports men and women. These are the reasons why I have tabled this amendment, which I hope will have the support of the Committee and the Government.
The Lord Bishop of Manchester
My Lords, Amendment 62 in this group, in my name and that of the noble Earl, Lord Leicester, is also about a particular form of occupational housing. I need to declare an interest: I own one small apartment in the West Midlands which has been let out to a tenant for a long time, but, according to some of the media, that makes me a kind of Rachmanite landlord who is trying to destroy the Bill. I can assure your Lordships that that is the last thing I have in mind.
This is about people who live in tied accommodation. As a Church of England bishop, I live in what I suppose we should call a tied palace rather than a tied cottage, but it is accommodation that I inhabit only for as long as I exercise my current office. That is the situation for the vast majority of stipendiary Church of England clergy, many other ministers of religion, and also for farm workers and estate workers who are required, for the better performance of their duties, to live where they actually work. It is a category that is accepted by HMRC, in terms of taxation legislation, as a special form of tenure. A large proportion of those who live in tied accommodation do not have the capacity during their working lives to save up and be able to provide for themselves in retirement, when they eventually have to move out of their tied dwelling.
I will not benefit from the amendment I am proposing to your Lordships today, because I will be able to accommodate myself by other means, but the Church of England Pensions Board lets out 50 or so properties each year—that is the average over the last few years—to retiring clergy, or sometimes to the spouse or surviving civil partner of a member of the clergy who has died in office, usually at about 60% of what the market rent would normally be in those circumstances. These properties are made available for clergy to look at any time up to about five years before they retire. The importance of that is we know that when people retire and move out of tied accommodation, they need time to think about where they are going to live, what sort of community they will want to settle in and put down roots in, because it is probably where they will stay for the rest of their lives.
At the moment, what the pensions board is able to do, and what other landlords who are used to accommodating people in tied accommodation can do, is to reserve a property for some period of time in advance and let it out in the meantime, but that will not be possible if the Bill passes in its present form. All that my amendment seeks to do is to make a small change that will allow an extra ground for granting possession where it is to accommodate somebody who is moving out of tied accommodation and the person who is providing their accommodation in retirement is somebody who is closely connected with who they were working for. It may be a former employer. In the case of clergy, who are officeholders rather than employees —a bit like police officers, we are officeholders—it will be an appropriate charity that provides accommodation in retirement.
This would make very little difference to the availability of rented housing overall—it would not make it impossible for other people to find properties to rent—but, as we have already heard several times today, there are people who wish to rent for a shorter period of time. It would be known that these properties will be subject to that clawback when the person who has earmarked them retires. If this amendment is not accepted, I fear that what will happen is that properties will simply lie empty for several years until the member of the clergy or the farm worker is ready to retire into them, and thus take properties away from the rented market, which I do not think is the aim of the Bill at all. I think this is a rather modest, quite niche measure, which would affect only particular categories of labourer, but for them it would make a huge difference to be able to identify where they are going to live when they retire a few years ahead of retirement and to know that that property will be available for them on the day of their retirement.
Baroness Grender (LD)
My Lords, I will speak briefly from these Benches, in part to spare my noble friend’s voice—I assure noble Lords that no wine has been taken this evening.
I will stress something that is beginning to cause confusion on these Benches: the suggestion that an assured shorthold tenancy is in some way secure. It has been well documented over many years that huge insecurity is attached to an assured shorthold tenancy. Everything that we have learned about the huge turnover has for so many tenants been attached to the fact that ASTs are sometimes down to six months. A periodic tenancy—which has no end—is surely more secure than these fragile assured shorthold tenancies, which are often for only six months and cause huge insecurity for so many tenants. For that reason, these Benches are extremely concerned about the current direction of travel.
Baroness Scott of Bybrook (Con)
My Lords, I am very grateful to all noble Lords who have spoken in this debate. Indeed, it follows on very neatly from our earlier debate on fixed-term tenancies. My noble friends Lord Davies of Gower and Lord Moynihan made compelling arguments for why we should permit fixed-term tenancies for both professional athletes and police officers. The benefits were set out with conviction and clarity, and I hope the Government Benches have listened. Of course, I would prefer that fixed-term tenancies continued to be available for everyone.
I will not rehearse the arguments made earlier, but does not the growing list of amendments seeking exemptions highlight the real value that fixed-term tenancies offer, supporting people from all walks of life, from athletes to police officers and everyone in between? Nurses, doctors, students, military personnel and even performers can all benefit from a fixed-term tenancy. The Government should consider these benefits. In removing fixed terms altogether, the Bill risks taking away short-term lets that serve as a real benefit for many thousands of people.
I turn to the Minister’s Amendment 59, which expands ground 5C to account for police officers. These Benches understand the importance of an employer’s need to regain possession of rented property if the tenancy is linked to a tenant’s employment. I thank the Minister for setting out details of the amendment.
Finally, I wish to note Amendment 62, tabled by the right reverend Prelate the Bishop of Manchester. I thank him for the chat we had about it, because I had no idea that this happened within the Church of England. Enabling a debate on possession for the purposes of housing a person leaving tied accommodation is most welcome. This is an important issue, as it ensures that a landlord, who is often also the employer, can regain possession of a property when it is needed to house a new employee, but also—as in the case of the Church of England—allows the Church to regain a property that is required for the retiring employee. We must recognise the value of maintaining the availability of essential employment-linked housing, and consider how best to safeguard it in practice. Additionally, we must not discourage landlords from helping tenants by giving them extra time to move out, providing references or offering alternative housing, especially in sectors such as education or farming—or, indeed, in the Church.
This debate has encapsulated the depth and breadth of the Bill, and the numerous areas that it covers. A modern, dynamic workforce needs the freedom to move, adapt and pursue opportunities wherever they arise. We must have a laser focus on occupational needs when considering any changes to the rental market.
Baroness Taylor of Stevenage (Lab)
My Lords, before I respond to these amendments, I congratulate Leeds United on their promotion to the Premier League. They are not my team, but what an achievement. We were all shouting when they got through the other day, so well done to Leeds. I have several close friends who are Leeds supporters, and they will be listening to that with interest.
I thank the noble Lords, Lord Davies of Gower and Lord Moynihan, and the right reverend Prelate the Bishop of Manchester for their amendments, and the noble Baronesses, Lady Grender and Lady Scott, for their comments. These amendments are on fixed terms and occupational possession grounds. The noble Baroness, Lady Grender, is quite right to highlight the insecurity of assured shorthold tenancies. They are not secure tenancies, and I do not accept that it is better for tenants to have a fixed-term tenancy than a periodic tenancy, which is theirs until they decide to end it and give the necessary two months’ notice.
I will start with Amendment 10 in the name of the noble Lord, Lord Davies of Gower, and Amendment 11 in the name of the noble Lord, Lord Moynihan. These would retain fixed terms where the property is let to any ranking serving police officer and to professional athletes. As with Amendment 7, the Government believe tenants should not have reduced flexibility and greater financial obligation because of their personal circumstances. I am not convinced there is any case for police officers, who put themselves on the front line in the service of others, to benefit any less from the new tenancy regime. I do not think the case for that has been made.
We have heard concerns about ensuring provision of housing for the police, and that is why government Amendment 59 amends possession ground 5C to ensure it is available to police forces and others who provide accommodation for their officers. This will allow landlords to take possession where a tenancy was granted to an officer in relation to their service in the office of constable, and the tenancy is no longer required for the purpose for which it was granted. I do not consider it necessary to retain fixed terms in addition to this.
Needless to say, we all want to see the UK’s excellent professional athletes succeed in their endeavours. The whole Committee is aware of the sporting achievements of the noble Lord, Lord Moynihan, and his advocacy and service on behalf of British sport. However, it would seem a shame to lock athletes into fixed terms, which might prevent them moving around the country in pursuit of sporting greatness. We would not want to do that. However, if an athlete is in accommodation provided by their employer, then ground 5C would apply and the tenancy could be ended, as necessary.
Amendment 62, in the name of the right reverend Prelate the Bishop of Manchester, seeks to create two new grounds for possession. The first, new ground 8A, would enable a landlord to seek possession from an existing tenant in order to re-let that dwelling to a former employee—of the landlord, we assume—who was housed in accommodation tied to their role. It would also apply to other types of workers, such as officeholders. I appreciate the aim of the right reverend Prelate’s amendment and, following engagement with bishops, including the right reverend Prelate the Bishop of Chelmsford, we are sympathetic and understand that the Church wishes to house retired clergy. However, after very careful consideration, I genuinely believe this should not be at the expense of existing tenants. We have already created expanded or strengthened possession grounds to cover situations—such as housing employees or evicting tenants to use the dwelling as supported accommodation—where we believe that the needs of those involved can be deemed to overrule the general principle that renters deserve security of tenure and should be able to put down roots in their long-term homes.
We are not of the view that housing a former employee of the landlord meets the bar to overrule the general principle that private renters should have secure homes. In order to house the former employee, another tenant would need to be evicted, through no fault of their own, placing them in the position of needing to find a new home. This simply moves the problem around. As such, we are content that the current grounds strike the right balance.
The second proposed ground, 8B, seeks to enable possession of a tenanted property so it can be relet to a surviving spouse, civil partner or dependant of a person described in the previous proposed ground who died before being required to vacate the accommodation linked to their role. Although I appreciate the reasons behind wanting to help people in these circumstances, again, this proposed new ground would mean an existing tenant could be evicted through no fault of their own, simply moving the problem around and creating more insecurity for more tenants. For the reasons I have set out, I ask that noble Lords not press their amendments.
Lord Davies of Gower (Con)
My Lords, I am grateful to the noble Lord, Lord Moynihan, for his contribution on sport and to the right reverend Prelate the Bishop of Manchester for his remarks on the clergy. I am disappointed, indeed a little surprised, that the Minister does not agree that police officers fall into a particular category, but, for the time being anyway, I shall consider what she said and therefore beg leave to withdraw my amendment.
Renters’ Rights Bill
Tuesday 22nd April 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-I(b) Amendments for Committee (Supplementary to the Marshalled List) - (22 Apr 2025)
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment would retain social landlords’ ability to apply for a demotion order in response to the anti-social behaviour of a tenant.
Baroness Scott of Bybrook (Con)
My Lords, I will speak to Amendments 14, 66 and 67 standing in my name.
Anti-social behaviour is a scourge on our communities but is particularly devastating from a housing perspective. Quite often, anti-social behaviour replaces productive community spirit with fear and tension, leading to residents feeling trapped and helpless. Anti-social behaviour strips away the very essence of what makes a house a home.
The consequences of anti-social behaviour are often forgotten. The costs of repairing damage, the need to enhance and increase security measures, and the day-to-day administration involved in responding to complaints from neighbours all place a significant and often unsustainable financial strain on housing associations, local authorities and landlords across the country.
As drafted, the Bill reduces the powers available to local authorities and social housing landlords in cases where tenants are responsible for anti-social behaviour. Amendment 14, tabled in my name, seeks to preserve the ability of landlords to demote tenancies in response to such behaviour. Loud noise, vandalism and intimidation leave residents helpless, and local authorities must have the power to uphold community stability without the detriment of demotion. How can the Government ensure that there are consequences for this ruinous behaviour?
Amendment 66, tabled in my name, probes the Government’s objectives in creating a duty on the court to consider any co-operation on the part of the tenant against whom an order is sought. On these Benches we wish to understand the real-world impact of this change. I ask the Minister: what constitutes co-operation? Is it replying to an email or answering a call, or does it require a tenant to display a serious and notable change in their behaviour? Is this simply a requirement for engagement or would there be a requirement to take practical steps to prevent anti-social behaviour in the future?
Baroness Eaton (Con)
My Lords, I support Amendment 14, tabled by my noble friends Lady Scott of Bybrook and Lord Jamieson. Local authorities have a duty to ensure fairness for their social housing tenants, and I believe the steps taken in the Bill to restrict local authorities and housing associations in their use of demotion orders are wrong and unnecessary.
The reality is that a small minority of tenants cause misery to other tenants through anti-social behaviour. A report from Nottingham Trent University in 2018 suggested that 30% of social housing tenants are more likely to come across anti-social behaviour, crime and drug dealing. Likewise, a social housing residents’ survey report from 2022 found that 26% had been impacted by anti-social behaviour.
Local authorities and housing associations are already severely restricted in the action they can take against the small minority of tenants who cause misery for other tenants who are law-abiding and play by the rules. Withdrawing the ability for local authorities and housing associations to issue demotion orders will severely diminish their ability to combat anti-social behaviour. As far as I am aware, the Government do not even collect data on the number of demotion orders that are issued each year to social housing tenants, so one has to question how big an issue this really is at present. I hope that the Government will accept Amendment 14, given that it is an instrument used by housing associations as the treatment of last resort.
Baroness Thornhill (LD)
I apologise for interrupting the noble Baroness earlier; she was on my blind side. She mentioned those of us who have been involved in local government. Well, I had the pleasure, I would say, of being in a beacon council under the Blair Government when the now noble Baroness, Lady Casey, was actually doing all the work with the then Labour Government on anti-social behaviour. We recognised that it was a serious issue on many of our estates—and a deeply challenging one at that. I would argue that councils are not necessarily restricted in what they can do, but it is very challenging. It is difficult, and we often found that the courts were very sympathetic to tenants while we were sitting there going, “But you don’t have to live next door to them”.
Very often, another issue that occurred was that neighbours, after months of ongoing, low-level, constant nuisance, retaliated in some way. Such incidents were then reduced to being 50/50, when in actual fact you had only to speak to the people around the neighbourhood to know that that was not the case. These things are difficult to prove and difficult to get evidence on. People do not always write the dates down—“Oh, please keep a diary”—you know. Sometimes, even that is quite difficult for people. This is an area, Minister, where we would like to explore more what the route is for proving and what the bar is, what the level is, that has to be satisfied.
I must admit that I did not read into the Bill that it was that much of a restriction or a difficulty, but perhaps I have missed something. The National Housing Federation certainly has not listed it as one of its key concerns. That, in itself, perhaps tells me how much of an issue it is, but I would support the noble Baroness if that proved to be the case. As I say, I know from very bitter experience just how difficult this area is, and it is most likely to be the one that would come up most in certain areas.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendments relating to anti-social behaviour, and I agree with her powerful statement on ASB. As a councillor, I saw at first hand, as the noble Baronesses, Lady Thornhill and Lady Eaton, did, the utter misery that is caused to individuals and communities through the irresponsible actions of others and I properly understand why it is important that we have provisions to tackle it.
Amendment 14 seeks to reintroduce social landlords’ ability to apply for a demotion order in response to the anti-social behaviour of a tenant. This amendment seeks to enable landlords to demote social tenants to a less secure form of tenancy because of anti-social behaviour. However, the amendment as drafted would not work; the Renters’ Rights Bill will move tenants to a simpler tenancy structure where assured shorthold tenancies and the ability to evict shorthold tenants via Section 21 are abolished. There will therefore no longer be a tenancy with lower security to demote tenants to. To work, it would require a reversal of measures in the Bill to remove demoted tenancies and assured shorthold tenancies; that is the issue with the amendment as drafted.
I reassure the noble Baroness that tackling anti-social behaviour is a top priority for our Government and a key part of our safer streets mission. The Bill will shorten the notice period for the existing mandatory eviction ground, with landlords being able to make a claim to the court immediately in cases of anti-social behaviour. In addition, the Bill amends the matters that judges must consider when deciding whether to award possession under the discretionary ground. This will ensure that judges give particular regard to whether tenants have engaged with efforts to resolve their behaviour and the impact on other tenants within HMOs.
As well as the positive changes that the Bill makes towards tackling anti-social behaviour within the rental sector, we will crack down on those making neighbourhoods feel unsafe and unwelcoming by introducing the new respect order, which local authorities will be able to apply for and which will carry tough sanctions and penalties for persistent adult offenders. Together, those changes will ensure that the needs of victims are at the heart of our response to anti-social behaviour—that is what is important. Too often victims have felt that the power is all on the side of those who are committing the anti-social behaviour and not on the side of victims—that cannot carry on.
In response to the comments from the noble Baroness, Lady Eaton, about local authority housing tenants, the Bill introduces reforms to the assured tenancies framework, which applies to both the private rented sector and private registered providers of social housing. Local authority tenants are provided secure tenancies under a different tenancy regime. The vast majority of local authority tenants are secure lifetime tenants, and therefore they already enjoy a high security of tenure. Local authority landlords also have existing powers to tackle ASB, including eviction grounds similar to those in the Bill.
The point is taken from the noble Baroness, Lady Thornhill, about the further information about evidence and where the bar is going to be set; I will take that back to the team and come back to her. For these reasons, we feel this amendment is not needed and kindly ask that the noble Baroness withdraws it.
I turn to Amendment 66, which seeks to remove the requirement imposed upon judges, which has been introduced by the Bill, to give a particular consideration to whether a tenant, against whom a possession order is sought under ground 14 for anti-social behaviour, has engaged with attempts by the landlord to resolve the behaviour. We believe this change represents the wrong approach, for two reasons.
First, the Government believe that landlords should attempt to resolve problematic behaviour issues with tenants before attempting to evict them. By directing courts to particularly consider whether a tenant is engaged with these efforts, landlords will be incentivised to make them. Secondly, it is right that the court should give particular consideration to whether a tenant has engaged with attempts to resolve the behaviour so that courts may be more likely to evict a tenant who has, for example, been obstructive throughout the process. Where a tenant has shown willingness to engage constructively with the landlord, it is right that the court considers this factor, and it is for those reasons that we introduced the requirement.
I turn to Amendment 67, also tabled by the noble Baroness, Lady Scott, which seeks to expand the factors that a court is specifically directed to consider when deciding whether to make an order for possession against a tenant in a house in multiple occupancy for anti-social behaviour under ground 14. Currently, courts will be directed to give particular consideration to the past impact of the tenant’s behaviour on their fellow HMO tenants. This is in recognition of the increased impact that anti-social behaviour can have when victims have to share facilities and live in close proximity with the perpetrator, as the noble Baroness mentioned. Judges will also consider all factors relevant to the case and will already be directed generally to have consideration of the future and ongoing impact of that behaviour. As such, we do not think this amendment is strictly necessary to achieve the intended effect, although we are very grateful to the noble Baroness for flagging up that point.
Baroness Scott of Bybrook (Con)
My Lords, first of all, I thank the noble Baronesses, Lady Eaton and Lady Thornhill, and the Minister. All are from local government and understand anti-social behaviour over many years and the effect it can have. We on these Benches recognise that what is often described as anti- social behaviour may indeed be a symptom of much deeper, complex personal struggles. Those underlying issues, of course, deserve serious compassionate attention. So it is important that the Government are looking at the issues surrounding anti-social behaviour. I am particularly interested—I do not need an answer tonight —in bolstering the capabilities of support services within local government, to ensure that intervention can give people a real chance to turn things around before they get to the stage of being evicted.
Baroness Grender
“Assured tenancy exemption: new build propertiesAssured shorthold tenancies are abolished except in relation to premises whose current tenants are the first tenants since the construction of the premises, and only for the period of six months beginning with the day on which the tenancy began.”Member’s explanatory statement
This amendment would allow an assured short-term tenancy for six months after a premises is constructed.
Baroness Grender (LD)
My Lords, this is my first speech today, so I will take the opportunity to thank the Minister and her team for all the discussions so far. I support the fundamental principles underpinning this legislation, in particular the long-overdue abolition of Section 21 no-fault evictions—a change that, as we have heard, cannot come soon enough for countless renters across the country.
However, as we work to create a much fairer and more secure private rented sector, we on these Benches are also hugely aware of the pressing need to increase the supply of high-quality rental homes. For that reason, we have tabled Amendment 15, which aims to provide a very specific and targeted temporary exemption to the abolition of ASTs—assured shorthold tenancies. Specifically, the provision would allow assured shorthold tenancies for a period of six months for premises whose current tenants are the first tenants since the construction of the premises. This is a carefully considered proposal, designed to support the laudable aims of the Bill by incentivising the creation of much-needed new rental stock.
My honourable friend in the House of Commons, Gideon Amos, and noble Lords on these Benches have consistently championed the cause of increasing housing supply, particularly through new innovative models such as build-to-rent accommodation. This highlights the urgent need to restore hope to millions aspiring to a decent home after decades of decline in social housing provision. Indeed, ours was the only manifesto with a direct target of 150,000 new social homes to rent—a vital underpinning building block to change the lack of balance in tenures to match and accommodate the desperate need that has reached a crisis level today.
My colleague tabled an amendment in the House of Commons that would have specifically incentivised more build-to-rent accommodation by offering a degree of initial security for developers. Although that original amendment proposed a longer initial term of about two years, the underlying principle remains the same. New developments, particularly in the build-to-rent sector, require a degree of certainty.
We have heard directly from the British Property Federation, which is the representative body for the build-to-rent sector. It has expressed its support for measures that increase the certainty of rental income for institutional investors developing these new homes. It has engaged with us and our colleagues in the Commons on a similar amendment and explicitly stated support for its general thrust. The British Property Federation supports the new supply of rental housing and has said that six months would be an adequate period to incentivise investment in new construction and build to rent. I thank the British Property Federation for its engagement and advice, specifically on this issue.
In the previous group, I explained why I think ASTs are not very secure. This proposed six-month assured shorthold is a one-off exemption that would genuinely offer a limited period of certainty for developers to encourage them to build. That is what we are aiming for. It is a narrowly defined exemption that would apply only to properties being let for the very first time after their construction. It would not affect existing tenancies or undermine the core principles of abolishing no-fault evictions for the vast majority of renters, which we strongly support.
Indeed, by encouraging the creation of new rental homes, we believe the amendment would be a small, modest but useful way of ultimately expanding the options available to renters and contributing to a better balance in the market. The proposal is so modest, unlike other amendments that we have heard today, with build to rent currently estimated to be around 0.1% of the overall housing stock. We believe it would have minimal impact on the much broader move towards periodic tenancies. It may be appropriate at this point to say that we would not support removing Clause 2 from the Bill as we agree with its broad principles, but this approach would recognise the practical realities of bringing new developments to market.
In conclusion, while we rightly focus on enhancing security and rights for existing renters, we must not lose sight of the fundamental need to find ways to increase the supply of decent homes. That is what we are attempting to do with this amendment. We believe that it will act as a catalyst for increased investment in new rental properties, ultimately benefiting renters by providing more choice and contributing to a more sustainable and responsive housing market.
I urge the Minister and noble Lords to give this proposal careful consideration. We will be more than happy to do further work if it is not exactly to order. We believe that there is an opportunity to try to at least encourage a bit more supply in the market sector, even if we do not entirely agree with the suggestions that the whole market will suddenly disappear in the wake of this Bill. With that, I beg to move.
Lord Jamieson (Con)
My Lords, I am grateful to the noble Baroness, Lady Grender, for introducing an amendment that would allow short-term tenancies to continue for six months after a premises is constructed. The noble Baroness has highlighted the fundamental importance of increasing the supply of rented properties. Her case is compelling. This amendment would allow support for newly constructed properties by providing greater certainty for investors in that property. Additionally, it is often true that new properties have periods of vacancy while long-term lets are secured. We must consider, evaluate and listen to all solutions to ensure that liveable accommodation is not left empty and to help develop a stable and thriving community. I am thankful that the noble Baroness has brought this discussion to the attention of the Committee.
However, I wish to probe more widely why the Government are seeking to abolish assured shorthold tenancies, and therefore will speak to my opposition to Clause 2 standing part of the Bill. The short-term rental market supports job mobility, especially industries which require relocation or even temporary positions. Enabling the mobility of working-age adults to reach the depth and breadth of the United Kingdom is vital for economic growth. The modern workforce requires flexibility—the ability to move and adapt, and to pursue opportunities wherever they may arise. By discouraging the ebb and flow of economic activity, we discourage the labour market flexibility required for an expanding economy. Jobs must follow demand, not be restrained by the state removing the option of a short-term tenancy.
While the economic argument is compelling, so is the practical one. For individuals undertaking a home renovation or experiencing family breakdown, short tenancies provide not only a practical solution but an important reprieve, allowing people to escape the chaos of building works or to rebuild a new life without haste. Have the Government considered the benefits of shorthold tenancies for the tenant? Has the Minister considered both the economic and practical benefits of their existence?
With this Bill, the Government are overseeing a huge change to the rental market. Can the Minister please set out the impact on long-term housing pressures as a result of this ban? In markets with soaring demand and low capacity, is it not the case that short-term tenancies can alleviate some of the pressures that tenants face?
The Government have been consistent in highlighting the perceived drawbacks of short-term tenancies. Of course, as with any housing arrangement, there will inevitably be aspects that are less than desirable, depending on one’s individual circumstances. However, in identifying these challenges, it is only right that the Government also acknowledge and weigh the very real, tangible benefits that short-term tenancies offer to many others. As other noble Lords have mentioned, such tenancies expand the availability of housing which might otherwise remain empty. The decision to impose an outright ban is, in effect, the most extreme course of action—the so-called nuclear option. From these Benches, we cannot help but wonder whether sufficient consideration was given to alternative, more balanced solutions that might have addressed the concerns identified while preserving the flexibility and choice that short-term tenancies provide for so many.
I hope the Minister will carefully reflect on these benefits and acknowledge the convenience of shorthold tenancies, as well as the key role they play in enabling economic mobility and the use of homes which might otherwise remain empty.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Grender, for her amendment, and the noble Lord, Lord Jamieson, for speaking to the opposition that Clause 2 stand part of the Bill on behalf of himself and the noble Baroness, Lady Scott.
The assured shorthold tenancy regime and Section 21 mean that millions of tenants live with the knowledge that they could be uprooted from their homes with little notice. Some of them end up living in substandard properties for fear of retaliatory action and eviction should they complain.
This has embedded chronic insecurity in the private rented sector. It affects both tenants who want a stable home and the many good landlords who operate professionally but are undercut by rogue landlords. It is a drain on aspiration and prevents tenants having the chance to achieve their potential. Removing Section 21 is critical to giving renters greater security and stability. They will be able to stay in their homes for longer and avoid the risk of homelessness. They will also have the confidence to challenge poor practice and unjust rent increases. Clause 2 therefore removes the assured shorthold tenancy regime and in doing so abolishes Section 21 as well.
Baroness Grender (LD)
What we are trying to achieve with this amendment is a guaranteed fixed period for a developer. Authoritative bodies in this sector have suggested that some kind of guaranteed period does not necessarily mean that Section 21 has to remain. Or is it the Minister’s firm belief that you cannot give a fixed period to a developer in order to encourage construction without an element of Section 21 being there?
Baroness Taylor of Stevenage (Lab)
We do not want to see Section 21 in place for this. We are talking to the build-to-rent sector about the issues it believes it faces, but I genuinely believe that if somebody is going to be evicted from a property, there must be a reason why they are being evicted. We have provided in the Bill the grounds for why people can be evicted. When I come back to the House on this, I will update noble Lords on the work we are doing with the build-to-rent sector to increase supply. There are fairer ways of doing that than continuing to impose Section 21 evictions on people, just because they happen to have moved into a new-build property.
Baroness Grender (LD)
I thank the Minister and the noble Lord, Lord Jamieson, for participating in this short but quality debate. We will go back to our drawing board on this because we think that it is a way of delivering construction. We believe that we can get to a point where this is done without Section 21 being part of it. That was the intention behind the amendment; if it would not achieve that then we will go back and look at it again, because we believe that there must be a way to provide some kind of incentive to increase supply. This is a very modest approach and not about wrecking the Bill or taking 85% of landlords out of the equation, so we will take another look at it. We believe that it can proceed without Section 21 being imposed; clearly the Minister does not, so we will go back to the drawing board. With that in mind, I beg leave to withdraw the amendment.
Renters’ Rights Bill
Thursday 24th April 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-II(a) Amendment for Committee (Supplementary to the Second Marshalled List) - (23 Apr 2025)
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we start the debate on the first group, I remind the Committee of the protocol around declaring interests, following a number of questions. As I mentioned earlier this week, noble Lords should declare any relevant interests at each stage of proceedings on a Bill. That means that, in Committee, relevant interests should be declared during the first group on which a noble Lord speaks. If a noble Lord declared an interest during the previous day of Committee then that is sufficient, but if this is their first contribution then any relevant interest should be declared specifically but briefly.
Clause 3: Sections 1 and 2: effect of superior leases
Amendment 16
Member’s explanatory statement
This amendment seeks to probe the government’s rationale for introducing retroactive legislation.
Lord Jackson of Peterborough (Con)
My Lords, I am grateful for that clarification from the Government Whip. On that basis I declare again that, as in the register of Members’ financial interests, I receive a rental income from my one property, which was my matrimonial home.
I will speak to Amendments 16, 17 and 18. My intention is to highlight an important principle that this legislation seems to violate. The amendments in this group are underpinned by the Bill’s retroactivity. I seek to probe the Government’s use of retroactive provisions, and I urge them to reaffirm from the Dispatch Box their commitment to prospective lawmaking.
Retrospective legislation is generally defined as legislation which
“takes away or impairs any vested right acquired under existing laws, or creates a new obligation, or imposes a new duty or attaches a new disability in respect to transactions or considerations already passed”.
The Oxford Dictionary of Law defines retroactive legislation as:
“Legislation that operates on matters taking place before its enactment, e.g. by penalizing conduct that was lawful when it occurred. There is a presumption that statutes are not intended to have retroactive effect unless they merely change legal procedure”.
Stroud’s Judicial Dictionary of Words and Phrases—a tome that I am sure we are all familiar with—defines it in Latin as:
“Nova constitutio futuris formam imponere debet, non praeteritis”.
That is, unless there be clear words to the contrary, statutes do not apply to a past but to a future state or circumstance.
The general approach to retrospective legislation was summarised by the noble Lord, Lord Kerr, in the Supreme Court case of Walker v Innospec Ltd and others in 2017, where he said:
“The general rule, applicable in most modern legal systems, is that legislative changes apply prospectively. Under English law, for example, unless a contrary intention appears, an enactment is presumed not to be intended to have retrospective effect. The logic behind this principle is explained in Bennion on Statutory Interpretation, 6th ed (2013), Comment on Code section 97: ‘If we do something today, we feel that the law applying to it should be the law in force today, not tomorrow’s backward adjustment of it’”.
Retrospective legislation may also be challenged under Article 6 of the European Convention on Human Rights, because such legislation will only be compliant with convention rights where there are
“compelling grounds of the general interest”—
that comment was made in the case of Zielinski, Gonzalez and others v France 1998—or where such legislation seeks to remedy existing defective legislation.
The principle of non-retroactivity is a fundamental concept within the civil law system that ensures the stability and predictability of legal relations. It refers to the restriction placed on the application of new legislation to actions or events that have occurred prior to the law’s enactment. Essentially, this principle serves as a safeguard for individuals, protecting their existing rights and expectations from being unexpectedly altered by future legislative changes. Non-retroactivity is rooted in several key rationales. It reflects the belief that individuals should be able to rely on the legal framework in place at the time they act. If laws were to apply retrospectively, it could lead to confusion and insecurity, undermining the rule of law and fairness.
That is the basis on which I move my Amendment 16 and speak to my Amendments 17 and 18. In many jurisdictions, this principle is codified within civil codes or specific statutes. For instance, the French civil code explicitly states that a law cannot have retroactive effects unless otherwise specified. Similarly, the German Basic Law incorporates this principle, which serves as a safeguard against potential abuses of legal reforms by ensuring that new laws do not adversely affect established rights and obligations. Internationally, treaties and conventions also reflect the doctrine of non-retroactivity. The European Convention on Human Rights articulates the necessity of legal certainty and protection of rights, endorsing the notion that individuals must be aware of the legal consequences of their actions at a given point in time. The UN’s International Covenant on Civil and Political Rights further emphasises that no one shall be subjected to retroactive penal laws, further demonstrating the widespread acceptance of this principle.
I accept that there are some notable exceptions to the English legal system setting its face against retroactivity. One such case, perhaps the most notable, is of course the War Crimes Act 1991. If legislation is aimed at, for instance, protecting public safety or welfare, such as in scenarios where a retroactive law serves to enhance public health standards or address urgent safety concerns, the legal system may justify its application to prior situation. Courts often assess the implications of such laws on individual rights, weighing the benefits to society as a whole against potential infringements on personal freedoms. Another example in this context is the landmark case of the European Court of Human Rights ruling in Hirst v the United Kingdom about prisoner voting rights, where the court emphasised that legislative changes should not detrimentally affect individuals who were previously adjudicated under earlier laws. In this instance, the court reinforced the significance of respecting established legal positions, thereby underscoring the essence of non-retroactivity.
Lord Marlesford (Con)
My Lords, my noble friend raises a very important point. The Bill has merit. It also endangers the overall objective of increasing the supply of housing for the people of this country. It is very important that the transitional costs of introducing the Bill, if it becomes an Act, are minimised. The point that my noble friend perhaps did not emphasise sufficiently is that if there is a retrospective element to the Act, particularly if it is a rather obscure and unclear retrospective element, that will result in more confusion and, most importantly, more need for judicial decision. We should bear in mind throughout Committee that the judicial system in this country is under huge stress, the Chancellor is being asked for more money for really crucial cases, and it must be an objective of the Government, as we consider the Bill, to make sure that, in whatever form the Bill eventually comes out, it will require a minimum of judicial intervention.
Lord Carter of Haslemere (CB)
My Lords, I support what the noble Lords have said there. The principle against retrospection is long-lasting and fundamental to our constitution and our legal system, and it is enshrined, as has been said, in the European Convention on Human Rights.
There is an ECHR memorandum on the Bill in which the assessment is made that it strikes a proportionate balance between rights of property on one hand and the rights of tenants on the other. I would like to know from the Minister whether that proportionality assessment has properly taken into account the significance and the implications of the retrospection that has been drawn attention to here. What actually are the implications of that retrospection? What does it affect? If those words are kept in the Bill, what rights do they actually affect which are imposed in a new way by the Bill?
Baroness Thornhill (LD)
Not wishing to lower the tone of erudition in the Committee, I would say, “latine non studi”. In plain English, what I would like to say is that the kernel of the noble Lord’s concerns is about certainty and clarity over arrangements. We have all had letters from different people saying, “I don’t know whether this means I now have to change”. So I genuinely think that there is an issue around clarity and understanding and, to that end, I really look forward to the Minister’s response, because what we all need is a clear and flexible framework for tenancies that everyone understands. She spoke in some of her answers about making it simpler, but it seems that, historically, we have inherited quite an amazing array of differences, and it is perhaps no wonder that some people are struggling. So I think that the transition, and transitional arrangements, is something we should look at.
Lord Empey (UUP)
My Lords, I again note my interest in the register as the owner of a single rented property. The Minister has asserted, as Ministers are required to do, that, in her view,
“the provisions of the Renters’ Rights Bill are compatible with the Convention rights”.
I am just wondering, because it does tend to be a bit of a routine that those of us who have ever done this sign these things: can she tell the Committee whether there was a very specific examination of the circumstances in the Bill?
I must also say that the tour de force by the noble Lord, Lord Jackson, was impressive. We all felt that his Latin was very good—we will give him marks for that, I think—and he raises a very significant point. It is not unique to have retrospective legislation, but it is certainly frowned upon, bearing in mind the number of people who could be directly affected—their financial welfare, their own welfare, their concerns and the worries that can be generated by having something done, in effect, long after they had agreed and thought they had a deal. I am sure that President Trump will be listening to this debate, because he might be learning lessons; we might be teaching him things to do.
Can the Minister assure the Committee that when she signed that, or gave her views on the convention rights, that it was actually properly assessed, and legal advice was provided, rather than it simply being a piece of routine that departments do when they bring legislation to Parliament? Having listened to the contribution of the noble Lord, Lord Jackson, I think there could very well be people who will feel aggrieved if something happens subsequent to an agreement that they entered into freely and, all of a sudden, things have changed. I think we do need an explanation.
Lord Cromwell (CB)
Can I just add that I was disappointed that we did not have any phraseology in ancient Greek? We will have to put up with that for today, I suppose. I echo my noble friend Lord Carter’s point: I think it would be really helpful, whatever one thinks of the rights and wrongs of retrospective legislation, that a proper list is set out as to which rights are going to be affected. I think everybody outside this Chamber is going to need that, in practice, in the rental sector. It would be very helpful if something could be published that literally specifies which bits are going to be affected retrospectively and how.
Baroness Scott of Bybrook (Con)
My Lords, I start by thanking my noble friend Lord Jackson of Peterborough for bringing Amendments 16 to 18 to the Committee today. The question of the retroactivity of the Bill is not just a question of how it will be applied, it is a question as to whether it is fair at all. It is easy for Governments armed with executive powers to apply the law retrospectively, but it should be the duty of every Minister to ask: is this the right way? Is it the fair way?
I invite noble Lords to imagine that they signed a tenancy agreement under a clear set of rules in January 2025; they followed all the rules; then, in June 2025, Parliament passes a law saying that their tenancy is now invalid. Well, many will have to imagine no longer, because once the Bill gets Royal Assent, tenants and landlords may find that their agreements are no longer valid.
The predecessor of the Bill adopted a model of prospective lawmaking by setting out a two-pronged approach to implementation. It would have assured that substantial changes were introduced at a suitable pace, one that brought the sector along with it, giving it time to understand the new requirements and adapt accordingly. In their haste to publish the Bill, the Government appear willing to abandon the principle of prospective lawmaking, placing an immediate and heavy burden on landlords. The Committee will be well aware that 45% of landlords own just a single property. These are not professional landlords with teams behind them. They lack the infrastructure to absorb complex regulatory change. They are not poring over the details of legislation, nor do they have time to follow days of Committee proceedings. How do the Government expect these individuals to implement such sweeping reforms all at once and without a serious and structured implementation period?
At this Dispatch Box on Tuesday, I quoted some statistics from Paragon. In the same survey, it noted that 39% of landlords had not even heard of the Bill. Will the Minister please explain how the Government will communicate these changes? The department must begin explaining in clear and simple terms what is coming down the track. Landlords need to know that change is coming. Regardless of the Bill’s specific contents or intentions, its retroactive nature will pose challenges. It will not only bring an abrupt end to agreements freely entered into by two consenting adults, it will unleash a wave of challenges upon landlords through its immediate implementation.
I turn to the litany of amendments put down by the Government. We welcome the right to sublet and want to ensure people do not lose that right, but we want it to be implemented with clarity. On these Benches, we would prefer those specific tenancy types which underlie the right to sublet—such as fixed-term assured tenancies or assured shorthold tenancies—to remain. We set out our clear case yesterday and we will continue to stand up for a sector that delivers choice and variety and provides the homes we need. Will the Minister explain the Government’s adjustments to the context of Clause 3? It is clear that they intend to restructure the legislation, so on these Benches we wish to ensure that the effects of superior leases are appropriately addressed within the updated framework. Can the Minister set out how the Government will ensure that tenants in sublet arrangements are not left in legal limbo?
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Lord, Lord Jackson, for his amendments relating to transitional provisions and retroactive legislation, and for his lesson in Latin. In the year I took my second language, I was hoping to do Latin, but they changed it to Russian, so I never got to do it. I am very grateful for the lesson this morning. I will return to his points in a moment.
I will cover a couple of other points before I explain the government amendments. First, in relation to the comments made by the noble Baroness, Lady Scott, if landlords are not aware of the legislation, it has certainly not prevented them from coming forward with their representations—we have had hundreds of them. We have also had frequent contact with representative bodies such as the National Residential Landlords Association, but that does not mean that the Government do not understand the need for effective communication of the legislation. We will continue to work on a programme for that.
In relation to the comments made by the noble Lord, Lord Empey, one thing that frustrated and annoyed me when I was a council leader was when the standard equalities clause was put at the end of a committee report, as if it was just a tick-box exercise and everybody assumed it covered all the bases. I used to insist that the statement of equalities was relevant to the paper to which it was appended. I feel the same about signing off the rights clauses in this Bill, so I take it seriously. However, he makes a very good point, and we must always be clear that what we are signing off does its intended job.
I thank all noble Lords who have contributed to the debate: the noble Lords, Lord Marlesford, Lord Carter and Lord Cromwell, the noble Baroness, Lady Thornhill, as well as the other noble Lords whom I have mentioned.
On the government amendment removing Clause 3, I think this is the first time I have had to remove a government clause from a government Bill, but that shows that we are listening and thinking about making this a better Bill as we go along. Our amendments remove Clause 3, which makes transitional provision for terms in existing superior leases, and replace it with government Amendment 296. Government Amendment 296 inserts Part 2 of Schedule 6 to make transitional arrangements which ensure that pre-existing legal instruments will continue to operate and that parties to such instruments will not be found in breach of their terms following the implementation of our tenancy reforms. The risk arises because such instruments may make express reference to certain tenancies—such as assured shorthold tenancies, to which the noble Lord, Lord Jackson, referred—which will become obsolete as a result of the Bill. Mortgages, for example, sometimes require letting only on assured shorthold tenancies, which would be impossible for a landlord to comply with after commencement. In the case of mortgages, insurance contracts and Section 106 planning obligations, landlords will be able to continue to let their properties without being found in breach of their terms where they were able to do so before the reforms. Provision is made so that parties will not be prevented from making changes or modifications to their agreements of their own volition.
In relation to existing leases, the amendment will ensure that intermediate landlords will not be found in breach of their head lease terms should they return a property to the superior landlord which is subject to a post-reform assured periodic tenancy—I realise this has a level of complexity that can be baffling. That could be the case, for example, if a subtenancy is converted from a fixed-term to a periodic tenancy on commencement of the Bill and the head lease is for a fixed term that expires shortly thereafter.
Government Amendments 184, 276, 277, 290 and 297 to 301 make technical, consequential amendments associated with government Amendment 296. Notably, government Amendments 297 and 299 enable changes to be made to Part 2 of Schedule 6. These will ensure that transitional or saving provision can be made to address all possible issues which may arise from pre-existing instruments and that are yet to be identified. Again, this ensures a seamless transition to the new legal framework in what is, admittedly, a very complex legal context.
I will make a few general comments on the amendments tabled by the noble Lord, Lord Jackson. Subsuming Clause 3 into new Part 2 of Schedule 6 is intended to ensure that leaseholders who are permitted or required to sublet on a fixed-term assured tenancy, or an assured shorthold tenancy, under the terms of a superior lease are not put in breach of a superior lease following the changes to the assured tenancy regime made by the Bill. It necessarily has a retrospective effect on parties to such superior leases which were entered into before the Bill’s provision came into force.
The explanatory statement appended to the noble Lord’s amendment explains that the intention is to probe why this clause operates retrospectively. It is not entirely clear from the drafting what the amendment wants to achieve; the intention appears to be to enable an assured tenancy to be granted pursuant to the term in a superior lease in the same circumstances and on the same terms as would have been possible before the changes made by the Bill. It is possible that the intention is even to go as far as allowing a fixed-term tenancy or an AST to be granted. If so, the amendment would very likely not achieve that.
The policy intent behind Clause 3 is important: to protect landlords with superior leases from being unable to sublet in future, or even being placed in breach of their superior leases, as a result of the reforms. It is important enough to merit interfering in existing contracts. The Government recognise that any legislation with retrospective effect needs to be carefully considered. In the case of this Bill, we will apply the new tenancy system to all private tenancies at the same time, including those entered into before commencement. This will prevent a lengthy system of two-tier tenancy, ensuring that tenants can enjoy better rights at the same time and that Section 21 is not available in relation to private tenancies. Landlords will continue to have access to strengthened grounds for possession to end tenancies when they need to.
I turn specifically to Amendments 16, 17 and 18. As I have just set out, Clause 3 has been subsumed into new Part 2 of Schedule 6. However, the intended outcome behind Clause 3 will still be delivered, so I will address the substance behind the amendments tabled by the noble Lord, Lord Jackson, as this will still be relevant even if the clause structure and numbering are somewhat altered.
The purpose of Clause 3 is to enable landlords with superior leases to continue to sublet after the reforms have come into force. Existing superior leases may require landlords who sublet to do so on an assured shorthold or a tenancy with a fixed term. These are types of tenancy that this Bill will abolish, so landlords will not be able to comply with such requirements in future.
Clause 3 therefore ensures that the intermediate landlord will not be in breach of the terms of their superior lease and can continue to sublet under the new system by issuing new-style assured tenancies. This is critical to ensuring that landlords with existing superior leases are not unduly impacted by the reforms and left in breach, and must therefore apply retrospectively to existing leases in order to operate as intended. Indeed, this preserves the effect of existing agreements and ensures that the reforms do not interfere in previously agreed arrangements—the opposite of what the noble Lord, Lord Jackson, was suggesting. Without these provisions, some landlords would be left in breach of their own superior lease, and the future supply of private rented properties could be severely affected.
I do not think that these amendments will improve how Clause 3 will operate in the proposed new structure, and therefore I respectfully ask the noble Lord, Lord Jackson, to withdraw the amendment.
Lord Jackson of Peterborough (Con)
I thank the Minister for those comments. I, too, remember when we sparred on regional television many years ago. We did it in English—not Latin, unfortunately, or even in Russian.
On a serious point, I hear from the Minister that she is cognisant of the need for a balance between the rights and obligations, and duties and responsibilities, of tenants and landlords. I was struck by the comments of my noble friend Lord Marlesford about litigation and the capacity of the courts to deal with some of these issues which may arise from aspects of retroactivity in this legislation. The noble Lord, Lord Cromwell, also made a very good point, which the Minister will hopefully take on board, that we need a proper schedule ahead of time where the Government outline where these changes will be made, in order for representative organisations, such as the NRLA and others, to communicate that. I also hope the Government take the opportunity to consult properly with small landlords and other representative bodies.
Naturally, because of the wide-ranging nature of these changes, we will no doubt have to return to this issue from the Front Bench and across the House on Report, but with the spirit of co-operation and the helpful response from the Minister, I am happy to withdraw my amendment.
Lord Young of Cookham
“(7A) Any regulations made under subsection (7) must make specific provision for shared ownership leases.”Member's explanatory statement
This amendment probes what effect the Secretary of State considers clauses 1 and 2 will have on shared ownership leaseholders who currently rent out their apartments under licences.
Lord Young of Cookham (Con)
My Lords, these probing amendments draw attention to the problems already facing many shared owners following the cladding scandal but also problems for them with the provisions in the Bill as it stands. I note that the Government’s impact assessment makes no mention of shared owners who have become accidental landlords.
This form of tenure, shared ownership, occupies the space between owner occupation on the one hand and tenancy on the other, as a shared owner owns part of the property and rents the other bit from a social landlord. Shared owners are individuals who are unable to buy a property on the open market and use a government-backed affordable housing scheme to buy a share of a property, increasing that share as their circumstances improve. So, by definition, they are not well off. The Joseph Rowntree Foundation analysis in 2020 indicated that around 20% of shared owners are in poverty—double the rate for outright or mortgaged home owners—suggesting a demographic that is vulnerable to shocks such as those following the cladding scandal.
To complicate matters, shared owners can simultaneously be both a tenant and a landlord. In its 2025 survey, the Shared Owners’ Network found that 22% of its members are now subletting, with 90% doing so because of the cladding scandal. They have to sublet to move on with their lives, because their properties are not sellable. The Government do not collect data on the number of shared owners who sublet, but the Government recently amended the Homes England Capital Funding Guide to facilitate subletting for shared owners who are trapped—so I expect that the numbers are substantial and are to increase.
Conventional leaseholders have the right to let their property, but shared owners do not. Subletting is seen as an exceptional measure, subject to social landlord and lender approval, with commercial gain from subletting prohibited. Social landlords’ approval remains inconsistent on the ground.
The Bill abolishes fixed-term tenancy and moves all tenants on to periodic tenancies, but shared ownership tenants who sublet cannot give a periodic tenancy. Any permission they get from their social landlord is time-limited and can be withdrawn. Withdrawal often happens when a compliant EWS form becomes available for the building and the social landlord argues that this makes the flat sellable. However, major lenders have agreed only to consider lending on these properties, and often other issues, such as a very high service charge and high insurance, impact mortgageability and the property is not in fact sellable. Where a licence to sublet is not renewed, shared owners are required to evict their tenants, even if they are not able to sell their property.
So how will they cope with the Bill, which, on enactment, converts all tenancies into periodic tenancies? How will any existing agreements interact with the provisions in the Bill that give tenants the right to stay in a property for a minimum of 12 months, when, as I have just explained, consent can be withdrawn by the social landlord before that period has expired?
Lord Cromwell (CB)
My Lords, I will speak very briefly because, as always, the noble Lord, Lord Young of Cookham, has set out his case so coherently and in such detail that I need raise just a couple of points. Before I do, I declare an interest: I do not let out any residential property, but I have a couple of family members who let out one each.
I support all four of the amendments in this group, because there is considerable uncertainty about how the Bill will affect shared owners who become the so-called accidental landlords that have been referred to. They often sublet as a survival strategy, to deal with exceptionally difficult financial circumstances, which the noble Lord set out. Where co-owners try but, as is common, fail to sell, the proposed 12-month letting period ban—the lack of a letting period—risks punishing the very people who simply do not have the financial resilience to cope with a 12-month void in their ability to sublet. This applies acutely to the poorer and more vulnerable end of the market, so I trust that it will be of particular interest to this Government.
Baroness Thornhill (LD)
My Lords, I too support the amendments in the name of the noble Lord, Lord Young of Cookham.
If many of the amendments to this Bill are designed to make us look at unintended consequences for certain groups of people, these amendments concern one group of people who wholeheartedly deserve and need us to look at how the Bill will impact their situation as shared owners who cannot sell their flats and are subletting due to a variety of legitimate reasons. The specific conditions of their model of part ownership were so cogently outlined by the noble Lord, Lord Young, that, noble Lords will be pleased to know, I will not even attempt to repeat them. That has led to their campaign to plead with us—“plead” is almost not a strong enough word—to look at ways to ameliorate the devastating situation in which they find themselves.
The key element of concern is the stranglehold that the registered providers have on the property—no doubt deemed to be a good thing in normal times, but this situation is far from normal. Due to that stranglehold and the restrictive rules that shared owners must abide by, for the majority of shared owners subletting is a loss-making operation by design. I am not given to hyperbole, but I cannot think of anything worse than being in the situation that they are trapped in.
The term “accidental landlord” was a new one to me, but when I heard first hand from the shared ownership owners, I felt their pain—it is a really messy issue. Let us not forget that, if you have gone into shared ownership in the first place, it is highly likely that your finances are going to be stretched anyway—no high salary, no inheritance, and no bank of mum and dad—or you would have bought outright. As has already been said, the 2025 survey of the Shared Owners’ Network found that 90% of subletters were created because of the building safety crisis.
Another shocking statistic was that, in November 2024, the National Audit Office stated that the Government will not reach their 2023 target for the remediation of high-rise buildings with dangerous cladding. This building safety crisis is set to continue for over a decade or more, so it is not a big stretch to say that the problem of accidental landlords will increase. That is why I too was disappointed that this was not picked up by the impact assessment—perhaps the Minister can explain why.
The issue is certainly complex, and I am absolutely certain that the Minister is fully knowledgeable about it and sympathetic to it. The amendments tabled by the noble Lord, Lord Young, are trying to find out whether there is a way forward through this Bill to help this group of people. Alternatively, perhaps the Minister will take it upon herself to follow this up by other means.
I will end with a few words from one of the many emails from the aforementioned Stephanie, but I will pick up on a slightly different point. She says that
“we are not bad people … we’re trying to cope with an impossible situation … we don’t need to be punished for failing to sell the unsellable flats that are already ruining us”.
Between the noble Lord, Lord Young, and Stephanie, they say it all—and they have our full support.
Lord Jamieson (Con)
My Lords, I support the amendments proposed by my noble friend Lord Young of Cookham, who made a powerful case and highlighted the unique circumstances of shared ownership owners. These amendments address the specific and pressing concerns faced by shared ownership leaseholders under this Bill, and we believe that they would help ensure that this group is treated with fairness and clarity.
Shared ownership has proved to be a valuable tenure, enabling many individuals and families to take their first step on the housing ladder. However, as has been highlighted, there are circumstances where shared ownership owners find themselves trapped, and we do not want them to be disadvantaged by this Bill and face unforeseen consequences. They are subletting not out of a desire but out of necessity
To avoid repetition, I will speak to the amendments together in a way that highlights their collective aim of protecting shared ownership leaseholders, who often have limited means. Clearly, they speak to the potential unintended consequences of the Bill and the repercussions of fire safety.
Amendments 19 and 20 focus on the impact that Clauses 1 and 2 will have on shared ownership leaseholders, particularly those who rent out their properties under licences. The amendments seek to provide clarity on how these leaseholders will be affected by the proposed regulations, ensuring that their unique circumstances are properly considered. In particular, Amendment 20, which defines “shared ownership lease” by reference to Section 13 of the Landlord and Tenant Act 1985, would be an important step towards eliminating any ambiguity in the application of the legislation to this group.
Amendment 107 addresses a significant practical issue: many shared ownership leaseholders face restrictions in their lease agreements that prevent them profiting from subletting. In some cases, they are not even permitted to increase rent during a subletting arrangement, regardless of market conditions. This amendment seeks to ensure that leaseholders in these circumstances are not unfairly burdened by rules that were never designed with their situation in mind.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Young of Cookham, for his amendments relating to shared ownership licensing and for his usual clarity and coherence in the way that he proposed them. I also thank the noble Lords, Lord Cromwell and Lord Jamieson, and the noble Baroness, Lady Thornhill, for their contributions to this discussion.
Amendment 19 would require any regulations made under the power in Clause 3 to include provision for shared ownership leases. As noble Lords are aware from our previous debate, the current Clause 3 will be subsumed within part 2 of Schedule 6, but that will still deliver the same effect. I will therefore respond to Amendments 19 and 20 with reference to the fact that these measures will sit elsewhere in the Bill.
As I set out in the discussion on the previous group, the new part 2 of Schedule 6 will ensure that landlords with superior leases can continue to sublet in the future system if they currently have permission to do so. Superior leases or agreements may currently require subletting to be on an assured shorthold or an assured tenancy with a fixed term. Part 2 of Schedule 6 will ensure that, where a sublease transitions into a new periodic assured tenancy, the intermediate landlord will not be in breach of the terms of their superior lease and can continue to sublet under the new system. This will include sectors such as shared ownership and leasehold, where these kinds of restrictions in superior leases are commonplace.
The Government do not believe that Amendment 19 is necessary. It would lead to additional and otherwise unnecessary drafting in any regulations made under this power. The power already requires the Government to specify what sectors the regulations will apply to.
Amendment 20 defines shared ownership for the purposes of Amendment 19. The Government believe this is unnecessary for the same reasons that I just set out for Amendment 19.
Amendment 107 would exempt landlords who are shared owners from Clauses 7 and 8. The effect of these clauses is to prevent unscrupulous landlords using rent increases as a backdoor means of eviction, while ensuring that rents can be increased to reflect market rates, as we have debated previously. Of course, the Government, and I personally, have every sympathy with shared owners who have been affected by building safety issues—such as Stephanie and James, to whom the noble Lord, Lord Young, gave testament—and who, through no fault of their own, are unable to sell their homes. We know that subletting their homes, whether it is accidental or not, is an important way in which shared owners can mitigate the effects of building safety issues.
To respond briefly to the point made by the noble Baroness, Lady Thornhill, my honourable friend Alex Norris is making good progress with the remediation action plan. Both he and the Deputy Prime Minister are determined that the targets set in that plan are achieved, and we are moving that forward. I can assure noble Lords that it is a top priority for the department.
The Government have made it clear that such shared owners should be able to charge up to full market rent when subletting their homes. The Homes England and Greater London Authority capital funding guides have been updated to make this explicit. I believe that the noble Lord, Lord Young, referred to that point. Adherence to this guidance is a condition of receiving grant funding through the affordable homes programme. Moreover, the Government have made clear their expectation that this guidance should apply to all shared owners, regardless of how their home has been delivered, and the department is working with the sector to ensure that this is implemented across the board. As the noble Lord requested, I am very happy to meet before Report to discuss this matter further.
It is therefore unnecessary to exempt these landlords from the important protections that Clauses 7 and 8 provide. These clauses will still allow these landlords to increase the rent in line with market rates, and their subtenants will be protected from egregious rent increases and enjoy the same protections as other assured tenants.
Amendment 143 would exempt landlords who are shared owners from new Sections 16E and 16F of the Housing Act 1988, as inserted by Clause 15. These sections will prevent landlords reletting or remarketing a property if they have used the selling or moving-in grounds for 12 months after the date the relevant notice was served. These sections also set out other prohibited landlord behaviours, such as trying to create fixed-term tenancies. Although we appreciate that landlords’ circumstances may change, new Sections 16E and 16F contain critical protections for tenants. The 12-month restriction will stop unscrupulous landlords using grounds 1 and 1A to evict a tenant with the intention of immediately reletting. It will be unprofitable to evict a tenant simply to increase the rent and it will stop landlords using these grounds as a backdoor Section 21.
We believe that all tenants must benefit from these protections. It would not be right or fair to compromise tenants’ security of tenure simply because of who their landlord is and the circumstances those landlords might find themselves in when selling a property. That said, I am happy to meet again with the noble Lord and anyone else who is interested in this topic before Report, but for now, I ask the noble Lord, Lord Young, to withdraw his amendment.
Lord Young of Cookham (Con)
My Lords, I am grateful to all those who took part in the debate: the noble Lord, Lord Cromwell, the noble Baroness, Lady Thornhill, my noble friend Lord Jamieson, and, of course, the Minister, who gave the sympathetic reply that we would all expect.
As I understand it, periodic tenancies will continue to be allowed after the Bill because there is an exemption in another part of the Bill which enables these tenancies, which are not assured tenancies, to continue. Therefore, a shared owner who is subletting will continue to be able to let on fixed-term tenancies or tenancies subject to notice from the social landlord without granting a periodic tenancy.
Where I was disappointed by the Minister’s reply was on the issues I raised about the four-month notice and the 12-month ban on subsequent letting. It simply is not possible for a shared owner, who we have all agreed is somebody on a limited income, to give four months’ notice when an offer is accepted before contracts are exchanged because these sales are particularly vulnerable for all the reasons that I have explained. A shared owner who does not want to have additional financial liabilities would therefore give notice to a tenant only once contracts have been exchanged. Otherwise, they are even more at financial risk. As I understand it, the Minister is inflexible on the exemption I am seeking for the four months’ notice for shared owners.
Likewise, I think the Minister was also, at this stage, resistant to an exemption to the 12-month ban on subsequent letting. A shared owner whose sale falls through, through no fault of the shared owner, is banned—unless we get an amendment—from reletting that property for the next 12 months. How on earth are they going to survive? They have no income and they continue to have all the outgoings.
I am grateful for the Minister’s offer of a meeting, and those are two issues that I will certainly want to pursue. Even if we get all these amendments, shared owners will still be running at a loss, but the long-term solution is either for them to resell the property back to the social landlord, which would solve the problem, or to get ahead with remediation of all these blocks so they can sell these properties on the open market. The first is unlikely and the second will take time, so that brings me back to the point that, in the meantime, we really must take all the pressure off shared owners where we can. I have already indicated two issues on which I will wish to press the Government to think again at the meeting, which I readily accept. In the meantime, I beg leave to withdraw the amendment.
Member’s explanatory statement
This brings the wording in this provision into line with the definitions used in the Agricultural Holdings Act 1986.
Baroness Taylor of Stevenage (Lab)
My Lords, these government amendments are broadly small and technical in nature. I will briefly refer to each in turn.
Government Amendments 21 to 23, 36, 39 and 180 will ensure that provisions regarding suitable alternative accommodation mechanisms for secure and agricultural tenancies continue to work in light of our reforms and ensure continued tenant security and consistency of language.
Government Amendments 25 and 179 will also ensure that Sections 553 and 554 of the Housing Act 1985 can continue to function effectively. These sections deal with tenancies relating to the repurchase of defective properties by local authorities.
Government Amendments 186 and 187 provide that the repairs obligations in Section 11 of the Landlord and Tenant Act 1985 will not apply to most existing PRS tenancies that have a fixed term of seven years or more. This will ensure that for those existing leases, the repairing obligations will continue to be governed by the terms of the tenancy agreement, thus maintaining the status quo for both parties.
Government Amendment 255 corrects a drafting error in paragraph 36 of Schedule 4 to the Bill.
Government Amendment 256 is a minor and technical amendment that removes paragraph 41 of Schedule 4 to the Bill. Paragraph 41 makes the consequential amendment to provisions in the Deregulation Act 2015, preventing retaliatory Section 21 evictions. These are not required, as these provisions will be repealed as a result of the abolition of Section 21.
Government Amendments 292 and 295 are technical amendments that address the period after which possession notices would remain valid after the commencement of the Bill. The Bill makes specific provision to ensure a smooth transition and avoid unnecessary cliff edges. This includes maintaining the validity of notices served prior to implementation. These minor and technical amendments address the period after which possession notices will remain valid after the commencement of the Renters’ Rights Act. Depending on when notice was served, landlords will have up to three months from the commencement date to initiate possession proceedings. These amendments clarify and define the intended meaning of “initiating possession proceedings”, by clarifying that proceedings are started when the court issues a claim form at the request of a claimant. This change better preserves the intention of the Government, and it ensures that the full maximum period of three months is available to relevant landlords to initiate proceedings on valid notices that were issued prior to the commencement of the Act.
Finally, government Amendment 183 ensures that charities do not incur additional financial and administrative burdens by being required to obtain a designated adviser report for every assured tenancy they grant. Currently, before a charity lets a property on a lease of more than seven years, it is required to obtain a designated adviser report. These can cost around £2,000. Under the new tenancy regime, the length of the tenancy will not be known when it is granted. The Charities Act 2011 could be interpreted so that the charity would need to obtain a report for every property let on an assured tenancy. This could substantially increase administrative burdens and financial costs for some charities.
The amendment seeks to change the Charities Act 2011, so that charities are not required to obtain a designated adviser report prior to the granting of any assured tenancy. Charities will still be required to obtain advice and consider whether the terms of the lease are the best that can reasonably be obtained for the charity. This amendment will provide legal clarity and certainty for charities, their trustees and the Charity Commission, while ensuring that charities do not incur additional financial and administrative burdens because of the tenancy reforms we are introducing.
I hope that noble Lords will feel able to support these amendments. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I thank the Minister for bringing these amendments before the House and for clearly setting out the minor and technical corrections to the legislation. Ensuring legal consistency is crucial, and aligning the wording with the Agricultural Holdings Act 1986 will help maintain uniformity across legislation.
As we will discover in coming days, the agricultural aspects of the Bill are both detailed and complex, containing numerous references to specialised terminology. Any technical amendments that help harmonise such language are most welcome on these Benches.
I trust the Minister will continue to approach these proceedings with a collaborative and constructive mindset. These amendments demonstrate that the legislation, as drafted, is not beyond improvement, and we welcome the Government’s recognition of that fact. It is our hope that suggestions from your Lordships’ House are given due consideration and are not dismissed too readily from the Dispatch Box.
We trust that the Minister will also view forthcoming amendments in the spirit intended: to test and to probe the Government’s rationale in pursuing particular policy choices, particularly when it comes to the inclusion or the omission of specific clauses and definitions in the Bill. We are grateful for the opportunity to raise these important issues and we welcome continued constructive dialogue on how we can best improve the technical framework of the legislation.
On that note, I wish to ask further questions of the Government on government Amendment 183. From our understanding, this amends the Charities Act, as the Minister said, to ensure that the disposition of leases which are assured tenancies will be subject to that Act. However, as she said, the requirement to obtain a written report from an independent property adviser could be costly. The costs of these reports vary, and they can impose a significant burden on whoever is footing the bill for them. So I would be grateful if the Minister could just clarify in writing that no charities will be required to obtain this particular report and, if there are some that will continue to need it, can she set out the conditions on which those reports from an independent adviser will be required?
If trustees do not comply with the law, they may be personally liable if this report is required and they do not do it; therefore, it is really important that we get absolute clarity on who, if anybody, will be required to do that. I reiterate the importance of keeping the core text of the Bill simple and, where possible, as focused as we can.
Baroness Taylor of Stevenage (Lab)
Just to respond briefly to the noble Baroness, I understand that the change to the Charities Act 2011 means that charities would not be required to obtain the designated adviser report prior to granting. They would be required to obtain advice and consider whether the terms of the lease are the best that can be reasonably obtained by the charity; that would be the requirement for trustees. But I will respond in writing to the noble Baroness just to confirm that that is the case.
“(ba) the assured tenancy was granted immediately after the agricultural tenancy came to an end, and” Member’s explanatory statement
This means that only an assured tenancy granted by the former agricultural landlord immediately after the end of a tenancy of a smallholding to which the Agricultural Holdings Act 1986 applies will be subject to the restricted grounds of possession.
“(5ZB) The court may not make an order for possession of a dwelling-house let on an assured tenancy on any of Grounds 1 to 5H or Ground 6A where, on the basis of the proposed let of the dwelling-house on that tenancy, the dwelling-house was deemed to be suitable alternative accommodation under paragraph 1(c) of Part 4 of Schedule 2 to the Housing Act 1985 for the purposes of section 84(2)(b) and (c) of that Act.”Member’s explanatory statement
This restricts the grounds of possession that will be available in relation to a tenancy when the proposed tenancy was deemed to be suitable alternative accommodation for the purposes of enabling an order of possession to be made of premises let under a secure tenancy.
Renters’ Rights Bill
Thursday 24th April 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-II(a) Amendment for Committee (Supplementary to the Second Marshalled List) - (23 Apr 2025)
“(5ZB) The court may not make an order for possession of a dwelling-house on Ground 6B (whether or not an order is also sought on any other ground) where the landlord has not complied with section 11A of this Act.”Member's explanatory statement
This amendment would make possession under ground 6B contingent on compensation being paid, rather than compensation being dependent on court proceedings.
Baroness Warwick of Undercliffe (Lab)
My Lords, I declare an interest as chair of the Property Ombudsman, TPO, for the private rented sector. I have two amendments in this group, Amendments 24 and 30. Both relate to repossession under ground 6B. Their intention is to make possession on that ground contingent on compensation being paid, rather than being dependent on court proceedings. I am grateful for the very helpful briefing on this matter to the National Renters Alliance and specifically to Safer Renting, a renter advocacy service operated by the social action charity Cambridge House.
Ground 6B provides landlords with a route to vacant possession, evicting the renter in the process, to give the landlord the possibility of avoiding a range of sanctions that could be imposed or taken by a local authority when breaches have occurred. As I understand it, the purpose is to protect renters from poor landlord practice—for example, poor housing conditions—while enabling landlords to comply with enforcement action. However, it gives the non-compliant landlord grounds for possession of the property in cases where renter wrongdoing may not have occurred, yet resulting in potential homelessness for the renter. An amendment was made to the Bill in another place to give the court the option of ordering the landlord to pay to the tenant such sum as appears sufficient as compensation for damage or loss sustained by that tenant as a result of the order for possession.
This is a welcome addition to the Bill. The intention of that amendment is to compensate the renter appropriately for the damages of possession. However, Safer Renting, whose staff are experts in supporting renters to access redress, believes that the mechanism for doing so via a court order has significant complications. Under the current proposal, any compensation ordered by the court may not be paid to the renter before their eviction. If compensation is not paid before the eviction, renters may be left to foot the bill for any relocation or legal expenses out of their own pockets.
This is wholly inappropriate and leaves the renter in an extremely perilous position. It is surely contrary to natural justice. Ground 6B would mean that the renter is evicted from their home, forced into finding alternative accommodation—potentially at a higher rate—or faces homelessness. The renter is burdened by the highly stressful situation of having to find a new private tenancy. The renter is likely to be forced to pay for a new deposit in the intermediary period before the possession and the compensation payment, which they may not be able to afford. The renter’s housing move-on is at the mercy of the court system for their compensation—a court system with extreme backlogs and under extreme pressure. This is likely to cause a prolonged period of uncertainty and stress. The renter must find legal representation, potentially at prohibitively high costs, and is expected to take on the additional burden of pursuing an unscrupulous landlord for unpaid compensation. By making the possession contingent on compensation paid up front, the renter does not suffer these consequences and is fairly compensated for any stress and burden experienced.
There are further considerations if a renter is evicted. Renters in priority need must be placed in temporary accommodation and rehoused by the council, at substantial cost to the individual local authority and the public purse. This is further complicated by the prospect that a mandatory ground for eviction could financially disincentivise councils from pursuing the necessary enforcement action against the non-compliant landlord, contradicting the local authorities’ enforcement strategy as the costs of rehousing are passed on to the local authority. This is during a period in which local authorities are spending £2.3 billion on temporary accommodation housing more than 120,000 households, and many councils are in severe financial trouble.
In addition, with deposits now averaging around £1,218, the cost of a new deposit is potentially a major prohibitor to finding new accommodation quickly. Should the landlord fail to return the renter’s deposit on their vacating the property, the renter would be expected to find an additional cash sum likely to be over £1,000. This is highly prohibitive for most renters and leaves them either in potentially dire financial straits or unable to afford access to a new home.
A recent survey by the property company Reposit showed that, of 1,000 renters surveyed, nearly half—48%—had to borrow money to afford a deposit. By ensuring that compensation for possession is paid prior to the possession order, renters will be able to move properties more seamlessly and not face potentially prohibitive financial burdens or barriers.
As the Bill is currently presented, for the renter to access compensation they must rely on the landlord, who has already broken the law, to comply with the court order to pay compensation. There is no guarantee that any compensation ordered by the court will be paid to the renter. In this event, the renter must take the landlord to court. The courts, as I have said, are currently under record backlogs, with most recent data suggesting that the wait time for a small claims hearing is 54 weeks—more than a year. This is an egregious length of time to wait to receive the necessary and appropriate compensation for a vacant possession through a landlord’s non-compliance.
Legal representation is also a major financial barrier that may prevent renters from attempting to claim compensation. Vacant possessions are typically ordered on poor-quality housing where the rent is lower; therefore, the income of the renter is also likely to be lower. It is logical to assume that the majority of renters who receive a possession order will not have the funds to support a legal claim against the landlord for the compensation that they are due. This would be a significant injustice; I hope it can be prevented.
Although some renters would be able to access legal aid funding, the majority and an increasing proportion would not. Legal aid cuts have resulted in 34% fewer legal aid funded possessions proceedings since the introduction of the Legal Aid, Sentencing and Punishment of Offenders Act 2012—according to analysis from Safer Renting.
Furthermore, compensation is not always paid by criminal landlords, even following a court order, as Safer Renting has witnessed in a high number of cases. Safer Renting’s data reveals that, in instances where award for a rent repayment order has been given against a landlord, with the proper status and assets, only 40% of landlords have complied with the order to pay the renter. When the order has been made against an intermediary landlord, compliance with the order drops even further to just 5%. This is contrary to natural justice and the intentions of Parliament in bringing forward the Bill.
I hope my noble friend the Minister will consider how, without compensation paid prior to the possession of the home, renters—particularly those on low or no income—will find the necessary funds to pay for a deposit on a new home while they await a court order. What estimate do the Government make of the additional costs that local authorities in England will incur in cases where priority-need renters are evicted from their homes and placed into temporary accommodation? Will legal aid be made available to renters to enforce compensation orders made by the court under the existing provision for representation in relation to possession proceedings? If so, what is the Government’s calculation of how much extra this will cost? Finally, can the Minister say whether there is an appropriate timeframe for a renter to receive compensation following their eviction?
I hope I have shown that my amendments would deliver a fairer and more just outcome for the renter, where the landlord has acted unscrupulously or without compliance. I beg to move.
Baroness Grender (LD)
My Lords, we welcome the Government’s commitment to rebalancing the relationship between landlords and tenants, and the abolition of Section 21, but we must ensure that the protections afforded to tenants are as robust as possible if the Bill is truly to deliver for the people who find themselves on the front line of this housing crisis. The Bill introduces new mandatory eviction grounds. Although we understand that the intention is to provide clear routes for landlords to regain property, making grounds mandatory removes the courts’ vital ability to act as a backstop and consider the individual circumstances of the tenant. It is important to test this issue in Committee, which is why we tabled Amendment 31.
Although most repossessions will be able to proceed without a hitch under the new Act, ensuring that exceptional cases have a discretionary element is critical—a discretionary element that the Labour Front Bench argued for with some vigour in the previous Parliament. Indeed, the Renters’ Reform Coalition argue that the lack of discretion is one of the most significant shortcomings in the Bill. The Renters’ Reform Coalition comprises some of the leading charities that work tirelessly on the issues of tenancy, homelessness and housing, including Shelter, which I used to work for. I thank the coalition for its work on this amendment and its support on this issue.
It is not difficult to imagine situations where compelling reasons for refusing immediate possession should exist. For instance, a tenant or a member of their family may have a serious terminal illness such as cancer, with a very limited life expectancy, a severe disability, or caring responsibilities for a disabled person, meaning they will necessarily need a longer period to find the most suitable accommodation. In the previous Parliament, the shadow Housing Minister, Matthew Pennycook, provided us with a useful hypothetical example, in which a terminally ill cancer patient could be evicted and at risk of homelessness because the landlord wishes to sell—a landlord, in this hypothetical scenario, with a portfolio of, say, eight houses and no compelling need to sell. In that scenario, he argued, a judge should have discretion.
Mandatory grounds, such as grounds 2ZB and 2ZC, which cover possession when a superior lease ends, prevent the court taking these profoundly human factors into account. Making all grounds discretionary would offer a vital layer of protection. It would allow the courts the potential to act as a backstop, consider all factors and potentially propose alternative courses of action to avoid a damaging eviction.
Obviously, some will argue that this cannot be done on the grounds of backlogs in the courts. Reforms in Scotland, where grounds for possession were made discretionary in October 2022, have shown little evidence of significantly worsening court backlogs. Indeed, if backlogs in courts, or in any institution right now, were applied to every piece of legislation that comes before us as a rationale for not proceeding or making a decision, we would be very hampered indeed as a legislative body.
We all know that the reality and likelihood of tenants taking up this course of action, just like the First-tier Tribunal, will be minimal, but the existence of the discretionary approach would ensure that an all-important safety net is in place for the worst possible cases. This amendment would remove “must” and insert “may” in the relevant heading of part 1 of Schedule 1, and omit the heading of part 2. This would provide the courts with the flexibility needed to consider the specific context of each case. I understand that the Housing Minister, Matthew Pennycook, in the House of Commons has countered that this is “a step too far” and would remove “certainty” for landlords, but we disagree—or rather, we agree with his original arguments, which are no different from mine today.
Should the Government remain resistant to making all grounds fully discretionary, can we please explore, between now and Report, robust mechanisms to prevent evictions that would cause severe hardship? As a fallback position, we advocate strongly for the introduction of a mandatory hardship test that courts must apply when considering possession orders under any mandatory grounds. This test would require the court to explicitly weigh the potential severity of the hardship caused to the tenant, considering factors such as health, disability, how many children there are, access to alternative accommodation and the impact on the ability to maintain employment or education, against the landlord’s stated reason for seeking possession. This hardship test would ensure that the most vulnerable tenants are not rendered homeless or forced into the inadequate temporary accommodation that we have heard described by the noble Baroness, Lady Warwick, simply because a mandatory ground is technically met without consideration of the dire circumstances in which the tenant finds themselves. It would provide a necessary safety net, ensuring that, while good landlords could regain their property for legitimate reasons, the system does not blindly facilitate deeply unfair and harmful evictions.
We must listen to the voices of those who live with the constant fear of losing their home. We owe it to future generations to get this bit right. This amendment would strengthen the Bill to ensure that security, fairness and compassion are at its heart by making grounds discretionary—or, at the very least, by introducing a mandatory hardship test.
Baroness Jones of Moulsecoomb (GP)
My Lords, my Amendments 35 and 71 both aim to help people who rent. I declare an interest as someone who rents a two-bedroom flat.
I have tabled Amendment 35 because I am worried that the Government’s good policy will actually end up penalising the very people that it is aiming to help. I hope the Minister will go away from here thinking, “The Green Party had quite a good idea on that, and how nice it is to have them on our side for once”.
The Government are doing the right thing for the climate and for people in putting in higher energy efficiency standards—that is a given—and doing the right thing for landlords with grants to help them meet those standards. However, the only people who do not get a guaranteed better life are the poor tenants who have to put up with the work, dust, noise and inconvenience of the energy improvements being done, with the possibility that their rent will be going up as their energy costs go down. Amendment 35 is an attempt to give tenants a guarantee that they will also get some direct benefit from the drive for net zero with two years of lower energy bills, without that saving being cancelled out by a landlord focusing on profiting from a government grant. I think this is a sensible amendment and I hope it will find favour with the Minister.
Amendment 71 aims to shift the debate firmly on to the needs of the tenant and to discourage landlords from constantly changing their minds about letting out their properties. It builds on the Government’s welcome attempt to get rid of no-fault evictions by adding a new clause to the eviction process that gives the tenant a one-month financial head start. With all the costs involved with moving—the deposit and moving costs—it can be a long, drawn-out process, and, for many tenants who are self-employed or on zero-hours contracts, time is literally money and moving is a time-consuming business.
I hope that passing this legislation will create a new era of stability for those in the private rental market. A whole generation of young people has had to suffer from an overheated rental market, which was firmly loaded in favour of investors and those with the money to buy properties. This legislation does not actually solve that problem, because only the Government building hundreds of thousands of social homes could probably do that, but I welcome the start the Bill is making and I hope the Minister will consider the needs of tenants even more in this way.
Lord Cromwell (CB)
My Lords, I rather like the look of Amendments 26 and 27 from the noble Baroness, Lady Thornhill, and look forward to hearing her describe them. They also relate to my Amendment 142, which I will now speak to.
The Bill restricts a landlord to four instances where they can recover their property and require a tenant to leave. One of these is if the landlord is selling the property. The purpose of this amendment is to ensure that, where a landlord seeks to sell a property under the new ground 1A but fails to do so, the property is made available again on the rental market without unnecessary delay.
The Bill requires that the property is on the market for sale for at least 12 months before, if no sale is forthcoming, it can be re-let. Market statistics show that typically about 20% of rental properties taken off the rental market do not sell and come back to the rental market. Savills puts the figure higher, at 33%. According to Hamptons, on average properties come back as available to rent after about 90 days, or three months. Where properties do sell, Zoopla figures indicate that the period between first marketing and completion is typically six months. This amendment responds to these facts and reduces to six months the period when the property is required to be unavailable to rent.
I move from the market facts to the Government’s approach. I am very grateful to the Minister for the opportunity that we had to discuss this and the understanding I obtained of the Government’s thinking. I understand that the Government’s concern is that landlords seeking to increase the rent might claim the property is on the market as a means to obtain vacant possession, apparently expecting much higher rent thereafter. They would leave it standing empty for, say, six months with no rental income, and then re-let it not just at a higher rent but at one that would both recover the rent lost in that six-month period and obtain a higher ongoing rent. The assertion is that making the required period 12 months would make such assumed motivation and behaviour unworkable economically.
I have struggled without success to find a period as long as 12 months credible for this purpose. So I ask the Minister: if the current rent on a property is for some reason set below the market rate, would it not be possible for the landlord simply to seek an increase to the market level in the normal way, rather than going through the convoluted processes and expense involved in removing the tenant, putting the property on the market and then re-letting it? If the rent is close to the market rate, it is surely unrealistic to expect that a landlord would be able to leave the property empty for six months, with ongoing costs but full loss of income, and then rent it out again at an uncompetitive rate, well above the market rate, in order, as the Government’s thinking seems to be, to recover six months of losses and then settle at what would be, I repeat, by definition, an uncompetitively high rent. I just do not see how that would have a chance of working.
To give a quick numerical example, a landlord receiving £2,500 a month in rent who puts the property on the market and receives no rent for just six months would, after leaving aside any other costs incurred in departing the tenant and marketing the property, lose at least £15,000 of rental income. To recover this over the subsequent six months and raise a base rental amount to, say, £3,000 per month compared with the £2,500, which for our evil, rapacious landlord is a pretty modest increase of £500, would mean seeking to rent out the property at £5,500 a month—a 220% rent increase over just a six-month period. If Mr Rapacious wanted to recover his losses faster, say in one quarter—three months—the rent would have to go up to £8,000 a month, a 320% increase in rent over just six months.
I must therefore say to the Minister that just six months off the market is easily more than enough to make evicting a tenant simply to achieve a rent increase a highly implausible strategy. Requiring it to be off the market for a full 12 months is not only unnecessary but a distorted intervention that simply reduces the availability of rental accommodation.
Finally, I draw to noble Lords’ attention the two provisions included in the amendment. First, the property would have to have been demonstrably available to purchase on the open market at a fair market price with no suitable offers received and, importantly, the tenant and the courts could require evidence of these points and would be able to decide whether the landlord had made genuine attempts to sell. Amendments 26 and 27, which are coming up shortly, I believe, are also very helpful in this area.
Lord Carter of Haslemere (CB)
My Lords, I declare my interest as a landlord of a residential property. I will speak to Amendments 60 and 61 in this group. I am grateful to the National Residential Landlords Association for very helpful discussions. These amendments would benefit both tenants and landlords.
The first amendment would keep the threshold for mandatory repossession by landlords at two months of rent arrears, rather than increasing it to three months, as proposed in the Bill. The second would continue to permit rent arrears arising from non-payment of universal credit to be taken into account as a ground for repossession.
One might think that my motivation behind these amendments is purely to support landlords but, as I said at Second Reading, I am keen to support tenants as much as landlords in improving the current system, since they are two sides of the same coin, and one cannot exist without the other. This is a golden thread running through this entire Bill.
As the noble Baroness, Lady Scott, said on the first day of Committee, there must be “balance” in the Bill. Any weighting of the scales in favour of one—while it might be well motivated—risks being counterproductive and detrimental to both. This is amply demonstrated by the Bill proposing to increase the threshold for rent arrears to three months before enforcement action can be taken.
Tenants in arrears will struggle to recover financially, making it harder for them to access housing in the future. The arrears are likely to mount up well beyond the three-month threshold. For example, if one adds on the one-month notice period, plus the average seven months for a court to process a Section 8 possession application, the tenant could end up having to leave the property with nearly 12 months’ arrears. Is that really a good outcome for tenants?
In addition, responsible landlords will become more risk averse, prioritising tenants who can clearly prove their ability to sustain a tenancy in the long term. This will be particularly damaging for vulnerable tenants, including those in receipt of local housing allowance, especially as support for housing costs has been frozen from April this year. Moreover, allowing rent arrears to climb to three months before enforcement action can be taken risks intimidating good landlords into leaving the sector.
A landlord is not a charity, and some depend entirely on the rent to pay mortgages or for their daily living costs. If good landlords are intimidated into selling up because it is too difficult to enforce rent arrears, tenants will very often have nowhere to live. According to Savills, up to 1 million more homes for private rent will be needed by 2031 to meet growing demand. We must keep good landlords in the sector to avoid making tenants homeless. Again, these are two sides of the same coin, and one cannot exist without the other.
My first amendment would keep the threshold for enforcement action at two months’ rent arrears. I accept that, if we are going to keep the existing threshold, landlords should be required to do more to help their tenants. For example, there could be a duty on landlords, at the first sign of arrears, to seek meaningful engagement with the tenant to prevent further debt, and to show in any subsequent possession proceedings that they had done that, or at least tried to do that. During the Covid-19 pandemic, the National Residential Landlords Association produced some very highly regarded golden rules showing how this and other types of landlord-tenant engagement could work; for example, by the landlord pointing the tenant to a relevant advisory service, such as Citizens Advice and/or the debt charity StepChange. Such measures would improve the status quo while avoiding the damaging effects of moving to a three-month arrears threshold.
I turn to my second amendment. It makes no sense whatever to disregard for enforcement purposes rent arrears arising from the fact that the tenant has not received an award of universal credit under Part 1 of the Welfare Reform Act 2012. This is for two reasons. First, it is unjustifiable to penalise landlords for non-payment of universal credit to the tenant. Why should the landlord suffer if the non-payment of universal credit is the fault of the tenant, or if the universal credit system has broken down in some way?
Secondly, unlike in the social sector, private landlords are not allowed to know, under GDPR rules, whether a tenant is in receipt of universal credit. As such, they have no idea whether rent arrears are due to a non-payment of universal credit, especially if a tenant has multiple sources of income. Disregarding non-payment of universal credit is therefore wholly unworkable since, if the landlord does not know whether rent arrears are due to non-payment of universal credit, the Bill has the effect that they may try to take enforcement action that proves to be pointless, which is surely the last thing that this new system needs.
The upshot is that landlords will be more cautious about taking on tenants on universal credit, contrary to the commendable ethos of the Bill as a whole. I ask the Minister to consider these amendments very carefully and to bear in mind the need for balance and my suggested mitigations so as to keep the status quo, having regard to the need for real evenness of handling on both sides of the landlord/tenant coin.
Lord Hacking (Lab)
My Lords, I rise to support Amendment 60 of the noble Lord, Lord Carter of Haslemere, and will speak to my Amendments 165 and 166. But, before I do, I have two apologies to give to the House. The first apology relates to my failure to speak at Second Reading, although I did speak at the Second Reading of the last Government’s Renters (Reform) Bill. The reason I was unable to speak at Second Reading is that I was, unfortunately, in and out of St Thomas’ Hospital, which looked after me very well, but I was unable to come to the House at the time of the Second Reading of the Bill.
My second apology is for my absence on Tuesday of this week, the first day of Committee on the Bill. My wife had booked a short Easter holiday on the Isle of Wight, not expecting the House to be sitting immediately after Easter Monday. Rightly or wrongly, I took the favour of the family rather than the first day of Committee. I think my noble friend the Minister has forgiven me for this—at least I hope she has. Happily, however, my noble friend Lady Warwick of Undercliffe, who sits behind me, agreed to be in the House for the first Committee day and to move any of my amendments should they be called. Even more happily, none was.
I should declare interests which are recorded in the register. My wife and I are the landlords of five sets of tenants in one-bedroom flats in the house next door to our own. While we as landlords and our tenants will be subject to the new provisions contained in this Bill, there is nothing contentious relating to our five tenants—or to ourselves—that I will be raising during the passage of this Bill.
Amendment 60, tabled by the noble Lord, Lord Carter of Haslemere, which I support, has been grouped among a variety of amendments relating to orders for possession. Most of them have little contact one with the other, but they are all grouped together in this same list. That certainly applies to my Amendments 165 and 166.
I shall say a general word before I go on to the specific argument concerning these amendments. This Bill is, most rightly, directed to redress the balance between the landlord and the tenant in the private rented sector. This is very right, because since the Housing Act 1988, the balance has swung far too far towards the landlords—particularly rogue landlords—which has caused great distress to many innocent tenants. However, we must be sure now that we are getting the right balance between landlords and tenants. Yes, there are rogue landlords, but there are also rogue tenants.
Originally, in Schedule 1 to the Housing Act 1988, notices for possession for arrears of rent would not become effective until the rent was overdue for 13 weeks, relating to weekly or fortnightly rentals, or three months, relating to monthly rentals. This was altered in some subsequent legislation, and this Bill now seeks to go back to the provisions of the 1988 Act. What is the reason for this? I would be grateful if my noble friend the Minister could address it. What is the evidence that shorter periods of eight weeks and two months had been causing any problems?
We need to look at the practical side. The maximum deposit that a landlord is now permitted to collect is calculated against five weeks of rent. The effect is that the landlord is covered for the first failure of paying rent but is not covered during the subsequent two months of non-paid rent. More than that, it will take up to two more months before the landlord is able to get a hearing in the county court for possession and unpaid rent. This means that the landlord will be without rent for at least four months. Even if the landlord succeeds in getting an order for possession and an order for the unpaid rent, the chances are that he will never get back the unpaid rent. The question that I put to the House, and indeed to my noble friend the Minister, is whether this is fair and balanced.
I turn to Amendments 165 and 166, which are directed to the time in which the landlord is not permitted to put the property on the market when he has gained possession on the grounds of family need or other need specified in ground 1 or 1A of the Housing Act 1988. I adopt all that the noble Lord, Lord Cromwell, said in his argument that this period under which the landlord is not permitted to put the property on the market—a period of 12 months—is quite excessive and quite wrong. I need not repeat the noble Lord’s arguments.
The Minister was very kind to see many of us in meetings before Committee. I had the privilege of a meeting with her, at which she explained that there is an abuse by some rogue landlords in using the instrument to remove a tenant from the property, let us say, for members of his family or other persons as specified in ground 1A of the 1988 Act. She described the 12 months as a deterrent against this abuse—a means, so my noble friend said, for the rogue landlord to raise the rent. What about the genuine situation of a landlord getting possession of the accommodation, say on family grounds, to accommodate grandparents, and then one of the grandparents has a severe stroke which prevents both of them taking up the accommodation? Why should the landlord then be left with the property when he was genuinely seeking to accommodate members of his own family for 12 months? The question is: is it fair or right that the landlord is prevented for a whole year from letting out his property? That is a matter that I again address to my noble friend the Minister.
Lord Carrington (CB)
My Lords, I declare my direct interest in the private rented sector, with cottage lettings in Buckinghamshire and Lincolnshire, together with farming and agricultural lettings. I am also a member of the National Farmers’ Union and the Country Land and Business Association, which have a direct interest in Amendment 63, on which I shall speak and for which I am grateful for the support of the noble Earl, Lord Leicester, and the noble Lord, Lord Roborough, who sadly is not able to be here today.
Before I turn to Amendment 63, I am also very pleased to be able to support Amendment 60 in the names of my noble friend Lord Carter of Haslemere and the noble Lord, Lord Hacking. I certainly will not repeat everything that has been said, but I shall make just one further point: it is relevant to note that Paragon, a bank that specialises in the private rented sector, commissioned a survey of landlords on the proposals in the Bill and the result was that 71% of landlords put the extended time, from two months to three months, as their top concern.
On Amendment 63, the Bill does not contain provisions to allow the repossession of a residential property if there is to be a change of usage. For example, if a landlord wanted to use the land for office space or commercial or retail usage, the amendment would allow them to seek possession of a dwelling house where it was intended that the use of that property, or the land on which it was situated, would be changed to non-residential and there was permission from the relevant authorities to do so. There are a number of Bills, reviews and reports in motion which cover farm diversification, which the Government are keen to encourage in the light of falling profitability in farming as subsidies are withdrawn or concentrated on environmental activities and concerns. Farmers are therefore looking carefully at their assets to see whether they can be put to more profitable usage. Obviously, this can involve the farmstead house and buildings rather than just stand-alone farm buildings. The Planning and Infrastructure Bill is relevant in this context, together with the Rural England Prosperity Fund, which specifically targets facilities and building conversions that help rural businesses to diversify.
In addition, we have the land use framework and a farming road map to look forward to, and it has also been announced that the noble Baroness, Lady Batters, will chair a report on profitability in farming and this will include diversification. This amendment assists in enabling this diversification, if the necessary planning permission has been granted. I am thoroughly aware that the Minister is keen not to reduce the housing stock. However, although it is possible that the proposed diversification will affect only agricultural buildings, there may be a more comprehensive development involving a farmhouse or other residential building, particularly if they are closely located to the diversification site. I therefore hope that the Minister will include this amendment as a sensible ground for possession, one which would assist in the development of the rural economy.
Lord Pannick (CB)
My Lords, I support my noble friend Lord Cromwell’s Amendment 142. I declare an interest in that my wife owns rental properties. I agree with what the noble Lord says about the mischief of Clause 15. It is very easy to imagine circumstances in which the owner of a property decides, in good faith, to sell it and the tenant therefore has to leave. The landlord then places the property for sale on the market but finds that, for whatever reason, after four or six months they cannot sell it. Clause 15 would prevent the landlord for 12 months from again leasing out the property. It would do so however well-intentioned the conduct of the owner of the property and however reasonable the new tenancy agreement, and even if the new lease is to the same tenant as the old one, on the same terms, including as to rent.
I entirely understand the Government’s wish to prevent landlords from abusing their rights, but the breadth of this restriction is, to my mind, plainly disproportionate to the feared mischief. This is not only unfair on the landlord; it will inevitably have an adverse effect on the housing stock available for rental purposes.
I appreciate that Ministers have stated that this Bill is compatible with the European Convention on Human Rights, but it seems to me very doubtful indeed that this clause complies with Article 1 of the first protocol to the convention, on the right to property. The European Court of Human Rights and our domestic courts have explained that the right to property requires a fair balance between the interests of property owners and those of the community in general. I cannot see how a blanket provision which penalises a landlord by preventing them from renting out their property, for a period of 12 months, however bona fide their conduct or however fair the terms of the lease, could possibly be said to respect a fair balance.
The mischief which the Government seek to prevent requires a more tailored response. I hope the Minister will be able to say, in response to the concerns that have been expressed by my noble friend Lord Cromwell and myself, that she will be prepared to meet with us to discuss ways of making this clause more proportionate by recognising an exception for landlords who have acted in good faith and responsibly.
Lord de Clifford (CB)
My Lords, Amendment 64 in my name is in regard to the family. I thank the noble Baronesses, Lady Bowles of Berkhamsted and Lady Neville-Rolfe, for their support for this amendment. The Bill allows a landlord to take possession of a property for a family reason. This is a small extension to the number of reasons for which a landlord could take possession of a property. That reason is that a property is to be used by a carer for a family member who requires full-time care.
The amendment clearly sets out that the property needs to be in close proximity to the landlord’s family home and be used by the carer. The reason for the close proximity is so that the carer can attend not only on a daily basis but, more importantly, be available to attend in emergencies, quickly and efficiently. These can be on a regular occurrence in some cases. The types of properties that I have in mind are: annexes on homes; a flat in a block of flats where the landlord’s primary residence is located; properties in less urban areas, such as rural villages, hamlets and remote farms; and small property clusters where properties are in short supply.
I appreciate that tenants would be forced to leave a property, but this amendment does not seem to shorten the four months’ notice period. The Bill allows some landlords the opportunity to gain possession for an employee or a worker for agricultural purposes under ground 5A in Schedule 1. I have assumed that the reason why this exemption has been included is that agricultural workers need a property close to their place of work due to the nature of the work, and at all times of day. The need of a carer is similar to that of the agricultural worker: they need to be close to the patient and could be on call and work unsociable hours.
Most landlords’ and tenants’ relations are generally good, and most likely, the landlord would make the tenant aware that the tenancy could be terminated if a property needs to be for a carer. To leave a property is an unsettling upheaval for a tenant and their family, but they would be given four months’ notice. If there is good communication between parties, everybody lives in the knowledge that this could be a possible outcome and plan accordingly.
Financially, if you own an appropriate property, this is the most practical way a landlord or their family can provide the most cost-effective accommodation for a long-term carer, and when the family is facing a high demand on its finances. Only a limited number of landlords will use this possession right, but if needed, it would be welcomed by the family, as it would give flexibility in times of sadness and when time requires the need for it.
I thank the Minister for her engagement on the Bill and for our short discussion on the amendment. I note the Minister’s suggestions that alternatives could be found to house a carer, but my response is that to find a property in the correct location and which is suitable for a carer would be extremely difficult in this current high-demand rental marketplace.
The second suggestion was that the tenant has the right to a secure home. The other side of that debate would be: would it not be a reasonable case that the landlord has a right to gain possession of their own assets for the benefit of their well-being or a family member’s own caring needs?
Properties are owned for many purposes: in some cases, for financial reasons, like investments, and to provide regular income or pension funds. It may be available to rent during a job relocation or as a future residence in a desired location. All these landlords who own such properties could gain possession under the Bill when needed. However, if the property owner who may wish to use a property for a legitimate family reason, to care for a family member, cannot gain access to the property at the time of need, then this amendment seeks to rectify this.
In summing up the group beginning Amendment 10 in Tuesday’s Committee, the Minister said that those amendments did not meet
“the bar to overrule the general principle that private renters should have secure homes”.—[Official Report, 22/4/25; col. 615.]
I believe that a long-term carer of somebody crosses that bar to enable possession for a family.
Baroness Bowles of Berkhamsted (LD)
My Lords, unfortunately, I was unable to speak at Second Reading, but I saw that the noble Lord, Lord de Clifford, raised an issue that I wanted to raise, concerning the matter of carers, and I have been pleased to co-operate with him to produce Amendment 64. First, I declare my interests as a private landlord for over 25 years, both in a personal capacity, with lettings in Hertfordshire and Buckinghamshire, and also as an experienced—though unpaid—trustee-type director for lettings in Buckinghamshire.
Being a landlord started accidentally: when I rented a property, I intended to sell to a friend in need. Then, like many self-employed people without an employment-linked pension, I saw its value as pension provision instead of selling it and that it kept the asset available, if needed, for business-loan security. I have had conversations about the extra risks and costs, should we sell and what it means for rents. I have, as the Minister said we should on Tuesday, examined our business models. Even without exposure to mortgages, the effect is that rents will rise and will track market rates sooner rather than risk larger, less frequent adjustments that are more likely to attract challenge, which, of course, would exert an inflationary feedback loop on rents. In a nutshell, it has made it riskier to be a benign landlord.
Baroness Neville-Rolfe (Con)
My Lords, I rise to support Amendment 64, in the names of the noble Lord, Lord de Clifford, and the noble Baroness, Lady Bowles, to which I have added my name. They have both spoken with immense good sense and from knowledgeable positions. I am sorry that I was not present at Second Reading, but I believe that it is essential that the Bill allows a landlord to seek possession of a property where it is needed to house a carer or carers for the landlord or his or her family.
I will illustrate the problem with a case study of my own, and in so doing declare an interest. My husband and I own a house close to our own in a small Wiltshire village which we bought for use by a carer as and when we reach that stage. We usually let it out, in the meantime, to local people, and it appears in my register of interests, to which I refer the House. With the demise of shorthold tenancies, we face the prospect of not being able to get it back once let again. Moreover, even as and when we do offer it to a carer, if the appointment does not work out, we lose the property.
We have discussed in other debates the importance of carers, the problem of supply of beds in old people’s homes and support for the elderly. This is a particular problem in rural areas like ours, making it all the more important to encourage independent provision. I urge the Government to think again on this and return on Report with a suitable amendment.
I am glad that the Government more generally are increasingly realising the bad effect of too much regulation on growth and competitiveness, which is well documented now in academic literature. Coming to this Bill, and indeed this group, cold from my common-sense ex-business perspective, I felt a chill down my spine. Most landlords, in my experience, are reasonable, but there are several well-intentioned amendments before us today seeking to tighten regulation and add further detail and impractical conditions. These could have a profoundly perverse effect and put more pressure on the overworked courts. For example, the amendment on discretion would certainly increase their workload, and, in practice, these would further reduce the supply of rented property.
We heard this week at Questions that this had collapsed as a result of this Bill. An overheated market, in the words of the noble Baroness, Lady Jones of Moulsecoomb, is thus being fired up further. This is what we need to work on together to reverse and keep good landlords in the sector, as the noble Lord, Lord Carter of Haslemere, explained, saying that Savills thinks landlords will need 1 million more rented homes by 2031. That does not now look possible. I just hope that the Government will think again, resist burdensome additions and consider some sensible lightening of the burden of the kind that I and my fellow Peers propose in this amendment. Other examples would those given by the noble Lord, Lord Carter, in Amendment 60 and the noble Lord, Lord Cromwell, in Amendment 142.
The Earl of Leicester (Con)
My Lords, I refer to my declaration of interests with respect to this Bill, including a large portfolio of residential property in north Norfolk, 93% of which is let out to local people, key workers and direct agricultural workers, with only seven holiday lets and seven lets to family members.
This schedule is on grounds for possession, and some excellent amendments have been put forward, to which I urge the Government to give serious consideration. However, as a generality when talking about grounds for possession, as a landlord, I do not want to lose tenants. I hate voids. As an example, I have 47 tenants who have been my tenants for between 21 and 40 years, and 45 who have been my tenants for between 11 and 20 years. These are people I know. They are my friends, they are in the community, they are contributing to the community and they, of course, live in it. Many noble Lords have spoken about the importance of not losing good landlords, and this Bill, as it is currently written, is very much in danger of creating that reality.
I turn now to Amendment 63 in the name of the noble Lord, Lord Carrington, to which I have added my name. It is essential that we allow a property owner to manage his or her property for change of use to commercial, whether that be retail, office or industry.
Let us assume a farmyard with a cottage that has a sitting tenant. The landowner gets planning permission for a block of offices or retail. Those offices and retail are going to produce a huge kick to the economy, jobs for the builders and groundworkers, and then, once they are occupied, jobs for the people working in them. So it would not be right that a single person or a family living in a cottage could stymie that development. The reality is that a landlord who is sensible—which most landlords are—would have open communication with their tenant, explain what is going to happen and try to offer them a different property. If a tenant refuses to move, that will have a real effect on the economy. This Government—who talk about growth—really need to understand that, by not accepting this amendment, they will very much be stymieing growth.
I will give another example, again I am afraid from my own playbook. It is an example of planning permission—albeit for residential, which does not necessarily refer to this amendment, and on green belt land. We are building 23 houses at the moment. Eight are for private sale, four are for affordable rent, two are for shared ownership with Broadland Housing Association, four are for intermediate rent with Homes for Wells, which is not really a housing association, and five will be retained by us for private rent. If this Bill goes through as it is proposed by the Government, why would I bother? It is really important that the Government listen to all these sensible amendments being proposed and I really hope the Minister will do so.
Lord Northbrook (Con)
My Lords, I firstly declare an interest as a private landlord of residential properties in Hampshire.
I support Amendment 60, to keep the rent arrears landlord legal action limit to two months rather than four. As the noble Lord, Lord Carter of Haslemere, said, landlords are not charities, and the noble Lord, Lord Hacking, agreed with this. I also support Amendment 63 in the name of the noble Lord, Lord Carrington, which also seems very sensible.
Local authorities are already reluctant to sanction a change of use from residential to commercial, so they exercise careful control over this. As the noble Earl, Lord Leicester, said, money from permission to convert residential properties to commercial can be used to pay for and improve properties, and something that has not been mentioned much so far is the EPC problem that a lot of these cottages have, and the extra money that needs to be found to pay for this.
Baroness Thornhill (LD)
My Lords, I would like to thank all the parties in the renters’ coalition for their work on many aspects of the Bill, particularly this one. They have very patiently answered my every query as I have attempted to familiarise myself with all the grounds for possessions and the implications of that.
Before I move to the detail of my Amendments 26 and 27, I would like to offer support for Amendments 24 and 30 from the noble Baroness, Lady Warwick. If one recalls—because she was right at the beginning of the debate—this was about ground 6B, when the house is required back for works to be done to it. Given that the landlord is not obliged to provide alternative accommodation while the works are done, we believe it might justify consideration of compensation, mainly because—this is interesting—6B is already being described on property websites as a “loophole”. Ground 6B currently lacks clear definitions and proper oversight, so it runs the risk of being misused, disputed or even ignored. Any moves to reduce court use, given our concerns in this regard, are also to be clearly welcomed.
Amendments 26 and 27 pertain to the two no-fault grounds for eviction: namely, ground 1, moving in a family member, and ground 1A, selling the property. First, the increase in notice periods from two to four months for eviction on these grounds is most welcome, giving tenants more time to find a new home. Amendment 71 from the noble Baroness, Lady Jones, strengthens this further by the discussion of compensation, as she outlined, and we feel that this complements our amendments.
Lord Cromwell (CB)
Perhaps I may be allowed another very brief speech, since I was commented on earlier. I am always grateful for any compliments I receive, no matter how backhanded, about my persuasiveness, so I thank the noble Baroness for those. I will just comment that the idea that you would put your house, flat or property on at a silly price is immediately contested by my amendment and beefed up by her amendment as having to produce evidence to that fact, so I do not think that really holds water. I encourage her to be convinced: not, as she suggested, to give in to her instincts, but to look at the economics, the logic and the maths, which simply demonstrate that six months is more than adequate, and 12 months is excessive.
Baroness Scott of Bybrook (Con)
My Lords, the amendments in this group represent yet another instance where the rights of renters intersect with those of landlords. This group of amendments is indicative of the broader Bill and, rather than increasing the availability of homes, we believe it risks reducing the supply of rental properties. This could drive up costs for renters at a time when the cost of renting has already risen significantly. It is, of course, important to make sure that the legal framework which governs this relationship protects those who are renting, but we cannot forget the landlords. They should also have their rights upheld. Landlords should have their rights over their properties respected and retain the ability to recover possession of their homes when they need to.
I start by speaking to Amendments 24 and 30, tabled by the noble Baroness, Lady Warwick of Undercliffe. They assume that the landlord is in some way liable to pay compensation for exercising rights, which surely are theirs by virtue of the fact that they actually own the property. Determining when in specific cases compensation is required is surely the responsibility of a court. To assume that compensation is always required tips the balance against the landlords and would likely discourage many responsible, principled landlords from entering the market and meeting the high demand for rented properties that we see across the country.
In the same vein, Amendments 26 and 27, tabled by the noble Baroness, Lady Thornhill, would place an administrative burden on landlords, which would have a dampening effect on the housing market. Houses are important personal assets. Piling on layers of regulation will further suffocate the market and limit the agency of landlords to use the assets that they own.
Conversely, we believe that Amendments 60 and 61, tabled by the noble Lord, Lord Carter of Haslemere, strike an appropriate balance, recognising that landlords need to be protected from bad actors, who could have a devastating financial effect on them. Landlords should not be punished for supplying rental properties to the market. Maintaining the existing possession grounds for rent arrears would mean that they can operate in the market with confidence that they will not be left out of pocket.
Amendments 63 and 64, tabled by the noble Lords, Lord Carrington and Lord de Clifford, further speak to the fact that landlords should retain the right to make use of their own property as they see fit. It is neither the role nor the place of government to dictate to home owners how their personal property should be used.
Amendment 71, tabled by the noble Baroness, Lady Jones of Moulsecoomb, seeks to conflate the rights of the landlords with their responsibilities. The landlord, by owning the property, has the right to make decisions about how that property is used. The tenant, in renting from that landlord, is expected to respect the rights of the landlord as the property owner. This relationship does not in any way suggest that the landlord should be liable to forgo income while still providing the service. This measure would clearly disadvantage landlords in their legal relationship with their tenant and would depress the market, which is already undersaturated.
Finally, I welcome that Amendments 142, 165 and 166, tabled by the noble Lords, Lord Cromwell and Lord Hacking, strike the appropriate balance between the rights of the renters and the rights of the landlord. We need to remember that we are talking about a market, which requires flexibility and adaptability so that it works for consumers and providers. Allowing landlords to make these decisions without being hamstrung by long-term obligations means that they can act in the mutual interest. A flourishing market benefits renters as much as landlords. This balance is imperative to achieve a flourishing market. I urge the Government further to consider, between now and Report, this crucial balance between landlords and tenants, most importantly to protect the tenants in this sector.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank my noble friends Lady Warwick and Lord Hacking, the noble Baronesses, Lady Thornhill, Lady Grender, Lady Jones, Lady Bowles, Lady Neville-Rolfe and Lady Scott, the noble Lords, Lord Carter, Lord Carrington, Lord de Clifford, Lord Cromwell, Lord Northbrook and Lord Pannick, and the noble Earl, Lord Leicester, for their amendments and comments during this debate. It was great to hear from the noble Earl about the long-term tenancies that he has, of 21 to 45 years. I made the point at Second Reading and on Tuesday about the symbiotic relationship that can and should exist between landlords and tenants. Our aim is to foster that relationship and the balance that makes it work properly as we go through the process of this Bill.
Amendment 24 and Amendment 30 seek to make possession under ground 6B contingent on compensation being first paid by the landlord to the tenant. Amendment 24 specifically prevents a court making an order for possession unless compensation has been paid; Amendment 30 sets out that landlords must pay compensation at a level set by the Secretary of State in regulation before they can take possession. Ground 6B allows a landlord to evict tenants where they are subject to enforcement action and eviction is the only way that they can comply. It is intended to prevent landlords ending up in the legal limbo of having broken the law but having no route to comply with it.
Baroness Bowles of Berkhamsted (LD)
With regard to the amendment concerning carers, the main reason for rejecting it seems to be that it would not be widely required; that it would only be a small minority who might find themselves in that situation. But is not the majority of this Bill based on the actions of a small minority of landlords? Therefore, we should look at both sides of the minorities argument.
The Minister said that the ground could be exploited. If such an amendment were to come forward in a fuller form on Report, it could clearly lay out the evidence that it would be necessary for the court to see—just the same as for a sale or any other purpose. For the purposes of a probing amendment, of course, that is not there.
I would ask to have another meeting with the Minister—I know that the noble Lord, Lord de Clifford, has had one, but perhaps those of us who are interested could have another. I do not see that there is any substance in saying that because it is a minority it does not apply; the whole Bill is about minority behaviour. Therefore, it is very relevant that any minority should be considered.
Baroness Taylor of Stevenage (Lab)
I thank the noble Baroness for those further comments. I am of course always happy to have a further meeting with her and the noble Lord, Lord de Clifford, on this subject. A core principle of the Bill is to increase the security of tenure that tenants enjoy. We want to keep our focus on that, but I understand the point the noble Baroness is making and the reason for putting forward the amendment. I think the words I used were that there was likely to be very limited use of this ground and a risk of abuse and that, where a family member would act as carer, there is another possession ground that can be used, but, of course, I am happy to meet and discuss it with her before Report.
Lord Cromwell (CB)
It is always helpful to remember that we judge a democracy on how it treats its minorities.
The Minister referred to my appearing to be interested in rent. I was interested in discussing the issue in the shape of rent because that was the reason I was given for a 12-month barrier to reselling the house: that the rapacious landlord would seek to make profit from doing so. I hope that the example I have given and the explanation and logic I provided demonstrated fairly compellingly that 12 months is simply excessive. I am sorry that I have not convinced the Minister of that. Perhaps we can have a further discussion, because I think the evidence will demonstrate that six months is more than adequate to put off a landlord from taking the risk of having no income for six months, and possibly costs in addition, and then trying to recover that over time.
Baroness Taylor of Stevenage (Lab)
I thank the noble Lord, Lord Cromwell, for his further clarification. I considered that we had a very useful meeting earlier on this and I have thought about it very carefully. I think the current 12-month restriction on re-letting is the right one to prevent abuse of those possession grounds, but of course I am happy to meet him and discuss it further.
Baroness Bowles of Berkhamsted (LD)
Can I also ask whether the Minister can provide any advice or evidence that she has been given concerning the issue of the European Convention on Human Rights and the right of access to property, as spoken about by the noble Lord, Lord Pannick?
Baroness Taylor of Stevenage (Lab)
The analysis on the ECHR is published in the ECHR memorandum. That information is set out in that document.
Baroness Taylor of Stevenage (Lab)
The advice I have is that it is in the ECHR memorandum, so I refer the noble Baroness to that. If she wants further advice once she has looked at it, I am happy to take that back to the department.
Lord Carter of Haslemere (CB)
The ECHR memorandum does not address the scenario outlined by the noble Lords, Lord Cromwell and Lord Pannick. It simply does not refer to that. That scenario looks at how this provision will affect bona fide, good landlords. Yes, there are possibly some rapacious landlords out there, but the vast majority are not. They might need to sell their property, and to have to wait a year to be able to do that is simply disproportionate.
Baroness Taylor of Stevenage (Lab)
I am happy to get further written advice for the noble Lords.
Lord Cromwell (CB)
I do not wish to detain the Minister with yet another question, but I will perhaps ask a little cheeky one. She referred a number of times to useful meetings with tenant representative bodies, which I have also had quite a number of meetings with. Can she tell us how many meetings she has had with landlord representative bodies?
Baroness Taylor of Stevenage (Lab)
I have had meetings with landlord representative bodies, but I cannot tell the noble Lord the number off the top of my head. I will write to him with that.
Lord Carter of Haslemere (CB)
I promise this will be my final point. Is the Minister monitoring carefully—I think in the past she said she was—how many landlords are leaving the sector? To state the blindingly obvious, many more people can afford to rent than can afford to buy. If large numbers of landlords are leaving the sector—and it would be really helpful to have some figures on that—where are those people going to live: with mum and dad, or on the streets?
Baroness Taylor of Stevenage (Lab)
I do not know whether the noble Lord was present on Tuesday, but we had an extensive discussion about the impact of the Bill. I set out the Government’s assessment that it will not have an unreasonable impact on letting, and that the department will carefully monitor the Bill’s impact going forward.
Baroness Neville-Rolfe (Con)
Before the Minister sits down, would it be possible, before Report, for her to look at the latest situation? On Tuesday, we had an exchange on the negative impact, which woke me up to all this. I think the last thing that either side of the House wants is fewer houses to let; I think the opposite is our general objective.
Lord Hacking (Lab)
Happily, my noble friend has already sat down, so I need not use that phraseology. She will remember that all my amendments discussed today related to the 12-month provision. Will she agree to my also coming to any further discussions she has on the 12-month issue?
Baroness Taylor of Stevenage (Lab)
All noble Lords, including my noble friends, will of course be welcome to any meetings that are held.
Baroness Warwick of Undercliffe (Lab)
My Lords, I will not attempt to critique the Minister’s response to other amendments or indeed to summarise comments on them. They were all about repossessions, but they were so very different that it would be impossible to do that. I admire the Minister, and indeed the Opposition Front Bench, for trying to pull them all together into one discussion. I will not critique them, but I will look very carefully at what the Minister has said. I particularly thank the noble Baroness, Lady Thornhill, for her support for my amendments.
I know the Minister sought to reassure me that the Bill was capable of covering the concerns that I had expressed. She commented that the courts were best placed to decide on compensation—of course I appreciate that—and that the courts would set out a timeframe for compensation, which I very much welcome and understand. But I am still very conscious of the concerns of the Renters Alliance and its various constituent organisations about the impact of these repossessions, particularly on the most vulnerable, when they are evicted at no fault of their own and are in financial difficulties and under a lot of stress as a result.
I hope the Minister will agree to see how this very real problem could be resolved. I am reluctant to ask her for another meeting when so many others have already been agreed to, but I would appreciate it very much if we could sit down and discuss this, because I feel I would need personally to be reassured that there are parts of the Bill that would satisfy the concerns that I have expressed. I beg leave to withdraw my amendment.
“(5AA) The court may not make an order for possession of a dwelling-house let on an assured tenancy granted in accordance with section 554(3)(c) (before its repeal) or (ca) of the Housing Act 1985 on any of Grounds 1 to 5H or Ground 6A.”Member’s explanatory statement
This restricts the grounds that are available where premises are let on an assured tenancy which is granted to the former owner-occupier of a defective dwelling under section 554 of the Housing Act 1985.
Lord Carrington
Member's explanatory statement
This amendment, along with other amendments related to new Ground 2ZZA in the name of Lord Carrington, seeks to ensure that where the intermediate landlord is given less than 3 months’ notice to quit, the duration of any notice they are required to give to their tenant is limited to 2 months.
Lord Carrington (CB)
My Lords, I have already declared my interests earlier in the debate today. In speaking to this group of amendments, I thank the Minister for discussing them with me yesterday in great detail. I also forgot to thank her for the discussion that we had on the previous amendment.
The amendments that I have tabled are designed to ensure that an intermediate landlord who is, under the terms of his tenancy, obliged under a notice to quit to release his tenancy in less than three months, can give notice to his own subtenant limited to two months rather than the Bill’s four months, so that he is not in contravention of the head tenancy. It is proposed that ground 2ZA is amended to reduce the notice period to two months to avoid situations where an Agricultural Holdings Act tenant is forced into breaching the terms of their agreement through no fault of their own.
Lord Jamieson (Con)
My Lords, I was expecting a slightly longer debate this time, as we have been proceeding slightly more slowly than the other day. I thank the noble Lord, Lord Carrington, for bringing this debate on notice periods for intermediate landlords. Intermediate landlords make the rental market more flexible and accessible, precisely the kind of benefits we should be seeking to expand, yet the Bill now risks removing them. These landlords play a vital role in our housing system. They unlock additional housing options by turning single lets into shared accommodation. They offer more affordable arrangements and provide the flexibility that is so essential in urban and rural areas closely tied to the job market. It is therefore vital that any legislation we pass recognises their contribution and protects the value they bring to the sector. In the previous debate, many noble Lords talked about the red-hot market and the lack of housing. I genuinely worry about the risk of reducing the amount of housing.
On that note, I turn specifically to the amendments before us in this group and thank the noble Lord, Lord Carrington, for giving us such an erudite summation of a rather technical area, which I could not and do not wish to replicate, and therefore I shall move on swiftly. These amendments will certainly assist the Committee in considering how best to address this issue. Protecting small-scale renters should be the priority for us all. I hope to work constructively across the Committee to ensure that we get this right. From housing associations to charities and small local businesses providing accommodation, intermediate landlords are vital to the supply on which a secure, reasonably priced and decent rental sector depends.
Amendments 37 and 38 apply explicitly to the Agricultural Holdings Act 1986 and the Agricultural Tenancies Act 1985. These tenancies by their nature can be very long indeed, even multigenerational. The tenanted property can include farmhouses and cottages, which could be occupied either by agricultural employees or open market tenants, depending on the terms of the superior tenancy. While in some cases they may have fixed termination dates, in other cases these tenancies could be brought to an end unexpectedly with a short timescale. It is right that these intermediate landlords should have the power to terminate subsidiary tenancies in a shorter timeframe in order to deliver the property back to the superior landlord in compliance with the superior tenancy agreement. Otherwise, the risk is that they may choose not to let such properties. There are many such tenancies already in place that will not and could not have anticipated this Renters’ Rights Bill. Intermediate tenants could well be put in a position of being in breach of their own tenancies, with negative financial implications.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Carrington, for the amendments and for the meeting we had yesterday, and I thank the noble Lord, Lord Jamieson, for his comments on this set of amendments. Amendment 28 works together with Amendments 29, 37 and 38 to insert a new ground for possession, numbered 2ZZA. This proposed ground for possession is well intentioned but, in the Government’s view, unnecessary. It seeks to replicate ground 2ZA with a notice period of two months rather than four in the limited circumstances where agricultural landlords have been given short notice to vacate of three months or less by their superior landlord. Ground 2ZA already covers these circumstances and allows superior landlords and courts to treat a notice given under ground 2ZA as valid even after the intermediate landlord is no longer legally involved once their lease has ended, thus providing the affected tenant with the same protection.
Amendment 28 specifically seeks to ensure that the proposed ground has two months’ notice. This goes against the general principle of the Bill that tenants should generally be given four months’ notice to uproot their lives in circumstances where they have not committed any wrongdoing. We do not believe that a tenant’s security of tenure should be undermined due to the actions of a superior landlord and encourage communication between all parties, where a superior landlord’s notice to the intermediate landlord is shorter. By creating ground 2ZZA with a shorter notice period for circumstances where the intermediate agricultural landlord has themself been given short notice by their superior landlord, the noble Lord, Lord Carrington, is seeking to ensure that the superior landlord is not left managing the subtenancy.
Amendment 29 adds ground 2ZZA to the list, in subsection 4(3)(f) of the Bill, in which a notice given by an intermediate landlord can be treated as a notice given by a superior landlord once the intermediate tenancy has ended. As superior landlords will already be able to evict tenants under a notice given by an intermediate landlord, we do not think the noble Lord’s proposed ground 2ZZA is required.
Amendment 37 is an amendment specifically to ground 2ZA, disapplying it in the circumstances in which the noble Lord wishes ground 2ZZA to apply. Further to what I have already said, this highlights the redundancy of the proposed ground 2ZZA. Clearly, ground 2ZA would apply already, to the point that it needs to be disapplied to make proposed ground 2ZZA work. I am sorry—I hope everyone is following this.
Amendment 38 inserts the proposed ground into Schedule 1 to the Bill. For all the reasons I have already highlighted, in our view the amendment is not required. As such, I ask the noble Lord to withdraw the amendment.
Lord Carrington (CB)
I thank the Minister for her extremely clear description of this amendment and why it might not work. I also thank the noble Lord, Lord Jamieson, very much for his own contribution. Everyone is probably now completely befuddled by the whole thing. I will not take up any more of your Lordships’ time, and I certainly will withdraw the amendment. However, we will be looking further at the legal implications of this.
Baroness Scott of Bybrook
Member's explanatory statement
This amendment, and others in the name of Baroness Scott of Bybrook, seeks to apply the same definition of family member which is used in Clause 21 of the Act in Schedule 1 to ensure the internal consistency of this Act.
Baroness Scott of Bybrook (Con)
My Lords, I will move my Amendment 32 and speak to Amendments 33 and 34 in this group. All three of these amendments are underpinned by the same principle, that of consistency. When anybody involved in a tenancy speaks about “family members”, there should be clarity on what that means, but the Bill is not consistent in its definition of a family. This inconsistency will make it much harder to achieve clarity for those who will have to work with this legislation in the real world. I will briefly outline the two definitions of the family that are currently in the text of the Bill.
In Clause 21, which relates to renter guarantors, the Government have defined family members in a broader way, including nieces, nephews, aunts, uncles, partners, children and cousins within the definition. In Schedule 1, which we are debating today, the definition is much narrower, limiting the definition of family members in that part of the Bill to parents, grandparents, siblings, children and grandchildren. We have tabled these amendments to highlight this inconsistency, which will create an imbalance between the definitions of the family of a tenant and that of a landlord. While inconsistency applies to nieces, nephews, aunts, uncles, partners, children and cousins, I will use the example of cousins to illustrate my point.
Surely whether a person is a landlord or a tenant, all families should be treated equally before the law. It cannot be right that a tenant’s cousin who is a rent guarantor is defined as a family member, but a landlord’s cousin is not defined as a family member for the purposes of ground 1. Can the Minister please explain why she believes it is acceptable for a cousin of a tenant who is their rent guarantor to be treated as a family member, but the cousin of a landlord is not treated as a family member for the purposes of ground 1, under this legislation? Does she agree that this is an inconsistent way of defining family members?
We are also interested in the perverse outcome that would result in a circumstance where a cousin of a person acts as a rent guarantor but also has another cousin who is a landlord. Under Clause 21, they would be the tenant’s family member; under Schedule 1, they would not be the landlord’s family member. In the real world, they are family members in both cases. It is unacceptable that an individual in this position would be treated in one way in respect of their relationship with their cousin who is a tenant and in a different way in respect of their relationship with their cousin who is a landlord.
Additionally, I am not certain whether cousins of tenants and cousins of landlords are different classes of people. If we are to treat cousins as a class of people for the purposes of the Bill, it seems that the Bill will affect private interests of cousins of landlords in a different way to the interests of cousins of tenants. We feel that this is unacceptable, and it should be resolved.
Baroness Grender (LD)
My Lords, I will speak very briefly from these Benches to say that there is some nervousness on our part with regard to these amendments and the potential for loopholes to be created. If the discussion is that this is a meeting of equals between tenants and landlords, then I am not sure that this is entirely the case from all the experience and data that we have so far. Let me stress that one of the reasons why we are very excited about the data section, which we will come to later in the Bill, is that we have quite a strong belief that there is limited knowledge about who is out there and who is a landlord right now. All we know about are the responsible ones who register themselves and provide information.
A tenant by very definition is not an equal to someone who owns a property. There may be exceptions to that case, such as tenants who are in high-end properties, but on the whole the tenants we are talking about within the Bill are the ones who struggle on a weekly basis to pay their rent. Therefore, it is not a meeting of equals.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendments. Amendments 32, 33 and 34 seek to expand the definition of a family member for the purposes of possession ground 1. This mandatory possession ground is available if the landlord or their close family member wishes to move into the property. These amendments widen the ground to allow a landlord to claim possession from an existing tenant to move in relatives of their spouse, partner or co-habitee, along with nieces, nephews, aunts, uncles or cousins.
In choosing which of the landlord’s family members can move in under ground 1, we have reflected the diversity of modern families while drawing a line short of where some might wish. But we are of the view that to expand the ground any further would diminish tenant protections too far. It would open tenants up to evictions from a wide range of people—potentially very significant numbers indeed where families are large—while providing more opportunity for ill-intentioned landlords to abuse the system.
The noble Baroness, Lady Scott, asked why “family member” is used in Clause 21 while close family member is used in the moving-in ground. The moving-in ground is designed for very specific circumstances where a landlord’s family member is in need of accommodation, so it is right that this definition is narrower, as tenants risk losing their home. New Section 16N of the Housing Act 1988, “Guarantor not liable for rent payable after the tenant’s death”, as inserted by Clause 21, is specifically targeted to stop those grieving being held liable after a tenancy should have been ended, and it is right that this is a broader protection. The use of guarantors is wide ranging and, as such, a wider definition is needed to encompass all relevant persons. However, that is not the case when a tenant is facing eviction from a property.
For these reasons, I ask the noble Baroness to withdraw her amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank the Minister. These amendments may appear complicated in their drafting, but they have one simple objective which is to deliver a consistent definition of the family across the Bill. While I am very disappointed that the Government do not feel able to accept the amendment today, I hope that the Minister is willing to discuss a way to resolve this inconsistency in future meetings as we make progress on the Bill.
The law should be as simple as possible and, crucially, consistent, so that those who have to deal with the legislation in the real world can do so without unnecessary confusion. It is clear that two different definitions of the family will create confusion. A consistent definition would prevent that confusion. While I reserve the right to bring this back on Report, I beg leave to withdraw the amendment.
Member’s explanatory statement
This brings this provision into line with the definitions used in the Agricultural Holdings Act 1986.
Member’s explanatory statement
This brings this provision into line with the definitions used in the Agricultural Holdings Act 1986.
“In a case where, because of paragraph 8(7) of Schedule 1 to the 1988 Act, a tenancy becomes an assured tenancy, the condition in paragraph (c) of the first paragraph of this ground is met if the written statement referred to there is given within the period of 28 days beginning with the date on which the tenancy becomes an assured tenancy.”Member’s explanatory statement
This is consequential on the amendment to clause 34 in my name.
Lord Carrington
Member’s explanatory statement
This amendment, along with other amendments related to new grounds for possession for occupation in the name of Lord Carrington, seeks to enable the landlord to gain possession of the dwelling-house to house their agricultural worker regardless of the worker’s employment status (i.e. employee, worker, self-employed person or contractor).
Lord Carrington (CB)
My Lords, I already declared my interests earlier in the debate.
I will speak to Amendments 48, 49, 51, 52, 54, 55, 56, 57 and 58. Some of these amendments have been kindly supported by the noble Earl, Lord Leicester, and the noble Lords, Lord Colgrain and Lord Roborough. The objective of Amendment 48 is to broaden the definition of “agricultural worker”, regardless of the worker’s employment status to cover not only a direct employee but a self-employed person or contractor, as this reflects modern farming employment practices.
In my meeting with the Minister, to whom I am most grateful for her attention, I learned that she was worried that this could open up an exemption for a wider group of workers, but I hope that I have reassured her that this specifically covers only agricultural workers. Her suggestion that the same could be achieved by allowing self-employed workers to occupy a property under licence would not be appropriate for longer-term workers, which this amendment seeks to address.
We believe that a ground for possession should be available where there is a need to house a non-employed agricultural worker; for example, a self-employed party to a share-farming arrangement on the farm or a self-employed shepherd or cowman. It is quite common in the agriculture industry for workers to be self-employed, but, given the nature of their work, especially if it is with livestock, they need to live on the site.
Currently, ground 5A provides a means of getting possession where the dwelling is required to house someone who will be employed by them as an agricultural worker. However, it does not cover the situation where the worker is self-employed. Similarly, ground 5C does not adequately provide for possession where a self-employed worker has been provided with a dwelling, but the work contract has ended. It applies only when the tenant has been employed directly by the landlord. We would like to see extensions to grounds 5A and 5C to cover situations where the worker/tenant is self-employed as well as employed. I hope that the Minister will be able to accept this amendment, which purely reflects current employment practices in the farming industry and is certainly not designed to cover non-agricultural workers.
I turn now to Amendments 50 and 53 in this group. By way of background, in the rural private rented sector the average length of a tenancy is around seven years, so there is little churn in view of the long-term nature of accommodation in rural areas. Combined with the shortage of rural affordable housing, which I hope will be addressed in the Planning and Infra- structure Bill, the availability of housing to support rural growth, particularly that driven by the increasing need for farm diversification due to lack of profitability in farming, is a clear and continuing problem. This diversification is being encouraged by the Government through schemes such as the Rural England Prosperity Fund. However, this diversification will be held back if it involves the necessity to house an employee on site and there is no availability of housing.
Rural landlords in the private rented sector have traditionally been the employer of their tenants. Historically, they have primarily housed agricultural workers, but with mechanisation, fewer mixed farms and employment costs, these cottages have been rented to others. At the same time, legislation governing the private rented sector has evolved to give extra statutory protection to agricultural workers. However, as farms have modernised and have been encouraged to diversify, many farmers and landlords have businesses which employ staff to operate in non-farming sectors but still need to be housed by the landlord for the better performance of their duties. The system of assured shorthold tenancies has allowed farmers and landowners to recover cottages at the end of the fixed term and thereby house the employee for the new enterprise.
In a situation of assured tenancies, this option will not exist, so the prudent owner may well take the view that he cannot risk an assured tenancy and therefore keep the house unoccupied. This could affect supply in an already-stretched private rented sector. While it remains very important that rural landlords are able to house incoming agricultural workers—new ground 5A —it is increasingly important that they are able to gain possession from a non-employee PRS tenant in order to house an employee of their diversified business.
This amendment would allow possession where the property is required for housing a person who, for the better performance of their duties, is required to be, or is by custom, housed by their employer. In order to conform with an assured tenancy, this circumstance could be made a prior notice ground in an assured tenancy if a fixed-term tenancy is not allowed. The possibility of registering such properties would allow an incoming tenant to be aware that such properties can be let only on fixed terms. Examples of such employees include security personnel, housekeepers, catering staff, wardens and groundsmen.
I urge the Minister to favourably consider this amendment, in light of the real needs of the rural economy, where housing is in very short supply and the need for rural diversification from farming is paramount. The Bill is currently geared toward the urban PRS and does not take sufficient account of the different challenges in the rural sector. I beg to move.
The Earl of Leicester (Con)
My Lords, I support the noble Lord, Lord Carrington, on Amendments 48, 49 and 51 and, subsequently, 50 and 53. On the first ones, the noble Lord is absolutely right that, in the 21st century, the terms of employment in agriculture have moved on: they are not based on the old direct employee relationship. There are increasing numbers of self-employed people—the noble Lord mentioned stockmen and stockwomen, and many stockmen will be self-employed and work for two or three farmers, with two or three herds. Obviously, it puts you at an advantage if you can provide them with a house.
Baroness Grender (LD)
My Lords, we thank the noble Lord, Lord Carrington, and the noble Earl, Lord Leicester, for raising a critical issue that is at crisis point: namely, housing in rural communities. We on these Benches understand the need to support those in the agricultural community, who are on unique tenancy arrangements for a variety of historical reasons. These tenancies often involve longer durations, inter- generational involvement and a closer relationship between the land and the livelihood than is typical elsewhere in the rental sector, as the noble Lord, Lord Carrington, described. As such, it is vital that any legislative change reflects the particular realities of agricultural life and does not introduce any unintended uncertainty or disruption.
Crucially, it is important to ensure that there is greater clarity for both landlords and tenants operating under agricultural tenancies. In a sector where long-term planning and security of tenure are essential, both parties require clear and consistent rules to navigate their rights and responsibilities with confidence. That said, we on these Benches are somewhat hesitant about the proposed amendments in this group to introduce a new repossession ground for these tenancies. We believe it is possible that there may be more effective ways to provide reassurance to those living under such arrangements. On that basis, I look forward to hearing the Minister’s response.
Lord Berkeley of Knighton (CB)
My Lords, as someone who farms, albeit not on the same scale as the noble Lords who have spoken thus far, or indeed anywhere near it, I am very sensitive to the requirement for security of tenants. On the other hand, I know that—
Captain of the King’s Bodyguard of the Yeomen of the Guard and Deputy Chief Whip (Baroness Wheeler) (Lab)
Excuse me, can the noble Lord confirm that he was here at the start of the debate?
Baroness Wheeler (Lab)
But, as the noble Lord was not here from the start of the debate, I am afraid he cannot speak.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Carrington, for bringing a debate on possession grounds. This is an important issue, as it ensures that a landlord—who is often also the employer—can regain possession of a property when it is needed to house a new employee.
I will address Amendments 48, 49, 51 and 52, tabled by the noble Lord, Lord Carrington. These amendments raise an important and complex issue concerning agricultural tenancies, particularly in the light of the proposed reforms to tenancy law, including the abolition of fixed terms and the removal of Section 21 no-fault evictions.
At present, agricultural landlords can avoid creating an agricultural assured occupancy—an AAO—by serving notice before the tenancy begins, thereby establishing it as an assured shorthold tenancy, or AST. This provides access to Section 21, which allows landlords to regain possession without the need to demonstrate fault. It is a mechanism widely relied on in the agricultural sector, where housing is often tied to employment or operational needs. With the removal of Section 21, this option will no longer be available. As a result, there will be a significant shift in the way in which agricultural landlords recover their properties. We must ensure that alternative grounds for possession are workable and fair, and can lead to the recovery of a property.
I do not suggest that there are easy answers here. However, I believe that this area requires careful scrutiny and targeted solutions. I believe the noble Lord’s amendments offer a useful starting point for this discussion and he has rightly brought this to the attention of the House. I urge the Government to consider these issues closely and to engage further with agricultural landlords to ensure that they have the means to house new farmers under their employment.
Finally, I will talk to the remaining amendments in this group: Amendments 50, 53, 54, 55, 56, 57, 58 and 63. We must recognise the value of maintaining the availability of essential employment-linked housing and consider how best to safeguard it in practice. This of course must have thoughtful consideration, as the implications of any decision made affect not only the landlord and the employer but the broader rental market. I hope the Government will give serious consideration to the amendments from the noble Lord, Lord Carrington, as part of a broader and much-needed discussion on how landlords can fairly regain possession of a property when a tenancy is tied to employment that has come to an end. I have milked many cows in my life, and even at Easter I was lambing ewes, so I know a lot about this.
Many roles with occupational housing are time-sensitive and hands-on. A new employee may require immediate access to the same accommodation as the previous employee in order to perform their duties. Herdsmen and herdswomen are often up at 3.30 in the morning to begin milking and shepherds may be lambing right through the night into the dawn, and for their own welfare as a family they need to be on site to fulfil that role. Animal welfare on farms also requires staff to immediately be available at all times, whether it is for calving, lambing, farrowing or just for sick animals, so accommodation on site is absolutely critical. The same applies to those managing diversification of agricultural properties and businesses, managing holiday accommodation or providing security for storage facilities on the farm, for example.
Failure to ensure timely access to such housing can have significant operational impacts. It can delay essential work and place considerable strain on the profit-making enterprises already operating within tight margins. This debate is therefore not only about the protection of property rights; it is fundamental to supporting those agricultural businesses, the people employed in them and the welfare of the stock on those farms, which rely so heavily on occupational housing as a practical necessity.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Carrington, for these amendments relating to agricultural tenancies, and thank him, the noble Earl, Lord Leicester, and the noble Baroness, Lady Scott, for their obvious farming expertise as they have taken us through the rationale for the amendments. I thank the noble Baroness, Lady Grender, for her comments about the long relationships that are often prevalent in rural tenancies. It is important to make the point that one of the aims of the Bill is to facilitate those longer tenancy relationships.
I will make a few general comments, particularly that we appreciate that the agricultural sector has distinct requirements, and it is often vital for workers to live on-site to carry out their duties, as the noble Baroness, Lady Scott, very ably described to us. That is why we have included ground 5A. However, this must be balanced with the needs of the wider rural community. This ground balances both. It allows agricultural workers to be housed while protecting other tenants who may work in critical local jobs.
Widening the ground—for example, to include contractors—could, we believe, open the ground to abuse and decrease rural security of tenure. For example, a landlord could contract someone to do a nominal amount of agricultural work for their business and, on that basis, use the expanded ground to evict a tenant in respect of whom no other grounds were available.
The noble Earl, Lord Leicester, talked about the self-employed and contractors. We recognise that it is sometimes necessary for landlords to move tenants on where accommodation is intended for a particular purpose, and understand that employee accommodation plays a critical role for many employers, so we are strengthening the possession ground by making it mandatory. It would not be right to broaden the ground too much, and thereby reduce the security of tenure for more tenancies, as this would be contradictory to the purpose of the Bill.
There are other arrangements that a landlord can use to help their contractors with accommodation when they are working away from their home, such as paying expenses for the contractor to make their own arrangements, using licences to occupy, or paying for them to be hosted in an Airbnb. As people working away from their home are often working on short-term projects—for example, in the construction industry—tenancy agreements are unlikely to be the right solution in these circumstances.
Taken together, Amendments 48 to 53 would expand the types of agricultural worker that other rural tenants can be evicted in order to house. Amendment 48 replaces the word “person” in the ground with the term “agricultural worker”. As I have discussed, we do not support the overall intent of these amendments, which would reduce security of tenure for all rural tenants with a landlord engaged in agriculture.
Amendment 49 removes the requirement for the incoming tenant to be employed by the landlord, replacing it with a broader definition of “working for a business operated” by the landlord. Amendment 50 specifically mentions service occupants, who are defined later. Amendment 51 changes the wording of the ground from “employee” to the broader “agricultural worker”. Amendment 52 adds a definition of “agricultural worker” for the purposes of the ground which is far broader than an employee. Amendment 53 defines “service occupier” for the purpose of the ground.
The current drafting of ground 5A allows for tenants to be evicted only in order to house employees. Together, these amendments expand this group to include service occupants, contractors and self-employed persons. This definition is far too broad and would endanger security of tenure for existing rural tenants. It would give a landlord running an agricultural business a much freer hand to evict anyone living in their property by, for example, creating a contract with another person to do a nominal amount of work for them. It is just not the right balance. Rural tenants do not deserve less security than others, and the amendments proposed would open up tenants renting from a landlord involved in agriculture to being evicted in a much wider range of circumstances. For this reason, I ask for Amendment 48 to be withdrawn.
Baroness Scott of Bybrook (Con)
Can the Minister explain how this scenario will work? It happens quite a lot, particularly on dairy farms, in my experience. Let us say that an employee milking as a herdsman, living in the one herdsman’s property on the farm, leaves at quite short notice. The day after that employee goes, the cows still have to be milked. The only way to get somebody in quickly to milk them is on contract—that is an easy way of doing it. How will you get that person living close enough to be able to look after the welfare of that herd of cows and milk them twice or three times a day when you do not have any property because you cannot get rid of the employee who has left?
Baroness Taylor of Stevenage (Lab)
Presumably there would be a time lag anyway because of the notice period that is required. Whatever arrangements are made in those circumstances would need to be used in the circumstances that the noble Baroness describes.
Lord Carrington (CB)
I just add that there may not be a notice period if there has been an accident.
I thank all the noble Lords who have contributed to the debate, particularly the noble Earl, Lord Leicester, and the noble Baronesses, Lady Scott and Lady Grender. I look forward to hearing what the noble Lord, Lord Berkeley, has to say before Report.
There are two themes to these amendments. The first is the change in farming employment practices, and these amendments are designed to cater for that. The second theme is farm diversification, which this Government are keen, quite rightly, to encourage. As we all know, diversification ought to lead to growth and growth ought to lead to more housing, as there will be more wealth. I think the Government should, if possible, broaden the way that they look at these two amendments.
The Minister mentioned that the proposals that have been put forward are open to abuse. I say only that the abuse would be by a very small number of people, whom one could probably deal with in a different way. Airbnb and licensing are solutions for certain types of contractors or employees who are brought in for a limited period, but are certainly not suitable for the longer term. It is not in any landowner’s interests to get rid of a tenant who is paying a decent rent in order to put in an employee who is not paying a rent, unless he really has to, so I do not think that abuse is really an issue.
However, I see that we need to look at the definitions very carefully and I am happy to sit down again to try to come up with some definitions of who should qualify for this. That said, I beg leave to withdraw the amendment.
“(2A) After the second paragraph of the new Ground 5C insert—“This ground also applies to the letting of a dwelling-house to a tenant in consequence of the tenant’s service in the office of constable, but with the following modifications.“Employment” means service in the office of constable.In the first paragraph of this ground, in paragraph (d), “the employer” means any of the following persons—(a) the chief officer of a police force;(b) a policing body;(c) in relation to a constable’s service under the direction and control of a person who is not a constable (the “senior person”)—(i) the senior person, or(ii) a person or body with the function of maintaining or securing the maintenance of the body of which the senior person is a member.The first paragraph of this ground has effect as if the following were substituted for the second paragraph (b)—“(b) the tenancy was granted for a particular purpose relating to the tenant’s service as a constable and—(i) that purpose has been fulfilled, or(ii) the tenancy is no longer required for that purpose.”In those modifications—(a) “service in the office of a constable” includes a constable’s service under the direction and control of a person who is not a constable;(b) “chief officer of a police force” means— (i) a chief officer of police (which has the same meaning as in the Police Act 1996 — see section 101(1) of that Act),(ii) the chief constable of the Ministry of Defence Police,(iii) the chief constable of the British Transport Police,(iv) the chief constable of the Civil Nuclear Constabulary,(v) the chief constable of the Police Service of Scotland, or(vi) the chief constable of the Police Service of Northern Ireland;(c) “policing body” means—(i) a local policing body (which has the same meaning as in the Police Act 1996 — see section 101(1) of that Act),(ii) the Secretary of State in relation to the Ministry of Defence Police,(iii) the British Transport Police Authority,(iv) the Civil Nuclear Police Authority,(v) the Scottish Police Authority, or(vi) the Northern Ireland Policing Board.””Member’s explanatory statement
Police officers are not employees but office holders (the office of constable). This amendment expands Ground 5C so that it applies to constables as well as to employees.
Lord Carrington
“New ground for possession for property which is needed to house a protected tenant
24A After Ground 8 insert—“Ground 8A
The landlord seeking possession requires the dwelling-house for the purpose of housing a person who either—(a) was employed by the landlord, or in the case of joint landlords seeking possession, by at least one of those landlords, and whom the landlord has an ongoing statutory duty to house after the job has ended as provided by the Rent (Agriculture) Act 1976 or this Act, or(b) is the former employee’s successor under the Rent (Agriculture) Act 1976 or this Act.””Member’s explanatory statement
This new ground for possession allows possession of a property where it is needed for the landlord/s to provide Suitable Alternative Accommodation under the Rent (Agriculture) Act 1976 or this Act to a protected former employee (or their successor) whom the landlord has a lifetime duty to house.
Lord Carrington (CB)
My Lords, I repeat that I declared my interests earlier in the debate, so I will not bore your Lordships with them again. I am now talking about Amendment 65, on which I am pleased to have the support of the noble Earl, Lord Leicester, and the noble Lord, Lord Roborough. Once again, it is a fairly technical matter, so I will try not to send everyone to sleep.
I thank the Minister for her engagement on this issue. I have taken on board her concerns, which relate principally, as we have heard throughout these debates, to making sure that the rights of assured tenants are not affected.
Many former or current agricultural employees have protected tenancies under the Rent (Agriculture) Act 1976 or they have lifetime security of tenure as assured agricultural occupants under the Housing Act 1988. While landlords have the statutory duty to house these protected tenants for their lifetime, and for at least one succession to a spouse or other family member, they have the right under the above statutes to offer such tenants suitable alternative accommodation—SAA.
Often, the tenants of these houses occupy housing required for a new agricultural worker or a property that is no longer suitable for them due to age or infirmity. In its current form, the Renters’ Rights Bill does not address the fact that a property may be occupied by a protected tenant. To offer that property to a new agricultural employee or rehouse an aged retiree to ensure that their housing needs are appropriately met, another property is required to offer as suitable alternative accommodation to that protected tenant. There is currently no ground in the Bill to allow possession of a PRS property in order to rehouse a tenant whom the landlord has a statutory lifetime duty to house. This amendment will enable landlords of rural properties to manage their properties when rehousing protected tenants.
The amendment is vital because of the longer-term nature of accommodation in rural areas. The average tenancy, as I said in a previous debate, last for 7.5 years and it is often not possible to rely on a natural churn of tenancies in order to offer the suitable alternative accommodation when it is needed. A nearby vacant rental property is often unavailable. Accordingly, our amendment deals only with the issue of suitable alternative accommodation under the terms of the Rent (Agriculture) Act 1976 rather than the Rent Act 1977, covering non-agricultural workers. It aims to ensure that the existing right can be honoured: in other words, that properties will be provided for protected tenants when required.
The amendment enables landlords to provide such accommodation when it is needed. This is particularly important when it comes to former agricultural workers who have lifetime security of tenure under the Rent (Agriculture) Act 1976. It should be noted that it is very common that such workers are moved on retirement to an alternative property owned by the employer, as the particular property they have occupied as part of their job is key to the nature of their work: for example, the dairyman’s house and things like that.
This amendment is in some ways similar to Amendment 62, from the right reverend Prelate the Bishop of Manchester and the noble Earl, Lord Leicester, which seeks to facilitate the housing of retired clergy. In both cases, the properties required are usually used for employees, but they will be let on the open market for times when they are not required by employees or former employees. Employers need to know that they will be able to regain possession as and when needed, or else they will not let them out. However, the big difference between this amendment and Amendment 62 is that, in the case of Amendment 65, the landlord has a statutory duty to house the employee under existing legislation.
The Bill already acknowledges in new ground 5A the fact that it is critical to certain jobs that an employer can house an incoming agricultural worker. The point of this amendment is to ensure that, when an incoming agricultural worker comes into a property, that property can be made available to the outgoing retired agricultural worker whom the landlord has a statutory duty to House, even after the job has ended.
This amendment is a key part of the mechanism for making way for an incoming agricultural worker, so that a different property can be freed up for the retired outgoing worker. In short, it is like the incoming agricultural worker ground but it is, in effect, an incoming retired agricultural worker whom the landlord has the duty to House. This circumstance could be made a prior notice in an assured tenancy if a fixed tenancy is not allowed. That would mean that PRS tenants would be on notice from the outset that this is the type of house that a landlord usually uses to house employees—incoming or retired—and they may give notice in the future on this ground.
Finally, as I am sure the Minister will point out, there is the possibility, under Section 27 of the Rent (Agriculture) Act 1976, of applying to the local authority to have retired agricultural workers housed. This is only in very limited circumstances where the following conditions are fulfilled: the house is occupied by a qualifying worker, protected by the Housing Act 1988 or the Rent (Agriculture) Act 1976; it is required for an incoming agricultural worker; the employer cannot by any reasonable means provide alternative accommodation; and the authority ought to provide it in the interests of agricultural efficiency.
The Earl of Leicester (Con)
My Lords, I support the noble Lord, Lord Carrington, on Amendment 65. I take this opportunity to apologise that, sadly, I was not able to attend the first day of Committee on Tuesday, when, had I been able to, I would have supported the right reverend Prelate the Bishop of Manchester in his Amendment 62, which, as the noble Lord, Lord Carrington, noted, is reasonably similar to this.
I shall embellish what the noble Lord has said clearly with two examples. One example is a house that has been lived in by a protected tenant family but, 30 or 40 years on—that is the reality of protected tenancies—the house might need serious refurbishment, which after 35 years may cost north of £100,000 to comply with EPC or MEES, and will take nine or more months to complete; and the need to find a house to put said old and retired couple in more suitable accommodation while retaining their protected tenancy status. That accommodation might be an almshouse or a bungalow.
The second example is a protected tenant family that may have been a large family, with three or four children back in the day, occupying a four-bedroom house. The children have married or moved away. The father is deceased and the widow is knocking around in a large four-bedroom house that is expensive to heat and manage; perhaps it has a dangerous old staircase, with a bathroom downstairs and the bedrooms upstairs. One has to think about this, because that is denying a large house to a young, growing family who may themselves be in a two-bedroom flat or house. A simple solution—which, again, would come through negotiation, but I am sure would be welcomed by a widow—would be a house swap, with the widow retaining her protected tenancy. That would mean evicting the small, growing family, but offering them the opportunity to move into a larger house.
There are quite a few examples in the rural tenanted sector—and, I suspect, in the urban sector—where families have stayed in houses for many years, but then the family, having grown for 20-odd years, starts reducing in size but they remain in a big house. So it is important that protected tenants can be housed in smaller houses and that the tenants of those smaller houses are moved out, to allow the churn of housing as families grow and then reduce in size.
Lord Berkeley of Knighton (CB)
My Lords, I apologise to the Committee for speaking prematurely. I speak as someone—I should declare this interest—who has a small farm, as I said earlier, which is very small in comparison with those of some of the noble Lords who have spoken. However, I have seen at first hand some of the problems that have been described. In particular, I remember one old lady who carried on in a house where she simply was not able to manage the property and its upkeep. What I think the noble Lord, Lord Carrington, and the noble Lord opposite are suggesting would help to avoid very painful, costly legal cases where people have to try and get somebody out, which causes enormous bad feeling and cost.
I am in favour of this amendment and would have been in favour of previous ones because I think in farming at the moment the difficulties that landlords face are so immense—I will not go through them all now—that the ability to keep a farm going, which is the interests of tenants and future tenants, is prejudiced if they cannot get back suitable accommodation. I completely understand the desire, which I am sure the Government have, to offer security to tenants. In fact, that is an extremely important part of the fabric of our society, but we have moved on in some ways and what has happened in farming and what I have observed around me in mid-Wales is that there is a need to be able to get back certain properties to bring in younger people to farm.
I broadly support these amendments and suggest to the Government, with great respect, that if there is any way that they can move to accommodate them, I would very much support them.
Lord Jamieson (Con)
I am grateful to the noble Lord, Lord Carrington, for moving this amendment and again he has given an excellent technical explanation of the need for it. I shall not try and repeat it, in the certain knowledge that I would not give as good an explanation. It recognises the enduring statutory duties placed on certain landlords to house former employees. I also thank the noble Earl, Lord Leicester, and the noble Lord, Lord Berkeley of Knighton, who have further explained and emphasised the issues and why this amendment is necessary.
Many of these tenants are retired agricultural workers who have given years, sometimes decades, of service and who now occupy homes with lifetime security of tenure. As such, landlords—often small family-run farming businesses—continue to shoulder a statutory duty to provide housing, even after the employment relationship has finished. This is not merely a moral obligation; it is a legal one that increasingly runs into practical difficulty.
The housing needs of retired employees can evolve over time. A once necessary dwelling may no longer be suitable, as has been mentioned, due to age, health, or changes in family circumstances and numbers. At the same time, that same property may now be needed to house a current employee whose work is essential to the functioning of the farm. Yet under the current drafting of the renters reform Bill, landlords cannot regain possession of that alternative accommodation in order to fulfil their continuing statutory duty. Amendment 65 corrects that oversight. It provides for a narrow, targeted new ground for possession applicable only when the landlord is required to rehouse a protected tenant or their successor, and only when suitable alternative accommodation is required for that purpose.
This is not about weakening tenant protections or finding a loophole—far from it. This is about balance, ensuring that landlords who remain bound by statutory obligations are able to meet them in practice. Without this amendment we risk trapping landlords in a legal Catch-22, where they are legally required to provide suitable housing but legally prevented from doing so. Importantly, they will be able to provide accommodation to retired employees who may have given many years of service and who deserve secure accommodation in their retirement, without the risk of breaking the law or leaving accommodation empty in expectation of its use later.
This amendment does not open a back door to wider evictions; it simply ensures the fair and functional operation of existing, long-established housing duties. It is balanced, proportionate and essential to upholding the very laws that protect these tenants.
Baroness Taylor of Stevenage (Lab)
My Lords, once again I thank the noble Lord, Lord Carrington, for his amendment which would create a new ground for possession, and thank the noble Earl, Lord Leicester, and the noble Lords, Lord Berkeley of Knighton and Lord Jamieson, for their contributions to this debate. This ground would enable a landlord to seek possession of a tenanted property in order to re-let the property to a person to whom they have a lifetime duty under the Rent (Agriculture) Act 1976 or the Housing Act 1988.
I thank the noble Lord, Lord Carrington, for his collaborative engagement on this matter and for helping me through his reasoning for the amendment, both in our meeting and his clear explanation in this Chamber. However, our position towards this amendment remains the same. It would go against the general principle of increasing security of tenure for assured tenants that is consistent throughout the Bill.
We do not agree that there is a compelling reason that this particular group of agricultural tenants need to be housed in specific dwellings at the expense of existing assured tenants. Where a landlord has a statutory duty to house an agricultural tenant or their successor, in many cases landlords will be able to move tenants as and when suitable properties become available. Landlords can also use the existing discretionary suitable alternative accommodation ground 9, which the noble Lord, Lord Carrington, mentioned, to move an assured tenant to another property if needed.
The noble Earl, Lord Leicester, referred to the issue of underoccupation, which all landlords face. I certainly faced it as a social landlord when I was a council leader; it is not unique to farming. The idea that mandatory eviction is the answer to this, rather than incentivising people to move on from underoccupied properties, would be a completely new area of legislation to be considered and would be out of scope of this Bill.
The new ground would mean that an existing assured tenant could be evicted through no fault of their own, simply moving the problem around and creating insecurity for tenants. As the noble Lord, Lord Carrington, said, this is similar to the issue we discussed on Tuesday in relation to retired clergy. I understand the distinction that the noble Lord made in relation to the statutory duty, but it is not for a specific property. The issue of just moving the problem around is the same. As such, I ask the noble Lord to withdraw his amendment.
Lord Carrington (CB)
I thank everyone who has contributed, particularly the noble Earl, Lord Leicester, my noble friend Lord Berkeley of Knighton and the noble Lord, Lord Jamieson.
I think we must agree to disagree on this. The Minister, quite rightly, is trying to uphold the essence of the Bill, which is security of tenure for assured tenants, and does not appear to be able to consider the fact that some properties should have a sticker on them saying “prior notice could be given for the occupation of this property”. I think that would be a sensible solution because there are two big things that this Bill does not take account of—no doubt among others.
First, the rural economy is very different from the urban economy. We do not have the housing that is available in the urban economy, and we are going through a revolution in terms of farming. Secondly, and I keep emphasising this, the farmer or landowner has a statutory duty. That was put firmly in an Act passed, I believe, under a Labour Government: the Rent (Agriculture) Act 1976. I urge the Government to consider this again, but in the meantime, I withdraw the amendment.
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment seeks to understand in what circumstances the Government feels it would be appropriate for the Secretary of State not to publish the form or ensure the form is the up-to-date version.
Baroness Scott of Bybrook (Con)
My Lords, I will be brief. Amendment 68 seeks to make a modest but sensible change to Clause 6 by replacing “may” with “must”. The intention here is clear: to ensure that the Secretary of State is under a duty—not merely a discretion—to publish the prescribed form for a notice of possession and to ensure that it is kept up to date. We simply do not understand why the Government believe that discretion is necessary in this case. If a form is to be relied on by landlords and tenants alike, and ultimately by the courts, it must be accessible and current. Anything less introduces the risk of confusion, inconsistency or even procedural unfairness.
Can the Government kindly explain the rationale behind retaining this discretion? In what circumstances does the Secretary of State envisage not publishing the form or not ensuring that the version in use is the most recent? This is a matter of basic clarity and procedural transparency, and I hope the Minister can provide some reassurance on this point.
Baroness Grender (LD)
My Lords, I find myself in a strange position: having argued earlier on discretionary powers to change “must” to “may”, I now find myself in support of changing a “may” to a “must”. I agree with the noble Baroness, Lady Scott, that making this open, available and transparent would be a good thing. I look forward to hearing the Minister’s response.
Lord Empey (UUP)
My Lords, I would have thought that common sense alone would have encouraged the Government to accept the amendment on the grounds that, surely, it is one way of avoiding potential legal arguments where people will get into a dispute over the actual process and will argue that form A should have been in one form and form B in another. Surely, it is relatively straightforward to ensure consistency, clarity and certainty. Having a position where forms are not published does not seem to make any sense, and I would appreciate it if the Minister could explain to the Committee why it would be in the Secretary of State’s interest even to have the burden of that responsibility, never mind the difficulties that tenants and others might have. Surely anything that could create certainty and remove grounds for illegal dispute would be in the interests of the Minister and the Government.
Baroness Taylor of Stevenage (Lab)
My Lords, I hope that I can explain this very quickly and simply. I thank the noble Baroness, Lady Scott, for her amendment regarding the form of notice for proceedings. Clause 6 allows the Secretary of State to publish the prescribed form to be used when landlords serve notice of intention to begin possession proceedings. The form will continue to be published on GOV.UK. Amendment 68 by the noble Baroness, Lady Scott, would not affect whether the Government are required to prescribe that form. This requirement is already laid out in Section 8(3) of the Housing Act 1988 and is not repealed by any measure in the Renters’ Rights Bill.
Clause 6 provides that regulations may allow the Secretary of State to publish and update the required form without the need for any updates to be made by way of statutory instrument, as is currently the case. It is crucial that the information that landlords are required to provide reflects current law. This clause will allow regulations to be made so that we can update the forms at speed and respond to changing circumstances. As the notice of possession proceedings remains a prescribed form under Section 8(3) of the Housing Act 1988, the requirement for the Government to prescribe the form persists; however, Clause 6 provides a simpler mechanism in which the form can be updated—it is the mechanism that changes.
I therefore ask the noble Baroness to withdraw the amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank the Minister for that explanation. I am afraid that I am still confused, and what I would like to do is to read her explanation in Hansard and reserve the right to bring this back if we do not think that it is clear. It did not quite make sense to me, but I am sure that it might if I read it in the next couple of days. With that in mind, I beg leave to withdraw my amendment.
Renters’ Rights Bill
Monday 28th April 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-III Third marshalled list for Committee - (25 Apr 2025)
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
Before we move to the debate on the amendments, I will make a statement. I remind the House again of the protocol around declaring interests. As I mentioned last week, noble Lords should declare relevant interests at each stage of proceedings on a Bill. That means in Committee, relevant interests should be declared during the first group on which a noble Lord speaks. If a noble Lord declared an interest during the last two days in Committee, that is sufficient, but, if this your first contribution, any relevant interests should be declared in a specific but brief way.
Amendment 69
Baroness Scott of Bybrook
“Assessment of operation of possession process(1) The Lord Chancellor must prepare an assessment of the operation of the process by which—(a) on applications made by landlords the county court is able to make orders for the possession of dwellings in England that are let under assured and regulated tenancies, and(b) such orders are enforced.(2) The Lord Chancellor must publish the assessment at such time, and in such manner, as the Lord Chancellor thinks appropriate.(3) In this section—“assured tenancy” means an assured tenancy within the meaning of the 1988 Act;“dwelling” means a building or part of a building which is occupied or intended to be occupied as a separate dwelling;“regulated tenancy” means a regulated tenancy within the meaning of the Rent Act 1977.”Member’s explanatory statement
This amendment would require the Lord Chancellor to assess the operation of the possession process to ensure that the courts service has the capacity to deal with the increased demand expected because of this Bill.
Baroness Scott of Bybrook (Con)
My Lords, I rise to speak to this group of amendments and to thank my noble friend Lord Young of Cookham, the noble and learned Lord, Lord Etherton, and the noble Baroness, Lady Thornhill, for their amendments.
Before I get into the substance of the debate, I would like to issue a plea. I hope the Minister knows that I have the utmost respect for her. However, so far in Committee, we have been disappointed with the responses we have received to our debates and amendments. I can say in good conscience that, when I sat in her seat on her side of the Chamber, I treated every amendment put before me with respect; I often took issues back to the department to consider and, where possible, made changes. That is because I understood that it was the role of the House of Lords to scrutinise, revise and improve legislation. Unfortunately, it does not feel like this is still happening. Questions go unanswered and suggestions are dismissed without sufficient consideration.
This House has always been more about reason and substance than blind political ideology. I hope that the Minister can approach our debates going forward in that vein. I know full well that Ministers cannot always have the answers at their fingertips, and I am very happy to have written answers on points of details. However, I do ask that the Minister treats our House and our suggestions seriously, in the nature that they are intended.
This group addresses a critical issue that will determine the success or failure of the Bill: the capacity of our courts to deliver it. Let me say from the outset that we fully support the ambition to strengthen security and fairness in the private rented sector. That commitment was made clear in the previous Renters (Reform) Bill. Within that, the previous Conservative Government set out that Section 21 would not be abolished until meaningful court reform had been undertaken and sufficient progress achieved. Such caution was not merely prudent but essential, considering the challenges facing our courts system.
This Bill abandons the careful sequencing we set out under the previous Renters (Reform) Bill. Under our approach, Section 21 would not have been abolished until meaningful improvements had been made to His Majesty’s Courts & Tribunals Service. We also committed to a six-month implementation period for new tenancies to ensure that the system could cope. These safeguards were not incidental; they were essential.
However, in this Bill, those safeguards are gone. There is no clear commitment to upgrade court capacity before abolishing Section 21 and no phased rollout to protect the system from being overwhelmed. As a result, we face a real risk that our courts will be asked to carry out a far more demanding role without the necessary resources, reforms or readiness.
The ambition of the Renters’ Rights Bill is commendable, but ambition alone is not enough. We must also confront the operational realities. This legislation will place significant demands on our already stretched courts and tribunals system. If we press ahead without ensuring that the system is properly resourced, modernised and fully functional, we risk undermining the very objectives that the Bill sets out to achieve. Tenants and landlords alike need a process they can trust: one that is timely, fair and accessible. Without that, this reform will falter at the first hurdle.
Let us be clear about the scale of what we are asking the courts to do under this legislation. With the removal of Section 21, we are fundamentally reshaping the legal framework for possession. Possession cases that might previously have been resolved swiftly, albeit controversially, will now be channelled through more complex, contested grounds. This is a just and necessary step, but it is one that demands an equal and opposite increase in our ability to administer justice efficiently.
Yet the system is not ready. The Civil Justice Council, the Law Society and countless court users have been sounding the alarm for years. Backlogs are rising, court rooms lie unused for lack of staff and overburdened judges are stretched too thin. In some parts of the country, landlords wait months, not weeks, for a simple hearing. In turn, tenants are left in limbo and often under the threat of eviction without resolution or recourse.
We must remember that delay is not neutral. It is not a benign inconvenience. It is a deeply disruptive force in people’s lives. For a landlord, it might mean months without rental income, with mortgage arrears mounting. For a tenant, it means living in a state of uncertainty. That silence—those weeks and months of not knowing—is not just stressful but debilitating. It leaves tenants feeling powerless and unable to plan their future and move forward.
It is for that reason that I urge the Minister to consider carefully Amendment 69 in my name, which requires the Lord Chancellor to conduct an assessment of the possession process. This assessment would examine how county courts handle applications from landlords for possession of properties under both assured and regulated tenancies, and how those orders are subsequently enforced.
This is a foundational step. If we are to move away from Section 21, we must be absolutely confident that the remaining legal routes for possession are functioning effectively, fairly and in a timely manner. This is not just a tick-box exercise; it is about ensuring we have a legitimate understanding of where our courts stand, their capacity and whether they are in any fit state to take on the increased volume and complexity of cases that this Bill will inevitably bring.
The amendment ensures transparency, accountability and evidence-based implementation. Without such an assessment, we risk walking blindly into a situation where the courts become the bottleneck, where neither landlords nor tenants can get timely access to justice. Likewise, Amendment 283 provides an essential safeguard. It would ensure that Section 21 cannot be abolished until the assessment outlined in Amendment 69 has been published and, crucially, that the Secretary of State is satisfied that the courts have the capacity to manage the increased demand. This is not an attempt to delay reform indefinitely; it is a commonsense measure to ensure that reform is deliverable. It puts the infrastructure in place before the policy takes effect. Without this step, we risk setting both tenants and landlords adrift in a system that simply cannot cope.
I look forward to hearing from other noble Lords on this very significant group. The amendments from the noble and learned Lord, Lord Etherton, in particular, underscore the necessity of certifying that the court system has the capacity to manage the anticipated increase in possession cases. Amendment 279 in his name stipulates:
“None of the provisions of this Act, other than this subsection, come into force until the Secretary of State certifies that the average time for the court’s disposal of landlords possession actions in respect of residential property is as timely as in the year ending 23 March 2020”.
This benchmark is not arbitrary. It reflects a period when the system was functioning at a level that we can reasonably expect to return to. Furthermore, Amendment 280, also in his name, reinforces this by requiring the Secretary of State to certify that the courts are not only timely but efficient and adequately resourced to handle the increased caseload.
These amendments are not about delaying progress. They are about ensuring that progress is achievable and that the reforms we implement are not undermined by an overburdened and underresourced court system. As we have discussed, the abolition of Section 21 will undoubtedly lead to more contested possession proceedings. Without the necessary court capacity, we risk exacerbating the very issue that we seek to address: delays, uncertainty and a lack of access to justice for both tenants and landlords. The amendments before us today provide a prudent and responsible approach to ensuring that our court system is ready to meet these challenges.
In conclusion, I urge the Government to give serious consideration to these amendments. They represent a balanced approach that aligns the ambition of the Renters’ Rights Bill with the practical realities of our courts system. We have noble Lords present who are experts in that system and I look forward to listening to their contributions. I beg to move.
Lord Young of Cookham (Con)
My Lords, Amendment 205 in my name has much in common with the other amendments in this group, which are probing amendments to see whether the capacity of the courts is up to dealing with the cases that are likely to come before them—not least the likely increase in possession cases when the Act is implemented, and of course to deal with any backlog that has accrued between now and when it comes into effect.
Amendment 283, in the name of my noble friend Lady Scott, is the most demanding of the amendments. It basically defers the abolition of Section 21 until an assessment of court capacity has been completed and the Secretary of State is satisfied about capacity. Amendment 69 finds her in a more conciliatory mood. That amendment does not delay the abolition of Section 21 but requires the Lord Chancellor to monitor progress and ensure that the capacity is there, and it sets no time limit on that assessment. My Amendment 205 finds a middle way, requiring the assessment to be carried out within six months of the passage of the Bill, while Amendment 264, in the name of the noble Baroness, Lady Thornhill, is more generous, allowing two years. Neither would hold up the abolition of Section 21.
Lord Cromwell (CB)
My Lords, the noble Lord, Lord Young of Cookham, has again spoken so much sense that it leaves me little to add. I should warn him that in our previous day’s debate I was described as “irritatingly persuasive”, so I hope not to damage his case by supporting it.
There is a real issue here and it does need some serious probing. I am not suggesting that we retain Section 21, but noble Lords have raised at Second Reading and today in Committee, as I am sure others will raise again, the courts simply not being ready to take on the burden that is coming to them. There is no credible timescale to transform the clogged courts and tribunals system. However, my main reason for speaking is to put on record and advise the House that I attended a meeting—with the Minister and other noble Lords, some of whom are present today—with those responsible for the court digitisation, which has been held out as the kind of techno magic that will transform the speed of court processes.
This was illuminating, but it left attendees, a good number of whom have very considerable experience of our legal system, very doubtful about this still-evolving IT system. The view from the people I spoke to was that it would take at least five years to bed in.
The Earl of Kinnoull (CB)
My Lords, Amendments 279 and 280 stand in the name of my friend, the noble and learned friend, Lord Etherton. I signed those amendments as well, not with a legal hat on but more with the hat of someone who has been there for the development of a large number of complex IT systems over the years, and has probably contributed to almost every mistake it is possible to make in doing that.
The noble and learned Lord, Lord Etherton, unfortunately cannot be here today, so I am going to make some observations that follow on nicely from what the noble Lord, Lord Cromwell, has just said. I refer the Committee to my register of interests. I am, in my own capacity and to a small extent, a landlord, but in Scotland. I am also trustee of a couple of trusts in Scotland that are renting properties out.
The problem was set out by the noble and learned Lord, Lord Etherton, at Second Reading. I am afraid that, because he is not here, I will use his words very briefly. He said:
“We all know that there will be many more contested possession proceedings by landlords following the enactment of the Bill and the abolition of Section 21 no-fault evictions. It would not be right to abolish no-fault evictions without adequate speed and resources for dealing with the increase in contested proceedings … The Government need to demonstrate that measures have been or will be put in place which will help to secure that court claims by landlords for possession of residential properties will be disposed of in a timely and efficient way”.—[Official Report, 4/2/25; cols. 623-24.]
The meeting to which the noble Lord, Lord Cromwell, has just referred took place on 11 March. There were half a dozen Cross-Bench people there. I am holding the 30-page presentation that was handed out. There were officials there from the Ministry of Justice, in particular from HM Courts & Tribunals Service, and from MHCLG; the Minister was there as well. It was an extremely interesting presentation, and there were two things that came out that I feel I should speak to the Committee about today. The first was about the size of the problem. There is a slide that scopes out the size of the IT system that is involved. This IT system exists today. The noble and learned Lord, Lord Etherton, is very familiar with the IT systems that support the court services, as he was responsible for a large number of them for some years, and he was very much the driver for the half a dozen of us who were there.
That IT system has separate subsystems for case management, hearings management, work allocation, user registration and fee payment—there are others as well. Noble Lords can see just how complex this IT system is. In each of the things I have just mentioned, there would of course be major changes required to the IT system that would need to go through development and be dealt with in a proper way.
After considering the size of the problem, which I certainly assess as pretty big, we went on to discuss their approach to the design and build of the new system. This was in a slide that was extremely clear, and they were pleased to report that the prototype stage had arrived. The prototype stage sounds very hopeful, but in fact this comes before the fifth of the six stages, which is “prepare for build”; the sixth stage is “build and test”. The prototype is literally that—something which comes at a pretty early stage in the development of the IT system. All that comes, of course, before user acceptance testing and actually training up people involved in the court system to use this complex system in an efficient manner. The acid question that was put to the people advising us on this was how long they thought it would take to get to the end of the “build and test” stage. The answer on 11 March was two years.
The people who were briefing us universally gave a very good impression indeed. I have met a lot of IT people, but they seemed to me very steady in every way and have clearly been through this a lot before, so I have no reason to doubt their two-year estimate for getting to the end of the IT build. In speaking to colleagues afterwards, I think they also felt that the people who were presenting it—who were, after all, the people who were actually doing the programming—were of a very high quality.
With no IT system, the presentation explains that there are 110,000 cases a year, and this is without any uplift in the number of cases that one would expect. The uplift referred to earlier in this debate, and by the noble and learned Lord, Lord Etherton, in his Second Reading contribution, was 110,000 cases a year. Let us say that we had only a year and a half of it because things went on, but that would be 165,000 cases clogging up a system that is already under strain, producing delay and, because it is going into the county court system, affecting access to justice for the rest of the county court system as well, one assumes. The amendments that the noble and learned Lord prepared—and I was very much in consultation with him while he was doing it—were aimed at trying to prevent undesirable outcomes.
Can the Minister update us on the progress of the IT system that was presented to us on 11 March? Will she agree to meet further to discuss this issue after Committee?
Lord Empey (UUP)
My Lords, in previous contributions to the Committee, I made the point that our objective should be to increase supply and simultaneously reduce demand. I think we are now facing a situation in which we are doing everything in our power to decrease supply. The amendments tabled by the noble Lord, Lord Young of Cookham, and the noble Baronesses, Lady Thornhill and Lady Scott, are all basically meritorious in their own way, but they are all trying to solve a problem that we foresee. It does not have to be thought about as something that may happen as a remote possibility: it is almost a certainty and therefore has to be addressed.
There are other things that I think the Government are doing that are decreasing supply. The prospect of a landlord entering into the relationship with a tenant is even further off-put by these measures in the uncertainty that they could be left with no income for very long periods of time and tenants could find themselves stranded if they cannot go to a court and have the thing settled.
I also raised with the Minister the ECHR implications. There is yet another matter that is arising: there are reports that the Government are effectively talking out of both sides of their mouth at once. Here they are telling us that we have to get rid of Section 21 as we do not want agreed-term tenancies; on the other hand, it appears that the Government are going to landlords and offering them up to five-year tenancies if they house asylum seekers. You cannot have it both ways. The Minister told me that you could not discriminate between one tenant and another, but in fact that is precisely what we are doing. We are introducing a new class of tenant—a tenant who is in a superior position to the ordinary tenants we have at the moment. There is a great deal of uncertainty around this. Common sense dictates that this matter of the courts has to be addressed, and the very fact that we are having to burden the courts with our legislation tells us that perhaps there is something fundamentally wrong with this in the first place.
Lord Wolfson of Tredegar (Con)
My Lords, I speak in support of Amendments 279 and 280 in the name of the noble and learned Lord, Lord Etherton, who is unfortunately unable to be in his place today. I hoped to have added my name to them, but I think I got to the Public Bill Office after the Marshalled List had gone to print. These amendments, together with others in this group, address an issue that is central to the Bill: the capacity of the courts. I declare at the outset my interest as somebody who benefits from rental income from residential property, as set out in the register.
Lord Northbrook (Con)
My Lords, I declare my interest as a landlord of rental properties in Hampshire. I support all the amendments in this group. I fear that the Government may not support Amendment 283, even though it was in the original Bill that was presented when we were in Government.
I will focus on the amendment from the noble Baroness, Lady Thornhill, which would require the Government to conduct a formal review of the Bill’s impact on the court system within two years of its enactment. This review, supported by the National Residential Landlords Association, would assess case volumes, the court’s ability to manage demand, the efficiency and timeliness of proceedings, and the administrative burden on the courts. It would require the Secretary of State to consult legal practitioners, court officials and other relevant experts to ensure that decisions are based on reliable evidence.
Crucially, this amendment does not seek to delay the abolition of Section 21. Instead, it would ensure that the Government monitor the impact of these changes and, if necessary, take action to address the extra pressures on the justice system.
With the abolition of Section 21 no-explanation repossessions, landlords will become more reliant on the courts when seeking to gain possession of a property using the legitimate grounds under the Section 8 process. However, as many other noble Lords have said, this shift raises serious concerns about the capacity of the justice system to handle the increased caseload. The Law Society notes:
“The bill in its current form, may lead to an increase in contested hearings in the short term, as landlords that would previously have used no-fault provisions will instead have to show good reason for eviction”.
The Housing Minister has said that the Government are working to ensure the courts are “ready” for the system replacing Section 21. As other noble Lords have said, they have given no indication on what this means in practice or how it will be achieved. The court system was already struggling. As the noble Lord, Lord Young of Cookham, has said, the Housing Minister told the Bill Committee in the Commons that
“the court system is on its knees”.—[Official Report, Commons, Renters’ Rights Bill Committee, 22/10/24; col. 9.]
Government data shows that the average time to process and enforce a Section 8 possession case—the grounds-based route to possession—is over seven months. That is seven months in which a responsible landlord might be left unable to recover their property in cases of serious rent arrears or anti-social behaviour; seven months where neighbours may have to endure disruption; and seven months in which tenants who are genuinely in need of housing will not have access to the market because homes that should be available are instead tied up in legal delays. It is only right and fair that responsible landlords have confidence that the system will not leave them in limbo when they have legitimate grounds for possession.
Tenants also face major barriers to justice. As the noble Lord, Lord Young of Cookham, has said, close to a majority of the population of England and Wales do not have a housing legal aid provider in their local authority area.
Given all this, Richard Atkinson, the president of the Law Society, has rightly concluded that
“the bill will not be effective without further investment in the justice system. We urge the government to provide greater funding and more clarity to the enforcement provisions so that justice is accessible to renters and landlords alike”.
No mention is made in the impact assessment of what the extra costs of improving the Courts & Tribunals Service will be, or of implementing the new IT system that other noble Lords have met with the Minister to hear about. Does that mean that nothing extra will be spent on improving systems in the Courts & Tribunals Service?
Baroness Grender (LD)
My Lords, I wish to ensure that there is an awareness within the context of these amendments of the current state of play. According to a briefing from Generation Rent, which I thank for the information, only a tiny minority of tenancies ever get anywhere near a court—currently, about 0.3% end in repossession in the court. While the courts are indeed very overcrowded and have a lot of cases coming before them, it is important to understand where in the hierarchy tenancies currently are.
In addition, the vast majority of tenants, the minute they receive a notice—whatever the notice is—tend to see the writing on the wall and leave, because there is such a strong power imbalance, and therefore it never makes it to court. Although I recognise that we are hearing about the situation when something reaches court, the likelihood of anything actually reaching court is, as we will discuss in further amendments later today, often very remote, from both sides of the argument.
Lord Northbrook (Con)
I am sorry to disagree with the noble Baroness but, sadly, from practical experience, I think what she is saying is not necessarily the case.
Baroness Thornhill (LD)
My Lords, I will wind up on this group and give a little more detail on my Amendment 264. It is a straightforward amendment; I like to be straightforward. Based on the facts given by noble Lords in this debate, there is evidently a genuine concern about the capacity of the courts to deliver. All contributions have been well evidenced and—I will be quite frank—are worrying.
From our perspective, as was evidenced by the contribution from my noble friend Lady Grender, we support this legislation, we want ir to work and, for it to work, we know that the courts have to be efficient. If they are not, it could undermine the core purpose of the Bill, as was passionately said by the noble Baroness, Lady Scott. We know of, and understand, the issues regarding the courts. These have been well articulated in every contribution across the Committee, so I will not repeat them. However, many legitimate questions have been posed to which we need answers.
On Amendment 264, it is vital that court capacity is reviewed, and that this is enshrined in the Bill to make sure that it happens formally and can be scrutinised within two years. We feel that two years is probably enough, certainly to sort out the IT—as referenced by the noble Earl—and to feel whether we are moving on to an even keel after an initial transition period. I am sure that, as we go through the rest of the days in Committee, we will look at that transition period.
The amendment looks at all the key components for the effective working of the courts. It asks to look at access to justice. We must ensure that the system is accessible, affordable and understandable for all, regardless of a tenant’s background and circumstances. It is legitimate to ask the Government for their commitment to resourcing the courts and to have hard evidence about case volume, how many cases, and how long they are taking—the last aspect being very important for both landlords and tenants.
As has been mentioned, the current evidence is of the months ticking by, which is unfair to landlords. Their concerns in this instance are valid. Under the new grounds, if eviction is legitimate, it needs to happen quickly. Delaying things by months could put some landlords in financial jeopardy and tenants in real limbo and uncertainty. I am sure that any Secretary of State would want answers to these pertinent questions within a reasonable timeframe to ensure that all is working as intended, or, if not, in time to make some remediation, as the assessment will be based on real data. I am certain that the Government, too, are concerned about this and are doing everything they can to make sure that the courts are ready; I look forward to the Minister’s reply.
However, we do not support in any way Amendment 283 in the name of the noble Baroness, Lady Scott, to delay the abolition of Section 21. The sooner the long-promised abolition of Section 21 happens, the better. Indeed, Amendments 279, 280 and 283, as well as, to a lesser extent, Amendment 69, would certainly result in delays in the Act coming into force. For this critical reason, we cannot support them.
However, this does not mean that we do not take this issue seriously; I am not wearing rose-coloured spectacles. I expect full answers on the readiness of our courts to deal with these radical changes. The criticism and concerns regarding the courts have been known now for some considerable time. Work must have been done, so we would expect the Government now to have some hard answers.
Lord Carter of Haslemere (CB)
My Lords, I support the comments of the noble Baroness, Lady Thornhill, and all noble Lords who have spoken about concerns about court capacity to deal with the huge increase in loads that will come their way. This is not just a serious policy issue; it is an important legal one. Article 6 of the ECHR guarantees rights of access to justice within a reasonable time, and if those rights are delayed then that will impact also on landlords’ rights under Article 1 of Protocol 1 of the ECHR, which is about rights to property. I am afraid there is nothing in the ECHR memorandum, which I have with me, addressing the Article 6 and Article 1 of Protocol 1 points relating to delays to justice in the courts. That is an important issue that has to be addressed, and I cannot see how this sensible Amendment 264 can be denied. Incidentally, the amendment overlaps with Amendment 106, which we will consider later; for some reason, they have been put in different groups.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Baronesses, Lady Scott and Lady Thornhill, the noble Lord, Lord Young of Cookham, and the noble and learned Lord, Lord Etherton, for their amendments, and I thank the noble Lords Cromwell, Lord Empey, Lord Wolfson and Lord Northbrook, the noble Baroness, Lady Grender, and the noble Earl, Lord Kinnoull, for their comments and for bringing the noble and learned Lord’s amendments before us.
I understand the concerns that Members have on this issue, which is why we engaged early on with noble Lords in advance of the Bill coming before this House. We have listened to noble Lords’ views and experience in this area. I appreciate that we may need to have further discussions.
I say to the noble Baroness, Lady Scott, that I started working with noble Lords on the Bill some months ago to understand the concerns that they had. Where probing amendments have been tabled, I have attempted to answer in detail. On matters requiring factual answers, such as data that I did not have at my fingertips, I have responded either in writing and/or offered further meetings to noble Lords.
However, it was too late in the day when the party opposite recognised the dreadful housing crisis that it had led us into, which meant it was too late for it to finish legislation to deal with it. Today, we are faced with amendments seeking to remove core principles of the Bill that is trying to deal with it. If those come before us, I will have no option but to disagree with them. Some of those core principles were in the Bill of the party opposite when that sat before this House. This Government will take up the challenge of dealing with the issues with a degree of balance between landlords and renters and, I believe, will do a better job of it.
The amendments before the Committee today would all require the Government to make an assessment of the justice system as a result of these reforms and, in some cases, delay commencement of the reforms until certain conditions were fulfilled. Amendment 69, in the name of the noble Baroness, Lady Scott, would require the Lord Chancellor to prepare an assessment of the operation of the process by which a county court is able to make possession orders for rented properties, and how such orders are enforced. That assessment will be published at such a such a time and in such a manner as the Lord Chancellor sees fit. The noble Baroness, Lady Scott, has also tabled Amendment 283, which, if made, would delay the commencement of these important reforms until the Lord Chancellor had carried out and published the proposed assessment and was satisfied that the court service had sufficient capacity.
The Government’s view is that the implementation of our tenancy reforms should not, as the noble Baroness, Lady Thornhill said, be held back by an assessment of current working, especially one that is so broad and undefined. We have no intention of delaying these urgent reforms while we wait for an unnecessary assessment of the existing possession process. The proposed assessment will provide no new insight or benefit to interested parties. Compelling the courts and tribunals to undertake such an assessment would detract from their vital work to make sure that the courts are ready for our reforms.
Quarterly data on the operation of the court possession process for rented properties is already, and will continue to be, published by the Ministry of Justice. This is regularly reported and scrutinised. The published statistics include both the volumes and timeliness of possession orders and the enforcement of those orders. Court rules specify that possession claims requiring a hearing should be listed within four to eight weeks of the claim being issued. Landlord possession claims are taking an average of eight weeks—not seven months, as quoted by the noble Lord, Lord Northbrook—to progress from the issue of a claim to a possession order in the most recent quarter from October to December 2024.
Instead of publishing this unnecessary assessment, we will carry out our tenancy reforms as quickly as possible. I want to reassure the Committee that we are fully focused on making sure that the justice system is prepared for the changes to court caseload and procedures which will be required for our reforms. We are working with the Ministry of Justice and HM Courts & Tribunals Service to that effect. This includes investing in additional court and tribunal capacity to handle any extra hearings generated. I hope that answers the point from the noble Lord, Lord Wolfson. I therefore ask that those amendments are not pressed.
Amendment 205 in the name of the noble Lord, Lord Young of Cookham, would require the Secretary of State to lay a Statement before Parliament setting out how the Government will ensure that the county courts are prepared for the impact of the Renters’ Rights Bill on possession cases. The Statement would need to be made within six months of the Bill being passed and assess the effect of the Bill on the volume of cases, the efficiency and timeliness of judicial proceedings, and the resource requirements of the courts in future.
As I have said, I fully recognise noble Lords’ concerns that this Bill will impose an additional burden on the justice system and understand the concern of my honourable friend at the other end of the building about the court system. As already noted, I reassure the Committee that we are fully focused on making sure that the justice system is prepared for changes to court caseload and procedures which will be required for our reforms and we are working with the MoJ and HMCTS to that effect.
To pick up the point from the noble Lord, Lord Young, about resources, we are working together to agree how these reforms are implemented. This will include ensuring that the county court will have the capacity and resources it needs to adjust to any changes in possession caseloads—which will, of course, involve the assessment that the noble Lord, Lord Northbrook, referred to—and commitments to address the resources needed. Work is also progressing on updating rules and procedures in readiness for the implementation of the new legislation.
In the longer term, we expect our reforms to reduce the volume of court possession claims, as only those cases where there is a clear, well-evidenced ground for possession will be able to proceed. This will help offset any increased pressure on the courts resulting from our reforms in due course.
His Majesty’s Courts & Tribunals Service is building an end-to-end digital service for resolving all possession claims in the county courts in England and Wales, to make processes more efficient and easier to understand for landlords and tenants—a much-needed reform. Funding has been agreed and provided to enable the design and build of this new service, which is well under way and builds on the existing digitisation of the justice system.
The noble Lord, Lord Cromwell, said it had left him with the impression that this was five years away. That is not what the court service said and not my understanding of where we are with it. As I have explained, this is not a new system that is being built from scratch; it is a further module of an existing system.
The noble Earl, Lord Kinnoull, commented on the outlining of the size of the problem that our colleagues from HMCTS set out. That was the hold system that they are developing, with the approach to design and build being at prototype stage. I understand what he is saying, but the digitisation process is not the whole picture of what we are doing with our colleagues in the courts service. This service will offer an online route for making and responding to possession claims, filing documents and receiving updates and outcomes, offering improved user experience through guided journeys.
As we have heard, some noble Lords heard first-hand about the progress being made. The noble Earl, Lord Kinnoull, said that the question was put, “How long will this take?” and colleagues replied, as I understand it, “Two years from March”. I thank him for those comments, but that is not the totality of the work we are doing with the courts service, so, while progress on that is really important to driving this forward for the future, we will be working with our friends in the courts service and supporting them in the interim. I therefore ask him not to press his amendment.
I reiterate my thanks to the noble Baroness, Lady Thornhill, for Amendment 264, which would require the Secretary of State to publish a review of the impacts on the judicial system arising from the Renters’ Rights Bill within two years of the legislation being passed. The review would need to consider the effect of the Bill on the volume of cases, the efficiency and timeliness of judicial proceedings and the resource and administrative burdens on the courts.
As I already outlined, I want to reassure the Committee that we are fully focused on making sure that the justice system is prepared for changes to court caseloads and procedures. We are taking that issue very seriously. We will monitor the effects of these reforms on the justice system by closely engaging with the sector and analysing the comprehensive data that is already collected. It is not that we do not think it is necessary to analyse the data; it is more that we think committing to a formal review on the face of the Bill is unnecessary.
The points the noble Baroness made about justice delayed being justice denied are quite right. That is why we do not want to delay all this, including abolishing the Section 21 evictions that have caused so many problems. We want to do that as quickly as possible, but I want her to be assured that we believe that analysis of the impact of the Bill on the system is critical and important, and we will be doing that using the information that is already available.
Baroness Thornhill (LD)
I thank the Minister for giving way. Does that mean, as I take from her words, that such monitoring and review will be an ongoing and rolling process from day one?
Baroness Taylor of Stevenage (Lab)
That is completely correct. We need to make sure we are taking account of the impact on the system from the start. We believe that over time it will reduce the volume of cases going to the court service. As the noble Baroness, Lady Grender, pointed out, not many cases end up in the courts system, but there are some that go down that route. We will be monitoring them from the outset.
Baroness Scott of Bybrook (Con)
On that point, I have just gone online and it is still being quoted that there is a seven-month delay, as my noble friend Lord Northbrook said. If it becomes clear during the process leading to the implementation of the Bill that the courts cannot cope and it will have a severe impact on people’s lives—the lives of both landlords and tenants—will His Majesty’s Government be brave enough to slow down the implementation of this Bill?
Baroness Taylor of Stevenage (Lab)
As I hope I have already made clear, we do not want to slow down implementation. We think the reforms we are bringing forward are really important and very much overdue. We do not expect that it will have the impact the noble Baroness has just outlined, but we will continue to monitor it and we will support our friends in the courts service with whatever help they need to make sure the impact is mitigated.
I turn finally to Amendments 279 and 280, in the name of the noble and learned Lord, Lord Etherton. I thank the noble Lord for his continued engagement on the Bill, particularly on the judicial impacts. It has been incredibly valuable to me to have that input. Amendment 280 would require the Secretary of State to certify that landlord possession actions in respect of residential property are processed by the courts in no greater time, on average, than they were in the year before the first Covid-19 lockdown. In addition, Amendment 279 would delay the commencement of important reforms until this proposed assessment had been carried out.
As I have previously outlined, I recognise that landlords need a smooth and efficient process in the county court for the minority of cases where court action for possession becomes necessary. But we will not tie the implementation of these urgent reforms to an arbitrary target of court timeliness. The sector has already waited too long.
As noted, the Ministry of Justice already publishes quarterly statistics on the operation of the county court possession process, and court rules specify that possession cases requiring a hearing should be listed between four and eight weeks from the issue of the claim. If the noble Baroness, Lady Scott, says that that figure is still disputed, I am happy to get back to her on that.
Setting a target for the possession process as a gateway for the operation of other Bill provisions would not be meaningful. A key stage of the process is the application for a warrant of possession. This is dependent on the actions of the landlord and is therefore outside the control of the courts service. Where a tenant stays in a property beyond the date set out in the possession order, a landlord can choose whether to apply for a warrant immediately to enforce a possession order granted by the court, and whether to apply to transfer the case to the High Court. We will continue to work closely with the Ministry of Justice on implementing these reforms. This includes ensuring that the county court has the resources it needs to adjust to any changes in case loads, and that the relevant rules and procedures are updated. The noble Earl, Lord Kinnoull, requested a meeting. I am very happy to continue meeting on the progress of digitisation and the other interim steps that we are likely to take.
Lord Empey (UUP)
Will the Minister agree to write to us about the Home Office and place a copy in the Library? Additionally, the Minister said on the previous day in Committee that she did not want to see different classes of tenant. How is it possible to have this Bill on the statute book and at the same time have the proposed Serco arrangements in operation without creating two classes of tenant?
Baroness Taylor of Stevenage (Lab)
I think it is best to wait until I have the detail of the Serco arrangement before we debate that. As I said, I will give noble Lords a response in writing and place a copy in the Library.
Lord Northbrook (Con)
I listened carefully to the Minister’s encouraging remarks on improving capacity and resources, and on the digitisation process. However, the impact assessment—if I have read it correctly—says there was no extra expenditure on this. I am not quite sure how to square the circle on that.
Baroness Taylor of Stevenage (Lab)
As I said, we are working very closely with our colleagues in the Ministry of Justice and the courts service. The digitisation process is already under way and is already costed, and we are looking at other impacts. If the noble Lord’s view is that they are not clearly set out in the impact statement, I will come back to noble Lords on what they may be.
Lord Cromwell (CB)
I just want to come back to the estimated five-year implementation period that the Minister responded to. That arose from conversations with people who have had a lifetime of professional involvement in legal processes, so I would not brush it aside too early. I have been on the sharp end of a number of these sorts of IT projects that get built. If you build anything, you always double the budget and double the time you are told it is going to take; anybody who has built anything knows that—I will not touch on R&R.
The Minister has told us a number of times that the Government are fully focused—a phrase that has been used a number of times. I do not wish to be discourteous, but it sounds like the Government are being fully optimistic, almost to the point of naivety, on this. These are probing amendments. There is a general agreement, including from the Government, that there really is a problem here that needs to be solved. There is no dispute about it being a problem. I urge that, before we get to Report, we need a crisp, specific, clear and credible statement about what exactly will be done to resource this properly, because our current court system is not a model of swiftness and efficiency, and it is hard to see how this will be magically transformed.
Lord Wolfson of Tredegar (Con)
I will follow on from that so the Minister can reply to both. I retain a certain fondness for my former department, and I know that the budget of the Ministry of Justice is extremely tight. I have not seen any scope in that budget for the expected increase in the courts’ workload that the Bill will generate. The Minister said she will work very closely with the MoJ, and I know that, when I was an MoJ Minister, that meant that people would work closely with me by telling me that I needed to spend money from my budget on what they wanted. Can I therefore take it that, when she says she will work very closely with the MoJ, what she actually means is that, if the MoJ needs money to do what the Bill requires, it will come from her budget?
Baroness Taylor of Stevenage (Lab)
In response to the noble Lord, Lord Cromwell, I say that I too have been involved with a number of IT projects over the years, and I understand his scepticism. However, having listened to the excellent presentation, I agree with the comments that the noble Earl, Lord Kinnoull, made about the nature of the team that came to present to us, which was outstanding in the straightforward way it presented to us both the challenges it faced and the success it had had in taking the project forward so far. We are making good progress on that project and, as the noble Baroness, Lady Scott, said, the benefit of bringing Bills before this House is that we get the outside experience that people bring. But we will see in due time whether it will move forward as quickly as we hope. I do not think that is overly optimistic—we have had a presentation from the team that is doing the work.
I understand the comments on funding, but the way that our Government have set about working across departments to deliver objectives has been incredibly productive so far. We are working very well across government, led by the team in the Cabinet Office, and I hope that means that we will not have this shunting around of costs but will all sit down and decide what we need to prioritise. It all depends on the spending review, and this would be a lot easier if we had not been left with a £22 billion black hole.
The Earl of Kinnoull (CB)
I am sorry to put something else to the Minister, and I am very grateful to her for the offer of a meeting. I have here the latest possession statistics, which I printed off beforehand, so I thought I would merely inform the Committee what they say: claims to order is currently eight weeks, but claims to repossessions is 25 weeks. So everyone was saying something correct, but in fact they were looking at different bits of the statistics. But, of course, claims to repossessions is what a landlord would be thinking about. You cannot start the claim until various amounts of time have passed, so actually the median 25 weeks for claims to repossessions is quite a long time. Going on from that, I turn to item 7, on regional possession claims. In fact, there are quite big differences between the regions, and there are some regions where claims are quite slow.
Baroness Taylor of Stevenage (Lab)
I thank the noble Earl for clarifying that point. Indeed, I was talking about the claims to order median timeliness being eight weeks. It is difficult to take measures from different places—there are lies, damned lies and statistics, as we all know—but, as I mentioned, in the longer term we expect the reforms we are introducing to reduce the volume of possession claims. That is why the monitoring that I set out in response to the amendment of the noble Baroness, Lady Thornhill, is really important, so that we can see where this is taking us. We expect that only those cases where there is a clear, well-evidenced ground for possession will be able to proceed, and that should, over time, reduce the volumes overall.
Baroness Scott of Bybrook (Con)
My Lords, I am grateful for the insightful contributions made during this debate and the amendments we have discussed, particularly those proposed by my noble friend Lord Young of Cookham and the noble and learned Lord, Lord Etherton. I thank my noble friend Lord Wolfson for speaking to them with such in-depth knowledge, which was much appreciated. The whole debate underscores shared concerns across the Committee about the capacity of our courts to effectively implement the Bill.
As I made clear throughout the previous days in Committee, the ambition to reform the private rented sector is commendable, yet without a robust and adequately resourced court system, these reforms risk being totally undermined. Amendments 283 and 69 in my name would create a foundational aim to ensure that the necessary infrastructure is in place before significant changes are enacted, thereby safeguarding the interests of both tenants and landlords.
The Minister remarked on the first day of Committee and has continued to say that the Government are working with the Ministry of Justice to complete a justice impact test. This assessment is intended to identify the additional burdens on the system arising from the new policies in the Bill and to ensure that the system is fully prepared for any increases in workload. This commitment is welcomed, but we need to know how long this justice impact test will take to complete. Will it be ready before the Bill progresses through Parliament? Given the significant implications for the court system, it is imperative that this assessment is thorough and timely and that the Bill is impacted only once we know the court system is ready for these changes.
The capacity of our courts is not a peripheral concern; it is central to the success of this legislation. As we have discussed, delays in the court process are not merely procedural; they have a real-world consequence for tenants and landlords alike. I urge the Minister to expediate the impact test and to ensure its findings are fully considered before any further steps are taken. I reiterate the importance of aligning the ambition of the Bill with the practical realities of our court system. The amendments before us provide a prudent approach to achieving this balance. I look forward to the Minister’s response and to continuing our discussions on how best to deliver. I beg leave to withdraw my amendment at this point.
Baroness Coffey
“Repossession of homes during school holidays(1) The court may only make an order for possession of a dwelling which houses children of school age during the school holidays.(2) The Secretary of State may by regulations define the period of school holidays under subsection (1) on an annual basis.”
Baroness Coffey (Con)
My Lords, my Amendment 70 is fundamentally to help children. We should recognise that certain changes have made it far more profitable for landlords to change long-term family-home lets to homes in multiple occupation or sometimes, depending on location, to holiday lets. Losing family homes in rural locations from both the private and social housing sectors is a real issue, particularly when one considers that median salaries tend to be considerably lower than in towns and cities.
I was inspired to put forward this amendment after a discussion with a landlord in Suffolk about various reforms being considered by this House that would likely reduce the availability of rented accommodation for families, particularly in rural areas. This landlord told me of one change that he would put into law if he had the opportunity—a practice he undertakes himself today—and that is making sure that any changes in tenancy arrangements for properties occupied by families happen only during the school summer holidays. My amendment seeks to ensure that any such eviction could happen only during a school holiday.
I understand that it is the Government’s intention to reduce evictions, particularly no-fault evictions; however, they do accept that a landlord may need to require such actions. That said, disruption of a child’s education through absolutely no fault of their own can have a real impact on their life in both the short and long term.
For what it is worth, I also think that the situation is more likely to be acute for children living in rural areas. Often, people displaced from accommodation in rural areas end up having to move considerable distances to much more urban conurbations, which would likely require a change of school, whether that be at primary or secondary age. My amendment would at least limit this potential disruption to the child’s life to be only during school holidays, giving parents and the child time to find a new school or to make alternative transport arrangements if necessary. I appreciate that we are still in Committee, so I am floating this idea to consider what we can do to help children in these challenging moments in their family’s life. I would be grateful if I could meet the Minister to discuss this issue further. With that, I beg to move.
Baroness Thornhill (LD)
I do not doubt the genuine compassion and sincerity of the noble Baroness, Lady Coffey, but I feel there is a real incongruity about the current position of His Majesty’s Official Opposition to favour landlords and make evictions quicker and easier. The message to tenants via this amendment is, “Your unwanted evictions will take place only in the school holidays, so on 21 December rather than earlier in December”. I genuinely feel that it would be unworkable and that circumstances differ. I could actually argue the opposite: I would rather my children were safe in school while I negotiated trying to find where we were to live. I just do not think we can say that one size fits all on this.
Baroness Scott of Bybrook (Con)
My Lords, I thank my noble friend Lady Coffey for bringing Amendment 70 before the Committee today. It is a thoughtful and considered probing amendment that rightly recognises the significant impact that housing stability can have on a child’s education. During the pandemic, our children and grandchildren suffered greatly. Schools were closed, youth clubs shut down and extracurricular activities ground to a halt. The disruption left many young people adrift at a crucial stage of their development, and only now are we beginning to understand the effects. It is therefore incumbent on us all to support and uplift the next generation. However, the Government must ensure that the burden does not fall disproportionately on individual landlords. It is not, and should not be, their moral obligation to serve as the final safety net for vulnerable families. That responsibility lies with us—with the state, with local authorities and with society.
Owning a property does not automatically confer great wealth. It does not equip an individual to shoulder the complex needs of a struggling family. The Government must tread carefully to ensure that their actions do not drive up costs in this sector, which fall most heavily and disproportionately on low-income families and the most vulnerable members of our society. A sustainable housing market depends on both tenant security and landlords’ confidence. This is a very tough balance to strike, but I believe that the onus is on us all to strike it.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Coffey, for her amendment, which would allow the court to grant an order for possession of a property that houses school-aged children only during school holidays, and I thank the noble Baronesses, Lady Thornhill and Lady Scott, for their comments. I understand the probing nature of the amendment and the compassion that sits behind it. However, I gently point out that at the latest count, we have 160,000 children in temporary and emergency accommodation, a situation driven by the lack of attention to the housing situation paid by her Government. Therefore, while we want to do as much as we can to support families and children, I think it takes quite a lot of front to come before this Committee with this kind of proposal when we have that terrible situation of 160,000 children in temporary and emergency accommodation. I heard this morning of a three year-old who has been homeless for his entire life—astonishing.
Anyway, I appreciate the sentiment; however, I am going to talk about the practicality of delivering it. It would likely mean that, where possession has been sought, the courts would need to check whether the property contains school-age children and whether it is the school holidays or not, before scheduling a hearing. Not only would this create additional work for the courts—we have just spent quite some time debating the pressure the courts are already under—it could cause delays for landlords in obtaining possession orders. That is an issue the Opposition have taken great interest in. For example, a landlord’s case could be next in line to be heard, but, because it is the beginning of the school summer holidays, the hearing would be delayed for six weeks.
Furthermore, although provision is made within the amendment for regulations to be made annually to define the school periods, it would be an onerous task. School holidays vary across local authority areas and sectors; they can even vary within an individual area. My grandchildren live at the same address but go to different schools and have different holidays. This would likely cause confusion and added complexity for landlords who wish to seek possession of their properties.
While it is absolutely right that tenants enjoy a greater level of security in their homes, we have said that landlords must enjoy robust grounds for possession where there is good reason for them to seek to take their property back. It would not be reasonable to add additional barriers, complexities or delays to the possession process.
Our reforms give renters much greater security and stability, so they can stay in their homes for longer, build lives and communities and avoid the risk of homelessness. That is why we are introducing the many protections for tenants, such as banning Section 21 evictions, increasing notice periods and introducing a 12-month protected period at the beginning of a tenancy during which landlords cannot evict them to move into or sell the property. However, that must be balanced with the needs of landlords, who must enjoy those robust grounds we have already spoken about. Judges already have some discretion when deciding the date on which a tenant should give up possession. Even if an outright possession order is made, pursuant to a Section 21 notice or on a mandatory ground, the date for possession can be postponed for up to six weeks if a tenant can show that this would cause exceptional hardship.
As well as it being impractical, there is also a principled argument against this amendment. Being evicted will almost always be a significant upheaval for tenants—I accept that—particularly for those with children, so I understand the intent behind it. However, it would not necessarily—as the noble Baroness, Lady Thornhill, pointed out—always be easier for parents to deal with a possession order or eviction during the school holidays. During termtime, parents may have significantly fewer caring responsibilities, particularly if their children are younger. Therefore, many parents find the school holidays a time of increased responsibility and stress. Families being evicted during school holidays may also mean having to take up that school holiday with the necessities of moving, rather than doing activities with the children. So it may make it more difficult for families, not easier. It is for these reasons, both practical and principled, that I ask for this amendment to be withdrawn.
Baroness Coffey (Con)
I thank the noble Baronesses for speaking to this amendment. I am slightly surprised to hear a Member of this House being accused of having some front, based on previous government policy. I recognise this is a political debate, but I am talking about children and the UN Convention on the Rights of the Child should be considered in any consideration of legislation when it comes to this.
There has also been a kind of city and urban perspective on where children go to school; there has not been a realisation of quite how far some children in the countryside have to travel. If you are moved from, say, the middle of coastal Suffolk to Lowestoft, there is no way you could continue going to your school without considerable upheaval to your parents’ lives, and indeed at great expense.
I am conscious of the limitations being put on landlords. I had hoped to be able to speak to the Minister in more detail, but I have heard what she said and will consider potentially speaking to her noble friends in the Department for Education. I beg to withdraw this amendment.
Baroness Taylor of Stevenage (Lab)
My apologies, I neglected to say that I am very happy to meet with the noble Baroness.
Lord Jamieson
Member’s explanatory statement
This amendment, and another to this Clause in the name of Baroness Scott of Bybrook, probes the Government’s reasons for increasing the notice period for rent increases from one month to two months.
Lord Jamieson (Con)
My Lords, before I turn to the amendments, I will respond to the Minister’s comment. On this side of the House, we want to see a successful, thriving private rental market which gives everyone the opportunity to have a stable and secure home. However, as we have seen in Scotland, rental reform can have a deleterious impact on the availability of rental homes, and increase pricing. It is our concern that some of the reforms being proposed may harm tenants and the market. It is perfectly reasonable for us to have different views on what the potential reforms may or may not do, but let us be absolutely clear that, on this side of the House, we want successful tenanted private rentals. The Committee should have no doubt about that.
I turn to Amendments 72, 73, 74 and 81 in the name of my noble friend Lady Scott of Bybrook. The group addresses the matter of notice periods. Amendments 72, 73 and 74 are all probing amendments and seek to question the purpose of increasing the notice periods for rent increases and why the retention of one month is not kept. The Government have failed to sufficiently explain why the Bill looks to change the minimum period for notice of a rent increase from one month for assured periodic tenancies, particularly as landlords will now be able to increase rent only once a year, which we support.
In that case, a rent increase could reasonably be anticipated by the tenant. It should also reflect the current market conditions and economic factors such as interest rates, particularly with the increased powers to challenge by the tribunal. Increasing the notice period means that those data points are more out of date. Surely the Government would wish for rent increases that reflect current market and economic conditions, and to reduce the likelihood of tribunals. This change will undoubtedly have significant implications for landlords and the rental market more broadly. On a personal level, many landlords rely on the funds they intend to retrieve from an increase in rent payments to meet loan repayments and other financial obligations.
It is important that all noble Lords consider this change in the wider context of this Bill and the other factors which landlords will have to tackle. Changing notice periods for rent increases is just one obstacle that landlords will have to address. Others include the annual rent increase, which tenants will be able to challenge through First-tier Tribunals, which will subject landlords to greater risk of court backlogs. These changes may result in increased administrative burdens for landlords, brought about by the use of Section 13 notices for rent increases and the two-month notice period.
The ultimate issue with the rental market is one of supply. There are simply not enough homes to meet the demand. We must look not only to incentivise landlords to stay in the market but to encourage new entrants. It is vital that the Government avoid introducing unnecessary measures that create a hostile market.
The proposed changes to the notice period will, with many other new measures, cumulatively create significant consequences for landlords across the country. Will the Minister confirm whether the Government have consulted with landlords on the impact of these measures, and will they publish the findings from this consultation? If not, do they intend to do so? Similarly, will the Minister confirm whether the Government have conducted, or intend to conduct, an impact assessment on the changes to the notice period for rent increases?
Amendment 81, also in the name of my noble friend Lady Scott of Bybrook, seeks to question the Government’s reasons for having one-month notice periods for rent increases in the low-cost tenancy sector, despite the fact that those who are not in those tenancies are entitled to two. For clarity, we are not decreeing that it should not be one month; we are asking why there is the difference and seeking to understand the logic behind it. I look to the Minister to explain exactly why someone in a low-cost tenancy would get less notice of a rent increase compared with someone renting in the open market, such as those on assured periodic tenancies. Should not those who are the poorest in our society require greater notice, particularly given the importance of financial planning?
I look forward to the contributions of all noble Lords on this group of amendments and to the Minister providing clarification on the concerns I have raised. I beg to move.
Lord Marlesford (Con)
My Lords, I find these amendments very curious. The whole principle of the private rented sector is that it is a capitalist operation; it is an operation which has costs and revenue. The revenue comes from rent. Obviously, rents must be very carefully determined. As to whether it is one month or two, that seems to me of little account. Basically, what tenants need to know is that rents are likely to increase by some measure which is generally agreed. In the private rented sector, this is normally the retail prices index—the RPI, as opposed to the CPI. If there is not a return on the investment, the investment will not continue to exist. Nobody can afford to let properties if there is no return on the property. The question, of course, is: what should the return be?
There are two very important factors to think of. The first is the gross return, the gross rent, as a percentage of the market value of the property, and the question of what percentage it should be. I have produced a table which shows the different levels of rent for different values of property, but, of course, that is not the only factor, because one has to remember that the rent charged is gross before the cost of maintenance, and maintenance is hugely important. The solution to having a good private rented sector is proper maintenance and, indeed, improvement through modernisation maintenance. It may be that you put in a more economic burner to heat the house—they vary a lot, and later ones are much more efficient, but that is an expenditure. You have to get a balance there.
I suggest that very often, about a third of the rent, on average, will go on the maintenance—keeping up to date—and administration of properties. If we said, for example, that a 3% return on capital was a reasonable level for the rent to be set at, that might end up at a net 2%, which is probably about what equities yield at the moment. We must see that.
Then comes a very important point, which we shall no doubt be discussing later: the affordability of rents for tenants. The Government’s guidance has for a long time been that rents should not be more than 30% of household income. Therefore, that calculation should be made. If somebody is renting a property, they should bear in mind that that is the Government’s advice as to the amount that they can afford to pay, other things being equal. Equally, the landlord letting the property will also have to take into account whether or not the prospective tenant can afford their property. Again, it is essential that if you set a rent, you know the household income, to see whether it reaches the affordability stakes.
These are important and complicated matters, but they are crucial to the private rented sector. My worry about the Bill is that half the time the Government do not seem to understand the private rented sector. It is a business enterprise like many other business enterprises. It is not particularly virtuous or unvirtuous, but I wish I could feel that the Government, in fiddling around with it all, were trying to make it work in a practical manner for investors and those receiving the benefit of the investment; that is, the product. There is no real difference between a house that you rent and a product that you buy in a shop. It is part of how the system operates, how civilisation operates. The Government are very muddled in their thinking on this. I would have liked to have got rid of the Gove Bill, which also was ill considered and ill conceived, lacking in understanding of the real world.
Baroness Thornhill (LD)
My Lords, we have several groups of amendments that talk about rent, money and finances, so before commenting specifically on this amendment, I want to have a little rant regarding landlord finances. The narrative is that the majority of landlords are in a terrible financial position. What evidence do we actually have for that? It is certainly not borne out by my anecdotal evidence and could be conceived as scaremongering, because my understanding is that being a landlord is, and will remain, profitable.
The idea that, to remain sustainable, landlords must be able to pass the entirety of any increased business cost and risk on to the tenant through a rent increase is, frankly, ridiculous. There is no other business model that operates in this way, and it does not add up when we look at the sum of the data that we have. The English Private Landlord Survey said that the median income of landlords, including rental properties, is around £52,000. According to the Shelter/YouGov survey of private landlords, rental income is largely additional for landlords: 50% of landlords say that they do not rely on rental income to cover living expenses.
I note that in any investments that I have made, there is a very cleverly worded phrase at the bottom: “Investments can go down as well as up”—except if you are a landlord, it would seem; even more so as you are left with a capital asset that, in this country, largely increases in value. That is my rant. If the noble Baroness, Lady Jones of Moulsecoomb, were in her place, she would probably be quite proud of me for it.
I turn to the amendments in this group tabled by the noble Baroness, Lady Scott, regarding notice periods for rent increases. When the Bill was introduced in the Commons it proposed a standard one-month period. The Government’s decision to extend this to two months represents a welcome improvement that better balances the interests of landlords and tenants. This evolution demonstrates a willingness to listen and to respond to concerns about tenant security, for which I sincerely thank the Minister and her team.
Amendment 73 seeks to revert the notice period to just one month and Amendment 81 questions the differential treatment between standard and low-cost tenancies. These amendments, particularly Amendment 81, raise fair questions, which I too would like an answer to, as I have not been able to find a reason for that differentiation. A two-month notice period for rent increases represents a reasonable middle ground that acknowledges landlords’ legitimate need to adjust rents while giving tenants adequate time to prepare financially.
For many working families, a rent increase actually requires careful budgeting. I have not got the figures to hand but we know that a significant number—into the many thousands—of moves and evictions last year were due to the inability of the tenant to pay the new rent rise. One month is simply inefficient to work a decision to relocate and make those adjustments.
I commend the Government for finding a balanced approach. This middle ground solution may not be perfect from any single perspective, but it demonstrates what good legislation can achieve when all voices are genuinely heard during the parliamentary process. With these factors in mind, I look forward to the Minister’s response.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendments relating to notice periods for rent increases, and the noble Lord, Lord Jamieson, for moving Amendment 72.
I thank the noble Lord, Lord Marlesford, for his comments about the balance between landlord and tenant. We are aiming to get that balance in this Bill. He is right to point to the ratio of rent to income, but that is why tenants need longer to consider the impact on their family budget. Increasingly, the proportion of income that is taken up by rent is going up and up, particularly in certain parts of the country, making it very difficult for tenants to manage increases at short notice and without adequate notice to plan their family budgets.
The noble Lord, Lord Jamieson, talked about consultation with landlords on the impact of rent increases. Because of a question during the debate on a previous day, I undertook to give a written response on the consultation that has been carried out before and during the course of this Bill. I will provide that response in writing to noble Lords; it is being prepared at the moment, and I will get back to them with a summary of that.
I thank the noble Baroness, Lady Thornhill, for her comments. She is quite right to refer to issues of rental income and capital assets. As I have said many times, we must make this fair for everybody, and make sure that everybody gets what they want. Landlords want a tenant who will look after the property and pay their rent, and tenants want a landlord who will make sure the property is available, looked after and in good condition—that is what we are all after.
Amendment 72 would reduce the amount of notice of a rent increase that a landlord will have to give a tenant from two months to a period equal to a rental period. For example, where the rent is paid monthly, this would reduce the notice period from two months to one month. I appreciate, as the noble Lord, Lord Jamieson, said, that these are probing amendments.
Together with Amendment 72, Amendment 74 would remove the requirement for landlords to serve a rent increase notice two months before the rent increase comes into effect. We do not agree with this position. The Renters’ Rights Bill will deliver our manifesto commitment to empower private rented sector tenants to challenge unreasonable rent increases. This includes by requiring landlords to give two months’ notice of a change, rather than one. This was, as the noble Baroness, Lady Thornhill, pointed out, the result of debates in the other place and of lobbying from a number of groups that have been speaking to us. This will ensure that tenants who may struggle to pay a rent increase will have time to consider their options, seek advice and, where necessary, take steps to challenge the rent increase at a tribunal.
Receiving a rent increase can be distressing for many tenants. We want to give tenants time to reassess their budgets and consider their options. It is unfortunate that the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, do not agree that tenants should have this protection.
Amendment 73 seeks to decrease in the Bill the notice period for a landlord to serve a rent increase from two months to one month. Similarly to Amendment 72, we do not agree with this position. A two-month notice period will give tenants time to review their budgets before the rent increase takes effect and to take advice, if necessary or appropriate, from advice agencies such as Citizens Advice.
It is regrettable that the Opposition have tabled this amendment, because they supported this position on the matter. Their original White Paper, in 2022, promised to
“increase the minimum notice landlords must provide of any change in rent to two months”.
It is disappointing that they have changed their minds on this, and now wish for tenants to have less time to consider their options when receiving a rent increase.
Amendment 81 seeks to increase from one month to two months the amount of notice of a rent increase that landlords of relevant low-cost tenancies need to provide. Social landlords that fall under a new definition of a relevant low-cost tenancy in the Bill will be exempted from most of the changes the Bill makes to rent increases. This means that landlords of relevant low-cost tenancies will be permitted to increase the rent via the Section 13 process at any point in the first 52 weeks of a tenancy, and then once every 52 weeks thereafter, and must give at least one month’s notice. The new amount may take effect after this notice period if it is not challenged by the tenant in the tribunal. These landlords will still be able to use review clauses within a tenancy to increase the rent, as they can at present.
Lord Jamieson (Con)
My Lords, I rise to conclude our discussion on this group of amendments, and I thank the noble Lord, Lord Marlesford, and the noble Baroness, Lady Thornhill, for their comments. The Bill is a complex and far-reaching piece of legislation, and this group has sought to address the issue of notice period for rent increases. I still question in my own mind why low-rent tenants should be treated differently from those in the private rented sector. I appreciate that the Minister has said she will write to us on the various consultations, which addresses some of the issues I have raised. In particular, the point for us is an understanding of the need to go to two months. I also raise the clear understanding of how the whole sector functions and the practical consequences of operating in it, which are some of the issues that the noble Lord, Lord Marlesford, raised.
Savills, a leading authority in the sector, has warned that these reforms may deter investment in the private rented sector. It raises concerns about increased administrative overhead, reduced flexibility and potential delays to rent adjustments. Similarly, the National Residential Landlords Association has been vocal about the unintended consequences of these measures, warning that more regulation without proportional support risks undermining the viability of the sector. To address the point that the noble Baroness, Lady Thornhill, raised, it is not an issue of whether a landlord may or may not be able to afford the impact of this. It may be that they decide their investment is better placed elsewhere and they sell the property or do something else with it, therefore making it no longer available to the private rental sector. The issue that we face is whether this will harm the private rental sector.
These are not fringe voices that talk about this. They represent the heart of the industry, the landlords who provide the homes that tenants live in, so I ask the Minister again: what consultation has been undertaken? I appreciate that she will come back to us on this, but will the Government publish those findings? If that consultation has not yet taken place, will the Minister confirm when it will happen and whether it will inform the final shape of the Bill? Furthermore, have the Government conducted a formal impact assessment on the changes to rent notice periods? If so, when will it be made available to the House? If not, how can we legislate in good conscience without seeing the projected outcomes of these?
I return to the broader context, which we must not lose sight of. The fundamental issue facing the rental housing market is one of supply. There are simply not enough homes to meet demand. If we make it more difficult for landlords, particularly smaller ones who make up a significant share of the sector, we risk worsening the very crisis we are trying to address—a situation we have already seen demonstrated in Scotland. We support measures that improve fairness and predictability for tenants. If the outcome of the Bill is a smaller, more risk-averse rental market with fewer homes available at higher rents, we will have failed in our aims.
In closing, I reiterate the importance of these probing amendments. They are not about resisting reform; they are about getting it right. We have asked responsible questions and the Committee deserves answers. I look forward to hearing from the Minister, not only to clarify the Government’s thinking but to offer assurance that these concerns are taken seriously, that evidence will guide policy and that fairness will be applied consistently across the sector. The success of the legislation depends not just on good intentions but on practical deliverability, balanced implementation and trust from those who must operate within it. With that, I withdraw the amendment.
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment questions the Government's reasons for preventing the tenant and landlord from agreeing a rent value that is higher than the rent set by the Tribunal under Section 14.
Baroness Scott of Bybrook (Con)
My Lords, in my response to all amendments in this group, I will be guided by a principle of stability and fairness—fairness for both tenants and landlords. This is not a debate about unchecked gain, and nor should it result in the erosion of property rights. It is about balance, responsibility and securing a system that works for everyone.
Amendment 75 in my name probes the Government’s reasons for preventing the tenant and landlord agreeing a rent value that is higher than the rent set by the tribunal. Just consider this scenario: the tribunal makes a determination, but then the landlord embarks on a renovation, which includes new appliances and upgrades throughout the property. Under this legislation, even if a tenant voluntarily wishes to pay a higher rent to reflect improvements made to the property, they would be prohibited from doing so. Two consenting adults, tenant and landlord, may well agree that the enhanced value of the home warrants a modest increase in rent. A mutual agreement will exist and yet the Bill would override that agreement. Why should the Government intervene to prevent it? That is one example, but it is, in truth, superfluous to the broader point I wish to make. If a mutual will exists—if two adults come to an agreement, regardless of whether we personally deem their reasons rational—why should any Government say no? Why should this Bill override that choice? We must be careful not to legislate away agency in the pursuit of protection, and I hope the Minister will reflect on that.
Amendment 78 in my name seeks to prevent the Secretary of State expanding the definition of low-cost tenancy by regulation. This definition is important: it is not a technicality but fundamental. It determines not only how a property is treated under the law but how the relationship between the tenant and the landlord is structured. I understand that this is a significant power. Does the Minister agree? Anyone familiar with detail in the implications of this Bill will surely recognise that the power of a Minister to alter the foundations of an existing contract is unacceptable. Therefore, can the Minister commit to removing this regulatory power ahead of Report? If not, can she please set out in writing why she believes the Government should be afforded this power?
Finally, Amendment 86, in my name, probes the Government’s reasons for allowing a six-month period in which an application may be made to the tribunal under the newly constructed Section 14(A1). Six months could lead to a significant increase in claims being directed towards an already overburdened tribunal service. Have the Government properly considered multiple timescales and modelled the impact each would have on the tribunal system? If this vital work has been overlooked, will the Minister commit to reviewing the impact of the chosen timescale on the total claims and return to the Dispatch Box with this at a later time? This is not an unreasonable request, and I hope the Minister agrees.
Many of the amendments in this group are intended to probe the Government’s thinking and understand how they have arrived at the current text of the Bill. Unsurprisingly, given the importance of these matters, this group contains numerous amendments; I hope the Minister listens carefully to the views expressed across the Committee and is not too ready to dismiss them all in her reply. I beg to move.
Baroness Warwick of Undercliffe (Lab)
My Lords, I will speak to Amendments 80, 80A, 82 and 83 in my name. Each relates to the potential unintended consequences of Clause 7 for registered providers of social housing. I am grateful to the noble Lord, Lord Best, for his support.
Before turning to my amendments, I express my strong support for the Government’s ambition to give greater rights and protections to people renting their home. Since the previous Conservative Government first promised to end no-fault evictions in 2019, almost a million renters have received a Section 21 eviction, which is a leading cause of homelessness. It is right that the Government have acted decisively to end this unacceptable situation for good.
While most of the Bill is focused on reforming the private rented sector, some reforms will affect housing associations because the majority of homes that they provide use assured tenancies. This includes housing for people on low incomes, people needing high levels of support, people in crisis and people in need of short-term and emergency accommodation.
I understand that significant progress has been made to amend the Bill to negate any unintended consequences for social landlords. This has been strongly welcomed by the National Housing Federation and others that support this legislation. There have been welcome changes to ground 1B and ground 6, as well as the introduction of ground 6ZA, which will allow social landlords to gain access to properties both to meet housing need and to deliver essential redevelopment and improvement works. However, housing associations would still very much like to see further clarity in the Bill on proposed changes to the process for rent increases.
Housing associations are not-for-profit social landlords: they invest any income back into the development and maintenance of the homes they provide and into supporting residents and communities. To maintain fairness for tenants, to ensure administrative efficiency and alignment with benefits and utility rates increases, and to provide business certainty for repairs, maintenance and services, housing associations increase all tenants’ rent on the same day, usually in April. The Bill helpfully acknowledges this and attempts to provide a mechanism by which social landlords can still administer annual rent increases in the form of contractual clauses instead of Section 13A notices.
Retaining registered providers’ ability to use clauses in tenancy agreements to increase rents is positive, as it provides them with a practical method for increasing rents on the same day for all tenants. The loss of this rent-harmonisation mechanism would have been a significant disruption—and, indeed, unnecessary, given how heavily regulated this sector is compared with the private rented sector.
However, the ability to use contractual clauses instead of Section 13A notices could be clearer than is stated in the Bill currently. The Explanatory Notes clarify that contractual clause increases can be used, but the Bill says:
“For the purpose of securing an increase in the rent under a tenancy … the landlord may serve on the tenant a notice”.
It goes on. This reflects the wording applying to PRS tenancies, where the word “may” is used in a mandatory sense, as the only way that the landlord can increase the rent is through the process in Section 13 of the 1988 Act. In contrast, where it applies to relevant registered provider tenancies, “may” is used in a permissive sense: the landlord can use a Section 13A notice, but they also have the option to increase by a clause in the tenancy agreement.
The Bill provides for this method of increase by agreement between the landlord and the tenant. However, it does not make it clear whether each increase must be agreed or whether a mechanism for increase in the tenancy agreement covers all increases.
Baroness Wolf of Dulwich (CB)
My Lords, Amendment 87 in my name proposes that the Government adopt a screening procedure for rent appeals. It draws on and is prompted by current Scottish practice. The approach works well there and could make a substantial contribution to addressing the growing pressure on court capacity, which we have been discussing.
My amendment does not, in any way, reduce the right of tenants to appeal against a rent increase. I am not sure that it even reduces the incentive to appeal on the off chance, but it certainly reduces the likelihood that the courts will be overwhelmed by appeals and, in particular, appeals that do not succeed and therefore swamp the courts, to the detriment of important and merit-worthy cases.
Under the Government’s current proposals, tenants will enjoy a number of new and important rights: rents cannot be increased as often as at present, for example, and the notice period is increased. Most importantly in the context of this group of amendments, all tenants who wish to challenge what they see as an excessive rent increase have access to an independent tribunal. The tribunal cannot propose an increase that is any higher than the one initially proposed by the landlord; it can endorse the landlord’s proposal, in effect, or rule that a lower rent should be charged. Obviously, these changes will be of great assistance to tenants whose landlords are proposing major increases that are out of line with inflation or the market.
The problem is that, from most tenants’ point of view, appealing against an increase becomes something of a no-brainer. Why on earth would you not? What would you lose? At worst, you get a delay in the date when the increase takes effect. In that situation, the courts are bound to be faced with a tsunami of appeals with which they cannot possibly cope.
As many noble Lords are aware, Scotland reformed its rental legislation quite recently and it therefore provides us with useful indications of how contemporary rental markets respond to various types of change. Some Scottish developments are not very encouraging, as we have heard: there seems to be an ongoing decline in the number of rental properties and a sharp fall in the construction of properties for rent. However, one aspect of the current Scottish regime seems extremely sensible and successful. It does not reduce Scottish tenants’ rights but it does protect their court system.
The first stage in an appeal against a proposed rent increase goes to Rent Service Scotland. Apparently, it takes Rent Service Scotland, on average, just five days to respond. In almost every case, things stop there; very few cases then go on to a tribunal hearing.
The National Residential Landlords Association obtained information under a freedom of information request, which showed that, in the four months from April to July 2024, 928 applications were made to Rent Service Scotland to appeal a proposed rent increase. While there do not seem to be any summary statistics available that show exactly how numbers have evolved and changed over time, the Scottish tribunal is certainly not dealing with anything approaching that number. In fact, only about 30 decisions relating to rent increases were published between August 2024 and March 2025. The full 2023-24 Scottish tribunals report also shows that, while private rental sector cases were the large majority of property cases, they were overwhelmingly to do with evictions, deposits and repairs and not rent appeals.
Obviously, the Scottish situation is very different from ours, notably in adopting rent caps, but it is also obvious that that system is effective in giving tenants and landlords very quick feedback rather than months in limbo. It is also obvious, given the volume of appeals, that without this system the Scottish tribunal would be spending a lot of time and resource on a very large number of cases that were, in effect, a waste of its time.
It would be very easy for us to introduce a similar first-stage process in England. There is a large amount of expertise on rents outside the tribunals and courts. The Valuation Office Agency already gives the Government the valuations and property advice they need to support taxation and benefits. Rent officers set rents for the remaining group of protected tenancies. So, all the basic infrastructure we need is in place.
My amendment therefore proposes that all appeals against rent increases should go in the first instance to the Valuation Office Agency and progress to the First-tier Tribunal only if there is a clear case to answer. Obviously, if the Government chose to embrace the general idea, as I very much hope they will, the details would be in their hands—this is a probing amendment.
To see how important such a screening process could be in protecting our court system from near-complete collapse, it is worth doing a little bit of back-of-the-envelope arithmetic. If appeal rates from private sector tenants in England were at the same level as we currently see in Scotland and they all proceeded to the tribunal, we would end up in England with over 40,000 cases a year. That compares with 909 rent increase cases heard in the year 2023-24. We would be looking at an increase that is more than fortyfold, or 4,000%. As we have heard from noble Lords, it can already take months for the First-tier Tribunal to rule, so how can it possibly respond to this sort of increase? Of course, under the Bill’s provisions, the longer the delays, the greater the incentive is to appeal, so I am afraid that fortyfold might just be the start.
It is no wonder that even very strong supporters of the Bill, such as the Local Government Association, are expressing concerns about the potential impact of the new appeal rights on the capacity of the First-tier Tribunal to make decisions in a timely fashion. This timeliness matters not just because of the direct impact on changes in rents but because our judicial system also needs to deal with other property issues, including anti-social behaviour. It is worth emphasising that anti-social behaviour is not just an issue for landlords; it is at least as much of an issue for surrounding residents, many of whom will be tenants. If you live next to a property which is being used for intensive drug dealing, it is not much consolation to be told that this occurs only with a tiny minority of properties.
We already have very long delays in the court system, as other Lords have pointed out. Those delays seem to be growing and not reducing and we as a Chamber must, for the sake of tenants just as much as landlords, take the potential impact on the courts into account in scrutinising the Bill.
I therefore urge the Government to consider following and learning from the Scottish example and introducing a first-stage screening of rent appeals outside the court system. Is the Minister willing to meet me to discuss that suggestion?
Lord Hacking (Lab)
My Lords, my Amendments 88, 91, 94, 97, 100 and 101 appear in this group. Before I speak to the individual amendments, my general observation is that I do not have great enthusiasm about several of them, but they have been put to me and I thought it necessary to have them aired in this Committee.
Amendment 88 would enable landlords to claim costs against the tenant when the landlord succeeded after the tribunal confirmed the rent increase. This follows the normal rule in front of all tribunals and courts in our land of costs following the event, the event being who won the dispute, and the costs therefore have to be picked up by the loser. Having said that, I have a reservation about this amendment, because it could be a deterrent against tenants challenging an increase in rent, which is undesirable.
In speaking to Amendment 91, I will speak also to Amendments 94, 97 and 100. All these amendments seek to establish that the increase in rent should be calculated from the expiry of the landlord’s notice for the increase rather than the date of the tribunal’s decision. I tabled this amendment because there is quite a noticeable delay in decisions of tribunals, which means the landlord does not get his increase in rent until several months later.
Amendment 101 moves to a different subject: that the rent payable on the decision of the tribunal should be paid in equal monthly instalments within six months of the tribunal’s determination—that speaks for itself.
I am just looking at my list of amendments to speak to and I think I have got there; I have completed my comments on all of them. I say again that I do not speak to them with great enthusiasm. I spoke with great enthusiasm on Thursday in supporting Amendment 60 from the noble Lord, Lord Carter of Haslemere, and my own Amendments 165 and 166. Unfortunately, my enthusiasm for these amendments has not so far permeated to my noble friend on the Front Bench, but I hope that they will do later.
Baroness Jones of Moulsecoomb (GP)
My Lords, I rise with huge enthusiasm for my amendments. Amendment 90 in this group relates to Amendment 89 in the following group, so I will speak just once. I have been told to call them probing amendments; really, I would like to push them to a vote. In fact, I would like the Minister to accept them because I think they are very good. They are similar to probing amendments put down by my colleague Carla Denyer in the other place and aim to ensure that tenants have a way of benefiting from energy efficiency improvements where the Government have given landlords the money to make them.
I would like the Minister to think about who profits from the government subsidy. Are the Government interested only in increasing the profits of landlords or should tenants benefit as well? Triple-glazed windows and wall insulation mean lower energy bills for the tenant, but that makes absolutely no difference to them if the saving is cancelled out by higher rents.
Take, for example, this case study provided by Generation Rent: Maya lives with her husband and children in a home they rent from a private landlord. They had a lot of energy efficiency work done, which was paid for by a government grant. They were eligible for it because they received benefits. However, Maya came to Citizens Advice for help when the landlord asked for a £500 rent increase after her family had been through all the disruption of getting their home upgraded. You can imagine the dust, the dirt, the noise and the general disruption of having workers around all the time.
This increase would have left Maya’s family facing a £900 shortfall between their local housing allowance and their rent, making it absolutely unaffordable for them to stay in their home. Maya tried to negotiate the rent with the landlord but has now been issued with a Section 21 eviction notice. Maya and her husband believe that now the property is in an improved condition, thanks to the grant funding they secured, the landlord wants to find more affluent tenants who will pay a higher rent.
Lord Carrington (CB)
My Lords, I declare my interests in the private rented sector, with residential lettings in Buckinghamshire and Lincolnshire.
I have tabled Amendments 96, 98, 99, 103 and 104 to Clause 8, in which the Government seek to create a new right for renters to challenge their annual rent increases. I am most grateful for the support of the noble Lords, Lord Young of Cookham and Lord Howard of Rising, in this group.
I believe there is a strong consensus across your Lordships’ Committee that stands alongside the Government in wishing to prevent unreasonable rent increases being used as a means of eviction through the backdoor. However, I also believe there is a strong consensus that the Government’s drafting of Clause 8 will not work. Indeed, I am deeply concerned that providing a universal right for all renters to challenge all rent increases, in all circumstances and without qualification, will undermine the supply of rental homes and overwhelm our courts.
The Bill seeks to provide renters with mechanisms to ensure redress where their landlord behaves inappropriately, irresponsibly or exploitatively—yet I fear that the current drafting will undermine that intention in practice. At Second Reading we heard examples of poor behaviour by a small minority of landlords, but the response delivered by the Government will impact the whole private rental market, including the great majority of responsible landlords.
The effect of Clause 8 will be to create a right for all 4.5 million of England’s private rental households to challenge their rent increases annually, via the Section 13 process, at no cost and at zero risk. Every single renter will have a right to take their landlord to the First-tier Tribunal if they perceive their rent increase to be “disproportionate” or unreasonably above market rates.
The Government believe that tenants should apply to the tribunal only if they believe a rent increase is above market rents, but I am afraid that will not be the result of this legislation. The legal text of the Bill sets out that a rent increase could not come into force until after the tribunal rules, and explicitly prohibits the court from determining real market rent to be higher than the landlord’s proposal, even if that is a judge’s evidenced assessment.
The result of this drafting is to create an artificial incentive for all 4.5 million renters to submit a challenge to their rent rise, however legitimate, because this would prevent the increase coming into force until the tribunal decides. There is no risk to the tenant in this and it provides a guaranteed delay in when the increase comes into force. Once this is widely understood, renters will exercise their right as a matter of course.
This incentive risks overwhelming our First-tier Tribunal, burdening an already struggling court with hundreds of thousands of cases. This has already been referred to by the noble Baroness, Lady Wolf, who has come up with a sensible solution. The Government want renters in genuine need of redress to have access to the courts, but the queue for justice will be too long for this to prove possible.
Moreover, the risk of this backlog in cases is causing serious concern among professional and responsible landlords in the sector. The prospect of extended delays to increasing rent would make it more difficult for investment institutions and build-to-rent developers to invest in new, high-quality rental homes, undermining the rental housing supply that we want to see. The reality of this backlog would be upward pressure on rents—the opposite of what the Government want to achieve.
The Government themselves have acknowledged their desire to ensure that responsible landlords can increase their rents in line with the market annually, and the Government have rightly ruled out rent controls. However, the system proposed under this Bill will in practice undermine landlords’ ability to secure market rents annually.
The Guardian newspaper recently revealed that a King’s Counsel has assessed the Bill to determine the likelihood of a legal challenge in the European Court of Human Rights. Subsequently, the newspaper City AM published an article outlining this legal opinion, which determined that the Government stand a greater than 50% chance of losing in the ECHR on this aspect of the Bill. I implore the Government to look into this further as a matter of urgency.
My amendments would mitigate the very serious legal risk with the current proposals on rent challenges. It is all very well for the Minister to repeat, as she has in the past, that the Bill is compatible with the ECHR, but that judgment was made before our amendments were tabled and discussions ensued. As a matter of grave responsibility, the Government should consult again with their lawyers now that these issues have been raised.
The amendments to Clause 8 in my name offer a common-sense solution that should reassure all parties. In my amendments, I propose that if a renter’s challenge is unsuccessful, rents should take effect from the date of the Section 13 notice rather than the tribunal’s determination date. I further propose that the court should be able to follow the evidence, empowering the tribunal to raise rents to what it deems to be market rates, even if this is potentially higher than what a landlord originally proposed.
I believe that, taken together, the amendments would deliver a fair result—technical changes that would keep the right to challenge while reducing the artificial jeopardy-free incentive to take landlords to court. These reasonable amendments would also give institutional investors and build-to-rent landlords the confidence to invest in the high-quality new rental homes that our country needs. To address concerns raised by a number of noble Lords at Second Reading about unsuccessful challenges leaving renters with a large bill, my amendment is drafted to mandate landlords to spread any backdating over a 12-month period.
The number of amendments proposed to Clause 8 speak to the widespread concern in this House about the risks of the Government’s current drafting. Whether colleagues support my amendments or those of my colleagues, I believe the Government’s position is unsustainable. A credible plan is needed to address the artificial incentive for every renter to challenge their rent. Otherwise, I fear for serious investment in new rental homes and the functioning of our courts system.
Lord Cromwell (CB)
My Lords, I have some sympathy with Amendment 99, concerning the rent rise challenges under Section 13 of the Bill. It is essential that tenants can properly challenge excessive rent increases—but, once again, a fair balance is what we seek.
I slightly take the noble Baroness, Lady Scott, to task for her reference to “consenting adults”. The reason for the Bill arises precisely because of the power differential between landlords and tenants. Some adults are more consenting than others, if I may use that phrase. I am not quite sure that works, but noble Lords will know what I mean.
I support the proposal in Amendment 99 in the name of the noble Lord, Lord Carrington, that the rental increase—only, of course, if agreed by the tribunal—should take effect from the date of a Section 13 notice rather than the date of the tribunal decision. I also agree that, where this creates a rent backlog, you would need a payment plan to set it off over time. I note, however, that there would still be a risk to the landlord in those circumstances: if a tenant uses the tribunal as a speculative delaying tactic, and then if the rent increase is finally approved by the tribunal but the tenant does a flit with the rent arrears unpaid, this will leave the landlord with the unenviable prospect of trying to recover the money due to them from the departed tenant.
In short, the Bill enables—perhaps even invites—speculative challenges to any rent increase requests. I think the noble Lord, Lord Carrington, slightly overeggs it when he says that everyone in the entire country will do that, but perhaps he is doing that to illustrate his point. Either way, as my grandfather used to say, “Don’t complain if people fall for a temptation that you have created”. For the tenant it would make rational, self-interested economic sense to automatically challenge any rent increase, and this abuse of the tribunal process would add to its existing overload of cases and therefore discourage supply. I therefore support the amendment containing provisions in this regard.
There has also been a suggestion, I think in Amendment 98, that the tribunal might set a rent above what was requested by the landlord. I do not support that, for two reasons. First, if a landlord proposes a rent increase, it must be assumed that they consider it to be a satisfactory increase. Secondly, the danger of having the rent set higher than the landlord has requested is often mentioned by tenant groups that I have spoken to as a significant cause for tenants to feel intimidated, thereby preventing challenges to rent increases. The Bill does a lot to rebalance the power in the landlord/tenant relationship, but the issue needs to be re-examined. Making a revised rent payable from the notice date, if necessary with a payment plan for arrears, while at the same time not allowing rent to be increased beyond the landlord’s requested level, would achieve a better balance of rights between landlord and tenant and would prevent abuse of the tribunal system. I therefore hope the Minister will pay heed to this proposal and I look forward to hearing what she has to say.
Lord Howard of Rising (Con)
My Lords, I declare my interest as an owner of a rental property. I shall speak to Amendments 99 and 103 in this group, both of which would go towards preventing the situation where it has become almost mandatory for a tenant to take any increase to a tribunal. As that has been pointed out by the noble Lords, Lord Carrington and Lord Cromwell, I will spare your Lordships the repetition of those arguments, but it would be silly for a tenant not to take any proposed increase to a tribunal. Under present proposals, there is no risk or disadvantage to the tenant. The very worst that can happen to the tenant is that an increase, if agreed, is postponed until such time as it has been dealt with by the tribunal.
Amendment 99 proposes that any increase agreed by the tribunal could be implemented from the date when the increase was due to take effect. That would remove some of the incentive to automatically apply for reviews.
As has been mentioned, according to government statistics, there are 4.9 million private rented homes in England. Some of those will have an annual rent review, for some it will be less frequent, but, if one takes a conservative average of, say, three-year rent reviews for each dwelling, that would mean over 1.6 million possible applications to the rent tribunal per annum. I think every three years is an exaggeration—it is much more likely to be more frequent—but let us assume that we take the three years, and that one-third of the people who have received increases in rent do not apply to the tribunal. By my conservative calculation, that leaves 1 million applicants to the tribunal. How are His Majesty’s Government planning to deal with that? Could the Minister tell the Committee the number of challenges taken to the tribunal in the last period for which the information is available? What is the present delay or wait time for applications to the tribunal being heard?
Lord Young of Cookham (Con)
My Lords, I have added my name to Amendment 99 in the name of the noble Lord, Lord Carrington, which, as my noble friend Lord Howard of Rising explained, would ensure that, if there was an unsuccessful challenge to a rent tribunal on a rent increase, the increased rent would become payable on the date proposed by the landlord.
Before turning to that amendment, I will say that I have some sympathy with Amendment 87 in the name of the noble Baroness, Lady Wolf, which proposes an alternative means of filtering appeals before they reach the tribunal by enabling the tenants first to check with the VOA whether their challenge has any prospect of success. However, many of the arguments that the noble Baroness used are equally applicable to Amendment 99.
Turning to Amendment 99, what Clause 8 proposes is exactly the opposite of what happens at the moment, and what indeed has been the case since the Housing Act 1988. At the moment, if a landlord serves a Section 13 increase on the tenant, giving a month’s notice, the tenant can appeal. But, if the tribunal decides the rent should be increased, the increase is payable from the date given on the Section 13 notice. That is the position at the moment, which the Government propose to overturn. The CAB website gives advice to a tenant on this subject, saying that
“it’s probably best to save money towards your rent increase if it’s due to start before the tribunal makes a decision. That way, you won’t have to find a large sum of money if your rent is increased”.
It goes on to make the point that it can take up to 10 weeks for the tribunal to make a decision.
I agree with what has been said. I do not see how this proposal, as it stands, can possibly survive. As many noble Lords have pointed out, from the tenant’s point of view they have nothing to lose by appealing against any increase. The rent cannot be put up, and the increase is not effective until it has been endorsed by the courts.
No satisfactory reasons have been given for this, so I looked in Hansard to see what happened in the other place. The Minister, Matthew Pennycook, said on 29 October last year:
“Tenants should not be thrust into debt simply for enforcing their rights”.
But the relevant right of the tenant is to appeal against an unfair rent increase. There should be no additional right to the tenant if that appeal is subsequently lost, but that is what is proposed.
My honourable friend Jerome Mayhew intervened in the Minister’s speech. He said:
“The Minister says that it would be unfair on the tenant to have a significant increase in rent and a backlog after the determination of the tribunal, but that is rent that ought properly to have belonged to the landlord and has been unjustifiably denied them for the period of the process. Why is it fair for the landlord to be denied a just rent as a result of the delay in the process, yet it is for some reason not fair for the tenant?”
The Minister then in effect conceded the case:
“The hon. Gentleman is right that if the tribunal determines that the rent increase is reasonable, a landlord may have missed out on a short period of the rent increase—not the whole rent, but the rent increase”.
It is not “may have missed out” but will have missed out and, as we have heard, not for “a short period” but potentially for a very long period.
The Minister then sought to defend the position:
“I will be very clear about this: we took the view that it was better that tenants were not, by facing the prospect of significant arrears, disincentivised from taking any cases to tribunal to challenge what could be, on a number of occasions, completely unreasonable within-tenancy rent increases”.
But what the Minister described as “significant arrears” were sums which actually a tribunal will have deemed to be fair, and which current advice from the CAB is that tenants should make provision for. The argument the Minister uses is at odds, as I have said, with the position at the moment.
The Minister’s case was further weakened by a subsequent intervention. Again, my colleague Jerome Mayhew asked:
“I understand that the Government’s intention is that tenants should not go to the tribunal unless they are clear that the asked-for rent is too high, but what prevents them from gaming the system, as we discussed?”
In reply, the Minister said:
“What I would say to the hon. Gentleman—I will expand upon my argument in due course—is that I think he underestimates how difficult it is to take a case to the tribunal”.
In a spare moment over the weekend, I put into Google, “How do I appeal against my rent increase?”. Up came the answer: use form Rents 1 on the GOV.UK website. I downloaded the form. You can appeal, free and online. All credit to the noble Lord, Lord Maude of Horsham, and others for simplifying and digitising government forms. You fill in your name, address and contact details, the name and address of the landlord or agent, the amount of rent you are paying, when the tenancy began and the details of the property. You add a copy of the Section 13 notice from the landlord increasing the rent and a copy of the tenancy agreement, and send it off online to the nearest tribunal regional office. I estimate that it would take about 10 minutes. The tribunal will then ask you what type of hearing you want. Most tribunals for rent increases are based on the evidence you send—they are paper hearings—so there is no need for an appellant to do anything more than I have described.
I hope the Minister will not repeat what her colleague said in another place:
“However, I think the hon. Gentleman underestimates the onerous nature of taking a case to tribunal. It will not be as simple as the tenant deciding on a whim one day that they can do that, and that it is a no-lose situation, but I recognise the incentives at play on both sides”.—[Official Report, Commons, Renters’ Rights Bill Committee, 29/10/24; cols. 145-46.]
It is not onerous, and it is no lose. What is onerous is the pressure on the tribunals. I urge the Minister to reflect on the many amendments to this clause and, in her reply, indicate a willingness to think again.
Lord Marlesford (Con)
The points earlier expanded on the point about affordable rent. Is the Government’s policy still that affordable rent means that it should be no more than 30% of total household income? That immediately implies—it is a glimpse of the obvious—that for one tenant a property is affordable and for another tenant with fewer assets it is not affordable.
Secondly, where I support my noble friend’s entry into the argument is on this business of the fixing of rent by the tribunal. How long does that continue? Could that be spelled out clearly? Does it apply merely for the length of time that particular tenant is there? Would it be continued if there were to be a change of tenant and the next tenant said that was the rent the tribunal had set? If we are to have tribunal-set rents, we must be told exactly how they operate.
Finally, unless the Government can answer fully and confidently the points made by the noble Lord, Lord Carrington, this Bill will certainly fail in its objective.
Lord Best (CB)
My Lords, in the next group of amendments there are some excellent amendments in my name and those of others that seek to resolve some of the issues raised by the noble Lord, Lord Carrington, and many other Peers on this issue. However, in this group I have a rather more pedantic set of amendments to support. I am supporting Amendments 80, 82 and 83 in the name of the noble Baroness, Lady Warwick of Undercliffe.
The Bill is, of course, concerned with the private rented sector and not social housing, where tenants’ rights are already far stronger. But housing associations, often now known as registered providers, are drawn in to some of the Bill’s measures because these bodies use assured tenancies. This means that some ingredients in the Bill do not work for them, in particular the requirement for rent increases just once a year, as the noble Baroness, Lady Warwick, has explained.
The common practice in the social housing sector is to raise the rents for all tenants on one specific date, usually in the first week of April. Many housing associations provide several thousand tenancies, and it is far more efficient to have one rent increase day for everyone annually.
The Government have accepted the need for different treatment for housing associations, and Clause 7 contains measures to handle the problem. But the National Housing Federation, which brings specialist knowledge to bear on the formulation of these amendments after discussion with lawyers, feels the position would be more clearly dealt with by the wording in Amendments 80, 82 and 83.
This is indeed a rather dull set of amendments, but they would make for clarity, administrative simplicity, cost savings and fairness, and I am pleased to support these amendments.
Lord Hardie (CB)
My Lords, I support Amendment 90 in the name of the noble Baroness, Lady Jones of Moulsecoomb. The point made by the noble Baroness and by this amendment is not academic. Recently there was a newspaper report of a case in Scotland where an elderly, vulnerable tenant was persuaded by her landlord to apply for a grant for housing improvements. The grant was available only because of the vulnerability of the tenant. She lived through the upheaval of the work and when the improvements were completed she was then faced with a demand for increased rent.
There is considerable force in this amendment. Landlords should not deny the entire benefit of improvements funded by government grants, and I urge the Minister to accept this amendment or to come forward with a government amendment to a similar effect.
Baroness Kennedy of Cradley (Lab)
My Lords, I support Amendment 90 in the name of the noble Baroness, Lady Jones of Moulsecoomb. Many housing and tenant-focused organisations, such as Generation Rent, and organisations on the Renters’ Reform Coalition support this amendment. Put simply, it seeks to ensure that public funds cannot be used to justify a rent hike.
I am sure all noble Lords will agree that government grants are for a public good. They are funded by the taxpayer with a clear purpose. This amendment refers to grants for making homes warmer, safer, more energy efficient and, in essence, cheaper for the tenants who live in them, many of whom live in fuel poverty. It cannot be right that a landlord receives public money to upgrade a property—money received largely because the tenant within the property, as we have just heard from the noble Lord, is on a low income—and is then allowed to raise the rent because of the same improvements. It is not fair and I believe it betrays the very spirit of public support.
With this amendment, the Government could stop that situation occurring, as well as provide better protection for tenants so that they can enjoy the benefit of the improvement, which potentially would have been secured because of their personal circumstances in the first place. So I ask my noble friend the Minister whether she will consider Amendment 90 carefully and come back to noble Lords on the government position on the amendment before Report.
I would also like to ask whether current schemes, such as the Great British Insulation Scheme, have grant conditions that explicitly prohibit rent increases following property improvements funded by public money. If not, will the Government consider amending those conditions so that they do, and agree that this condition should be added to all future schemes? I appreciate that my noble friend may not have the answers to hand, but perhaps she could write to me and all noble Lords with the details and intention with reference to Amendment 90?
Baroness Thornhill (LD)
My Lords, there are a lot of issues in this group, but the bottom line, again and again, is the imbalance of supply and demand, and the imbalance of power between tenant and landlord. Demand significantly outstrips supply. The landlord/tenant balance is surely like a see-saw, with one fairly heavy person on one end and a nice sylph-like person on the other end. I believe this legislation just wants to even it up a little bit.
There are those of us who feel that, in this kind of market, landlords can and do charge what they want. Rents have been going up significantly, driving more people out of the private rented sector and—I think this is a point on which we have so far not joined the dots—into the arms of their local authorities under the homelessness and temporary accommodation route. We need only look at the rising figures to know that this is happening and happening at scale. We have debated it regularly in your Lordships’ House over several years.
I was not surprised to read on the front page of the Guardian this morning that one of its surveys found that private rented sector landlords are fleecing taxpayers as a direct result of the temporary accommodation crisis. The Guardian found:
“Local authorities in England are paying 60% more for rooms in … bed and breakfasts and hostels than it would cost to rent similar-sized accommodation”
in the private rented sector. There are far more details in the front-page article, but it is irrefutable that some private landlords and hotels are cashing in on England’s hidden homelessness crisis. The lack of supply creates a vicious cycle that is costing the country an enormous amount of money. Thus, we support all the measures the Government are taking in the Bill to try to curb unreasonable rent increases and prevent economic evictions. We will discuss this more in the next group.
We are also concerned about market rents being the deciding factor for the tribunal, given a market that is significantly undersupplied, especially in areas of the country with high housing prices. If market rents are used, they should be based on existing equivalent rental properties in the area and not just new builds, which are usually more expensive and can be overpriced. I look forward to debating the amendments in the next group, which are trying to bring some resolution to this.
I will dispatch positively and succinctly all the amendments tabled by the noble Baroness, Lady Warwick. Her commitment to the social housing sector and her work with registered providers is well known. It is no surprise that she was supported by the noble Lord, Lord Best, to whom the same accolades could apply. Such providers are in a dilemma over rents and at the mercy of the Government as to when and by how much they can increase rents, as the noble Baroness outlined very well. We are concerned that there is increasing evidence that a significant number are cutting back on their future development plans to build social and affordable homes at a time when we all want the opposite.
On the First-tier Tribunal, there seems to be a real fear around the Committee that renters will all rush to challenge their annual rent rise, as has been said by many. I am pragmatic about this. I think it is probably wise to expect an increase, which is why we wholeheartedly support Amendment 87, from the noble Baroness, Lady Wolf. I was a little too late to put my name to it—the nominations had closed, so to speak—but I would have. If there can be a simple mechanism to weed out claims that have absolutely no chance of success, as has happened in Scotland, it must be worth considering.
We can clearly see from recent tribunal hearings that cases are often contradictory and inconsistent, and seem to rely on different sources to make a judgment, which means they are often based on an incomplete picture. This is why I have submitted Amendment 106, supported by the noble Lords, Lord Carter and Lord Howard, for which I thank them. We are simply seeking assurances that the tribunal is fit for purpose and ready to go, and that adequate consultations have been carried out.
What is worrying is a recent survey by Generation Rent, which I too thank for its work all year round and in particular with this Bill. The survey found that less than one-third of renters had actually heard of the tribunal, with fewer than 10% claiming to know a lot about it. There is clearly a lot more work to do before we even get a trickle of people, let alone a tsunami of people or everyone, making an appeal against their rent. Thus, we could not support any amendments that involve tenants paying landlords’ costs, or allowing the tribunal to award higher rents, as these are new barriers to renters exercising their rights.
However, I have a degree of sympathy with Amendment 99, tabled by the noble Lord, Lord Carrington, and very ably supported by the noble Lord, Lord Cromwell. The rent should be backdated to when it would have been legally allowed to be raised, otherwise there really is an incentive to appeal: “What have we got to lose?”. To me, it does not seem fair.
Finally, it feels wrong, as has been said by several noble Lords, that a landlord should add value to their capital asset and then use that immediately to hike the rent—a financial win-win for the landlord. Likewise, Amendment 70 in the name of the noble Baroness, Lady Jones, has some merit.
Lord Carter of Haslemere (CB)
My Lords, I support Amendment 106 from the noble Baroness, Lady Thornhill. I declare an interest as a former landlord.
Clause 8 of the Bill amends Section 14 of the 1988 Act to allow any tenant to challenge a rent rise in the First-tier Tribunal. It will be free of charge. No tribunal ruling will be able to increase the rent proposed by the landlord. By challenging the rent rise, as we have heard, the tenant will automatically delay any rent rise by several months, however modest and justified it may be.
This will obviously create an incentive for tenants to challenge single rent rises, regardless of the merits, and without any risk to them doing so. As we have heard, if their appeal is unsuccessful, they will then be liable to pay the increase in rent only from the date of the tribunal’s determination. That is incredibly unfair on landlords, for the reasons the noble Lord, Lord Young, and my noble friends Lord Carrington and Lord Cromwell have given. What have tenants got to lose? My focus is to express strong support for seeking to ensure that the tribunal has adequate resources to cope with the likely increase in the number of rent rise challenges it will face. Okay, not 100% of tenants are going to challenge rent rises, but there will be a significant increase unless changes are made to the Bill to remove the incentive to do so, because they have nothing to lose.
Given that the tenant will hold all the aces in the pack, the tribunal floodgates are likely to be, or are at risk of being, opened. Without more tribunal resources, this will greatly increase delays and create even more incentives to challenge rent rises. The Government need to get this right or the system will grind to a halt, landlords will leave the sector in droves and tenants will be at risk of homelessness. As I said at Second Reading, there needs to be balance in the very welcome improvements that the Bill makes as a whole. The relationship between landlord and tenant has to be a two-way street to maximise the effectiveness of the Bill.
As this amendment proposes, there needs to be a proper consultation, including with the senior judiciary, before these provisions are commenced, to ensure that the tribunal system is adequately resourced to cope with the increased demand—what on earth could there be against that? This is such a sensible and unobjectionable amendment, and I am looking forward to seeing it accepted by the Minister and appearing in the next proof of the Bill.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baronesses, Lady Scott of Bybrook, Lady Thornhill, Lady Wolf of Dulwich and Lady Jones of Moulsecoomb, and the noble Lord, Lord Carrington, as well as my noble friends Lady Warwick of Undercliffe and Lord Hacking, for their amendments on rent increases, and all noble Lords who have spoken, including the noble Lords, Lord Cromwell, Lord Howard, Lord Young, Lord Marlesford and Lord Carter of Haslemere, and my noble friend Lady Kennedy of Cradley.
I will start with the comments from the noble Lord, Lord Marlesford, on the challenge to rent levels. He asked whether that concerned a permanent change to the rent. When a tenant challenges their rent, it will be that challenge that is decided upon by the tribunal. Each time the Section 13 notice is issued, presumably the tenant will be able to go back again and challenge that rent. It is unlikely that they will do that, because if a landlord gets taken through the tribunal for an increase in rent, he or she is unlikely to go back and do that again.
The point the noble Lord made about the lack of affordability in housing sits at the heart of the Bill, to some extent. However, this Bill is only part of the Government’s response to the housing market’s lack of affordability, and not the totality of it. I point to the increase in supply that we are trying to drive forward and the reforms we have made to planning, which will, I hope, increase the supply of housing. There is also the £2 billion we are investing in social and affordable housing, which I genuinely think will help to change things, and the £633 million we have put into relieving homelessness, which I hope will help.
The noble Baroness, Lady Thornhill, referred to the cost of temporary and emergency accommodation. Not only is temporary and emergency accommodation devastating for families—it is just awful for them, and we have heard so many terrible stories about that—it has seriously exacerbated the dire financial situation that our councils find themselves in, which is not helped by profiteering. Of course, not all landlords do that, but there is no doubt that some profiteering is going on, as has been reported in the press today.
We have a significant number of amendments in this group; in the interests of time, I will attempt to address each of them thematically. First, Amendment 75, tabled by the noble Baroness, Lady Scott, would allow landlords and tenants to agree a higher rent than the tribunal’s determination. We have been clear that, after the Bill’s implementation, the only way that parties will be able to agree a higher rent is via the Section 13 process.
I am not sure why the noble Baroness, Lady Scott, feels that a tenant would object to and challenge a rent increase that they had agreed to. If a tenant and a landlord come to an agreement on a rent increase, presumably there would be no need for the tenant to challenge that at the tribunal. If the rent is challenged, then the tribunal can determine it. This amendment would leave a gaping loophole for unscrupulous landlords to force tenants to accept a higher rent, even after they have challenged it at the tribunal. Clearly, no tenant would agree to this unless they were under pressure, and it is for that reason that I ask the noble Baroness, Lady Scott, to withdraw her amendment.
Lord Cromwell (CB)
Very briefly, if I may, I rather like this idea—it is great. In the Government’s consideration, will they include where the grant covers only part of the cost and how that can be treated?
Baroness Taylor of Stevenage (Lab)
The noble Lord, Lord Cromwell, makes a very relevant point—we will have a look at both things.
Although I appreciate the intention behind Amendment 90, I have concerns about whether it would be practical to attribute a portion of the market rent to energy improvements. We need to think about how we might do this. I hope that the alternative approaches I have outlined and the steps we have taken to allow tenants to challenge egregious rents, for whatever reason the increase has been put on, provide some reassurance. I therefore respectfully ask the noble Baroness, Lady Jones, not to press the amendment.
Amendments 91, 94, 96, 97, 98, 99, 101 and 104 all deal with the backdating of rent increases. I do not agree that tenants should be forced to pay backdated rent. To ensure that tenants are not unexpectedly thrown into debt that could cause further difficulty, the Bill provides that the new rent will apply from the date the tribunal directs, not earlier than the date of determination. We are clear that tenants should submit an application to the tribunal only where they believe that a rent increase is above market rates, and all parties should communicate about the level of rent increases that would be sustainable.
One noble Lord mentioned 1.6 million tenants taking landlords to court. I find that unlikely, to say the least, but we would quickly know. I have already undertaken to noble Lords that we will monitor this very carefully. If that did start to happen, we would certainly know that it was happening and would deal with it immediately. Allowing the backdating of rents risks disadvantaging the most vulnerable tenants—those who may forego challenging a rent increase that is designed purely to force them out of their home.
I turn briefly to each amendment in turn. My noble friend Lord Hacking has spoken to his Amendments 91, 94, and 97. Amendment 91 aims to backdate a rent increase to the date specified in the Section 13 notice. Amendment 94 seeks to backdate a rent increase where the tenant has challenged the relevant notice at tribunal. Amendment 97 is a consequential amendment linked to Amendment 94, which aims to ensure that, where a tenant challenges a rent increase notice at tribunal, any rent increase determined by the tribunal will be backdated to the date on the Section 13 notice. I have already set out why the Government do not agree that tenants should be forced to pay backdated rent. I therefore ask my noble friend not to press these three amendments.
The noble Lord, Lord Young, set out the process as it is now. If it really is as straightforward and simple as he said—I am not arguing with him, and I am sure he has been as diligent as he always is in looking up the facts—surely we would already be swamped with tenants appealing their rent increases, and that is not the case.
Lord Young of Cookham (Con)
The key difference is that it is backdated at the moment. The Bill changes that, which provides the incentive that is not there at the moment.
Baroness Taylor of Stevenage (Lab)
I understand what the noble Lord is saying, but putting a backdated rent increase burden on people who are challenging the rent because they cannot afford it in the first place would just exacerbate the problem, rather than make the proper ability to challenge their rent increase available and accessible to them, which is part of the aim of the Bill.
Lord Carter of Haslemere (CB)
If you take a civil case to the court and you win your appeal, the appeal court grants you your rights from the date they arose. Your rights are always backdated to the date the rights arose, so this is a dramatic departure from normal court procedure.
Baroness Taylor of Stevenage (Lab)
I accept that it is a dramatic departure, but it is done for a good purpose. We put the provision in the Bill to prevent tenants being penalised for challenging their rent at tribunal by having a backdated increase.
Lord Cromwell (CB)
Is the Minister saying that a tribunal that sets a rent at a level which it considers to be right is setting a penal level of rent? She is saying that tenants would be penalised if rent is backdated to the date when it should have occurred. The implication, therefore, is that the tribunal is setting a penal rent. I cannot think that that is what is intended.
Baroness Taylor of Stevenage (Lab)
I am not saying that; I am saying that the penalty for the person challenging their rent would be in the debt that accrued from the backdating. That is the point I was trying to make.
Amendment 97 is a consequential amendment linked to Amendment 94 which aims to ensure that, where a tenant challenges a rent increase notice at the tribunal, any rent increase determined by the tribunal would be backdated to the date on a Section 13 notice. I have already set out why the Government do not agree tenants should be forced to pay backdated rent.
Amendments 96 and 98, in the name of the noble Lord, Lord Carrington, should be considered in the light of his Amendment 103. Amendment 96 would allow a rent increase to be backdated to the date of the notice. It would, however, limit this to cases where the tribunal has determined that the rent increase proposed by the landlord is the same as or lower than the market rate.
Amendment 98 would similarly change when the rent increases apply after the tribunal determines a rent. It would mean that, if the tribunal finds that a landlord’s proposed rent is lower than the market rate, the rent increase would take effect from the date the landlord originally intended. However, where a landlord has proposed a rent above the open market rate, it would apply from a date on or after the date of the tribunal hearing. I understand the noble Lord’s concerns about the potential for the courts to be overwhelmed. We have had extensive discussions on this capacity issue.
I believe I answered his points around the ECHR in response to the noble Lord, Lord Pannick, last week, but I am happy to take that back to the department’s lawyers again. I have also responded previously to the noble Lord’s points about the impact on build-to-rent investment. The Government do not agree that tenants should be forced to pay backdated rent.
I have more amendments to get through, but I see that I am out of time. If noble Lords are happy for me to carry on, I will.
Amendment 99, also tabled by the noble Lord, Lord Carrington, seeks to backdate a rent increase to the date of the notice. It provides that tenants may either pay the backdated rent in one payment or in 12 equal instalments. Amendment 104 is consequential to Amendment 99 and seeks to define the terms “the uplifted rent” and “the rent difference”. Amendment 101, tabled by my noble friend Lord Hacking, similarly proposes that tenants pay a backdated rent increase in equal instalments for a period of up to six months after the date of the tribunal’s determination. I am sympathetic to the underlying premise of these amendments, which is that tenants might face financial problems in paying a rent increase approved by the tribunal. Although these amendments seek to smooth out the impact of an increase, it is much better to remove the cause of the problem, which our current policy achieves by ruling out backdating in the first place. I therefore ask noble Lords not to press these amendments.
Amendment 100, tabled by my noble friend Lord Hacking, seeks to remove the tribunal’s ability to delay a rent increase for up to two months after the date of determination in cases of undue hardship. The Government strongly believe that being able to defer rent increases for a short period is a necessary protection for renters. This will give them time to adjust and consider their options, while ensuring that the landlord can achieve market rent. I therefore ask my noble friend not to press his amendment.
Finally—noble Lords will be pleased to hear that—Amendment 106, tabled by the noble Baroness, Lady Thornhill, would require the Secretary of State to carry out a consultation on the resources available to the First-tier Tribunal (Property Chamber). My department has worked closely with His Majesty’s Courts & Tribunals Service and the Ministry of Justice throughout the formulation of this Bill. This collaboration has carefully considered implementation and resourcing issues. Our shared aim is that the tribunals are well equipped to implement our reforms effectively, as I have repeated a number of times during our debates. Work is progressing in the First-tier Tribunal (Property Chamber) to increase capacity, as well as to review resource and working practices. The noble Baroness’s amendment understandably reflects the need to ensure the tribunals are equipped to implement these reforms, but the proposed consultation would not provide any new information beyond the work that is already under way. I therefore respectfully ask the noble Baroness not to press this amendment.
Baroness Scott of Bybrook (Con)
My Lords, as expected, this has been a technical and densely packed group of amendments, with numerous contributions from noble Lords who clearly possess deep knowledge of this Bill. I have found their insights invaluable, and I trust the Government will reflect seriously on the points raised today.
I thank the noble Baroness, Lady Warwick of Undercliffe, for rightly seeking clarification on the mechanism available to social housing providers to increase rents. Amendments 80, 80A, 82 and 83 are thoughtful probing amendments and we thank the noble Baroness for bringing these to the attention of everyone in the Committee today. This is an important issue for both social housing providers and for tenants living in social housing. Clear rules and understandable mechanisms build trust and transparency. Furthermore, a standardised approach, underpinned by clear and consistent rules, ensures confidence in the process that governs rent and tenancy management. The Government have a duty to communicate these mechanisms, not only to this House but to those forced to respond to this incoming legislation. In fact, I would argue that the latter is much more important. As we have repeatedly noted throughout Committee, this legislation is technical and detailed, and so the Minister has an obligation to clarify. I trust she will welcome any further amendments brought forward with the purpose of testing and probing the Government’s rationale and decision-making process.
I now turn to Amendment 87, tabled by the noble Baroness, Lady Wolf of Dulwich. Any amendment brought to the attention of this Committee which seeks to alleviate the pressures on the tribunal process must be considered by the Government. This is an important area, and the noble Baroness should be commended for putting forward ideas to help filter out appeals which simply do not have any prospect of success. Prolonged uncertainty is not good for the landlord or the tenant. Delays in resolving disputes will keep both parties up at night and add to the pressures of everyday life. Additionally, backlogs will reduce confidence in the system and many will lose faith with that service as a legitimate protector of their interests. This is not an exhaustive description of all the issues arising from an overburdened system, but it highlights the serious risks we face if these concerns are not addressed.
The noble Baroness, Lady Thornhill, rightly highlighted the critical issue of resourcing within the tribunal system. This is a thoughtful amendment which clearly commands support. Ensuring that the tribunal system is adequately resourced is vital. The Secretary of State must take responsibility for ensuring that their own policies do not undermine or overwhelm the very system intended to deliver justice and security for tenants and landlords alike. My noble friend Lord Howard of Rising, among many others, spoke with his usual vigour and clarity on this issue. On many issues in Committee he has shown his understanding that it is only by striking the right balance in this legislation—I will say it again—that we can we hope to achieve an efficient and effective rental market for the future.
Amendment 88, tabled by the noble Lord, Lord Hacking, seeks to reduce the backlog by adding a drawback or consequence of taking a case to tribunal if unsuccessful. I recognise the determination of the noble Lord to take the pressure off the tribunal system.
Amendment 90, tabled by the noble Baroness, Lady Jones of Moulsecoomb, raises an interesting probing issue in relation to government grants. I was interested to hear that the Minister is going to look into this further. I welcome that and will be interested in what she comes forward with.
I turn to Amendments 91, 94, 97 and 100, tabled by the noble Lord, Lord Hacking. The Committee is right to consider amendments that tighten up and clarify the timing of when a rent increase or notice becomes effective. The Committee is also right to explore options that ensure a predictable timeline for this process, and I thank the noble Lord, Lord Hacking, for tabling these amendments.
Lastly, I briefly allude to the contribution of the noble Lord, Lord Carrington. Amendment 104 highlights the importance of clear, conscious definitions within law. Definitions provide certainty and consistency in application, and every Bill should have well-defined terms. Our courts rely on this, our public bodies rely on it and those who are expected to follow the law deserve it. I hope that the Minister agrees with this principle.
Next, Amendment 99, tabled by the noble Lord, Lord Carrington, is a useful probe into rent tribunals. To remind the Committee, this amendment would ensure that, if a rent challenge were unsuccessful, the reviewed rent would apply from the date that the increase was due to take effect, rather than the end of the legal process. We must consider the incentives and signals that the legislation sends to tenants, but additionally we must seek to protect landlords from financial losses caused by legal delays firmly out of their own control. I listened to what the Minister said on this, but we will be bringing this back for further discussion in the future. Across the Committee, we must consider proposals that ensure that tenants are not hit with sudden, unaffordable lump sums, but also ensure that landlords are properly compensated for a lawful rent increase. This amendment would bring this consideration front and centre, and I thank the noble Lord, Lord Carrington, for speaking to it today.
Briefly, Amendments 96, 98 and 103, tabled by the noble Lord, Lord Carrington, are interesting and quite thoughtful proposals. Where it is possible to do so fairly, rent should indeed be determined at the open market rate. Ensuring that rents reflect genuine market conditions helps to maintain balance and fairness in the market, for both tenants and landlords.
This was a packed and detailed group, with numerous proposals from across the Committee. Not only did I find it a fascinating debate, but once again it highlighted noble Lords’ understanding of the key issues facing the sector. I hope the Minister is listening carefully to the knowledge and expertise across this Chamber and can therefore help the Government make this a successful Bill at the end of the process. We have to ensure that we can enhance the availability of houses, alleviate the burden of unaffordable rents and really deliver security for tenants. Right across the Committee, we agree that renters need a better deal, but I fear that this group is yet another part of the story and, as it stands, the Bill is not quite the answer. However, at this time, I wish to withdraw my amendment.
Lord Hacking
“(d) a lease clause prescribing a rent increase in line with the Retail Price Index or the Consumer Price Index two months prior to the date of the rent increase coming into effect, subject to a minimum of 3% and a maximum of 8%;”
Lord Hacking (Lab)
My Lords, we are moving to a new subject in the taking of the Bill through Committee. This amendment concerns the process of assessment. I am sorry that so many noble Lords are leaving at this juncture, but I will go on, on the basis that I have been asked to move the amendment. It is directed towards the assessment of rent increases under the open market rent test. What I am seeking to do in this amendment is to limit these rent increases to the retail prices index and the consumer prices index. That merely provides, I suggest, a brake on the assessment of rent, which I hope the noble Baroness, Lady Thornhill, will like—she is nodding, which is very nice to notice—because she was concerned about moving into the open market rent and the unfair impact that could have on tenants’ rents.
Baroness Janke (LD)
My Lords, as colleagues have already said, the Liberal Democrats have long campaigned to abolish no-fault evictions. We support the measures in this Bill, particularly the provisions by which tenants can challenge rent increases. We support amendments in this group that seek to establish a fairer basis for rent increases and would prevent excessive and unpredictable increases, the severe impact of which may cause eviction and homelessness. We also support the amendments in this group that will reduce the need for tribunals to hear challenges from tenants. We feel that there is a fundamental problem with the concept of market rents, which are currently calculated by looking at a range of advertisements. This does not provide an accurate assessment of the actual rents that people are paying.
One-third of private renters are already paying half or more of their income on rent, well above the commonly accepted affordability threshold of 30%. Measures to stabilise rents within tenancies are essential to ensure that the Bill delivers the secure, stable system it promises, as well as empowering tenants to challenge unfair rent increases that result in unwanted moves.
For many renters, though, a rent increase is as good as an eviction notice. Without an established index that outlines what a fair increase looks like, the First-tier Tribunal will remain effective in supporting renters.
Rent increases must not become the new no-fault eviction. Over 300,000 renters moved last year because of a rent increase they could not afford; that is more than 900 renters a day. Market rent is an artificially high indicator for judging what an appropriate rent should be. The database proposed in the Bill, once established, would be able to capture what rents are actually being paid. This could then establish benchmarking for an appropriate rent, rather than having the traditional understanding of market rent.
Amendment 77 in my name reflects Liberal Democrat policy, which would limit any in-tenancy increase in rent to a percentage of the Bank of England base rate. This is different from inflation and other indicators that are often used. Landlords do face increasing costs from time to time, but the increases they face and want to pass on to tenants are generally more likely to be related to the cost of interest on their borrowing. Therefore, that is the appropriate measure for landlords to look to and should be considered appropriate for a rental increase. It is also often much less than the much more volatile changes in the market rent that are related to inflation.
We would relate rent increases to much more realistic, modest and accurate reflection of what landlords’ expenses are and use the Bank of England base rate as an appropriate limit on the amount of rent increase and any in-tenancy rent increase. That is the rationale behind this amendment.
Lord Best (CB)
My Lords, I rise to speak to Amendment 79 and the related Amendments 84 and 85 in my name and the names of the noble Lord, Lord Young of Cookham, and the noble Baronesses, Lady Grender and Lady Thornhill. I believe these amendments would overcome an inherent defect in the Bill, both for renters and landlords, making this a rare opportunity for amendments with appeal across the piece.
The amendments seek to protect tenants from unpredictable and unaffordable in-tenancy rent increases, but they also have distinct benefits for landlords. Together, the amendments would establish a fair basis for in-tenancy rent increases for a fixed period. As with the earlier amendments in this group from the noble Lord, Lord Hacking, and the noble Baroness, Lady Janke, the amendment would restrict rent increases to an index of inflation: in this case, either the consumer price index or an earnings index. However, in these amendments, the indexation is limited to four years, countering the concern that rents will be controlled. After four years, a market rent—if necessary decided by the First-tier Tribunal—would be allowed.
These amendments address the central issue of renters’ security, which lies at the heart of the Bill. Tenants need to know that their rented property is their home and they cannot be forced to move out by a massive rent increase. As the Housing Minister in the other place, Matthew Pennycook, said at the Bill’s Report stage in the Commons:
“Once section 21 evictions are done away with, unscrupulous landlords will no doubt attempt to evict tenants who assert their rights by means of extortionate rent rises”.—[Official Report, 14/1/25; col. 259.]
The Renters’ Reform Coalition and Shelter have campaigned assiduously for in-tenancy rent increases not to become a means of eviction by price.
The Bill’s remedy is to place a requirement on tenants to take their case to the First-tier Tribunal to set a market rent that cannot be exceeded. I argue that this whole First-tier Tribunal arrangement is a highly unsatisfactory mechanism for settling on appropriate rent levels. For a start, the outcome of tribunal hearings is unpredictable and sometimes arbitrary. Deciding on a market rent is an art, not a science. Sometimes the tribunal has accepted a case made on the basis of the asking rents advertised on Rightmove and Zoopla. Sometimes, however, the tribunal has explicitly dismissed the use of these asking rents, since there is no knowing what relationship actual rents have to the initial asking rent. Moreover, it is common practice for in-tenancy rent increases to be at lower levels than the open market rents for new tenants because landlords sensibly wish to keep their existing tenants.
There are other drawbacks to the Bill’s use of the tribunal route to determine a reasonable rent increase. First, this mechanism depends upon the renter actually taking their in-tenancy rent increase to the tribunal. This can be a daunting requirement for the renter. As Generation Rent has pointed out, very few tenants have any knowledge of the FTT. Even where renters are fully cognisant of their legal rights, many will be reluctant to go down this road, as doing so is likely to mean falling out with the landlord and negatively affecting the relationship. Taking their case to the tribunal will often involve hassle and expense, particularly if they are to present their case in person. It may require travelling a considerable distance and taking time off work, and the process itself may be intimidating. The whole business is fraught with uncertainty and anxiety.
Secondly, assuming the process is followed, the market rent determined by the tribunal may still mean that the renter faces an alarming increase. A recent Zoopla report shows market rents for new lets are 27% higher—£270 per month—than three years ago, which is an increase well above earnings growth. Many commentators are suggesting that shortages may push market rents much higher in the years to come.
The noble Lord, Lord Marlesford, mentioned the guideline of an affordable rent being 30% of take-home pay, but this is only a guideline and not a requirement of any kind on landlords. Sadly, a lot of tenants are paying over 40% of income on rent as the Affordable Housing Commission, which I had the pleasure of chairing, has shown. At that level of income-to-rent ratio, there is always the danger of arrears, let alone hardship to the renter.
From the landlord’s perspective, I suggest that the proposed regime based on appeals to the First-tier Tribunal is highly unsatisfactory. Those representing landlords have argued that large numbers of tenants could be tempted, as we have heard today, to take proposed rent increases to the FTT in the knowledge that they, the renters, have nothing to lose. They cannot be asked to pay more than the level the landlord proposes and they might be successful in arguing that the rent should be less. In any case, the process would save them money by delaying any increase until after the tribunal hearing, as we have heard, which could be months ahead.
A number of your Lordships have made the point that the number of cases referred to the tribunal could clog up the system and delay any decision being taken, at an ongoing cost to the landlord. Another way of looking at this, among the many that have been suggested, is that even if 99% of tenants accepted their landlord’s proposed rent increase, that would leave 50,000 cases still going to appeal. There is no way the FTT could deal with these numbers.
This overwhelming of the system seems more likely if rumours are true that specialist firms are planning to offer a no-win no-fee service, paid for by sharing the rental savings, to handle cases at tribunal hearings on behalf of renters. So, for both landlord and tenant, the dependency on securing a decision from the First-tier Tribunal—theoretically every year for every tenancy—is fraught with danger and potentially undermines the whole Bill.
I know the Government are rightly worried that introducing any form of rent control would have a significant detrimental impact, as history and international comparisons suggest. These Amendments 79, 84 and 85 do not undermine the overriding market principle; instead, they introduce a mechanism that removes the hazards of appeals to the First-tier Tribunal and provides the certainty of indexation for in-tenancy rent increases. After four years of occupation, the rent can be reset at the market level, determined by appeal to the FTT if necessary. Since most renters move within a five-year period, the amendment would ensure that rents are predictable throughout the great majority of tenancies.
The amendment adopts the same rent stabilisation proposition and indexing of increases devised by the Renters’ Reform Coalition, but the amendment limits this inflation indexing to a four-year period. There may be exceptional circumstances in which indexing a rent, rather than going for a market rent, could cause hardship or financial difficulty for the landlord. A case might be where the landlord spends substantial sums on upgrading the property and needs compensation from higher rents, or has borrowed heavily—probably with a buy-to-let mortgage—and needs to increase rents by a bigger margin to satisfy the lender’s requirements, driven in part by the rules of the Prudential Regulation Authority. To cover these relatively rare cases, an additional amendment could place the obligation on the landlord to go to the tribunal, rather than the tenant, to seek a setting of a market rent, instead of applying the usual indexation.
Lord Wilson of Sedgefield (Lab)
Can I ask the noble Lord to bring his remarks to an end? He has spoken for well over 10 minutes.
Lord Best (CB)
They introduce an arrangement that all parties could accept as a distinct improvement on the Bill’s reliance on appeals to the tribunal.
Baroness Jones of Moulsecoomb (GP)
My Lords, I signed Amendment 77 because it is a really sensible amendment. My Amendment 275 goes a little further. If I was enthusiastic about my Amendment 90, I am delirious about my Amendment 275.
Back in 2001, I was the Green Party member of the London Assembly. Our group persuaded the Mayor, Ken Livingstone, to set up a Living Wage Commission. It looked at what it really cost to live in London, rather than what the minimum wage paid. The commission then went about the work of persuading employers to sign up to a living wage, rather than the inadequate minimum wage. It was a real success, one that Tory and Labour mayors have kept going. It used common sense and facts instead of relying on market forces, and many people had easier lives as a result.
I now suggest a living rent commission to do a similar job, with local mayors given the power and discretion to bring in rent controls that match the conditions in their area. We need this simply because the privatisation of the rental market since the 1980s, with a decline in social housing and the right to buy, has a been a disaster for poorer people and, of course, young people. We have a two-tier economy in which the rich get richer and the rest of us barely manage to tread water. Because the rich can buy only so many yachts and overpriced handbags, they spend their money on buying assets, which often means properties. When BlackRock buys thousands of properties for rent in the UK and another US investment firm, Blackstone, spends £1.4 billion doing much the same, what chance do a couple earning an average income have of getting on the property ladder? We have a younger generation working hard but being sucked dry every month by a rental system that benefits the rich and big corporations.
The Resolution Foundation found that private renters were spending on average a third of their income on housing costs. This is getting worse rather than better, and it is not just a London problem. Rightmove reports that asking rents outside London have risen 60% since 2020, far outstripping inflation and wage growth.
Rent control is an established part of private renting in 16 European countries, so why not here? If the Government want to save money, bring in rent controls. Between 2021 and 2025, the Government are set to spend £70 billion of taxpayers’ money on housing benefit, with an additional £1.74 billion annual spend on temporary accommodation. Why not save money on housing benefit and use that to build more social housing, and reduce the millions of pounds spent every month on temporary accommodation? I have heard a lot from this Government about affordable housing; I have not heard quite so much about social housing. We need to bring it back into use.
Creating a living wage in London made sense because people in low-income jobs spend nearly all they have on just getting by, and by giving them more money you benefit the local economy because they go out and spend it. By contrast, the more money that goes to rich people and corporations, the more that money forces up the price of homes as they outbid everyone to buy more assets.
The Government can break that cycle by establishing a living rent. When one in five private tenants are spending half their wages on rent, our economy is not working for everyone. The Government are doing their best with this legislation, but if you want real change then we need big ideas—like a living rent.
Lord Young of Cookham (Con)
My Lords, I do not share the delirium of the noble Baroness, Lady Jones, for the reintroduction of rent controls, not least because I was a Housing Minister in the 1979-83 Parliament, which dismantled the rent controls that had strangulated the private market.
I want to add a brief footnote to the excellent speech made by the noble Lord, Lord Best, on Amendments 79, 84 and 85. Of the many reasons he gave, the last one attracted me. I see it as avoiding all the problems that arose in the last debate on the Government’s proposals for dealing with rent increases, in which there is no incentive for the tenant not to appeal. We all listened to the Minister’s defence of what is proposed. I may have misread the mood of the Committee, but I am not sure she carried the Committee with her.
The noble Lord, Lord Best, set out the reasons for avoiding overloading tribunals with appeals by inserting a formula for rent increases for four years. Other amendments propose different formulae. In the other place, the Minister explained that he wanted to avoid rent controls. I fully understand that institutional investment will be deterred by the reintroduction of rent control, which effectively nearly ended the private rented sector. The proposals in the amendment from the noble Lord, Lord Best, to restrict increases to RPI to four years, strikes the balance between rents falling out of line with market rents and the regime proposed in the Bill, with all the risks that were referred to in the last debate. Over four years, it is unlikely that there will be a serious deviation between RPI and rents.
I did a little research on this; the average annual rent inflation in the UK from 1989 to 2023 was 3.71%. I recognise that figure may have been depressed by rents in the public sector. The long-run average in RPI is 3.6%, so there is not a lot of difference between those two figures.
My final point, which was touched on by the noble Lord, Lord Best, is that the Minister and I are at one in wanting long-term institutional investment in rented accommodation. In our last two exchanges at Oral Questions, she has confirmed that we are at one on this. The institutions want the rent to go up each year, either in line with RPI, as proposed in the amendment, or in line with market rents, as in the Bill. They do not want reasonable increases to be regularly challenged by tenants who can simply defer any increase by appealing. What consultations has the Minister had with the pension funds, insurance companies and long-term institutional investors about whether they prefer the proposal from the noble Lord, Lord Best, or want to live with all the risks in the Bill? She may not have the answer at the moment, but I hope she will consult with those people, whom we want to invest in housing, and see which of these alternative measures they are in favour of.
Baroness Grender (LD)
I am delighted to be supporting the noble Lord, Lord Best, and I wholeheartedly agree with his perceptive analysis of this Bill. We on these Benches enthusiastically support the fundamental principles of the Bill and the Government’s commitment to redress the imbalance between landlords and tenants. I welcome the elegant bridge the noble Lord has built between landlords and tenants on the issue of rent.
I share the disappointment of the noble Lord, Lord Hacking, that there was an emptying of the Chamber. I see this group of amendments as a critical part of the discussion about what can help—in particular, with the tribunals. I look forward to us welcoming back shortly the people who are very interested in pets.
As the noble Lords, Lord Best and Lord Hacking, and my noble friend Lady Janke have so clearly articulated, there is a fundamental challenge that the Bill in its current form does not adequately address: the profound and escalating crisis of rent affordability. While the Bill introduces welcome measures on security and standards, it risks falling short of its aims unless the issue of rent is resolved. Rent inflation continues to far outstrip both wage growth and inflation, and pushes millions of renters into precarious situations, as described by my noble friend Lady Thornhill, because the highest cause of homelessness is eviction from the PRS. According to the Joseph Rowntree Foundation, more than a third of private renters are in poverty after housing costs, and according to Generation Rent, half of all private renters have no savings at all. We are talking about people who can ill-afford any shift, however small a percentage.
The Bill commendably aims to abolish Section 21 no-fault evictions. This is a crucial step towards greater security, but, as the Renters’ Reform Coalition—I thank it for its briefings—and others have rightly highlighted, without adequate protection against excessive rent increases, landlords can still force tenants out through eviction by price. This is effectively creating a Section 21 process by the back door. The amendments in this group are reasonable and measured in their aim to resolve this issue.
I am afraid that we do not go as far rent control on this—with apologies to the noble Baroness, Lady Jones. It would be a shame if this is perceived as a shift in that direction and that becomes the focus of the debate right now, because I genuinely believe that, with the amendments in this group, we are moving towards a solution—whether it is the Bank of England base rate or by the CPI—by attaching some kind of mechanism that helps to ensure that rents go up proportionately but fairly for everyone. By all means, we can discuss the Scotland experience yet again, but I feel it is not necessarily relevant to what is trying to be achieved here.
The primary mechanism in the Bill for tenants to challenge what they perceive as unreasonable rent increases is through application to the First-tier Tribunal. While the intention behind this is sound, the approach places the onus squarely on the tenant. I recognise that the highly competent noble Lord, Lord Young, is able to fill in a form at speed and be extremely muscular and assertive in riding the waves of any opposition. However, for countless renters—I think of a friend who is a renter who is holding down three very low-income jobs, does not have a smartphone and is trying to maintain a rent to keep her two children at primary school—the very concept of them feeling that they can assert themselves thanks to the changes made by the noble Lord, Lord Maude, to what is on a website is for the birds. Navigating a tribunal process is, for many, a daunting prospect—not for the people here who have described it in the last group of amendments but for the people out there who are renting and who are on the lowest incomes and often at the lowest ebb in their lives. They may lack the necessary means, confidence, awareness of their rights or resilience to engage with what is potentially—and feels to them—a very complex and time-consuming legal mechanism, however speedy it was for the noble Lord, Lord Young.
The Earl of Lytton (CB)
My Lords, as this is the first time I have spoken at this stage of the Bill, I ought to declare an interest. I am a landlord of private rented residential property, but I think that all—both—the renters concerned would agree that I am not somebody who sets out to extract the last penny from them; in fact, quite the opposite. More particularly, I stand here with some 50 years’ professional experience of property, not least of the private rented sector.
The noble Baroness, Lady Grender, is the cause of me getting to my feet—I give her that credit. She referred to rent affordability as security. Although I get that particular line of argument, the two things differ somewhat. All the amendments in this group relate in some way to control of rent, something the Government have always said they would not do. I listened very carefully to my colleague, the noble Lord, Lord Best, but say to him that a deferral or reduction in the receipts on a like-for-like basis is, none the less, a form of rent control. I do not think I can make any concession on that point. The noble Lord, Lord Young of Cookham, said that the amendment of the noble Lord, Lord Best, was less bad than what might be in the Bill. I am not sure that that particular line of argument commends the broader principle to me in general.
A recurring theme is this business of the affordability of rent to renters, but that actually is not the purpose of the private rented sector; that is the purpose of the social rented sector. If we are somehow transferring something which occurs in and is a feature of the social rented sector to the private rented sector, then a much bigger debate needs to take place—apart from this Bill—on precisely what that means. I do not believe that that debate has been entered into, nor do I believe that there is any substantial investigation or research into what that might mean in practice.
If we are in fact faced with that change, I predict the same outcome as occurred after 1965. The noble Lord, Lord Young of Cookham, referred to the rent control of the 1960s and his role in undoing that. I mentioned at Second Reading that the combined effects of security of tenure and rent control in the 1960s caused a fall from 30% of housing being in the private rented sector in 1961 to about 10% some 30 years later. Even after that freeing-up process which the noble Lord referred to, it was still under 10% in the year 2000. That is how durable the process is. It is very difficult to get confidence back once it has been severely damaged.
We must also bear in mind the progressive changes in the tax treatment of private rented sector landlords and what that has meant. It may be different when it is being dealt with at corporate level, when all sorts of things can be offset against a larger pool of property. For the 80% of private rented sector landlords who have five or fewer residential units, that does not look like the same thing at all. Ultimately, the test will be whether we generate competition in the market through an increase in supply. However, everything I have heard this afternoon, particularly from those who tabled the amendments in this group, has been about guarding against precisely that outcome that would be a failure of the intentions that sit behind this Bill. So we have to be very careful.
I do not take a moral stance of any sort on this. I stand before your Lordships as a technician, not a politician. I come with an economic view. However, if we are making a transfer of liabilities from one sector that has a considerable amount of government, financial and in many cases registered provider charitable support, to the private rented sector, which does not have that support, I predict a very significant failure in the outcomes of this Bill.
That would be a tragedy, because this Bill contains an awful lot of stuff that is very good indeed, I would like to see a successful private rented sector. I would like to see renters treated with humanity and civility and not exploited endlessly in the way that they have been. However, if we end up with reduced supply, and with those who show no civility or common decency towards their renters somehow still there, operating in some subculture or other, we will not have succeeded in dealing with this matter at all.
I wrote to the Minister recently. She has not had a moment to reply. I cast no aspersions at all, because she is extremely busy with this Bill. However, there is a need to look closely at the probable outcomes. If we do not, we will walk blindly into something that we would rather had not happened.
Lord Marlesford (Con)
I speak on this Bill from the rural perspective, which is very different from the urban perspective. The rural perspective is much more concerned with communities. In the fixing of rents, this is very much taken into account by most rural landlords. Affordability is one method: the 30%. Some return on capital is needed to keep the show on the road. However, taking account of individual circumstances is crucial.
Where there is talk about tying rents to inflation, it is very sensible that all leases make clear that, when rents are assessed annually—which seems to me a reasonable level—that should be on the basis of taking account of inflation. When the inflation is very high, it would be quite wrong to impose a full level of inflation on a tenant. We have had double-digit inflation in the last three years and those of us who were alive then will never forget 1975-76, when we had inflation of 25% per year, for goodness’ sake. Inflation is a dangerous animal. You should use it as a guide, but over a period. Also, you take account of individuals and their contribution to the community in which they live. After all, a rural community is about people in a much greater way than an urban community can be. I do not know whether the Minister has thought about this, but I would hope that she would make reference to what might work better in a rural community than in an urban community.
I very much agreed with my noble friend Lord Young, one of the liberators from a system which had almost destroyed the private rented sector. The other person who I have huge respect for is the noble Lord, Lord Best, who I have known for a very long time and whose judgment, knowledge and experience provide a very useful guide. I recommend that the Minister should have quiet, private discussions with people like that on the practicalities, because this Bill is getting knotted up in practicalities. It is easy to write it all down in clauses and subsections, but how it works will depend on human beings. Governments have a role. As a Burkean Conservative, I believe that the role of a Government is to hold the ring, to prevent people from being ill-treated in the community. It is people who matter.
Lord Thurlow (CB)
My Lords, this is my first contribution in Committee, so I declare my interests as the owner of a residential property in receipt of rent and as a practising chartered surveyor for some 35 years. I would like to stop for a moment and consider why rents are so high. Well, it is simple. It is supply and demand; we have not got enough, because there has not been sufficient building since the evolution of the AST regime that we heard about, which began to encourage investors back into the market.
British institutions—life companies, pension funds, insurance companies—used to own millions of pounds-worth of private rented accommodation in the UK. The post-war rent restrictions made it uneconomical and they dumped it, as we have heard from the noble Lord, Lord Young. It took many years for that to come back. The investors returned slowly with the AST and now we are interfering with it all again.
I am not objecting to that interference; I think ASTs needs updating. But the important thing to remember, or point out to the Committee, is that there is a vast amount of institutional money lying in the wings waiting to invest in private rented property. It is there, it is identified, some of it has been spent, and it is going to create tens of thousands of units of private rented accommodation. We are talking not about tens of millions but billions of pounds, and a lot of it is foreign investment. Institutional investment is the holy grail of generating high-volume addition to the inventory.
Lord Jamieson (Con)
My Lords, this has been a good debate. Rental costs are a serious problem, and we know that the high cost of housing, coupled with other pressures, poses real challenges for hard-working families across the UK. The Ministry of Housing, Communities and Local Government’s English Housing Survey 2022-23 found approximately 1.2 million private rented households reporting it difficult to pay their rent. That represented 29% of private rented households when the survey was conducted. When nearly a third of tenants find it difficult to pay their rent, there is clearly a problem. When we were in government, we took decisive action on the cost pressures faced by hard-working families across the country, and we zeroed in on the most important issue of all for households: inflation. By the time this Government took office, inflation was back below target. However, following the Chancellor’s Budget last year, inflation is, concerningly, now above target.
It is against that backdrop of cost pressures that these amendments have been tabled, and while we do not agree that rent controls are the solution to the problem, we do, however, share the concerns many noble Lords have raised about the cost of renting. As the noble Lord, Lord Thurlow, and the noble Earl, Lord Lytton, raised in the debate, supply is a fundamental part of the issue. We believe an adequate supply of rented accommodation is the way to address the cost of renting but, as we have warned in previous debates, the Bill risks driving landlords out of the sector and not attracting some of those institutional investors that could make a real difference if the quanta were increased. Decreasing the supply of rented accommodation at a time when demand is already high and rising will lead only to higher rents.
We also know that where rent controls have been tried, they have failed; and even the Minister has previously raised in Committee the impact of rent controls in Scotland, although, to be clear, we believe that rent controls are just part of the problem in Scotland. The SNP’s failed experiment with unbalanced renters’ reforms and rent controls in Scotland is a case worth dwelling on; there we have seen stifled supply and higher rents. That said, the Government must address the serious concerns raised by noble Lords across the Committee and listen to those tenants who are struggling with the cost of renting.
Last month, the Lord Chancellor warned that despite further court sitting days being announced by the Ministry of Justice, the sad reality is that the backlog of cases will still go up. It is right that we ask questions about the additional burdens that Clause 8 will place on our already overloaded courts and tribunal system. Can the Minister confirm what additional resources will be provided to the appropriate tribunals, so they have the means to cope with the increased number of cases brought before them under Clause 8?
Amendments 76 and 77 seek to introduce a cap on the increases in rent that can be brought forward by landlords, and we will listen carefully to the Minister’s response to those proposals. I know that the Deputy Prime Minister, the Secretary of State, has put her opposition to rent controls on the record, saying that they
“restrict housing supply, which does not help anyone”.—[Official Report, Commons, 9/10/24; col. 335.]
We agree with the Government that restricting housing supply does not help anyone. Ministers should listen carefully to the concerns we have raised throughout the debates on the Bill.
Amendment 275, in the name of the noble Baroness, Lady Jones of Moulsecoomb, would deliver an entirely separate body to set rules for rent increases. Leaving aside the fact that the noble Baroness’s amendment fails to provide parliamentary oversight, or that there are no clear objectives for the set of rules set by the independent living rent body which she is seeking to establish, and the lack of clarity on the governance of the proposed body, we do not feel that establishing what is, in effect, an additional regulator is the right approach. Our rental sector is already subject to heavy regulation and the Bill places additional burdens on the sector. As the noble Lord, Lord Young, said, we do not wish to strangle the market. For that reason, I am afraid we cannot support this even more onerous measure which the noble Baroness is proposing.
Amendments 79, 84 and 85, in the name of the noble Lord, Lord Best, are perhaps the most pragmatic of the amendments in this group, and I understand why he has tabled them. We will listen carefully to the Government’s response to his amendments and continue to work on this part of the Bill before we proceed to Report. It seems clear to us that now is not the time to impose additional burdens on our tribunals—when, by the Government’s own admission, backlogs are already rising. Ministers need to take a long, hard look at this part of the Bill, if we are to deliver a Bill that strikes the right balance on the rights of tenants and landlords without adding to the growing backlog and without discouraging investment in the sector. There are serious questions for Ministers to answer in all these areas, and we look forward to hearing the Minister’s reply to this group.
Baroness Taylor of Stevenage (Lab)
I am very grateful to all noble Lords. I agree that this is a very important group, and I was sorry to see other noble Lords leaving the Chamber, because this was a very important discussion.
I thank the noble Baronesses, Lady Janke and Lady Jones, and the noble Lords, Lord Hacking and Lord Best, for their amendments, and thank all noble Lords who have spoken: the noble Lords, Lord Thurlow, Lord Marlesford, Lord Jamieson and Lord Young, the noble Baroness, Lady Grender, and the noble Earl, Lord Lytton, to whose letter I have replied. It is in the post, so I have signed it off, and the noble Earl should receive it shortly.
As I have stated previously, and I am going to restate it, and the Deputy Prime Minister, as the noble Lord, Lord Jamieson, said, has been very clear about this, our Government do not support rent controls. We have considered rent regulation within the broader context of the private rented sector, and we do not believe that limiting rents in this way leads to positive outcomes. Evidence suggests that so-called first- and second-generation rent controls may disadvantage tenants as well as landlords. They can have a long-term negative impact on housing supply and discourage investment in the sector, leading to declining property standards. Subtler forms of rent control—second- or third-generation rent controls—have differential impacts on different groups, typically benefiting settled and better-off tenants more than those looking for a home or needing to move.
Academic studies from countries such as Sweden and Germany, and from places such as San Francisco and Ontario, show that rent controls can limit supply, discourage investment and lead to declining property standards. The noble Earl, Lord Lytton, referred to early attempts at rent controls and their impact on supply. We simply think that the answer to this is supply generally, and supply of social and affordable housing in particular, rather than putting controls on rents.
The noble Lord, Lord Thurlow, was right to say that my interactions with the financial sector indicate that institutional finance is available for rental property. The noble Lord, Lord Carrington, has spoken about build to rent very powerfully; the finance is there for that. That has the potential to drive the supply that will stabilise rents over time. That is why we do not want to introduce rent controls.
I will start with my noble friend Lord Hacking’s amendments—perhaps he could ask the two tenants to whom he referred to come up with a solution to the Arctic temperature in your Lordships’ Chamber this afternoon. The weather forecasts of a heatwave have been grossly exaggerated in this part of London. On Amendment 76, the Bill as presented to the Committee today seeks to remove the ability of landlords to place rent review clauses in tenancy agreements. The effect of the amendment tabled by my noble friend would be to reintroduce into the Bill a measure allowing landlords to make use of such a clause. To be specific, Amendment 76 would amend Clause 7 to allow for rent review clauses linking rent increases to inflation to be included in tenancy agreements so long as such an increase fell between 3% and 8%. Rent increases made under a rent review clause cannot be challenged at the tribunal. As such, the approach put forward by my noble friend Lord Hacking risks a significant reduction in the protection for tenants, who may not understand the effects of the rent review clause and could have limited power to negotiate these even if clearly articulated. It is likely that the use of such clauses would become standard, in effect taking us back to the status quo, where the protection the tribunal offers is available only to a small number of tenancies.
Furthermore, if the use of standardised rent review clauses became commonplace, there is a risk that this would, in effect, result in a system of de facto rent control. I will not repeat again our position on rent control, but it is worth while, if the Committee will allow me, to elaborate further on why any attempt to use a single metric for calculating rent increases risks unintended consequences. The danger of such an approach is that arbitrary increases prescribed in tenancy agreements could artificially inflate the rent for some locations. For example, in Leeds, rents increased by 2% between January 2024 and January 2025, whereas in Oxford, rents increased by 12% in the same period. CPI for this 12-month period was 3%. The measures contained within the amendment would therefore likely have led to rent increases in Leeds above the market rate, to the detriment of tenants there, and the controlling of rents in Oxford, with all the associated wider issues which we have already discussed. Therefore, I am sure my noble friend can understand why the Government cannot accept an amendment which would remove the right of tenants to appeal rent increases above market rate, risk some tenants being trapped in above-market-rate rent rises, and risk the implementation of de facto rent controls.
Turning to Amendments 79, 84 and 85, I join others in commending the noble Lord, Lord Best, for the clarity of his explanation and for all the work he has done as chair of the Affordable Housing Commission. This is vital work, and I sincerely understand the motivation behind his amendments: that these would limit annual rent increases during the first four years of a tenancy to a percentage calculated by reference to CPI or median national earnings over a three-year period—the noble Lord articulated his amendments much clearly than I could. If either of those things happened, a challenge to the tribunal by the tenant would not be possible.
The first of the amendments from the noble Lord, Lord Best, Amendment 79, would introduce measures into Clause 7 of the Bill which, as I have just set out, would separate the setting of rents from the market rate. As such, the amendment would introduce a form of rent control, and I have already explained our position in the Government towards rent control. The regulation of rents in the form proposed by the noble Lord could have a long-term negative impact on housing supply, discourage investment and lead to declining property standards.
In fact, the introduction of an in-tenancy rent control would create the risk of tenants in this country experiencing what has been seen in Ontario in Canada, where a similar form of regulation has limited the amount by which rents could increase each year for existing tenancies. For example, rental price growth in 2023 was capped at 2.5%, based on the Ontario consumer price index. Analysis suggests that the result of this measure has been higher rents for new tenants, with the impact felt by more mobile groups such as younger people, who are often new arrivals to the rental market. There is also evidence from Ontario that landlords have sought to evict tenants so that controlled rents can be reset at the market level. The risk, therefore, of causing unintended harm to tenants as well as landlords is too large for our Government to accept, even in an amendment as well-intentioned, as I know it is, as that put forward today by the noble Lord, Lord Best. Instead, as the Committee is already aware, our approach is to allow landlords to increase rents annually to the market rate, which represents a strengthening of rent regulation in the broader context of the entire system, including security of tenure, better enforcement and quality standards.
Lord Hacking (Lab)
My Lords, I am about to beg leave to withdraw my amendment, but I would like to reply to my noble friend the Minister and thank her very much for her detailed reply. I did not know about the experience in Ottawa, and I would like to consider that further.
I say quite plainly that I was not seeking to set up a rent control; I was seeking to set up guidance on rent increases associated with the RPI or another financial index. The reason for that was expressed well by the noble Lord, Lord Best, who detailed the problems for the renter in having to go through the process of making an appeal to the First-tier Tribunal and all the difficulties in that. If that can be relieved, we would be doing renters a service. I beg leave to withdraw the amendment.
The Deputy Chairman of Committees (Baroness Finlay of Llandaff) (CB)
My Lords, on Amendment 89 there is an error in the Marshalled List, which says
“leave out from beginning to end of line 8”.
It should instead say
“leave out from beginning to end of line 7”.
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment would remove the requirement that agreed tenancy rents can only be decreased by the Tribunal, therefore removing the potential incentive for tenants to appeal all rent increases when they would only go down or stay the same.
Baroness Scott of Bybrook (Con)
My Lords, I will speak to Amendments 92, 93, 95, 102 and 105 in my name, which relate to rent controls and caps. I apologise if I repeat quite a bit that other noble Lords have been debating, but I think this is an important issue and I would like to give my own explanation of my amendments in this group.
Amendment 92 in my name addresses an issue of critical concern both to landlords and to the overall functioning of the rental market. The current provision limits the ability of tribunals to increase rent, allowing only for reductions. Let us pause for a moment to consider what such a provision creates. In practice, what incentive does it give to tenants? In essence, this provision incentivises a clear motivation for tenants to appeal all rent increases, as we heard earlier, regardless of whether the increases are reasonable, aligned with market value or necessary. Why? Because they know that the worst outcome for them will be that their rent is either frozen or reduced.
I have tried over the course of our debates on this Bill to understand the Government’s position on many of its provisions. On this provision, I find myself asking who exactly came up with this. Who thought it was fair or reasonable to restrict the ability of tribunals to increase rents while leaving only the option for reductions?
Under this existing framework, tribunals can never increase rents, regardless of the circumstances. Not only does this create a totally imbalanced system within the rental market: more pressingly, how will the tribunals cope? How can we expect the tribunals to fairly adjudicate cases when the scope of their decision-making is so narrowly constrained?
On the issue of tribunal capacity, I once again ask the Minister to assure the House that tribunals will have the necessary resources and capacity to manage the inevitable increase in the number of cases under this new system. If the Minister does not have the figures on this available today, can she commit to writing to me with the details in full? It is essential that we understand how the Government intend to support the tribunals, given the increasing workload and the very real risk of backlogs that this Bill may introduce. I do not believe that it is sufficient simply to introduce this provision without a clear plan for ensuring that tribunals can operate efficiently and without significant delays.
I must ask: is this what we really want? Are we truly creating a fair system if landlords are unable to maintain rents that reflect the realities of the market? At what point do we risk undermining the rental market altogether? If landlords begin to feel that any rent increase, no matter how justified, will result in a tribunal-imposed reduction or freeze, will they not simply choose to exit the market—and what will this do to the rental supply?
To put it plainly, this provision will lead to fewer rental properties, fewer long-term stable tenancies and, ultimately, higher rents for tenants. We cannot ignore the wider consequences of this approach. Amendment 92 seeks to correct this imbalance by giving tribunals the discretion to make a neutral decision based on the facts before them. It would allow the tribunal to increase rents if justified, just as it could reduce rents when necessary. In doing this, we would be creating a balanced system that reflects the realities of the housing market and treats both landlords and tenants fairly.
Amendment 93 addresses another fundamental issue: the ability of tribunals to backdate rent reductions. How can it be fair to require landlords to repay rent that they agreed to in good faith at the start of the tenancy? If a rent increase has been agreed to, how can we justify forcing landlords to pay back significant sums retrospectively? The provision does not just destabilise the relationship between the landlord and the tenant; it undermines the entire principle of contractual fairness. If landlords face the risk of backdating payments, why would they agree to any rent increases at all? And what happens to trust between landlords and tenants when rents can be altered retrospectively? The solution is simple. Amendment 93 would ensure that rent reductions cannot be backdated, promoting stability and fairness.
Amendment 95 ties directly into this. It addresses the delay of rent increases by tribunals. How can we justify automatic delays to rent increases when those increases are fair, reasonable and in line with market conditions? This provision creates an incentive for tenants to appeal rent increases simply to delay them. Of course tenants would do this—if they know that they can delay rent increases for months or even longer, regardless of whether the increase is justified, why would they not do that?
The reality is that the current system encourages tenants to use the tribunal process as a delaying tactic, even when there is no real case against the rent increase. What does this do to landlords, who rely on these rent increases to cover rising costs, maintain their properties and meet their financial obligations? What happens to them when the tribunal can, at any time, delay a rent increase without a justifiable reason?
I therefore ask the Minister how the Government expect landlords to respond to this. Can she explain why we are encouraging tenants to delay rent increases when the increases are reasonable and necessary? Does she not see that this provision disincentivises landlords from entering or remaining in the rental market at all? If we allow this to continue, the only winners will be tenants who exploit the system. Landlords will be left with fewer options and fewer incentives to maintain or improve their properties. At what point do we risk irreparable damage to the rental market?
Amendment 95 seeks to correct this imbalance by ensuring that rent increases are delayed only where there is clear evidence of undue hardship for the tenant. This would prevent tenants delaying rent increases simply for convenience and would provide landlords with the certainty they need to operate within a fair system.
Why is the Renters’ Rights Bill so intent on restricting rent increases, when in many cases increases are entirely justified by market conditions? The provision that rents can only be decreased creates an artificial cap that disregards the economic reality of the rental market.
Moreover, by limiting rents to reductions, we are effectively disincentivising landlords from maintaining or improving their properties. Is the Minister aware of the potential long-term consequences of this? Amendment 102 seeks to address this by replacing the requirement for rents to be decreased with a possibility for rents to be adjusted according to the circumstances. This would create a more flexible and fair approach, one that allows the tribunal to consider the economic reality of the rental market without imposing artificial restrictions.
Lord Howard of Rising (Con)
My Lords, I support the amendments in this group in the name of the noble Baroness, Lady Scott, to which I have added my name. I endorse what she said just now when she spoke to the amendments.
When I spoke to the fourth group, I pointed out that, as presently drafted, the Bill will, at a conservative estimate, give rise to 1 million applications per annum to the rent tribunals. Other noble Lords have commented on the problems which will occur. The rent tribunals will be overwhelmed. With the delay for any rent increase, this will amount to a de facto rent control, with a corresponding and inevitable loss of rental accommodation when landlords disappear from the market as they cease to be able to cope with the ever-rising costs, not least the cost of increasing regulation.
I spoke at Second Reading to the problems in Berlin, where rent controls had to be abandoned owing to the lack of rental accommodation. These amendments would help introduce some realism into the system, so that applications to the rent tribunals are for genuine reasons and not merely because it would be silly not to go to the rent tribunal when there is no risk and a possible gain.
Baroness Thornhill (LD)
I had thought that there would be a few more speakers than that, but hey.
I wish I could be half as certain about what is going to happen in the future as some noble Lords here—they must have a crystal ball hidden somewhere. I feel this Bill is almost an act of faith. It is quite obvious that we believe that it is going to do good things and that Armageddon will not happen. However, the noble Baroness, Lady Scott, argued her case very well and sincerely, and likewise she believes that. At the moment, neither side really knows what is going to happen. To use the cliché: only time will tell.
The problem with so many amendments being regrouped is that we are into groundhog day, so I will be brief. As previously stated, we do not support amendments that would disincentivise tenants challenging rent rises and feel that most of these amendments fall into that category. The Bill is about a power balance between the tenant and the landlord, and is a genuine attempt to redress that balance. A lot of the amendments and statements made by some noble Lords want to maintain the status quo; for us on these Benches, that is an imbalance. We are just going to have to disagree about that.
The noble Baroness referred to the realities of the housing market. Our interpretation is that landlords can charge whatever they want—whatever the market will sustain—and we do not believe that that is right. In doing so, I genuinely believe we are creating an underclass of people who will never be able to fit into the private rented sector. That is perhaps an argument for another day.
The Minister has perhaps already answered Amendment 105, but I am quite happy to hear it again, given that I agree with the noble Baroness that such a review is important and necessary.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendments on rent regulation. I thank the noble Lord, Lord Howard, and the noble Baroness, Lady Thornhill, for their comments.
As I set out earlier, the Bill will empower private rented sector tenants to challenge unreasonable rent amounts. This is a central aim of the Government’s reform agenda and reflects our manifesto commitment. The tribunal will not be able to increase rent beyond what the landlord initially proposed. This will prevent unscrupulous landlords—let us face it, most of them are good, but there are some unscrupulous ones—using rent increases as a back door means of eviction, while ensuring rents can be increased to reflect market rates.
We are clear that tenants should submit an application to the tribunal only where they believe a rent increase is above market rates. In the first instance, we strongly encourage landlords and tenants to communicate early about what adjustments to rent are sustainable for both parties. We need to think about possible triage arrangements if there is no agreement between them.
We anticipate that our reforms will lead to some increases in cases, but, as I have already stated, we are working closely with the judiciary to ensure the tribunal has the capacity to deal with cases. In the First-tier Tribunal (Property Chamber), work is progressing to increase capacity, as well as on reviewing resourcing and working practices in readiness for any increase in demand. I am not sure if it will be 1 million applications, as the noble Lord, Lord Howard, said, but we anticipate that there will be some increase initially, until the way that this works drives down demand in the future—which I think it will. This is part of our wider work to make sure the justice system is prepared for the changes to case loads and procedures which will be required for our reforms.
As now, tenants will be able to challenge the rent payable in the first six months of a tenancy if it is above market rate at the First-tier Tribunal. The tribunal can determine the open market rent only to be lower than or the same as the tenancy rent itself. The tribunal will not be able to increase the rent above the amount originally proposed by the landlord. We see this as a rebalancing mechanism, as the noble Baroness, Lady Thornhill, said.
Amendment 92 seeks to allow the tribunal to determine the open market rent to be higher than that originally proposed by the landlord. We believe that limiting the tribunal to determine a rent to be either the same as the landlord themselves proposes or an amount lower than this is fair to both parties. If landlords have agreed a rent that they consider to be acceptable at the beginning of the tenancy, they should have no fear of a challenge at tribunal.
I turn to Amendment 93. This Bill enables a tenant during the first six months of a tenancy to challenge the rent payable. It is an important provision that should stop a minority of unscrupulous landlords exploiting tenants desperate to find a new home. It strengthens our ban on rental bidding, ensuring that any landlords who seek to charge over the odds can be challenged. When a tenant challenges their rent, the Bill states that the start date of the new rent determined by the tribunal
“must not be earlier than the date of the application”.
This reflects Section 22 of the Housing Act 1988, where a similar provision already exists to allow backdating of a determination where a tenant has challenged an excessive rent.
Amendment 93 would prevent a tribunal backdating the determination of the new rent payable to the date of the tenant’s application. It would mean that the new rent could take effect only from the date of the tribunal’s determination. I understand that the purpose of this is to ensure that the landlord will not have to repay the difference in rents back to the tenant. The Government encourage landlords and tenants to communicate early about what rents are sustainable for both parties. The Bill levels the playing field to enable a more equitable discussion about levels of rent before anything comes to the tribunal. To be clear, the aim of this is to prevent as many cases as possible ending up in court action.
In our view, the noble Baroness’s amendment would limit the ability of tenants in the first six months of an above-market tenancy to get justice for the period that the case is in the courts. It would also increase the risk that landlords would seek to exploit desperate tenants by extracting above-market rents. I am really concerned about that, because one of the key principles of the Bill is to stop that happening.
Lord Howard of Rising (Con)
Perhaps the Minister can help me: if you can never put the rent above market rates, how does it ever change? You can never put it up—you can only ever put it down—so it can never go up and will only ever drop. That seems a bit of a conundrum.
Baroness Taylor of Stevenage (Lab)
No—you can put the rent up to market rates.
Lord Howard of Rising (Con)
That is the point. If you put it up to market rates, it can never go above market rates, so market rates can never increase. They will always stay static, and in 10 years they will be exactly the same.
Baroness Taylor of Stevenage (Lab)
Market rates are usually driven by demand, not by what happens in the courts, so I do not think that will be the case.
On Amendment 95, for too long tenants have been afraid to challenge an unreasonable rent increase for the fear that the rent can be raised beyond what the landlord has asked for. The Bill will reform how the tribunal works to ensure that tenants feel confident in challenging poor practice and can enforce their rights. The tribunal will not be able to increase rent beyond what the landlord initially proposed. That strikes the right balance between empowering tenants to challenge unreasonable rent increases and ensuring that landlords can increase to the market rent.
Amendment 95 would require the tribunal to backdate a rent increase to the date of the rent increase notice, except where this is likely to cause undue hardship to the tenant. This amendment would punish the most vulnerable tenants who may already be struggling financially. Therefore, to ensure tenants are not unexpectedly thrust into debt, it is right that the new rent amount would take effect no earlier than the date of the tribunal determination. This will give tenants the time to prepare for any changes to their rent and seek independent advice on how best to manage their finances. For the sake of clarity, I repeat that the tenant will continue to pay the rent that they were paying before—it is the increase in the rent that is being challenged through this process.
Turning to Amendment 102, I reiterate that applying to the tribunal should be a last resort for a tenant. Good landlords and tenants will discuss what rent is sustainable for both parties but, if they cannot come to an agreement, a tenant has the right to challenge a rent increase at tribunal. As I have said, for too long tenants have been afraid to do that. I note, too, that the Opposition once supported our position on this matter. Their original White Paper said the tribunal will no longer have the power to increase the rent above the amount the landlord asked for. It is regrettable that they now disagree with themselves and want to make it easier for tenants to be evicted by the backdoor.
Baroness Scott of Bybrook (Con)
Can the Minister explain this? If a tribunal is taking quite a long time, then the decision is made and any increase happens from the date of that tribunal’s decision, and the landlord can go to a tribunal only every 12 months, does that 12 months start from the date of the tribunal’s decision, or can it go back six, seven or eight months prior, so that it could be nearly two years rather than one year?
Baroness Taylor of Stevenage (Lab)
I understand the noble Baroness’s question. My understanding is that the year starts from the date the tribunal decisions are made, but I will check that and write to her.
Baroness Scott of Bybrook (Con)
So you could lose six or eight months—it could be nearly two years. If the Minister could confirm that, it would be useful.
Baroness Taylor of Stevenage (Lab)
I will clarify that in the letter.
Amendment 105 would require the Secretary of State to carry out a review of the impact of Clause 8 on the First-tier Tribunal, and to consult the Competition and Markets Authority on whether further measures are needed to prevent distortion of the rental market by the tribunal’s determinations on rent. As I have made clear on similar amendments, the department is already collaborating extensively with His Majesty’s Courts & Tribunals Service, as well as the Ministry of Justice, to ensure that the property chamber of the First-tier Tribunal is prepared for the implementation of the Bill, including any changes to its role in determining rent.
Baroness Scott of Bybrook (Con)
My Lords, on the Minister’s last point on scaremongering, I do not think we are. I suggest that she might like to look at the latest weekend Bloomberg report on the rental sector in London. The number of landlords going out of the rental market is quite scary. It is said very clearly that they are going out because of further regulation of the sector. I will send the report to her if she would like; it is interesting.
I thank noble Lords who contributed on this group. In closing, I will return to our central concern, which runs through the whole group of amendments: the balance between landlord and tenant, between fairness and workability, and between principle and practical consequences. At the heart of this is the fundamental question about whether we believe in a truly impartial rent tribunal system. As the Bill stands, it allows only downward rent adjustments. Amendment 92 would correct that. It would give a tribunal the discretion to assess the facts and adjust rents up or down, depending on the evidence. That is the essence, we suggest, of a fair system that reflects market realities, not just one side of them. This imbalance is deepened further by the proposal to allow rent reductions to be backdated. Amendment 93 addresses this. Landlords who have acted in good faith, charging an agreed rent, should not be faced with demands to return funds months after the fact. That is not stability but uncertainty, and it undermines trust in the system.
That uncertainty only grows with the automatic delay of rent increases. Amendment 95 brings much-needed clarity to this. It ensures that rent increases are pushed back not simply as a matter of course but only when there is clear evidence of undue hardship. Without this, we risk creating a system where delay becomes the default tactic and landlords bear the cost. These problems are compounded by the Bill’s insistence that proposed rents can only be reduced. Amendment 102 introduces necessary flexibility. If we are asking tribunals to assess fairness, we must let them consider the full picture, not force them into decisions that ignore inflation, market trends or rising costs.
This brings us to the question of implementation. The tribunal system is already under enormous strain. Amendment 105 makes a straightforward, sensible request that the Secretary of State reviews the capacity of the system to manage what this Bill will ask of it. Without that, we are setting it up to fail. I urge the Government to consider the cumulative effect of these provisions. On paper, they may appear technical; in practice, they will drive landlords from the market, reduce housing supply and increase pressures on rents. This is not what this Bill should achieve, but at this stage tonight I wish to withdraw my amendment.
Lord Jamieson
Member’s explanatory statement
This amendment would allow a person to mutually agree a tenancy with a landlord which requires them to pay up to six months of rent in advance.
Lord Jamieson (Con)
My Lords, I will speak to the group of amendments in the name of my noble friend Lady Scott, relating to payments of rent in advance. The payment of rent in advance can provide a number of significant benefits to tenants. These go beyond avoiding late fees and the demonstration of financial security. Tenants may wish to pay rent in advance for financial planning or even to avoid the worry of monthly payments. Amendments 108, 109, 110, 112, 113 and 114 recognise and affirm the legitimate choice of a tenant to pay rent in advance. I emphasise that this is rooted firmly in mutual agreement. If a tenant does not wish to pay in advance, they are under no obligation to do so, but if a tenant chooses to take this step, if they believe it is in their personal best interest, why should we stand in their way? If a tenant makes a judgment on the basis of their financial circumstances that this is in their best interest, why should it be for the Minister to say, “No, the Government know best”? If a tenant believes their ability to pay may be inhibited by a financial burden coming down the track, they could legitimately plan for the payment now. But, regardless of the reason or even the need, if there is mutual agreement, what is the problem?
I turn to the impact of this on two groups who will be particularly impacted by this change: overseas students and those with poor credit ratings. Tenants with a poor credit rating history will inevitably appear risky—this may be through no fault of their own; they may just not have a rating history—and often this risk is too insurmountable to ignore. By paying up front, tenants can demonstrate responsibility and ultimately improve their chances of securing a rental agreement and the security of a home. In many cases, this proactive step, choosing to pay in advance, is the only practical means by which tenants can build trust, enhance their credibility and demonstrate financial reliability. Will the Minister please set out the impact of this change on those with a less than optimal credit history?
Next, I wish to address the issue of overseas students with no local credit history. The Committee will know that the UK credit rating agencies do not hold information about a person’s financial affairs outside the country, or any foreign credit reports. Therefore, overseas students often require a UK-based guarantor to cover potential property damage or unpaid bills. Where this is not possible, payment in advance can be a solution, and payments are often made for the entire term, or even the entire academic year. Will the Minister set out the expected impact of this change on overseas students, and the number we anticipate losing due to difficulties in securing student accommodation? Alternatively, does she believe that landlords will still have a sufficient incentive to house overseas students, despite their limited credit history? Will she outline what steps the Government are taking to strengthen the enforcement around credit arrears where overseas students are unable to pay? Current mechanisms are often weak, but it is an issue that is far less prevalent when payment is made up front.
I also want to highlight the plight of some of the most vulnerable, where councils have a duty of homelessness prevention. Councils often work with landlords and tenants, offering advanced rental payments, larger deposits and guarantees, which would be hampered by these proposals. Are councils to be banned from paying rent in advance to support some of the most vulnerable in our society? As has been raised earlier, the Home Office plans to offer landlords five-year tenancies to house asylum seekers. Will this involve rent being paid more than one month in advance? I invite the Minister to explain and I appreciate that she has offered to write to noble Lords regarding this. I look forward to that, and to any additional information that she is able to provide.
Finally, I draw the Committee’s attention to Amendment 117 in the name of my noble friend Lady Scott. This amendment requires Ministers to ensure that changes being made to the Tenant Fees Act 2019 are clearly communicated to tenants, letting agents and landlords. These changes involve fines of up to £5,000 for new offences and it is essential that landlords and letting agencies are aware of their new responsibilities. We regard this as a technical but important amendment and I hope that the Minister will see it as a practical and necessary change that can be accepted. This group will consider whether mutually agreed or tenant-requested payment of rent in advance should be permitted to continue. On these Benches, we are clear that it should. Mutual agreement can foster a more stable housing situation, one that recognises the unique benefits that rent in advance may offer certain groups of tenants in securing a home. I hope that the Minister will take note.
Lord Hacking (Lab)
My Lords, I entirely support the noble Lord, Lord Jamieson, in his submissions just now. My Amendments 115 and 116 deal with the same problem but from a different perspective.
Lord Truscott (Non-Afl)
My Lords, before I speak to my Amendment 111, I declare an interest as a landlord of over two decades and a former renter in the private rented sector for some 16 years.
As I mentioned before in Committee, the Bill before us has much to commend it. I support ending arbitrary evictions under Section 21, the imposition of a decent homes standard and the imposition of Awaab’s law in the PRS. Renters should not be exploited by the minority of rogue landlords. However, the fact remains that over 80% of tenants have a satisfactory experience in the PRS, and, despite HMG’s unduly negative impact assessment, it is the most popular form of rental tenancy—more popular than council housing or other forms of social housing. Remember, Awaab’s law came about because of the shocking state of some of the social rented housing, and will now rightly be applied to the PRS.
We should not blame the PRS for the failure of housing policy over previous decades and under Governments of all hues. There is a chronic shortage of affordable rental stock, and, where demand exceeds supply, rents inevitably go up, as mentioned by the noble Lord, Lord Thurlow, in a previous group.
More rental homes are needed in the PRS—some estimates say another 50,000 a year, on top of an extra 90,000 social homes, are required, as was outlined previously by the noble Lord, Lord Best. Ministers should ask themselves whether there is anything in this Bill which will increase the supply of affordable rental homes, or whether the best we can hope for is treading water.
It is often quoted that the PRS has doubled in size since the early 2000s, yet it is also a fact that the PRS stopped growing in 2016 when tax changes shifted the business model, and has since been stuck at 5.5 million homes, with the number of landlords buying offset by the number of landlords selling. Now that half of the PRS is owned by 20% of the landlords with the largest portfolios, this trend is accelerating. Many of these larger corporates tend not to house families; they impose the highest rent increases in an inflexible manner and, because they tend to own large, purpose-built flats, are distinct from local communities and smaller properties.
It is the smaller landlord who often has more interest in their tenant and property, embedded in the local community—I think the noble Lord, Lord Hacking, is probably one of them. This may be their only investment, and so they look after it well. Many are known to subsidise or help out their tenants in difficult times—which would be unlikely from a large corporate.
Forget for a moment whether there will be a mass exodus from the PRS because of this Bill, as the effects bed down; according to the ONS, by 2050 there will be 78 million people in this country—some 8 million more than now. Are we ready for that? If we think we have a housing crisis now, in 25 years it could become a major catastrophe. Against that background, anything which makes the current housing crisis worse should be avoided at all costs.
My amendment provides for tenants to pay up to 12 months’ rent in advance, if mutually agreed with the landlord. It provides security for both the tenant and the landlord. As has been said before in your Lordships’ House, thousands of people will be deprived of the opportunity to rent a home if advance payments are banned. As the noble Lord, Lord Jamieson, mentioned just a few moments ago, that includes students—particularly foreign students, on whom our educational institutions rely—who have no credit or banking history in this country. It also includes self-employed people and downsizers, who may have cash but no proof of income. It includes vulnerable people with poor credit histories and county court judgments against them. All these groups often offer rent in advance to prove they can afford to stay in their homes.
If the option of rent in advance is denied, literally thousands of people will be excluded from the rental market, as landlords will feel unable to take the risk of accepting tenants with no apparent source of paying their rent. Guarantors will be unable to give unlimited guarantees under rolling periodic tenancies. Once again, Ministers have a line. The line is that advance rent payments will discriminate against those with limited means. First, most tenants are never asked for advance payments. Landlords frankly prefer longer-term, stable tenants who can prove they have enough to pay the monthly rent. Students, for example, are not always the first choice of landlords, advance payment or not. Secondly, I hate to say it, but we live in a capitalist society. Banning advance payments was also not mentioned in Labour’s election manifesto, so it is within the conventions of this House to ask the Government to think again.
We should allow rental payments in advance because, at the end of the day, this measure will help more tenants than it will hinder.
Lord de Clifford (CB)
I support Amendment 111 and thank the noble Lord, Lord Truscott, for leading on this amendment. I also agree with a lot that was in the speech of the noble Lord, Lord Jamieson. The removal of the right to payment of advance rent will cause more tenants with problems accessing housing to find it even more difficult to get access to their choice as tenants. Currently, 7% of tenants pay advance rent, according to several letting agencies and credit reference agencies. I thank the Minister for her time meeting me on this matter. We have not heard what percentage of landlords are asking for or demanding advance rent.
The Bill targets these rogue, or possibly bad, landlords who are looking for secure rental income from tenants in this high-demand rental market. During our meeting, the Minister suggested that the answer for tenants who currently need to pay advance rent was to seek out a guarantor. Most tenants would prefer not to pay in advance if a guarantor was available or could be found. In my personal experience of being a guarantor for student accommodation for both my children, guarantors are asked for not only rent but other liabilities. Therefore, finding guarantors who will be willing to cover both rent and other liabilities is difficult. Also, guarantors need to prove their income and their assets. For foreign tenants, it will be very difficult to find a guarantor with UK income or assets, and that is one reason that advance rent is needed.
For students who do not have a guarantor, so they need to pay in advance, the suggestion was that universities could provide guarantee services. This would add further burdens to many universities, which are financially under pressure. The final suggestion was to approach a local authority, to ask it to act as a guarantor. I certainly will not challenge the Minister on her knowledge of local authorities, as her service to Stevenage and Herefordshire Councils is outstanding. Sadly, from the comments made in this Chamber and the press, it would seem that local authority services are under severe pressure, so surely the addition of increased requests would be a further burden and demand on limited resources.
Therefore, if you allow advance rent, you will not add further burdens to both local authorities or universities. There are products and companies providing guaranteed services. These services are costly to tenants and a significant percentage of tenants paying in advance have a low income or a poor credit rating, as previously stated. Again, this is not a logical move. Individuals who cannot provide an income source for some reason or are unemployed, who have the funds to pay rent but do not want to access a guarantor, will be disadvantaged in the tenant selection process.
The removal of the payment of advanced rent has great merits, as it addresses a very unwelcome trend in the marketplace for the demanding of large amounts of money, which restricts the number of tenants who can access certain properties. With the Bill as it stands, more tenants will be affected and denied access to a full range of properties. This amendment keeps flexibility for tenants on how their rent is paid. Therefore, I ask the Government to consider this amendment, or have further discussions, before Report.
Baroness Thornhill (LD)
My Lords, most of the amendments in this group are disagreeing with the Government’s ban on being able to ask for rent in advance, and all basically say the same thing. While I am very supportive of the Government’s aims, there are legitimate questions to be answered in this area. By preventing tenants paying rent up front, will the Government potentially reduce the housing options available to financially vulnerable people? So says the letting and landlords’ association. Is it a way to crack down on discrimination against low-income renters by unscrupulous landlords? So say the Government and the lobby groups for renters.
Amendments 108 and 111, which would allow up to six months’ rent in advance or even 12 months, are troubling. Rogue landlords could pressure vulnerable tenants to mutually agree to these excessive payments, circumventing the very protections that the Bill seeks to establish. Furthermore, Amendment 112’s provision for tenants to specifically request such arrangements in writing could easily be manipulated. Landlords might simply make such requests a condition of securing the property, forcing tenants to choose between signing or losing their housing opportunity.
However, what we do know is that people on fixed incomes, such as pensioners, those with lower incomes, the self-employed, the overseas students, those with a bad credit history, those who fail referencing checks and those with no family member to act as a guarantor will all have challenges passing referencing and affordability checks. They are the risky renters. The Government’s amendments are clearly designed to protect these financially vulnerable people from exploitation, but the big question is: how will agents and landlords manage tenancy risk in the future? Tenancy risk is a reality. With over 20 tenants chasing each vacancy, landlords will, legitimately and legally, be able to pick the person who represents the lowest risk. The bottom line for them is economic reality. Your Lordships have all heard my views, but even I would say, “Who can blame them?”
There are many thousands in these various groups. How do the Government think that they will get housing in the future? How will landlords mitigate the risk of tenants who fail references and have no renting history in the UK or who have CCJs against their name? Millions of people fall into these categories. My deepest worry is that the rent in advance system will go underground and people will be asked to stuff cash into brown envelopes, while rental payments will be edited to make it seem that all is well. Desperate renters will do desperate things to put a roof over their heads. I hope that I am wrong and not being unduly harsh on landlords or tenants. It seems to me that such people are left with the sole option of a professional rent guarantor service. What else is there? I am quite sceptical of local authorities stepping into that role, although they do much already to make tenancies survive and to help tenants.
What are the Government doing to ensure that those services can operate legally and responsibly, and to help this group of people? Are they part of the solution? I look forward to the noble Baroness’s answers.
Finally, to reiterate the point, a market that is significantly undersupplied and where the market rules of supply and demand result in continually rising rents, impacting most on precisely this large group of risky renters, has already resulted in a whole cohort of renters who are forced into homelessness and overpriced temporary accommodation. These are the very people who would in the past have been in social housing, of which there is, as we know, a huge shortage. The free market, under the rules as they are now, has led us to this place—a broken system—and there is no one denying that. Continuing as we have thus far can lead only to more of the same.
The Bill is a brave attempt to recognise the current imbalance between tenant and landlord, but if we do what we always do, we will get what we always get, and that is not acceptable.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, and the noble Lords, Lord Jamieson, Lord Truscott and Lord Hacking, for their amendments in relation to rent in advance, and the noble Lord, Lord de Clifford, and the noble Baroness, Lady Thornhill, for commenting on these amendments.
Taken together, Amendments 108 to 110 and 112 tabled by the noble Baroness, Lady Scott, would allow landlords or agents to charge rent in advance when this has been mutually agreed with the tenants in a tenancy agreement. This Government are clear that the practice of landlords or agents charging rent in advance is unfair. Many of us will have heard the stories, many of them of requests for large amounts of rent in advance that have pushed families into financial hardship or locked some out of the sector completely. In other cases, unscrupulous landlords use rent in advance to pit prospective tenants against each other and create these dreadful bidding wars to help people secure a property. That is why the Bill will prohibit a landlord or letting agent requiring or accepting any payment of rent before a tenancy has been entered into. In addition, a landlord will be able to require only up to one month’s rent in advance in the window between a tenancy being entered into and that tenancy beginning.
I want to be crystal clear on this point: once a tenancy has begun, tenants will remain free to pay their rent prior to the agreed due date should they wish to do so, although landlords will not be able to require this and any attempt to require it will be challengeable by the tenant.
Amendment 108 would allow landlords to include terms in a tenancy agreement that require rent in advance to be paid up to six months before it is due. It is the view of the Government that this amendment would fail to protect tenants from exploitative rent in advance practices. Landlords, being able to require up to six months’ rent in advance when this is agreed in a tenancy agreement, could, in a market where properties are hotly contested, push tenants into agreements that stretch their finances to breaking point to secure a tenancy.
Amendment 109 would limit rent in advance to four months when agreed in a tenancy agreement. This has the same effect, with the potential for tenants in hotly contested markets to feel compelled to agree to terms that require significant financial outlay. Even the limit of two months, as the noble Baroness, Lady Scott, proposes in Amendment 110, in our view does not go far enough to protect tenants. In a scenario where a landlord can request two months’ rent in advance, this is still a significant financial expectation of a tenant. Given that the tenant will also likely be required to pay a five-week tenancy deposit, they could face being asked to stump up more than three months’ rent to access a property.
Lord Jamieson (Con)
I would just like clarification for my understanding. It has been made clear by a number of noble Lords that our concern is that some of the most vulnerable would be able to even up the playing field by providing rent in advance. I understand what the Minister is saying, but that competition, in a competitive market where there is a shortage of supply, risks excluding some of the most vulnerable. I am keen to hear how the Minister will address that.
Baroness Taylor of Stevenage (Lab)
I am coming on to the impact on vulnerable tenants, but it makes tenants far more vulnerable where they are being pushed to take on financial commitments well beyond their means just to get access to a tenancy in the first place.
In effect, Amendment 112 would enable some unscrupulous landlords to continue to pit tenants against each other in de facto bidding wars. In this circumstance, tenants under pressure to secure a property could face being required to offer in writing even greater sums of rent in advance.
Any one of these amendments could allow landlords at the pre-letting stage to insist upon a term in the tenancy agreement which permits rent in advance. This would leave tenants with a potentially impossible choice of stretching their finances to the limit or facing homelessness.
I would like to address the concerns of some in the Committee that those landlords who rely on rent in advance could find themselves left out of the market. We are clear that landlords are free to undertake the referencing and affordability checks necessary to give both the landlord and the tenant the confidence that a tenancy is sustainable.
The noble Lords, Lord Jamieson and Lord de Clifford, and the noble Baroness, Lady Thornhill, mentioned foreign students. If landlords are not satisfied with the outcome of pre-tenancy checks, there remain a number of options available, including requiring a tenant to provide a guarantor or the use of professional guarantor products. If the tenant is unable to provide a UK-basedguarantor—I accept that that may be the case for international students—alternative options could be available, such as professional guarantor services.
We are committed to robustly monitoring and evaluating the impact of our reforms. We retain powers to amend these measures should the evidence arise that they are having a significant impact on a particular group. The noble Baroness, Lady Thornhill, mentioned self-employed people and those on limited-income pensions. We maintain the powers to amend, should we need to do so.
The noble Lord, Lord de Clifford, raised a point about local authorities. Some local authorities are very proactive. The reason they take on this role is to prevent homelessness, and they recognise the benefit to families and individuals of not having to go into temporary and emergency accommodation. In addition, it can reduce the cost to the local authority if it does not have to find that family temporary and emergency accommodation, so it will take on that role.
The power gives the Secretary of State the flexibility to adapt the constraints on rent in advance to respond to a changing private rented sector. Changes in the balance of supply and demand within the private rented sector—driven, for example, by our commitment to building 1.5 million homes over this Parliament—may change the extent to which affordability is a barrier for prospective tenants entering the sector. In this scenario, the Government may consider it appropriate to make changes to the constraints on rent in advance. Equally, changes in the market could be driven by currently unanticipated future legislative changes, such as the introduction of new types of tenancies. In this scenario, the power would allow the Secretary of State to maintain the application of these measures to the intended cohorts of landlords and tenants.
The introduction of the power therefore provides the Government, or any future Government, with the ability to make sure rent in advance measures continue to apply as intended in the face of any changes within the private rented sector. However, I reassure the Committee that regulations made under the power will be subject to the affirmative procedure, which will ensure that there is appropriate parliamentary scrutiny of any changes.
Amendment 117, also in the name of the noble Baroness, Lady Scott, would introduce the legal requirement for the Secretary of State to communicate to tenants, letting agents and landlords the changes made by the Renters’ Rights Bill to the Tenant Fees Act 2019, which prohibits certain payments of rent in advance. I know the Committee will share my view that the successful implementation of the Renter’ Rights Bill is firmly rooted in how widely its provisions are known and understood. I reassure the Committee that the Government are committed to raising awareness of the full range of Renters’ Rights Bill reforms across the private rented sector.
This amendment would require the Government to make stakeholders aware of one aspect of our rent in advance policy, which is given effect by amendments to the Tenant Fees Act—namely, the prohibition on landlords inviting, encouraging or accepting a payment of rent in advance before the tenancy agreement is signed by both the landlord and the tenant. However, it would not oblige the Government to communicate the details of the rest of the rent in advance policy.
Lord Hacking (Lab)
My noble friend has replied to my Amendments 115 and 116, but I would be grateful if she could agree to talk further on them, particularly Amendment 116. It is an extraordinary situation how a landlord is not permitted to prevent a tenant moving into a property even though the tenant has not done the basic thing of paying the rent in advance. It is not an excessive amount of rent; in my case, as I explained to my noble friend, it is the rent for the rest of the month—a modest payment. Why on earth can a landlord not say, “You can’t come into the property until you’ve paid your rent”? You always pay rent in advance.
Baroness Taylor of Stevenage (Lab)
I would just reiterate the comments I made to my noble friend that, having undertaken a tenancy, gone through the process of vetting and paid the deposit and the holding deposit, it will be a very rare case where the tenant proceeds not to pay their first month’s rent.
Lord Jamieson (Con)
Before the Minister sits down, I just want to follow up on the question I raised regarding the Home Office’s plans to offer landlords five-year tenancies and ask whether the Minister can confirm whether there will or will not be more than one month’s rent in advance?
Baroness Taylor of Stevenage (Lab)
I thank the noble Lord for his question. I did respond earlier to the points in relation to the Home Office position. Because it is the work of another department, it would be best, as I said earlier, if I clarify the situation in relation to the Home Office’s proposals and come back to noble Lords on that. It involves the contract between the Home Office and Serco and I do not want to comment on it without knowing the facts from the Home Office. So, I will come back to the noble Lord on that point.
Lord Jamieson (Con)
My Lords, I rise to close this group of amendments. It has been an excellent debate and I thank all noble Lords who have provided contributions to this debate.
The noble Lord, Lord Hacking, has demonstrated the case for his amendments. I thank him for the support he has given to our amendments, and I certainly support the intention of his amendments. We also share the concerns of the noble Lord, Lord Truscott, that the Bill will potentially exclude thousands of tenants from the rental market. The noble Lord, Lord de Clifford, raised the issue of the difficulties of getting guarantors, particularly if you are an overseas student.
I also thank the noble Baroness, Lady Thornhill, and others who raised the issue that there are 20 people seeking every tenancy and you cannot blame the landlord for seeking the most stable and secure tenant for their property, with the risk, as I said earlier, that the most vulnerable will lose out. We believe that this will have a negative impact on tenants who might otherwise struggle to find a tenancy. Amendments 108, 109 and 110 provide three options for how much rent could be paid in advance with the mutual agreement of the renter and the landlord. Amendment 114 would allow rent in advance at the discretion of the tenant.
The Minister has raised the prospect of guarantors and, for those people who are not able to provide a personal guarantor, using guarantor services. Many people who have used these services will well know that these can be substantially expensive, and frequently far more expensive and onerous than paying rent in advance. Therefore, it seems only logical that one should offer that option.
The Minister has rejected all three options and has not proposed an alternative. It is disappointing to see such a lack of engagement with these amendments when they are likely to have a negative impact on both international students and those with poor credit scores. This clause reduces their ability to prove their financial responsibility and, as such, reduces their likelihood of finding suitable rental property—and, as I highlighted earlier, reduces the ability of councils to secure accommodation for some of the most vulnerable in their communities.
We raised the issue of the five-year tenancies that the Home Office is using, and I am glad the Minister will come back to us. I look forward to being assured that there is no differential treatment of landlords and tenants depending on which part of government is dealing with them.
This clause removes a tenant’s ability to prove their financial responsibility. If a tenant and landlord agree to pay rent in advance, why are the Government standing in the way? I urge the Minister to consider these amendments. Noble Lords across the House have raised genuine and real concerns with this clause. Although we all want to see a better deal for tenants, removing their autonomy to pay in advance is not the best way to go about this. I hope that the Minister will consider this before the next stages of the Bill.
Baroness Taylor of Stevenage (Lab)
My Lords, I do not want to delay proceedings, and the noble Lord, Lord Jamieson, might not agree with me, but I did fully answer the question of why we consider that payment of rent in advance, even when agreed between two parties, can have a serious effect on other tenants in the rental market who are not able to make those very large payments in advance. He may not agree with me on that, but I did respond to the point.
Renters’ Rights Bill
Tuesday 6th May 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-IV Fourth marshalled list for Committee - (1 May 2025)
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we start the debate on the first group, I remind the Committee again of the protocol around declaring interests. As I mentioned last week, noble Lords should declare relevant interests at each stage of a Bill’s proceedings. That means that, in Committee, relevant interests should be declared during the first group in which a noble Lord speaks. If a noble Lord declared an interest during the previous two days in Committee then that is sufficient, but if they are making their first contribution today then any relevant interest should be declared.
Clause 12: Right to request permission to keep a pet
Amendment 118
Lord Black of Brentwood
“(d) the landlord may not review or withdraw consent once given.”
Lord Black of Brentwood (Con)
My Lords, it is a pleasure to introduce this important group on pet ownership, which is a subject of real concern and interest to hundreds of thousands of families that live in rented accommodation and desperately want to share their lives with a pet. I will speak to Amendments 118 and 125, which are also supported by my noble friend Lord Lexden and the noble Baroness, Lady Jones, to whom I am very grateful. I am also grateful to my noble friend Lady Coffey for adding her name to Amendment 125. She brings great authority to this debate as a former Defra Secretary of State with a long-standing interest in and commitment to animal welfare.
I also support Amendments 119 and 126, in the name of the noble Baroness, Lady Miller of Chilthorne Domer, to which I have happily added my name. I declare my interest as a patron of International Cat Care. I am very grateful to Battersea Dogs & Cats Home, Cats Protection and other charities in the sector for their support and the excellent briefing they have provided us, as well as to other organisations, such as Mars Petcare, which has shared crucial research on the benefits of pet ownership and does so much for animal welfare.
I will set out the background to these amendments. We are a nation of pet lovers. Around 13.5 million homes in the UK include a dog and 12.5 million—mine included—are graced by a cat. Unfortunately, however, pet ownership is all too often limited to those who own their own home, causing huge anguish to the millions of families that rent but also want to share their lives with a pet. In 2024, Cats Protection found that over half a million households that would like a cat do not have one because their rental agreements forbid it. Research from Battersea Dogs & Cats Home shows that only 7% of private landlords list their property as pet friendly—an incredibly low number when we consider that, according to the same survey, 76% of tenants already own or aspire to own a pet.
Correcting that imbalance is so important for a number of reasons. There is the obvious link between rental restrictions and pet homelessness, with housing issues cited as the second most common reason that pets are relinquished to Battersea. Last year, Cats Protection took in the equivalent of three cats each day due to landlords not allowing them in their properties—part of a wider crisis of pets having to be given up. At Second Reading, I told the story of Zeke, a cat that arrived in Battersea just 24 hours before his first birthday after his owners faced the heartbreaking choice between finding an alternate rental property or giving him up to a shelter. His story is far from unique: across the UK, thousands of animals urgently need loving homes, yet countless responsible would-be pet owners in the private rental sector are being unfairly prevented from adopting or finding suitable housing due to overly restrictive tenancy agreements.
It is not just our pets that suffer as a result; public health is impacted too. Research conducted by Mars Petcare has found that pet ownership saves the NHS approximately £2.5 billion per year, with pet owners making 15% fewer visits to a doctor. The physical benefits of taking a dog for a walk or a run every day are obvious, but those of us who own pets know it is the mental health and well-being aspects that have the greatest impact. Pets provide people with companionship and loyalty—particularly for those who live alone—help them to meet new people, add structure to their day and offer unconditional love and support. Children also benefit from understanding the responsibilities of caring for a dog or cat and learning how to interact safely with animals. Pet ownership is also often an indicator of a responsible and reliable tenant, which is very relevant to this debate. Research from Battersea showed that three-quarters of landlords surveyed did not observe any discernible increase in wear and tear to their property due to pets.
For all these reasons, I am delighted that the Government are committed to encouraging responsible pet ownership across the private rented sector and I strongly support the ambition of this section of the Bill: providing tenants with the right to request a pet—a request that cannot be unreasonably refused by a landlord. My probing amendments today seek simply to tighten up certain aspects of legislation to guarantee that the pet provisions in the Bill are as effective as possible and that the laudable ambition and clear intention of this legislation is fully realised.
But we are not quite there yet. As it stands, I fear that there are loopholes in the Bill and that landlords will have too much room to deny most requests, risking a serious and unnecessary burden on tenants, the ombudsman and, ultimately, the courts. The amendments I have tabled will provide certainty for tenants and clarity for landlords, and will ensure that the Bill is not a missed opportunity to unlock thousands of homes for pet owners across the country.
Lord Lexden (Con)
I am always glad to support my noble friend Lord Black, with whom I have worked closely on many subjects over many years. Long ago, when we were both in the Conservative research department during a general election campaign, we circulated a briefing note to the party’s candidates telling them what they would need to do to win the support of animals great and small if these marvellous creatures had the vote. I cannot remember whether we included rights for pets in rented property, but it would have been a grave lapse if we had omitted them.
My noble friend’s amendments do not contain a hint of opposition to the Government’s proposals relating to pets; they seek to make the good relevant elements of the Bill even better. The amendments have two objectives: to strengthen the legal protection that the Bill confers on pets and to increase the well-being of people in rented accommodation who want to keep and cherish a pet. These two objectives, as my noble friend has explained, are intertwined. All the research carried out by the wonderful charities devoted to the welfare of pets shows that their owners in rented property not only enjoy greater contentment but lead healthier, better-disciplined lives. The upshot is that tenants who keep pets are likely to seek longer-term tenancies—something that benefits landlords by increasing rental income security.
Surely, through the Bill, we should do all that is possible to prevent responsible people in rented housing being denied unreasonably the opportunity to have a pet or pets, which those who own their homes enjoy automatically, particularly at a time when successive Governments have failed to ensure the provision of sufficient new housing for private ownership.
It is a sad and deeply regrettable fact that a significant proportion of landlords, as my noble friend has explained, are resolutely opposed to the presence of pets in their properties. A 2021 survey by YouGov, on behalf of those excellent charities the Dogs Trust and Cats Protection, found that one-third of private landlords who currently refuse to allow pets in their properties are not prepared to reconsider their opposition. They must be expected to go to all possible lengths to try to flout the pet ownership provisions of this Bill.
Nothing could illustrate more clearly the need for stronger legal protection than the Bill currently provides, which could be achieved through my noble friend’s amendment to define more firmly and tightly the circumstances in which a request to have a pet in rented property could be rejected. In the absence of a more precise definition of what would constitute acceptable grounds for a landlord’s refusal, disputes will inevitably proliferate. A lack of clarity and certainty in the law always leads to problems, as we have seen in various contexts recently. Opaque law cannot be satisfactory law.
I hope that the Government will give very careful consideration to these important and constructive amendments.
Baroness Miller of Chilthorne Domer (LD)
My Lords, I rise to speak to Amendments 119 and 126 in my name, to which the noble Lord, Lord Black of Brentwood, has added his name. The provisions of my two amendments simply mirror the provisions that are in Amendments 118 and 125, so that they will apply to superior landlords as well as landlords. A superior landlord is a person who, for example, owns the block of flats and has a greater interest in the tenants than does the immediate landlord. I declare an interest as I have been affected twice recently by the superior landlord being in a position to deny any pet ownership.
I fully agree with the excellent introduction to this issue from the noble Lord, Lord Black of Brentwood, and all the points that he made, but, if this provision is not added to the Bill, I fear it will completely undermine the Government’s very good intentions, which we support, in bringing forward Clause 12, because the position of the superior landlord will almost always override that of the landlord.
The interests that I quote I will give as examples. The first was from when, during Covid, I rented out my flat. The family who rented it wanted to adopt a cat. The rules applying to the block of flats state that pets may not be kept, so although I as a landlord was happy that this family adopted a cat, the superior landlord rules for the block forbade it. More recently, this year, my husband and I have bought a flat, but even as owners we are subject to a rule that the superior landlord has to give permission for a pet. This means a lot of uncertainty for the vendor and for us, while the superior landlord decided whether we could keep our 15 year-old dog.
If the Government succeed in changing the position for renters, they must also address the issue of superior landlords and their ability to block any pet ownership. If the Government do not address this, the likelihood is that the good intentions behind this clause will fail because of the legal limitations for subtenants. Usually, they do not have a direct contractual relationship—that is, in legalese, no privity of contract—with the superior landlord, unless there is a direct agreement. This can mean that enforcing rights or obligations becomes very difficult if the issue lies with the superior landlord rather than with the immediate landlord.
I look forward to hearing the Minister’s reply to this issue, because I fear that, otherwise, as I said, the good intentions of Clause 12 will be totally undermined.
Lord Howard of Rising (Con)
My Lords, I am not quite sure what the Minister said earlier, but I would like to declare interest as an owner of rented property.
I shall speak to Amendments 120, 122 and 123 in my name in this group. All these amendments seek to highlight where pets could be unsuitable in a rented property. Although, as I have already said earlier during this Committee, as a landlord I have never refused a pet, a blank cheque for pets is not practical. Amendment 120 would allow landlords to reasonably refuse their consent to a pet if the allergies from that pet would have a negative impact on the landlord’s employees, their managing agents or other related persons, including future tenants. For those who suffer with allergies, this is a very serious matter and can have a debilitating effect, and it is not always possible to remove allergens through standard cleaning. We have all read and heard about the allergies from peanuts et cetera that can kill; well, the allergies from pets are not so serious, but they are very serious for people who suffer.
Amendment 122 would allow landlords to reasonably refuse their consent to a pet if they reasonably believe it is unsuitable for the property, may cause a nuisance to neighbours or may damage the property or place an unreasonable burden on its upkeep. Wooden floors get scratched and carpets get stained—if they are still there —when pets are involved, so flooring almost always needs to be replaced when a tenancy ends. Some may consider this reasonable wear and tear, and others may not, but it is certainly a much greater cost when there have been pets in a property, and it is an important factor to consider. Not every landlord is in a position always to replace everything every time there is a new tenancy. Of course, some pets are capable of causing more damage than others, and some properties are easier to upkeep than others. I think there should be some leniency and some leeway for landlords who know their properties to make a judgment on this.
Amendment 123 follows on from this and seeks to exclude pets which are inappropriate or disproportionate in size or number. I realise there will be difficulties in defining this. Are five Dobermann pinschers more or less suitable than 25 fox-terriers? Nevertheless, as the Bill stands, I am not clear whether a landlord would be free to make a judgment, which most noble Lords would agree would be very sensible, that a Great Dane could not be housed in a studio flat, or that 50 cats could not be kept in a small terraced house. Given the difficulties, will the Minister consider making it clear that the landlord has, or should have, discretion to make sensible decisions for the benefits of residents, neighbours and the pets themselves?
The Earl of Kinnoull (CB)
My Lords, Amendment 124 is in my name, and I declared relevant interests earlier. The amendment is very simple: it is about putting social housing tenants in the same place as those in the private rental sector after the Bill has become an Act.
I received a copy of a letter that the Dogs Trust sent to the Deputy Prime Minister in March this year in which it proposed exactly the same thing. Looking at the crib sheet for the answer that came back, I see that the first part is commendable in that it says: “The Government understands that pet ownership can be hugely beneficial, bringing joy to owners and supporting mental and physical health”. I can only agree with that. At Second Reading and in various parts of the process of this Bill, it has been eloquently and frequently said how important pets are and—speaking as a Scottish landlord, both personally and as a charitable trustee— I very much believe that and strongly support the concept of there being a rebuttable presumption that pets are allowed where people are renting properties.
The letter went on to make two points. The first point was that the Government did not feel that what amounted to Amendment 124 was correct, because social housing tenants was a separate policy area. Of course, it is all still MHCLG, and I do feel that someone standing at a bus stop in middle England would scratch their head about that particular one: why on earth should someone living in social housing be in a different place to someone living in the private rental sector? It is a distinction without a difference.
In the second part of the letter, it went on to give various reasons why it might be reasonable, within social housing, to say no to a tenant who wanted a pet. It all amounted to a series of reasons why it might not be reasonable for a pet to be allowed in a particular property, but of course that is already how the Bill is drafted: it is possible for a landlord to say that a particular pet or series of pets should not be allowed in rented accommodation, as long as that is reasonable. It is reasonable for a landlord to say no, so I do not quite see what the logical force of that is, because the social housing sector would retain that right to say no. I therefore urge the Minister to reach across the corridor at MHCLG and accept what has become a very popular amendment.
Baroness Fookes (Con)
My Lords, I declare an interest in that I have close connections with various animal charities, in particular as a vice-president of the RSPCA nationally and as president of one of its branches.
I too want to speak to Amendment 124, eloquently introduced by the noble Earl, Lord Kinnoull. I see no logic whatever: to make a distinction in the way that apparently has been done is what I call Civil Service short-sightedness, and I strongly disapprove of it. I can see no logical reason whatever for treating people who are renting their properties differently simply because they live in a slightly different type of property. I hope that the Minister will look very carefully at this and come to a different conclusion.
I will broaden this out slightly to look at the various amendments in this group. It seems to me that while the heart is in the right place—and I give due credit to the Government for introducing this general right to have a pet, for which I have long campaigned—the Bill fails slightly in not laying down the circumstances clearly enough, so that it leaves the opportunity for some landlords to squeeze past what is clearly intended. On the other hand, it could make for some difficulties if the tenants themselves are unreasonable.
I suggest that the Minister look at bringing forward a code of conduct that would act as a guide for all the varying points which have been made hitherto—if you like, a “highway code”, not necessarily having the force of law, to which one could look for guidance where these tricky problems arise. I hope that this will commend itself to the Minister.
The Earl of Caithness (Con)
My Lords, I will speak to Amendment 124A in the name of my noble friend Lord Leicester. He apologises to the House for not being here. He had hoped to be here, but a long-standing commitment has prevented him from being so.
Of course, my noble friend Lord Black is absolutely right that pets can be extremely beneficial and are a great asset in many households. However, my noble friend Lord Howard is also right in saying that there needs to be a balance; there cannot just be an open door for tenants to have a pet as and when they want, however badly or well that pet behaves.
Amendment 124A refers especially to cats. I was actually quite surprised that my noble friend Lord Black did not mention cats. He mentioned dogs—he gave them a good write-up—but he did not mention cats because he probably knew that I would make the point that cats are killers. They have many assets and I love them dearly, but let out of a house and loose, they are killers. They kill between 160 million and 270 million animals every year, a quarter of those being birds.
I wonder how many of your Lordships woke up early on Sunday morning and listened to nature’s greatest symphony, the dawn chorus. It was International Dawn Chorus Day. We like small birds—songbirds. They are hugely under threat from all sorts of areas, but they are also under threat from cats. There are certain measures that cat owners can take to make their pet less harmful to other species, but the Brits are not terribly good at doing that. In fact, in Germany they have found that some of the Germans are not terribly good at that, either; they have actually made an order in some parts of Germany that during the summer, you have to keep your cat indoors all the time.
Amendment 124A is very tightly drawn. It allows a landlord to say no to a tenant having a cat if the property is in an area designated by the Wildlife and Countryside Act 1981—I remember speaking quite a lot during the progress of that Bill through Parliament—or close to a designated area. In other words, what we are really talking about here are key nature sites: the SSSIs and national nature reserves. The amendment is also carefully worded, in that one is not allowed to have a cat if the property is within a mile of one of those sites. Why a mile? The reason is that the research undertaken by the University of Reading and the University of Exeter at the request of SongBird Survival has found that cats can roam up to roughly 1,400 metres, which is just about a mile. Through their research, they also found that urban cats behave differently from what they call “peri-urban” cats, which are much more likely to stray further and have a different attitude and natural instincts from cats in urban areas, because of the restrictions of such areas.
It is entirely reasonable to encourage landlords to say yes, but equally, it is entirely reasonable to allow them to say no in certain circumstances. Nature in this country needs not only protecting but encouraging. One of the small ways to encourage nature is to say no to a tenant having a cat in an area that is very close to or part of an SSSI or a national nature reserve. That is the right step: protection of nature rather than the will of an individual.
Lord Trees (CB)
My Lords, I will speak briefly in support of Amendment 124 in the names of the noble Earl, Lord Kinnoull, and others. Like the noble Baroness, Lady Fookes, and the noble Earl, I am at a loss to understand why potential tenants in social housing are not included in the Bill. I would have thought that those seeking social housing are likely to be unable to afford to buy their own home, in which case they would not have a problem with having a pet. Why does the Bill not enable such tenants in social housing to enjoy the rights afforded to tenants in private housing? I cannot see the distinction, and I look forward to the Minister’s reply to this question.
Lord Hacking (Lab)
My Lords, this has been a very interesting debate. I am afraid I have none of the expertise of the noble Earl, Lord Caithness, who spoke about cats with intimate knowledge. At this stage I should redeclare an interest that I declared in the early days of this Committee. For the last almost 30 years my wife and I, by accident, in fact, have been the landlords of five one-bedroom flats in the house next door.
While households normally have as their pet either a dog or a cat, there are some extraordinary households that have a string of other sorts of pet—for example, a snake, monkey or parrot. Looking at page 21 of the Bill, we find that a “pet” is described as “an animal”. On that basis, a talkative parrot or indeed a snake does not fall under these provisions. The assumption therefore is that the landlord is entitled to say no to snakes and, if he needs to—although one hopes it is hardly necessary—no to a talkative parrot. It is important to establish the reasonable grounds on which a landlord can refuse to permit a tenant to bring a pet into the property.
Amendments 120 to 123, tabled by the noble Lord, Lord Howard of Rising, are very helpful. If they are going to be pressed on Report, I suggest they be condensed into a single amendment.
My wife and I have always refused to permit tenants to have a pet such as a dog or a cat, because we have been concerned about the disturbance of other tenants—a dog barking, for example—and the damage a pet can create in the household.
With that background, it has been very helpful of the noble Lord, Lord Howard of Rising, to identify circumstances in which it is reasonable or unreasonable for a landlord to refuse a pet in the premises. That continues to be a very interesting debate. I do not know whether the noble Earl, Lord Caithness, is going to educate us further on cats, but may we go on?
Baroness Jones of Moulsecoomb (GP)
My Lords, I shall speak very briefly, because the noble Lord, Lord Black, covered his two amendments very thoroughly. I do not have pets myself, but I declare that I have a daughter who has recently taken the tenancy of a house, and she has children, a dog and two cats. It was quite difficult for her to make sure that they could all live together, so I understand that a lot of people would have to lose their pets, and I think that is an incredible shame.
I thank the Dogs Trust, Mars Petcare and Battersea Dogs & Cats Home for their briefings and work on this, which were very thorough. Amendment 118 would provide security for pet owners in rented accommodation —knowing that, once granted, consent cannot be withdrawn. If this was tabled in the other place by the current Minister, I assume that he is going to accept this amendment, and that the noble Baroness the Minister will tell us that today.
Amendment 125, which I have also signed, would go a long way towards ensuring that blanket no-pet policies cannot continue. Battersea Dogs & Cats Home has described the second most common reason that pets are given up to it as because of rental restrictions. That seems extremely hard. Although I do not have any pets, I understand the value of pets to people in all sorts of ways, and I hope that we can have some success with these amendments.
Lord Carrington (CB)
I shall speak to Amendment 126A and to support the noble Earls, Lord Caithness and Lord Leicester. I had not intended to speak on this, but it is a point that there is a big difference between pets in rural properties and pets in urban properties. Speaking as someone who lets rural properties, I have never had any problem with stopping tenants bringing their pets, but I would mention that cats are a particular problem in certain areas. I think that the very carefully drafted amendment of the noble Earl, Lord Leicester, makes a great deal of sense in this respect.
Lord Inglewood (CB)
My Lords, I declare my interest as entered in the register and apologise to the House for not having spoken before in Committee. I spoke at Second Reading, but the combination of the west coast main line and prior commitments has made it impossible in Committee until now.
Briefly, I make just three points, in no particular order. First, in respect of Amendment 118, the nicest, cutest little puppy can turn into a horrible adult dog, and if it is impossible for the landlord, having given consent, to change that if the cute little puppy turns into a dog from hell, that would be a very great mistake. It is a matter of balance, reasonableness and judgment. Secondly, I support the amendment in the name of the noble Earl, Lord Kinnoull, because that seems to be elementary sensibleness—nothing more. Thirdly and finally, having heard the very persuasive speech of the noble Lord, Lord Black, I suddenly wondered: were they asking the Government to make it compulsory for tenants to have pets? I ask the Minister what her view about that would be.
Lord de Clifford (CB)
My Lords, I speak on this group mainly in support of Amendment 124 in the name of my noble friend Lord Kinnoull. I wish the Committee to note my entry in the register of interests: that I am a part-owner of a large independent veterinary practice, with a significant proportion of our turnover generated from pets.
I welcome Clause 12 as it will increase the number of properties that tenants can keep pets in. With the growing number of pet owners in the past five years, it is certainly welcome. How we care for pets and how we value their companionship has changed significantly in society in the last 10 years, and that is why this clause is so important. But we must be aware that there are many in society who are allergic to pets, who find them scary and who are made nervous by them, especially children, and those who just do not like pets. Therefore, somehow, through this amendment, we need to ensure a balance between landlords, tenants and their pets, and others in society.
As previously spoken to by the noble Earl, Lord Kinnoull, the noble Baroness, Lady Fookes, and the noble Lord, Lord Trees, the amendment gives access to all tenants, regardless of whether they are in the private rental sector or accessing social housing. This gives tenants the right to request permission to keep a pet, regardless of their landlord.
The Bill is also about improving opportunity for tenants to keep a pet; surely this simple amendment will create a level playing field between the social housing sector and private landlords. Social housing is probably the most likely first place to go for individuals on low income or who are homeless, seeking to find a home for themselves and their families, which often include a pet. This has been drawn to my attention recently by a TV advert for a homeless charity. Its website says:
“New polling from homeless charity St Mungo’s reveals new extent of the housing crisis and its impact on people sharing their lives with a pet. 50% of those surveyed reported being placed in situations where they were forced to choose between remaining with their pets or accessing housing. This situation is ever present, within the last 12 months, 43% of respondents experienced challenges in finding housing that allows pets. This is amplified for those between the ages of 18-24, where 70% experienced this”.
Therefore, to ensure that the private rental sector is not forced to take up all the housing needs of pet owners, I hope that this amendment will be considered by the Government. Surely the reasons for not allowing a pet in the home are the same for private landlords as for social housing landlords.
On the other amendments in the group, I support Amendment 118 in the name of the noble Lord, Lord Black of Brentwood, which would ensure that a landlord cannot withdraw consent. If a pet is causing an issue for a landlord, that will surely be covered by other provisions in the Bill. The landlord could terminate a tenancy using anti-social behaviour as a reason, whether it was caused by the tenant or the pet. The amendment would ensure that the tenant, once the pet is allowed in the home, cannot be forced to remove the pet unless the tenant has breached a term of the tenancy agreement.
I also support Amendment 119 in the name of the noble Baroness, Lady Miller, which would ensure that a tenant in all properties, regardless of who the landlord is, can ask for the right to keep a pet at their home. Like the social housing Amendment 124, this amendment seeks to increase the number of properties available to tenants, but also ensures that all landlords, regardless of their position in the rental housing sector, are obliged to consider the request of a tenant to keep a pet.
Amendments 125 and 126 provide some clarity for landlords and tenants, with definitions of when it is unreasonable for a landlord to reject a request for a tenant to keep a pet. This clarity can only help with negotiations between landlords and tenants with regard to keeping pets, and solutions will be found more quickly, I hope, and with less bad feeling between the two parties. This clarity will reduce the number of cases that can be referred to other authorities to decide whether a landlord’s reasons for rejection are in fact reasonable. I look forward to hearing the Minister’s comments.
Baroness D’Souza (CB)
My Lords, I declare an interest, having a young grandson who had an affinity with snakes. When he was very young, living in central London, he had several, one of which was quite large and called Wilberforce. Wilberforce used to do what snakes do—rear up and sway when anyone came in the room, so he was quite intimidating. One day he—we think it was a he—disappeared and has never been found. I mention this as a cautionary tale, as he may one day turn up somewhere where he is not quite as welcome as he was originally.
Baroness Grender (LD)
My Lords, the provisions relating to tenants keeping pets may seem a small aspect to some, but their impact on the well-being and lives of millions of renters cannot be overstated. We on these Benches warmly welcome the Bill’s intention to make it an implied term in most assured tenancies that landlords cannot unreasonably refuse a tenant’s request to keep a pet.
We support many of the amendments in this group, with the exception of Amendments 120, 122 and 123. For too long, a blanket ban on pets has been a source of needless unhappiness and stress for renters, compounding the sense that this large and ever-growing group are often treated as second-class citizens. This includes social renters, and we commend the amendment tabled by the noble Earl, Lord Kinnoull, on that issue. Indeed, research estimates that pet ownership contributes considerable savings to the NHS each year, as an example, potentially as much as £2.45 billion annually across the UK through reduced doctor visits. It is simply wrong that the joy and benefits that a pet brings should be restricted to those who are fortunate enough to own their own home.
We have heard compelling evidence illustrating the scale of this issue. Battersea Dogs & Cats Home, which I thank for its briefing on this issue, has highlighted that housing concerns are the second most common reason why dogs are relinquished to its care. Even though I am here in fear of the noble Earl, Lord Caithness, on this issue, I add my thanks to Battersea Dogs & Cats Home for the rescue cat that we got from Battersea, who brings us daily joy and, I reassure the noble Earl, kills a lot of rats. Despite 76% of UK private tenants owning or aspiring to own a pet, only 8% of landlords currently advertise properties as allowing pets. This creates immense difficulty for renters, forcing them into heartbreaking decisions, as we have already heard from the noble Lord, Lord de Clifford.
Clauses 10, 11, 12 and 13 introduce the right to request a pet and allow landlords to require insurance, but we feel that they still leave further questions about the practical implementation. Sources currently suggest that there are no readily available insurance products for tenants to cover potential pet damage. We welcome some of the probing amendments on this issue and look forward to hearing from the Minister about any clarification on that. Organisations such as Generation Rent argue that the existing tenancy deposit should be sufficient to cover those damages. We must ensure that the Bill does not disadvantage the most deprived renters, perhaps by exploring alternatives such as allowing for a higher deposit or different insurance mechanisms such as the Scottish model of an additional deposit. I look forward to hearing from the Minister on this issue.
Crucially, the Bill states that consent cannot be unreasonably refused. However, what constitutes unreasonably withholding consent is not yet clearly defined. We need the reasonable grounds for refusal to be set out with more clarity, ensuring fairness and consistency in decisions, especially if the proposed ombudsman service or the courts are involved.
A particularly troubling aspect is the exemption allowing superior landlords to override a landlord’s approval for pets. This risks undermining the spirit of the legislation, especially for tenants in blocks of flats or leasehold properties where management companies or freeholders might maintain blanket bans. We on these Benches support my noble friend Lady Miller of Chilthorne Domer in her Amendments 119 and 126 which seek greater clarity on this issue. This exemption should be removed to ensure that the right to keep a pet applies consistently across all types of rented homes. Other practicalities, such as the proposed timeframe for landlords to respond to pet requests, also may need some scrutiny or flexibility. Battersea Dogs & Cats Home has suggested that a shortening of this time might be an idea.
The intention behind these clauses is commendable, reflecting a much-needed shift towards acknowledging the important role pets play in many people’s lives. There is evidence that renting to tenants with pets can be commercially beneficial for landlords, with pet owners tending to have longer tenancies, averaging 24 months compared with 21 months for those without pets. Pet owners are also often willing to allow more regular inspections or consider covering additional costs. While concerns about damage are understandable, most evidence suggests that these fears can be exaggerated. In our view, and as other noble Lords and contributing organisations have highlighted, some refinement is needed. We must ensure that these provisions are not only well- intentioned but genuinely effective in practice, providing clear rights for tenants while addressing some of the legitimate concerns. We look forward to hearing the Minister’s response to these amendments.
Lord Cromwell (CB)
My Lords, I will very briefly intervene. I agree that people who like pets benefit from having them, and I guess that landlords who do not like pets are going to have to put up with it, which seems fair enough. But—no pun intended—what a legal can of worms we are opening here. What is a pet? I disagree with the noble Lord, Lord Hacking: snakes are animals, as are alligators, rats, goats, snakes, and even fleas, which some people keep as pets. That is going to cause a great deal of stress and redefinition at some point.
Listening to the very interesting speech by the noble Lord, Lord de Clifford, we heard that we are also going to introduce a category called an anti-social pet. That is going to be very hard to define and prosecute, and I suspect the unreasonable grounds for refusal will, again, cause interesting legal conundrums. So this amendment will go through, and I am happy to support it, but I wonder what legal can of worms we are opening for the future.
Baroness Scott of Bybrook (Con)
My Lords, this section of the Bill is set to introduce some significant changes affecting the rights of renters, the rights of landlords and the nature of the relationship between those two parties, and we need to consider these provisions and the amendments to them with particular care.
Amendments 118 and 119, tabled by my noble friend Lord Black of Brentwood and the noble Baroness, Lady Miller of Chilthorne Domer, seek to prevent consent from being withdrawn by a landlord once it has been granted. This proposal presents some challenges, as far as we can see, and may benefit from a more considered approach. It poses a risk to landlords when taking on a new tenant, because it raises the prospect that they could be tying themselves into a contract whereby they would have no right to remove, in future, a dangerous, aggressive or damaging animal from their own property.
In our opinion, these amendments also suffer from the way that they have been drafted. If a tenant acquired a new pet, would they be obliged to seek consent again from their landlord, or would the one issuing of consent cover all future acquisitions? If a tenant was granted consent for a goldfish, does this amendment really seek to assume that the consent is also automatically granted if the same tenant decides to buy an Irish wolfhound?
Amendment 120, tabled by my noble friend Lord Howard of Rising, seeks to address that fundamental question of proportionality, which I have referred to several times throughout my remarks on the Bill. This amendment rightly seeks to protect the landlord beyond the immediate term and ensures that they will still be able to make full use of their property after a tenant has left. If a landlord reasonably believes that a pet could limit their use of their property into the future and thus reduce its utility and value, it is surely reasonable to allow the landlord the discretion to protect their asset and the health of their family and future tenants.
My noble friend Lord Howard of Rising takes this responsible approach further in Amendments 121, 122 and 123, which would provide the landlord with the capacity to refuse consent if a pet was a dangerous wild animal, if a pet risked causing damage or disruption, or if a tenant wished to keep an inappropriate number of animals or an inappropriately sized animal in their property. These amendments would not only preserve the balance of the renter-landlord relationship but help to ensure the safety, protection from damage and the well-being of the landlord and tenant alike. As it stands, the Bill creates a huge risk for landlords: they could enter a contract with a tenant who could bring an unsuitable, untamed or even dangerous animal into their property without the capacity to refuse. These amendments are a sensible opportunity to redress this risk.
Amendments 124, 125 and 126, tabled by the noble Earl, Lord Kinnoull, my noble friend Lord Black of Brentwood and the noble Baroness, Lady Miller of Chilthorne Domer, seek to clarify unreasonable circumstances for pet refusal, including in social housing —Amendment 124 is an extremely interesting amendment from that point of view. In our opinion, outlining these conditions could make the law clearer in application, although it is right that this should not come at the expense of the right of the landlord to safeguard and utilise their property. For instance, these amendments attempt to prevent a landlord refusing to consent to a pet on grounds of pre-emptive concerns. For this demand to balance out with respect for the rights of the landlord, it is surely reasonable to support a further amendment that would allow a landlord to withdraw consent once provided if their pre-emptive concerns turn out to be valid.
We also have some concerns about the vagueness of the language used throughout these amendments, for instance the references to
“a generalised fear of damage to the property”
and to “generalised” animal welfare concerns. The Committee would benefit from further clarification about the specific steps a landlord would need to take to move from “generalised” to what would be considered a valid concern under the text of this amendment.
Finally, I turn to Amendment 126A, tabled by my noble friend Lord Leicester and introduced by my noble friend Lord Caithness. This is a very sensible proposal that is designed to build consensus and clarify points of concern over the scope and definition of the terms used by the Government in the Bill.
I think that Amendment 124A is for national, if not international, debate. Although I understand my noble friend’s concern, I think that debate probably goes wider than this Bill.
We must always remember that this Bill will be used to govern a series of relationships that involve possibly millions of people throughout the country. We have a duty in this place to make sure that the law is as clear as possible and that the relationship we create between a tenant and a landlord is fair and mutually beneficial. We need to make sure that we create market conditions in the rented sector that ensure a steady supply. If landlords start to pull out because of vague and overburdensome regulation, prices will go up and the choice for renters will go down. This is not an outcome that the Government want, nor one that will promote and protect renters’ rights.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I also thank all the animal charities and organisations that have helped us with this clause. I know that other noble Lords have really appreciated the briefings that those organisations have sent out. I also thank the noble Lords, Lord Black of Brentwood and Lord Howard of Rising, the noble Earls, Lord Kinnoull and Lord Leicester —whose amendment was ably moved by the noble Earl, Lord Caithness—and the noble Baroness, Lady Miller of Chilthorne Domer, for their thoughtful amendments in relation to pets, and all noble Lords who have spoken in this debate.
Before I go into the detail of the amendments, I reassure noble Lords how much I truly realise the incredible importance of pets to people’s lives, and I confirm that the Government have included provisions on pets in the Bill in recognition of that. The noble Baroness, Lady Scott, just mentioned that balance: we have tried really hard to get the balance right between wanting tenants to have the right to have a pet and making sure that landlords can have their responsibilities and property recognised.
I thank the noble Lord, Lord Black, the noble Baroness, Lady Fookes, and other noble Lords, for their recognition of the intent of pet provision in the Bill. No one wants people to have to give up precious pets just because of the tenure of their housing.
To respond to the noble Lord, Lord Inglewood, I would not make it compulsory to keep pets, although I took on board the comments by the noble Lord, Lord Black, and the noble Baroness, Lady Grender, about the impact on people’s health. If you were allergic to pets, making them compulsory might be a different issue, but we have no intention of doing that.
Amendment 118, tabled by the noble Lord, Lord Black of Brentwood, seeks to ensure that once a landlord has granted consent for a tenant to keep a pet, that consent cannot later be withdrawn. Noble Lords have mentioned my honourable friend Minister Pennycook’s advocacy of this issue. I reassure noble Lords that when a landlord gives permission for a tenant to have a pet, that consent is binding and cannot be revoked, with the exception of the very rare occasion when that becomes an anti-social behaviour issue, which it might. Apart from that, it cannot be revoked. That is because, once permission is given, it forms an implied term of the tenancy agreement. This is an unwritten contractual term that tenants can rely on, as it is legally binding. Any attempt by a landlord to withdraw consent once given would therefore be unenforceable. This principle will be clearly outlined in the accompanying guidance to ensure clarity for both landlords and tenants.
Given this, I do not believe it is necessary to add further provisions to the Bill, as doing so would introduce unnecessary complexity into legislation that is already clear on this point. The Bill is designed to create a fair and workable system for both landlords and tenants. Adding an explicit provision where the legal position is already established would have the potential to risk confusion and unintended consequences. In the light of that, I hope the noble Lord will consider withdrawing his amendment.
I thank the noble Baroness, Lady Miller of Chilthorne Domer, for her Amendment 119, which seeks to ensure that a superior landlord “cannot unreasonably withhold” consent when a request is made to allow a tenant to keep a pet. Although I understand and sympathise with the intention behind this amendment, I have some concerns about it. If accepted, it could lead to significant legal uncertainty.
Many superior leases include absolute prohibitions on pets, and introducing a reasonableness test in those cases could create confusion and conflict with existing contractual terms, which are legally binding on both parties. I intend to look at any data that might be available on the extent to which this might have an impact, but it could place a considerable burden on immediate landlords who would be required to engage with those superior landlords—who are often based overseas or are difficult to contact—before responding to a tenant’s request. That could cause delays, additional legal costs and the kind of practical difficulties the noble Baroness outlined herself in her own case—I hope permission is forthcoming for her dog. For those reasons, the amendment is not proportionate or necessary, and I hope the noble Baroness, Lady Miller, and the noble Lord, Lord Black, will not press this amendment.
I thank the noble Lord, Lord Howard of Rising, for Amendments 120, 122 and 123. Amendment 120 seeks to allow landlords to refuse a pet request where they reasonably believe that the pet may have a negative impact due to allergens on a range of individuals, including themselves, their employees, agents, neighbours and even future tenants. Although I understand the intention behind the amendment, I must express concern that it would significantly broaden the scope on which landlords could refuse consent.
The Bill already allows landlords to refuse permission where there is a legitimate concern, and guidance will make it clear that health-related issues, such as severe allergies, can be taken into account where medical evidence supports this and there is a genuine and ongoing concern to health. However, this amendment would go much further. In particular, the inclusion of future tenants introduces a highly speculative element, allowing landlords to refuse a request based on hypothetical scenarios that may never arise. That would give landlords an effective veto, entirely undermining the legislation, which aims to strike a balance between landlords and tenants. For these reasons, the amendment is not necessary or proportionate, and I hope the noble Lord will consider not pressing it.
Amendment 122 seeks to allow landlords to
“reasonably withhold or withdraw consent”
for a pet introduced mid-tenancy, where it is deemed
“unsuitable for the property, … may cause a nuisance”,
or may risk property damage or unreasonable upkeep. While I understand the noble Lord’s intention to provide clarity, I respectfully say that this amendment is not required. The Bill already permits landlords to refuse their consent on reasonable grounds, which are best judged on a case-by-case basis.
The noble Lord, Lord Black, recommended some guiding principles around this and the noble Baroness, Lady Fookes, called for a “highway code” of guidance. We will be providing guidance alongside the Bill to give examples of the types of situations in which it may be reasonable for a landlord to refuse or withdraw their consent to a tenant’s request to keep a pet. This will support both landlords and tenants without restricting flexibility in legislation. There is also a risk that listing specific reasons in the Bill may unintentionally narrow the interpretation of what counts as reasonable, excluding other valid concerns not explicitly named.
The Earl of Kinnoull (CB)
I am most grateful to the Minister for giving way. I would like to give her a bit more ammunition. I am looking at a website to do with MHCLG that talks about the “one team” approach in which MHCLG is very sensibly engaged. The first key principle in this approach is joined-up delivery. I feel there is a strong case here for a one-team approach and joined-up delivery.
Baroness Taylor of Stevenage (Lab)
I thank the noble Earl for those further comments. As I said, I will be happy to have further discussions with him and to take this important point back.
Amendment 124A would introduce specific grounds for landlords to refuse consent for a tenant to keep a cat where the property is located within, or within one mile of, a protected site under the Wildlife and Countryside Act 1981. The Government fully recognise the importance of protecting biodiversity and environmentally sensitive wildlife areas. However, we do not believe that such a blanket provision is necessary or proportionate in the context of this legislation. Nor is it fair on tenants, given that there is no similar restriction imposed on home owners in such environmentally sensitive areas.
The framework set out in Clause 12 already allows landlords to refuse consent where it is reasonable to do so. The amendment of the noble Earl, Lord Leicester, would in effect create an automatic exemption covering a significant number of properties near protected sites across England and Wales, regardless of the tenant’s circumstances or willingness to act responsibly and, as I said, would not affect any private owners in that area. It risks introducing an overly rigid restriction, undermining the Bill’s aim of promoting fair and balanced access to pet ownership in rented homes.
Tracking devices, which are sometimes put on cats’ collars, show how extensive cats’ daily travel can be— I think the noble Earl, Lord Caithness, referred to the extent of cats’ wanderings. It would be very difficult to keep a track on that for different places in different areas. It also places an unreasonable burden on landlords, requiring them to assess environmental designations and the distances between a property and a protected site—matters which are outside their typical responsibilities. For these reasons, I do not believe the amendment is necessary, and I hope the noble Earl will consider not pressing it.
While I understand the intention behind Amendment 125 from the noble Lord, Lord Black of Brentwood, I do not believe it would be practical for the Government to specify every scenario in which a landlord could or could not reasonably refuse a request to keep a pet. There are simply too many variables to account for, including the type of property, the nature of the pet and the specific circumstances of both the tenant and the landlord. This amendment seeks to outline certain, though not all, circumstances that may be deemed unreasonable when a landlord refuses a tenant’s request to keep a pet. However, its inclusion could inadvertently lead to any circumstance not explicitly included on this list being presumed reasonable by landlords. This could create unintended consequences, limiting flexibility and making it more difficult to fairly assess individual cases.
The question of whether it is reasonable for a tenant to have a pet in a rented property is, as I said before, best determined on a case-by-case basis. In most instances, this will be agreed on between the landlord and the tenant. As I said, there will be guidance available on this. Where disputes arise, they can be appropriately resolved by the ombudsman or the courts, which will be better placed to consider the individual facts of each case. It is also important to note that landlords will always retain the ability to refuse permission where a superior lease prohibits pets. This ensures that landlords are not placed in a position where they are forced to breach their own legal obligations.
Given these safeguards, I do not believe it is necessary to introduce additional legislative provisions that could add unnecessary rigidity to what should remain a flexible, case-by-case approach. In light of this, I hope the noble Lord will consider not pressing his amendment.
Amendment 126 from the noble Baroness, Lady Miller, seeks to define specific circumstances in which it would be considered unreasonable for a superior landlord to refuse consent for a tenant to keep a pet, such as personal opinions, general fears about the risk of damage caused by pets, or past unrelated experiences. While I understand the intention behind this amendment, I must resist it on the grounds that it could complicate the existing proposals unnecessarily. The Government’s position is that superior landlords should retain the ability to refuse consent without needing to justify their decision, particularly given the practical challenges involved in engaging with them.
In many cases, superior landlords are not based in the UK or are part of complex ownership structures and that can make communication slow, difficult and costly. Requiring them to provide reasons for refusal risks drawing immediate landlords and their tenants into prolonged and expensive legal or administrative processes. The Bill is designed to improve fairness and clarity in the tenant-landlord relationship without overburdening parties with obligations that may be difficult or unrealistic to meet in practice. That is why I said I will look into the quantum that might be involved here and come back to the noble Baroness on that, if that is okay. For these reasons, I do not believe the amendment is proportionate or necessary, and I hope the noble Baroness, Lady Miller, will consider not pressing it.
I am grateful to the noble Earl, Lord Leicester, for bringing forward Amendments 126A and 124A. Amendment 126A would place a duty on the Secretary of State to issue guidance on what constitutes a “reasonable refusal” of a pet under Clause 12, and would require consultation with landlords before they do so. I recognise the intention behind this proposal, which is to provide greater clarity and assurance for landlords when they consider tenant requests. As I have said, the concept of reasonable refusal is, by design, flexible. It allows landlords to take account of the specific circumstances of each tenancy. What is reasonable in one case may not be reasonable in another.
That said, I can assure the Committee that we will publish guidance to help landlords and tenants understand how these provisions should operate in practice. However, guidance of this nature cannot and should not seek to cover every possible circumstance. It will provide helpful principles and examples, but it is vital that landlords retain the ability to exercise reasonable judgment based on individual cases. For these reasons, I do not believe the amendment is necessary, and I hope the noble Earl will consider not moving it.
The Earl of Caithness (Con)
My Lords, I am grateful to the Minister for her reply. I am glad she will produce the guidance, though perhaps not in the form I would have liked. Can I clarify one issue I am now confused about? If a tenant wants a pet, there has to be a written agreement. Does there have to be a written agreement for every pet, or does “a pet” cover a multitude of pets?
Baroness Taylor of Stevenage (Lab)
My assumption had been that it was for a pet, but I will come back to the noble Earl with a written answer.
The Earl of Caithness (Con)
My Lords, I think it is relevant. If I rent a property in which I am allowed a dog and I have a bitch and she has puppies, I would then have perhaps 10 dogs in the house, although the agreement was that I should have one dog. Do I have to go to the landlord and say that I have nine more dogs, but that it will be on a temporary basis? How does that work?
Baroness Taylor of Stevenage (Lab)
I understand the issue and I will respond in due course.
Lord Black of Brentwood (Con)
My Lords, I am very grateful to all who have taken part in this debate. I always knew it would be an interesting debate, and so it has proved. I did not know until we had the appearance of Wilberforce the snake that it would be quite so wide-ranging, but that has certainly been the case.
One of the interesting things about this debate is that normally in Committee there is some disagreement with what the Government are trying to do. There has not really been any disagreement today with what the Government are seeking to do here; we are just seeking to make their noble intentions as effective as possible. I am very pleased the Minister responded constructively and positively.
As my noble friend Lord Lexden said, opaque law can never be satisfactory law. The speeches from the noble Baronesses, Lady Miller and Lady Grender, the noble Lords, Lord Howard of Rising and Lord de Clifford, and others have underlined that there are too many uncertainties as things stand. In that most precious of relationships between a human and a pet, there needs to be certainty. This debate has brought that out.
My anxiety is that some of the amendments, including those from the noble Earl, Lord Caithness, and the noble Lord, Lord Howard of Rising, seek to import more loopholes into the Bill and to give landlords greater powers of veto. I am disappointed that my noble friend Lady Scott of Bybrook has fallen into that trap as well.
I thank the Minister for her comments, which were very constructive and positive. She spoke a number of times about guidance, including on consent and withdrawal of consent. I am not a lawyer and I do not pretend to understand the intricacies of the contractual obligation she talked about, but I am pleased to hear that they will be spelled out in accompanying guidance. Would she be prepared to talk to the animal charities involved in this sector about the drafts of that guidance and, similarly, about the guidance on the refusal of consent? Those will clearly be very important documents and those with day-to-day practical experience of the problems that arise in this area would be very good people to consult.
We will all be grateful to the Minister for saying, on the issue of superior landlords, that she will look at the quantum of data. Perhaps she could do that before we reach Report and let the noble Baroness, Lady Miller, have it so we can discuss whether there is any need for further amendments.
Finally, the amendment from the noble Earl, Lord Kinnoull, has strong support from all sides of the House, and he is absolutely right to bring it forward. The right to own a pet should be universal and not in any way dependent on the type of property someone lives in. I am very grateful to the Minister for saying that she will look further at this and give it consideration before Report. On that note, I beg leave to withdraw my amendment.
Lord Howard of Rising
“(5A) Where a landlord has given their consent under subsection (1) they may withdraw their consent at any time if they become aware that the pet in question is a dangerous wild animal under the Dangerous Wild Animals Act 1976 or in breach of the Dangerous Dogs Act 1991.”Member's explanatory statement
This amendment seeks to enable landlords to refuse pets on the grounds that they are a dangerous wild animal.
Lord Howard of Rising (Con)
My Lords, Amendment 121 seeks to probe and address the inadequate definition of “pet” in the Bill, which has already been mentioned by a number of noble Lords during this debate. Part 1, Chapter 1, Clause 12(2) inserts the following definition into Section 45(1) of the Housing Act 1988:
“‘pet’ means an animal kept by a person mainly for … personal interest … companionship … ornamental purposes … or any combination”
of those. My Amendment 121 seeks to probe whether pets that are considered dangerous and/or wild animals under the Dangerous Wild Animals Act 1976 or the Dangerous Dogs Act 1991 should be counted as pets. This might sound like common sense, but I am not convinced that, under the current drafting of the Bill, landlords would not be forced to consider giving consent for unsuitable and, in this case, dangerous animals. These Acts already govern the keeping of dangerous animals, but it is good practice to ensure legal consistency, and it is not clear how they will interact with the Bill before us today.
For example, the Dangerous Wild Animals Act 1976 requires accommodation to be
“suitable as regards construction, size, temperature, lighting, ventilation, drainage and cleanliness”.
If a landlord’s property happens to fit the definition in that legislation, does that mean that an animal included therein would be considered a pet by the definition of this Bill? As we will hear in the next group, damage insurance is problematical, as it is for standard pets. Will any insurance provider give cover for the damage that could be caused by a dangerous animal? If the fact that an animal is dangerous and wild, or falls outside the definition of a pet, can be a reasonable ground for refusal, would it not be simpler to make that explicit by reference to an existing definition and list already in legislation? Why should landlords be required to make independent assessments to justify their refusal?
The Dangerous Dogs Act 1991 is another example. It bans the keeping of specific breeds without an exemption certificate and creates offences for dogs that are out of control or that cause injury or death. Again, it is unclear how this existing legislation interacts with the Bill. If the owner of a banned breed has an exemption certificate, would a landlord be able to refuse the animal in their property? Likewise, if a dog had been deemed dangerously out of control or had injured someone, what risk would this pose to the landlord, their property agents and others who need access? What risk would be considered acceptable, if any?
I hope that the Minister can answer these questions and clarify this matter. If she needs to write to me on any of them, I would be very happy to receive her letter, but I would like to be reassured that this amendment and others we will debate today are being considered as they should be. I beg to move.
Lord Dobbs (Con)
My Lords, what is a pet? That is a central question to everything that we are discussing. Some noble Lords will remember that there once was a parrot—a Norwegian Blue, to be precise—that was very sick. In fact, he was so sick, he was a deceased parrot—at least, that is how his new owner perceived it—and no amount of nailing that dead polly’s feet to the perch could change that. How we miss Monty Python.
Perceptions, rather like recollections, may differ, yet this Bill’s definition of a pet depends almost entirely on perception, and I suspect it is likely to cause quite a few ruffled feathers. Therefore, I have put down two amendments—Amendment 131 and the consequential Amendment 132—to prod and probe a little.
First, as the Chief Whip instructed, I declare my interest as a pet owner. Percy is our rescue cat—a very happy puss that has trained my family exceptionally well. So well that, if ever I were to ask my family who they love more, me or Percy, I would soon be looking for lodgings.
As the Explanatory Notes set out:
“The Bill requires landlords not to unreasonably withhold consent”
for tenants to have pets. Despite the split infinitive, I would have thought that that was the right target area: legislation based on what is reasonable. But the Bill goes further and howls at the moon in trying to define a pet. It does this in a very peculiar manner, by defining a pet not by what it is, but by how it is perceived. It offers three definitions, as my noble friend has already pointed out. A pet is defined as an animal kept, first, for mainly personal interest, secondly, for companionship, and thirdly—it is this that my amendment mostly concerns—mainly for ornamental purposes. That is a definition we should consider getting rid of.
What is a pet kept for ornamental purposes? I will take a calf as an example. Currently, the beautiful pastures around my home in Wylye are filled with any number of calves. They are so cute and cuddly, and my grandchildren always want to take one home. But I think we can agree that a calf is not really a pet; it is a would-be cow. Except, it would seem to fall directly under the Bill’s definition of a pet: first, it is personally interesting to my grandchildren; secondly, it is companionable, particularly so long as one has a bottle of milk handy; and thirdly, it is ornamental. A triple whammy.
I remember Margaret Thatcher once cuddled a calf. I was with her in Suffolk on the election trail in 1979 when she picked up this terrified young animal and embraced it. Did the fact that she found it personally interesting or exceptionally ornamental—and, as it happened, amazingly photogenic—make it a protected pet? Could she have taken it home? Apparently, the Daily Mirror paid the farmer £50 to let it know if the poor thing died before polling day. Can you imagine the headlines? “Maggie Thatcher, calf basher”—but I digress. The problem is that once we try to define what a pet is or is not in the way the Bill attempts, we start with a cat’s cradle of confusion and end up with a dog’s dinner. People nowadays get very protective about their pets, and very litigious; we need to take care.
Traditionally, working animals and pets have been regarded as separate categories, but it is not always clear cut. Take Larry, the Downing Street cat: is he not a working animal that is supposed to keep the place free of vermin? Good luck with that. Ever since the Prime Minister’s claim at his party conference that his main mission in life was to free the sausages—Remember that? It was a magical moment—I suspect that Larry has been working even harder to try to track down all those missing sausages.
However, it is the third category that really has me wondering. Clause 12 defines a pet as an animal that is kept for “mainly … ornamental purposes”. Forgive me, but what on earth does that mean? I am confused. Does it mean, for instance, an XL bully dog? I am told that many owners regard them as extremely attractive. It must be the way they smile, or drool. But does that give a tenant an unequivocal right to keep them? I ask the Minister: does the landlord have no grounds to refuse—even if keeping such animals might well cause fear for others, such their neighbours who have children or who own a small dog or cat? As my noble friend Lord Howard of Rising so eloquently pointed out, one pet owner’s rights can become another pet owner’s nightmare.
I should perhaps whimsically point out that for, the purposes of the discussion, I have decided this week to self-identify as a Chihuahua. So, hand on heart and paw on prostate, I say: these definitions are barking mad. I really do not want to end up as breakfast for next door’s bully dog, no matter how cute he looks.
Would it not be enough simply to require both tenant and landlord to be reasonable in the specific circumstances? The Minister keeps coming back to the concept of people being reasonable. That is a much stronger concept, it seems to me, than tying ourselves in knots trying to define what a pet is in the ways that the Bill currently attempts.
Our laws should offer clarity, not confusion. But, no matter how hard we try to nail these definitions to the perch, they will make about as much sense as a dead parrot. So their proper place is not in the Bill but in that great parliamentary litter tray in the sky. I request the Minister to go back and have a much closer look at the definition of a pet.
Lord Northbrook (Con)
My Lords, I declare my interests as a landlord of private property. It is becoming clear that the Bill will be a beanfeast for lawyers in the area of landlord-tenant disputes. As my noble friend Lord Dobbs implied, it could well happen with regard to landlord-tenant disputes over pets. My noble friend Lord Howard’s amendment is eminently sensible, and his points about overriding current legislation are very important, as are those on insurance problems in this area.
Baroness Miller of Chilthorne Domer (LD)
My Lords, the noble Lord, Lord Dobbs, was as entertaining as ever in speaking to his amendment. But none of us was here in 1990—here in your Lordships’ House, I mean; obviously, we were around. In 1990, this discussion took place on the definition of a pet under the Environmental Protection Act, which chose not to define a pet specifically. Instead, it focused on the nuisances and environmental harms, regardless of the type of animal. That approach was probably safer because, obviously, for some people a praying mantis could be a pet, and it is certainly a very ornamental creature when you look at it closely—as would be a butterfly.
I have a lot of sympathy with the Government, and I think that we should stick with the idea of companionship, which is in the Bill. But the Environmental Protection Act offers a lesson from that time, one concerned with the effects of an animal’s presence or behaviour and not with whether the animal is defined as a pet. I do not feel very strongly about this issue, but that lesson is there should the Government choose to take it.
Baroness Scott of Bybrook (Con)
My Lords, I thank noble Lords who took part in this engaging debate. I thank particularly my noble friend Lord Howard of Rising for moving Amendment 121, and my noble friend Lord Dobbs—as always, he has such a wonderful way of speaking in this Chamber. I cannot add much more to what he said. He is absolutely right.
Baroness Taylor of Stevenage (Lab)
I thank the noble Lords, Lord Howard of Rising and Lord Dobbs, for their amendments relating to the definition of a pet. I also thank the noble Lord, Lord Northbrook, and the noble Baronesses, Lady Miller and Lady Scott, for their comments on this debate. Even in these two short debates this afternoon, we have seen the benefit that our House can add to legislation, including probing very intensively a definition but also the entertaining nature of the speeches we are privileged to listen to. So I thank the noble Lord, Lord Dobbs, for his entertaining intervention.
Amendment 121 from the noble Lord, Lord Howard of Rising, seeks to allow landlords to withdraw consent for a pet if it is later found to be a dangerous wild animal under the Dangerous Wild Animals Act 1976, or in breach of the Dangerous Dogs Act 1991. Although I of course fully support the principle that animals posing a serious risk to safety should not be kept in rental properties, this amendment is not necessary. The keeping of dangerous wild animals without a licence is already prohibited under the 1976 Act, and the 1991 Act imposes strict controls on specific dog breeds—I presume that includes the XL bullies that were mentioned by the noble Lord. These laws already provide local authorities with sufficient powers, and we would expect a request for a pet that falls foul of that legislation to give landlords a strong case for refusing consent. Local authorities have the powers to act, and the amendment would therefore duplicate existing protections and introduce unnecessary complexity into the Bill. For these reasons, we do not consider the amendment necessary, and I hope the noble Lord will consider withdrawing it.
Amendment 131, from the noble Lord, Lord Dobbs, seeks to remove the line in Clause 12 that includes keeping animals for “ornamental purposes” within the definition of a pet. Amendment 132 is consequential to Amendment 131. I understand that these are probing amendments, intended to seek clarity on the scope of the term “pet” as used in the Bill. Like the noble Lord, Lord Dobbs, I miss Monty Python—I have watched them over and again, I must admit—but I must respectfully resist these amendments. The line in question, referring to animals kept for ornamental purposes, is a deliberate and important part of the definition. The noble Lord will be pleased to learn that it does not refer to dead parrots, but it ensures that the Bill captures a broad and inclusive understanding of what a pet may be, reflecting the wide range of animals that people may choose to keep in their homes for companionship or decorative enjoyment. I am not sure whether Wilberforce the snake was decorative, ornamental or a pet, but he is obviously now enjoying somebody else’s company than his original owner.
Removing this provision could risk narrowing the scope of the definition, creating legal ambiguity and potentially excluding animals that are commonly accepted as pets, such as fish and birds—live ones. To support implementation, the Government will provide guidance, setting out examples of instances where animals are likely to fall into the definition of a pet. I hope that that will help to ensure consistency and clarity for both tenants and landlords, without placing restrictions on primary legislation. It is important to repeat that landlords are required to agree only to reasonable requests; a calf that may grow into a cow is unlikely to be reasonable in a small flat, for example. For these reasons, I do not consider these amendments necessary, and I hope the noble Lord will consider not pressing them.
Lord Howard of Rising (Con)
As my amendment alluded to, the Government’s definition of a pet is very broad and open to debate, although I believe that the Minister’s remarks were helpful. As we have heard from my noble friend Lord Dobbs, the definition could be stretched to the extreme. How is a landlord or tribunal expected to understand its meaning?
To summarise, the definition of a pet in this Bill poses more questions than it answers, and I hope that the Government can offer some much-needed reassurance on this. In the meantime, I beg leave to withdraw the amendment.
The Earl of Kinnoull
Member’s explanatory statement
This amendment seeks to remove a requirement on tenants to have pet damage insurance.
The Earl of Kinnoull (CB)
My Lords, in moving Amendment 127, I shall speak also to Amendments 128, 129 and 130. I remind the Committee of some different interests this time, in that I am a director of Alpha Insurance Analysts, which operates around £1 billion of premiums at Lloyd’s, and I have share ownership in Hiscox Group.
The thrust of everything in this bit of the Bill is all about pets. I am very keen on pets in general being in houses. As I pointed out, pets are usually allowed in my Scottish interest. When I looked at the insurance provisions, I was looking very carefully with a professional eye, and I wanted to try to tweak four separate areas that all needed something. First, there was the proposition that the tenant would buy insurance, then that would be all right. Secondly, there was the proposition that the landlord could buy insurance and bill that back to the tenant. Thirdly, there was the possibility of aligning the England and Wales law with what happens in Scotland, where, of course, I have a lot of experience. Fourthly, there was the knotty issue of the definition of “premium”, over which I have had many arguments in many jurisdictions over many years—and I apologise in advance for disagreeing with counsel on that.
Amendment 127 is on the first of those things in my list. There is no market today for insurance where a tenant goes out privately to buy insurance. There certainly will not have been a single cent of premium written in the UK market up to 31 December last year nor in any of the continental European non-life insurance markets, with which I am extremely familiar. One or two products have appeared on the market that provide some sort of partial cover—and I shall try to describe some of that.
I am very grateful, in saying this, to the department and the people supporting the Minister, because we have had a funny tour around this issue. We even had one exciting moment when an insurer that I had never heard of, which turned out to be an insurance company based in Anguilla, of recent formation, was keen to sell insurance to British people, although of course there would have been no protection under the Financial Services Compensation Scheme or from the insurance ombudsman, let alone all the tax and regulatory problems with an Anguilla insurer trying to settle a claim in the UK.
Leaving aside that exciting insurer, one or two insurers have come along, but they want to insure only against accidental damage, however it is dressed up. When talking about insurers, it is important to understand the difference between the insurance carrier, which takes the bet, and the insurance intermediary, which puts exciting things on the web to try to entice you. These are all insurance intermediaries, and there is only one carrier that is identified at the moment, which is under half the size of the legal minimum for an insurance carrier, if you are forming a new one, and does not appear at all on any of the lists of allowed insurers that major brokers have. It is exceptionally small and very weak.
The problem with the cover of the three policies that appear online at the moment is that they are limited to accidental damage. In one of them, accidental damage is defined as
“unexpected damage which happens suddenly and has not been caused on purpose or inevitably”.
I immediate think that that does not sound like very good cover. The other one goes a lot further. It says that the policy is
“not for damage caused by everyday wear and tear. For example, if a dog scratches at your door every day, this is not covered, while if a pet pulls down curtains that causes damage to a wall this would be covered”.
Of course, that is a vanishingly small percentage of the loss costs likely to be caused by a pet. Most of the losses from pets will be to do with chewing or infestations—I look at my noble friend Lord Trees in the hope that he will tell us all a bit more about infestations later on.
The difficulty of trying to legislate so that a landlord can say to someone, “You can have a pet as long as you buy an insurance policy”, and there being no actual policy of insurance that exists, or no reasonable one, is that it is what is sometimes called an Italian torpedo—a legal trick whereby you started a case in a different jurisdiction to slow everything down, and the initial case never gets decided. It would mean that the landlord could ask the tenant to find insurance that he knew did not exist and the pet would never be allowed into the property. That is not the intention of this Bill, so it would be quite wrong to let this option go forward. That is why Amendment 127 seeks to get rid of that option. It is not a probing amendment—it is a real amendment.
I turn to Amendment 129 next, only because the amendments have appeared a bit out of order. It is a probing amendment, and it covers the second issue on insurance, which is whether the landlord could buy insurance. Here I am much more hopeful. I should point out that this type of insurance also does not exist at the moment, but I have spoken to the underwriting managers of at least two of the big players in the UK markets and left those conversations feeling that it was quite possible that this type of insurance could come into existence—in fact, in reviewing the internet, there is some evidence that it might. It will start with this accidental damage problem, so it is not a complete cover; therefore, landlords might not choose to exercise that option because it does not really exist.
Therefore, I feel it is unfair to ask landlords to go to the market to buy insurance, and they might not want to. The insurance would therefore be a terrible situation, where a landlord is being asked about a pet and the tenant cannot buy the insurance because it does not exist—at least not in a reasonable form—and nor can the landlord because it is at a very early stage. But I felt that should stay on the statute book because I believe that something helpful might come along. I believe also that the type of insurance that will come along will be a small layer just above the deposit that people pay anyway; at the moment, it is a five-week deposit.
Lord Black of Brentwood (Con)
My Lords, when the Renters (Reform) Bill was originally proposed, Battersea asked landlords what policies or incentives would make them more likely to consider offering pet-friendly properties—that is an important point to bear in mind—and out of all the different policies and incentives, the two most popular were requiring tenants to hold insurance to cover any damage, or changing the Tenant Fees Act to allow the landlord to charge for a deep clean and fumigation at the end of the tenancy. I acknowledge that there are concerns regarding availability of insurance to cover pet damage in line with the requirements currently set out in the Bill. However, having talked to those with expertise in the sector, I believe the insurance market will adapt to new legislation, as it has in the past with cyberinsurance under the Data Protection Act 2018 and professional indemnity insurance for cladding remediation under the Building Safety Act 2022. I think there is already evidence of insurers responding to market demand, with the letting insurance providers Paymentshield and Addept Insurance updating their tenants’ content policies to include pet damage cover. I am aware of other providers that are in the process of—
The Earl of Kinnoull (CB)
One of the things I read was that Paymentshield is offering accidental damage only; I read out the definition of accidental damage and that is not really any cover at all. I am sorry; I do not know whether the noble Lord was talking to insurance underwriters or brokers, but I can tell him that the underwriting community in the insurance world is absolutely solid on this.
Lord Black of Brentwood (Con)
My Lords, my general point was that I believe the market would adapt in time, because that is the purpose of legislation—to push that market on. I know there are other insurers that are looking at pet damage insurance products to bring to the marketplace. We will have to see if it happens, but I very much hope that it would. I understand the fears from landlords that pets may damage their properties, but I also do not believe that pet deposits are the solution to this area, because they are unevenly applied and unaffordable to many.
Finally, I just want to make the general point that research has shown that fears around pet damage are often largely unfounded. Again, research that was commissioned by Battersea with the University of Huddersfield showed that more than three out of four landlords did not encounter any damage caused by pets in their rental properties. So there is very low risk, and, alongside evidence showing that pet owners tend to stay longer in their properties, this demonstrates that renting to pet owners can be financially beneficial to landlords in the long run.
The Earl of Kinnoull (CB)
I put to the noble Lord this point about the Italian torpedo. I hope he will accept that there is currently no reasonable insurance solution available for a tenant—there is none. So, if a landlord says, “I need you to go out and buy a tenants’ insurance policy”, thinking, sneakily, that as one does not exist, the tenant will look forever and will never be allowed a pet, would that be an acceptable solution for the noble Lord?
Lord Black of Brentwood (Con)
I go back to the point that the market may not exist at the moment but the legislation is designed to push this market along. I very much hope that by the time the Bill becomes law, that market will have adapted.
The Earl of Kinnoull (CB)
But if the market does not come into being—I made the point about insurance not being available for inevitabilities—we will have created through the Bill a route for landlords to quite simply prevent tenants having pets.
Lord Black of Brentwood (Con)
That is probably a bridge we ought to cross when we come to it.
Baroness Miller of Chilthorne Domer (LD)
My Lords, the noble Lord, Lord Black, quoted from the University of Huddersfield’s excellent research, The Financial Impact of Pet Ownership in Rental Properties, which I have read in detail. One of the most surprising things is that there is more non-pet-related damage to properties from non-pet owners, which averaged at £215, than there is pet-related damage from pet owners. But perhaps the more relevant thing to this particular debate is that when there was damage: the tenant’s deposit fully covered the cost 38% of the time; the repair costs exceeded the deposit and the tenant covered the additional costs 18% of the time; and the repair costs exceeded the deposit and were covered by insurance 13% of the time—which is surprising given what the noble Earl, Lord Kinnoull, told us. So, more than 60% of the time, there was no problem at all. Only in a very small percentage of the time did the landlord find themselves out of pocket. The overall findings from this study were that it is a much-exaggerated fear rather than an actual problem.
Lord Trees (CB)
My Lords, I support Amendments 127, 128 and 129 in the name of my noble friend Lord Kinnoull and others. With regard to pets, the main purpose of the Bill is to make it more likely that landlords will accept tenants with pets. That is its purpose, surely, and it is an objective that I fully support, as a veterinarian, particularly for elderly and lonely people, as well as others. The benefits of pet ownership are very well known, with a strong evidence basis. Amendments 127, 128 and 129 would ensure that the purpose of the Bill with regard to pets is not confounded by unintended consequences. The current reality—and we cannot ignore realities, as the noble Lord, Lord Black, does—is that 40% of landlords are currently unwilling to accept tenants with pets.
Another survey that the noble Lord, Lord Black, quoted showed that 27% of landlords who do accept tenants with pets—that is, one-quarter—have experienced problems. So, in order to boost the market for pet-friendly rentals, it is important that landlords are assured that, were there to be negative effects due to pets, there is adequate legal recompense. The Bill recognises this, and the solution it proposes is that the landlord can require a tenant to provide appropriate insurance. But the problem, clearly articulated by my noble friend Lord Kinnoull, who is, of course, an expert in insurance, is that it appears extremely unlikely that there will be a product on the market which a tenant could buy to insure against the problem—relatively unlikely, perhaps —of damage. If that were the case, as my noble friend started to explain, a landlord could debar a tenant by the simple act of requiring that they provide insurance to cover pet damage, their failure to find which would legitimately allow a landlord to bar them access with a pet to rental accommodation. So it would conflict with the objective of the Bill.
Amendment 127 would remove that possibility. Instead, Amendment 128 would allow an increased deposit arrangement to enable landlords to permit pets, confident in the knowledge that, in the unlikely event of damage, it will be covered by the deposit. Amendments 128 and 129 would ensure that the level of recompense is likely to adequately cover relatively costly measures, such as deep cleaning to remove allergens, referred to earlier, or the elimination of infestation with fleas, which can be a significant problem if it occurs and expensive to remove. I would love to say more about fleas—they are remarkable creatures that can jump amazing distances compared to their size—but I am aware of the constraints on repeating Second Reading speeches, so I will not. I also make the point that a deposit is likely to be a fairer and more acceptable arrangement to a tenant than paying for an insurance policy, because obviously there is no cost unless there has been a problem.
To conclude on these three amendments, I strongly support them and I think they would make it more likely that landlords could be persuaded to offer their property for rent to tenants with a pet than any alternative. I shall just make an additional point that I did raise at Second Reading but which is pertinent to this issue and has wider implications, and that is on assistance dogs. We know that having a pet is very valuable to many people’s physical and mental health, but the case of assistance dogs is very special. These are incredibly valuable animals that can alert to medical emergencies of all sorts, as well as providing physical support for disabled people, hearing support and other things. Yet assistance dogs are not actually officially recognised—there is no list or register of them—and I understand that people with assistance dogs sometimes have problems finding rental accommodation. I raised this at Second Reading, but I hope the noble Baroness will excuse me mentioning it again. She said she would discuss it with officials, and I ask her to consider that again. I strongly support Amendments 127, 128 and 129.
Lord de Clifford (CB)
I am delighted to have added my name to Amendments 127, 129 and 130 in this group. I thank my noble friend Lord Kinnoull for leading on this section with regards to pet insurance and respect his deep knowledge of the insurance market. Amendments 127 and 128 seek to provide an alternative to the pet insurance route for protecting landlords from pet damage, as there is still uncertainty at present as to whether the insurance market will provide a policy that is fit for purpose, as described in the Bill. Amendment 128 would allow for an additional three weeks of deposit to be paid and held. I listened to the Government saying that finding a deposit can be challenging for tenants, especially the low paid. Therefore, these insurance policies, if they can be developed, could be an accessible and appropriate product for tenants.
For some tenants and landlords, the option of paying a three-week deposit could be an alternative, as both parties would know where they stand from the beginning of the tenancy, or when a pet moves into a property. There are further advantages, as the tenant would get their money back if no repairs were required at the end of the tenancy, thereby rewarding tenants for looking after the property. As my noble friend Lord Trees pointed out a minute ago, if tenants pay for an insurance product, they are not rewarded for being good tenants, and the premium paid benefits neither tenant nor landlord. The deposit scheme is allowed in Scotland, so there is some real-life data that can be drawn on to see whether it works for both tenants and landlords. From my noble friend Lord Kinnoull’s experience, it appears to be working.
The deposit option gives flexibility for landlords and tenants in choosing the most appropriate protection for themselves and their circumstances in covering the possible extra costs of housing a pet in a rental property. This is a challenging issue for some landlords and very few currently accept pets. That is why Clause 12 is welcome: it will increase the number of landlords accepting pets—surely giving two methods by which they can protect themselves can only ease the fear and reluctance in accepting a pet.
Amendments 129 and 130, which I also support, would bring clarity on the detail to be included in the proposed insurance products and would clear up some of the confusion with these amendments. Therefore, I hope the Government will listen to these speeches today and consider adding a bit more flexibility to the Bill by accepting these amendments on Report.
Lord Truscott (Non-Afl)
My Lords, I support Amendment 128 and declare my interests as a landlord and a former PRS tenant. I support the amendment of the noble Earl, Lord Kinnoull, on pet deposits. First, I want to state that I am a dog lover and had dogs as pets in my youth. I was, however, horrified by the description by the noble Lord, Lord Trees, at Second Reading of the potential cost and sustained effort required to deal with flea infestation, and there is other damage that cats and dogs in particular can cause. Carpets, for example, may need to be wholly replaced after some pet tenancies, as I have experienced at considerable additional cost, which was not met by the deposit. As your Lordships have heard, insurance products are currently non-existent or very unsatisfactory, so it makes sense, in my view, to introduce a pet deposit scheme which would make the whole process a lot simpler.
The main point I wish to make is that where a lease bans pets, particularly dogs, this should be respected. As we also heard earlier, not all properties are suitable for dogs, especially large dogs. There has been an exponential rise in dog attacks in the country, especially since the pandemic. In total, there were 31,920 dog attacks in England and Wales over the last year alone— 87 a day. Since 2022, 31 people have been killed by dogs, and there were almost 11,000 hospital admissions for dog bites in England between 2023 and 2024. These figures are truly horrific and are growing. I do not claim to be an expert on this rise, but many have put it down to the surge in dog ownership since the pandemic, poor dog training and an inability of inexperienced owners to control their powerful dogs.
If you had been the victim of a dog attack, you would understand why some seek protection in their home environment, especially blocks of flats. My wife was attacked by a dog in our open gardens. Although dogs are banned under the lease, we made an exception to allow a family with a dog. At the time, my wife was wearing a back brace, having recently fractured her spine. I placed myself between the dog and my wife, while the neighbour took five minutes to come outside and struggled to restrain the aggressive dog. Incidentally, it was not a banned breed.
Those five minutes felt like a long time. Although our neighbour was red-faced and apologetic, it was a serious and frightening incident. For months afterwards, my wife had flashbacks, as it could have been a life-altering experience, like the ones you read about in the newspaper or see on television. In conclusion, where dogs are banned under leases, those leases should be upheld, and where dogs are allowed with discretion, that should also be upheld.
Baroness Scott of Bybrook (Con)
My Lords, the matter of pet damage insurance is an extremely important one, as it directly addresses the responsibility of the tenant in conjunction with the increased rights that they may be granted under the Bill.
In all our discussions on this question, we have acknowledged that allowing pets into rented properties brings with it a series of risks. There are risks to health in questions around allergies and dangerous animals, risks of damage to the property and risks to the well-being of neighbours and other tenants.
Given this, we believe it is reasonable to grant the landlord the capacity to require the tenant wishing to bring a pet into their property to have pet damage insurance. I have listened very carefully to the noble Earl, Lord Kinnoull, and I thank him for all the work he has done on this—which I think is really important work—but I am disappointed that there does not yet seem to be a product in the market for this.
However, we have to continue down the insurance route as well as down the route of having deposits. It is important, as is in my amendments, that before this section of the Bill comes into effect, there is a final decision from the Secretary of State on an insurance product that is available. If that is not going to come forward, we will have to relook at the issues that have been brought up by the noble Earl, Lord Kinnoull, in Amendments 127 and 128, which, as we have heard, provide an alternative avenue for redress should any damage be caused. This is a flexible addition to the Bill, and discretion is going to be important, but it is important to give people the option here, whether it be through a deposit or through an insurance product which is on the market in the future.
There is concern over the deposit, because it is there for very specific reasons, and when you add a further reason—damage by pets—the amount of deposit may have to be looked at again. The noble Lord opposite brings up the idea of a pet deposit along with the deposit. The principle behind this is that when you have a right to have a pet, you also have responsibilities for that pet. It is correct that landlords should be permitted the ability to claim redress when their properties are damaged, and tenants should be responsible when choosing to have pets.
It is important that we make sure that there is some form of redress for any damage caused, if the landlord wishes. Some landlords will welcome pets without any further insurance or deposit, but where the landlord wishes it, there must be some way for the tenant to have some form of redress at the beginning of the tenancy, in case there is any issue with their pet’s damage or anything else concerning that pet.
Baroness Taylor of Stevenage (Lab)
I thank the noble Earl, Lord Kinnoull, and the noble Baroness, Lady Scott, for their amendments relating to pet insurance and deposits. The noble Lords, Lord Black, Lord Trees, Lord de Clifford and Lord Truscott, and the noble Baroness, Lady Miller, have all contributed to the debate.
Turning first to the amendments tabled by the noble Earl, Lord Kinnoull, I thank the noble Earl very much for his constructive engagement with me and my officials in the department in recent months. The benefit of the noble Earl’s expertise in this area has been very valuable and very much appreciated, so I am grateful to him.
Amendment 127 seeks to remove the requirement for tenants to obtain pet damage insurance. While I completely understand the concerns behind the amendment, respectfully, I disagree with its approach. One of the key barriers to renting with pets is landlords’ concerns over potential property damage, as the noble Lord, Lord Trees, outlined. Requiring tenants to have pet damage insurance provides landlords with the reassurance they need and helps foster a more positive attitude towards pet ownership in rental properties—that is the balance between rights and responsibilities that the noble Baroness, Lady Scott, mentioned. Removing this requirement risks undermining the balance of ensuring that tenants have a fair opportunity to rent with pets, while also protecting landlords from unnecessary financial risk.
It is also important to note that we are seeing some signs that insurance products designed specifically for pet-related damage are emerging in response to the Bill—not just from Anguilla, as I think the noble Earl, Lord Kinnoull, said. As the noble Lord, Lord Black, said, these products will develop, meaning that tenants should have viable options available. This requirement is therefore both reasonable and practical, ensuring responsible pet ownership without placing an undue burden on either tenants or landlords. I emphasise in response to the noble Earl, Lord Kinnoull—
Lord Marlesford (Con)
I will just raise one very simple point, which I thought the Minister was going to deal with. I declare my interests as a Suffolk farmer with houses to let. I am unclear, not being a lawyer: in terms of the liability of a tenant whose premises, or the premises which they occupy, are damaged during a tenancy, is there a distinction between the liability for something that they have done and for something that a pet has done? If there is not a distinction, then presumably the landlord does not have to worry too much about how the damage was done. All that is at stake is what the damage is and what it is going to cost to remedy it.
Baroness Taylor of Stevenage (Lab)
I thank the noble Lord, Lord Marlesford. The distinction in this case is just trying to encourage landlords who have previously been fairly resistant to tenants keeping pets that they are able to give that concession to pet owners.
In response to the noble Earl, Lord Kinnoull, I emphasise that we continue to engage with the insurance industry, and we remain open to further information about the market and views on how it might develop. I apologise that the noble Lord, Lord Trees, has not yet had a written response to his query about assistance dogs. I will follow that up and get a response for him.
In terms of the comments made by the noble Lord, Lord Truscott, I want to clarify a point I made in my previous speech. Landlords cannot withdraw their consent to keep a pet in case of anti-social behaviour. However, there are other steps they can take. Landlords can seek to evict anti-social tenants for a broad range of anti-social behaviours under ground 14, which could include behaviour related to noisy, disruptive or aggressive pets.
Landlords can also contact their local council’s anti-social behaviour team and the police if behaviour persists, which can culminate in anti-social behaviour injunctions being granted by the courts. In that instance, that could then ban the tenant in question from keeping a pet. The incident that the noble Lord, Lord Truscott, described was really frightening, and I understand why he would have concerns about that. I hope the action I have described helps to respond to his points.
Baroness Scott of Bybrook (Con)
I am a little bit confused as to where we go on this. We are hearing that there is no product at the moment, and there are differing views as to whether there will be a product. The Government are not interested in looking at extra deposits, and I understand the reasoning for that. But if we do not have extra deposits and there is no product, where do we go with this? When does this come into effect if there is no protection for the landlord in the future? I am just confused about the timescale. How long are the Government going to wait for a product to be available?
Baroness Taylor of Stevenage (Lab)
I understand those concerns. As I have already mentioned, the department is talking to insurers all the time. We are looking at the messages from them that they are developing new products in anticipation of the Bill going through, and we will keep monitoring that during the passage of the Bill. We do not want to create a delay in one of the Bill’s key objectives, which is facilitating pet ownership. We do not want to put a block or barrier in the way of that, but we understand that we need to keep this dialogue going with the insurance industry to see where we are as the Bill progresses.
Amendment 285 seeks to ensure that tenants have access to specific insurance products to cover pet-related damage before landlords can require such coverage. This is a similar point: the amendment would similarly create an unnecessary delay in giving landlords the confidence to rent to tenants with pets. The insurance options tailored specifically for pet damage exist in limited numbers at the moment. That is because landlords have had the discretion to refuse pets, so they have used that as a way of getting around the insurance issue, and it has led to low demand for such products. We believe that the Bill will change that by providing tenants with a fairer opportunity to rent with pets and giving landlords the reassurance they need. We do not believe that a mandatory delay should be made law, as we hope those new products are coming forward with the Bill.
If Clause 13 is postponed, tenants’ struggle to secure homes just because they have a pet will continue. Once the law is in place and landlords begin accepting more tenants with pets, we think the insurance market will adapt to meet the demand, and delaying Clause 13 would only prolong the struggles of responsible pet owners. Given these reasons, I hope the noble Baroness, Lady Scott, will consider not pressing these amendments. We will continue to monitor this situation and carry on our dialogue with the insurance industry.
Baroness Scott of Bybrook (Con)
I am sorry to ask the Minister further questions, but is the Minister saying that landlords will be required to take pets without insurance or any further deposits if there is no product available? If that is the case and a product comes in six months to a year later, will the Bill then allow landlords to ensure that tenants get that insurance product? I am not quite sure how that will work.
Baroness Taylor of Stevenage
We will be amending the Tenant Fees Act so that landlords will be able to require the tenant to obtain insurance to cover the risk of property damage caused by a pet. Landlords will be able to require tenants to have that insurance.
Lord Marlesford (Con)
The Minister has again referred to my point that we need to change the Tenant Fees Act. Is she saying there is in law a difference in liability for damage done to a rental property by the tenant or their pet? We know that, if they get struck by lightning, it is not their fault, but do they not have a liability for any damage done as a result of their tenancy anyway? In which case, why does any of this matter?
Baroness Taylor of Stevenage (Lab)
I have already answered the noble Lord’s question: the idea of this specific pet insurance is to encourage landlords to accept tenants with pets. That is what the clause is there to do: to try to incentivise and encourage landlords to accept pets as part of the tenancy.
The Earl of Kinnoull (CB)
My Lords, it has been a very interesting debate. I thank those who have contributed to it all round, and I will try to mention everyone. I thought I should start by answering the question of the noble Lord, Lord Marlesford, about whether there is a difference in the insurance policy between a pet and a human being. The answer is yes, because the provisions of a standard insurance policy in the UK would present two problems for the pet. The first is a total exclusion for infestation and insects—so the sort of problems the noble Lord, Lord Trees, was talking about would be taken out straight away. Secondly, there is usually a heavy exclusion for gradually operating causes, so that would take out chewing and other things pets might do. For centuries, or at least a century and a bit, there have been policies that are aware of pet damage issues. It is not just a landlord and tenant issue; it is a first-party issue that someone might start claiming for a dog chewing a Sheraton chair. Is that a thing you can claim for on insurance—yes or no? The answer has always been no.
This is the core of the problem, which I will finish on. I did not have the good grace to speak to Amendments 284 and 285, but they are in fact good ways of getting at the very problem I have been describing. I am not sure that I have been clear enough; it is not a question of the market eventually creating something, because it is not insurance if it is inevitable. The difficulty of “first dollar in” protection for a dog chewing something is that it is inevitable that there will be a loss. It is not something that any proper underwriting manager will ever say yes to. Lots of brokers will be very interested in saying yes, because they will see premium volumes and commissions to be earned as well, but underwriting managers will not, and I am therefore extremely negative on the prospects of there ever being a comprehensive policy for a tenant to insure against their pet damaging a flat. That is why I have been concentrating on trying to find other ways of doing this—that are going to be the enabler, which I want, of pets coming into flats.
On Amendment 130, what the Minister has just said is very helpful, in that that can at least be referred to. Although people in the insurance market will carry on knocking spots off each other about the definition of “premium”, the Minister’s helpful words at the Dispatch Box will settle that issue, and we can leave Amendment 130 to one side.
Amendment 129 tries to add something currently missing from the Bill, which is a better definition of what the landlord is able to buy and give the bill to the tenant for. It seems that, at the moment, the landlord could buy £5 million-worth of cover and ask the tenant to pay for it, which would be very expensive. There is more to be discussed on that, and I hope the Minister will agree to meet with me to carry on going through these various insurance issues.
On what the Minister said about the complexities of administering an eight-week deposit versus a five-week one, the great thing about having Scotland next door to us is that we can look over the border and see how complex that has proved to be. In fact, it is perfectly easy to handle. All the various agents who are active in Scotland—the big ones, anyway—are also active in England. I assume that they already have the systems to manage this. I do not feel that the deposit system, which is so successful in Scotland, could not be applied and be successful in England and Wales.
Finishing on Amendment 127, my advice to the House is that we will not get there by having this type of insurance. It would be very unfortunate if this went on to the statute book and it was possible for a landlord to use what I have described as an Italian torpedo approach to prevent people who want to have a pet in their home from doing so, simply by asking for the impossible. Therefore, I look forward to engaging with the Minister and her excellent team again, in the hope that we can find a way forward.
In the absence of anything else, I beg leave to withdraw the amendment.
Baroness Janke
“Permission for home adaptations(1) The Housing Act 1988 is amended as follows. (2) After section 16 insert—“16A Home adaptations(1) It is an implied term of every assured tenancy that a landlord must give permission for adaptations where a local council has carried out a Home Assessment and recommends adaptations which constitute reasonable adjustments under the Equality Act 2010.(2) A tenant may appeal a landlord’s refusal to give permission for such adaptations.””Member's explanatory statement
This new clause would ensure that landlords of private and social tenancies provide permission for home adaptations for people who have disabilities where a Home Assessment has been carried out.
Baroness Janke (LD)
My Lords, I rise to speak to Amendment 133 in my name and that of Lady Jones of Moulsecoomb. This amendment would require landlords to grant permission for home adaptations that constitute reasonable adjustments where these have been recommended by local authority assessments.
Disabled individuals in the private rented sector often face significant barriers in accessing essential adaptations that allow them to live safely, independently and with dignity. According to the English Housing Survey for 2022, 21% of private renters live in homes that fail to meet the decent home standards and 16% of private renters with a long-term illness or disability are in homes with at least one category 1 hazard, such as the risk of falls or inadequate heating. These conditions are not only uncomfortable; they can actively endanger health and undermine independence. The Family Resources Survey for 2022-23 reports that 24% of people in the UK are disabled, amounting to approximately 16 million individuals. With such a significant proportion of the population affected, the case for making housing adaptable and accessible is both moral and practical.
We know that many disabled renters face long delays, refusals or restrictive conditions when requesting simple modifications. Even small adjustments such as installing grab rails, ramps or stairlifts can make the difference between a person being able to remain in their home or being forced to move, rely on care or live in unsafe conditions. This amendment seeks to remove those barriers by ensuring that tenants can make necessary changes, subject to the existing checks and balances of local authority assessments. It offers a proportionate, workable solution that respects landlords’ rights while upholding the basic needs of tenants.
The amendment would also help to reduce demand on already stretched social housing by enabling more disabled people to remain in private accommodation that suits their needs. Given that nearly a quarter of the population is disabled, the need for accessible and safe housing is clear and pressing. This amendment offers a practical step to ensure that those who need adaptations are not denied them by process, delay or indifference.
I urge noble Lords to support this amendment in order to make real the promise of equality under the law and to ensure that disabled renters can live in homes that support their independence, health and dignity. I beg to move.
Baroness Jones of Moulsecoomb (GP)
My Lords, my Amendments 178 and 191, along with Amendment 133 in the name of the noble Baroness, Lady Janke, highlight some of the challenges that disabled people face living in rented accommodation. Life is hard if you have to live with a disability, and it makes sense if where you live can help you have as much of an active life as possible. When we talk about disabled people, we are not just talking about wheelchair users; we are talking, for example, about people who might react badly to certain colours or intensity of lighting. Step-free access these days ought to be almost automatic, given our ageing population.
The sad reality is that Britain’s housing stock has not been designed with disabled people in mind, and the provision of adaptations for disabled housing is quite scarce. My Amendment 191 would give people reassurance that they can ask about and discuss disability adjustments when looking for somewhere to live, without being disadvantaged. Amendment 178 would take this further and give tenants a right to make minor adaptations for disabilities without needing consent from the landlord.
Taken together, these amendments would support people with disabilities to live healthier, happier lives by ensuring that they have specific rights to meet their needs. I hope that the Minister can take this issue away and look at it, as there are some simple ways forward that will have a huge beneficial impact on disabled people and their families.
Lord Empey (UUP)
My Lords, I think the objective of the noble Baroness’s amendment is commendable. I worry, however, that if a property is altered, it will be limited by the assessment made by occupational health, within the limitations of local authority budgets and what the cost is estimated to be. In some properties, particularly older ones, these alterations can be very substantial.
The question arises: what happens if the tenant leaves the property and it has to be reinstated? That would be a relatively simple operation for a straight stairway, but not all properties are like that. Installing a lift would be a major structural operation. I wonder whether the noble Baroness could assess what the implications would be when someone left a property and how it would be reinstated. Reinstatement can often be more costly than the installation.
With regard to undertaking minor amendments, it depends on what we mean by minor. If building control consent is not required and people alter a property, they can undermine the structure very simply. It is not difficult—a lot of older properties may not have the same structural integrity as more modern ones. If people can say that a change is only minor, what is the boundary and what are the limitations if we have no definition of what a minor alteration is? If someone starts interfering with the structure of a property without the requirement of building control consent, there will be difficulties ahead, as there can be implications for the adjacent property. If various adaptations are needed in a terraced house, it can affect properties on either side.
Who would pay for the removal of the adaptations in the first place? Although the noble Baroness has tabled a very well-meaning amendment, I fear that, if given an inch, people would take a mile because they would not want to bother with getting the various consents. People could undertake quite substantial and perhaps even risky amendments to property without consent. Again, the question arises: how do we reinstate them afterwards?
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baronesses, Lady Janke and Lady Jones of Moulsecoomb, for their important amendments on disability adaptations. This is a crucial issue, and the Government have a duty to find the correct balance again between ensuring that disability adaptations are available to tenants and considering the significant impact that some provisions could have on our landlords.
Amendment 133, which proposes an obligation for landlords to grant permission for home adaptations following a local authority assessment under the Equality Act 2010, rightly highlights the importance of accessibility. However, we must also consider the practical and financial implications. Landlords, particularly those with smaller portfolios or those who operate on very tight margins, are already contending with a range of rising costs and regulatory pressures. Although the amendment’s intention is clear and commendable, the Government, we believe, must ensure that any new duty is accompanied by adequate support mechanisms so that landlords are not forced to absorb potentially substantial costs that could threaten the viability of their business or the quality of their housing stock.
Amendment 178 would allow tenants to undertake minor adaptations without seeking landlords’ consent. This is not merely a modest proposal—it raises some serious questions. Although “minor adaptation” may sound innocuous, this interpretation is highly subjective. One tenant’s minor change may in reality be a significant alteration that affects a property’s structure, aesthetics or marketability.
We must be clear that even small, cumulative changes can lead to a loss of value, future repair costs or regulatory complications for the landlord. Properties not designed or built to accommodate such modification may be especially vulnerable. This amendment risks creating confusion, undermining landlord confidence and ultimately reducing the availability of homes to rent, particularly in lower-cost segments of the market. Landlords must have clarity, and they must be protected from unintended consequences. As we heard from the noble Lord, Lord Empey, what happens when the tenant leaves, and who pays for reinstating the property?
Amendment 191, which seeks to prohibit discrimination against prospective tenants requiring adaptations, addresses an issue of genuine concern. We support the principle of tackling discrimination wherever it occurs; however, we must also recognise that landlords will reasonably assess the suitability of their properties and the cost implications of meeting specific needs. To avoid placing landlords in an impossible position, any new obligations must be underpinned by clear guidance and, where necessary, financial support.
I urge the Minister to bring forward some proposals before Report that genuinely balance the rights of disabled tenants with the realities that landlords face. If we are to ensure that homes are both accessible and available for disabled people, we must avoid shifting the full cost burden on to landlords, particularly without due process, oversight or compensation. The aim should be a system that is fair, proportionate and sustainable for all the parties involved.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baronesses, Lady Janke and Lady Jones of Moulsecoomb, for their amendments relating to home disability adaptations. I also thank the noble Lord, Lord Empey, and the noble Baroness, Lady Scott, for their comments.
Amendment 133 seeks to require landlords to permit home disability adaptations when these have been recommended in a local authority home assessment. The Equality Act 2010 already provides protections for disabled tenants, but I recognise that such rights are not always easy to enforce in practice. I therefore agree with the noble Baroness that we should take steps to remove barriers that unreasonably prevent disabled renters getting the home adaptations they need.
However, I do not consider this amendment to be the right way to achieve that. In particular, there are significant risks to introducing a new requirement linked to home assessments. These assessments are carried out by local authorities as part of the means-tested disabled facilities grant process. The amendment would therefore create a two-tier system and could make it harder for people who are not eligible for the disabled facilities grant to access adaptations.
I say to the noble Baroness, Lady Scott, that we recognise how important those home adaptations are to make sure that older and disabled people live as independently as possible in a safe and suitable environment. I have seen at first hand, as I know she has, the real difference that these adaptations can make. That is why the Government have awarded an £86 million in-year uplift to the disabled facilities grant for 2024-25, bringing the total funding to £711 million.
That increased funding will allow more eligible people to make vital improvements to their home, allowing them to live more independent lives and reducing hospitalisations. The Government have also confirmed that amount for 2025-26. To ensure that the disabled facilities grant is as effective as possible, we also continue to keep different aspects of the grant under review. For example, we are currently reviewing the suitability of the £30,000 upper limit. I have known cases where, because of the scale of the adaptations that are necessary and the impact of inflation on construction work, that needs to be reviewed. The Government are also reviewing the allocations formula for DFG to ensure that funding is aligned with local needs. We will consult during 2025 on a new approach, with a view to implementation as soon as possible after the consultation.
Baroness Scott of Bybrook (Con)
That is a very positive response. Can we have that in writing, please, to save us from going through Hansard, as to those further measures that the Government intend to take? Will they be in the Bill or in guidance?
Baroness Taylor of Stevenage (Lab)
I will provide in writing all that I have just outlined.
Amendment 178 seeks to allow private rented sector tenants to carry out disability adaptations to their homes without first obtaining consent from their landlord if the cost of these adaptations is below a threshold set in regulation. I agree that the Government should seek to address barriers preventing disabled tenants getting the home adaptations that they require. However, this amendment is not the right way to achieve it. The amendment defines which disability adaptations are classed as minor solely by reference to cost. This would not capture a range of other factors—referred to by the noble Lord, Lord Empey, and the noble Baroness, Lady Scott—that a responsible landlord would need to consider when deciding whether to permit alterations.
These factors could include interactions with building regulation requirements—a very important set of requirements on landlords—the need for consent from third parties and how easy it will be to return the property to its original condition. As many of these factors will be dependent on the features of each individual property, it would not be possible to define “minor adaptations” in a way that works effectively for all housing in a private rented sector as diverse as ours. Given the challenge in defining which adaptations are minor, it is likely that some disabled tenants would make genuine mistakes, for the best reasons, and carry out adaptations that were not in scope of the legislation. If successfully challenged by landlords in the courts, this could result in negative consequences, such as being ordered to pay damages to remove the adaptation. The risk of this happening could deter tenants from exercising such a right.
This amendment would also create a new right for tenants alongside the existing obligation on landlords under the Equality Act 2010 not to refuse consent for disability-related improvement. That could make the system more confusing and more difficult for tenants to navigate. Therefore, the amendment would not be an effective way of supporting disabled tenants and could even make things worse. The Government are already taking strong action on this through the existing measures in the Bill and the further commitments that I have set out.
Amendment 191 seeks to extend the rental discrimination measures in the Bill to persons requiring home adaptations. We recognise very much the important issue that this amendment raises and agree strongly that people with disabilities should not face discrimination when accessing the private rented sector; nor should they be unreasonably refused the adaptations that they require. We hope that the transformative reforms to the private rented sector delivered through the Bill will make a substantial difference to support disabled tenants. The abolition of Section 21 and the new PRS ombudsman address the two key barriers identified by the 2024 report of the former Levelling Up, Housing and Communities Committee: retaliatory eviction and access to redress.
Disabled people are, however, already afforded the full protection from discrimination by the Equality Act 2010. As part of this, landlords and agents are forbidden from victimising or discriminating against a person based on a disability in relation to the offer of a tenancy, the terms on which a tenancy is offered or their general treatment of that person. Expanding the Bill’s rental discrimination provisions in this manner would create an unnecessary dual system, increasing complexity and causing confusion, leading to an overlap of responsibilities between local authorities and the courts.
Lord Empey (UUP)
Can I just come back on the reinstatement issue? Perhaps there was something in that response in the other place that the Minister referred to which would have covered this. Everybody is at one in wishing to provide people with the best possible circumstances to enjoy their tenancies; if that requires adaptations, so be it. Statistically, it is very important. However, some of these adaptations can be very substantial. If you have a lift, you have to cut the floor out from ground floor to first floor to take the machinery out; structurally you have to leave the lift shaft. That is one example. Bathrooms and stairlifts are others. If you take them away, they leave huge holes. Does the Minister have a response to that? How will it be repaired so that a landlord can resell or relet the property?
Baroness Taylor of Stevenage (Lab)
I understand the noble Lord’s point about reinstatement. However, the property being adapted will usually extend the length of the tenancy, which is one of the initial objectives. This already happens where a tenant asks for a home adaptation to be carried out. That will usually mean that they will extend the length of their tenancy. If the tenant does decide to move out, the landlord can seek someone else who would benefit from that adaptation. I will come back to the noble Lord regarding his point about any necessary reinstatement costs. Normally, landlords will be able to find another tenant who would benefit from the adaptation that has been made to the property.
Baroness Janke (LD)
My Lords, I am very grateful to the Minister, and I look forward to seeing her letter and the various assurances that she has given us today. This amendment stemmed from the fact that refusal by landlords has been a major obstacle in the private sector to disabled people who are trying to get adaptations, and it seems that there are a number of measures within the Bill that will really start to tackle this problem. The Equality Act requirements have not prevented landlords refusing tenants who have requested adaptations.
As the Minister says, the business of reinstatement is not always necessary. I admit that some hoists might need to be reinstated, but there is a huge shortage of rental places available for people with even minor disabilities. Bathroom improvements and stairlifts can be a great benefit and make the property much more in demand, because they are in very short supply. I accept that some reinstatement may well be necessary at some stage, but you need only to look at how much demand there is for these properties before you think that you would necessarily have to reinstate them after somebody with a disability has left. The fact that the tenants have a longer period of tenure as a result is also an important factor.
The point of this amendment was that getting it under the disabled facilities grants, meaning that local councils would have their inspection under some form of supervision, was meant to be a safeguard to ensure that things were not being done in an ad hoc or an unsafe way. I am very pleased to hear that disabled facilities grants are being boosted, because the fact that there has been so little money in them for so long has been a major impediment to getting these improvements. I look forward to reading the Minister’s assurances in the letter, and I beg leave to withdraw the amendment.
Baroness Janke
“Right to request Fibre to the Premises (FTTP) installation(1) It is an implied term of every assured tenancy to which this section applies that— (a) a tenant may request the installation of Fibre to the Premises (FTTP) at the dwelling-house if the tenant asks to do so in accordance with this section and the landlord consents;(b) such consent is not to be unreasonably refused by the landlord;(c) the landlord is to give or refuse consent in writing on or before the 28th day after the date of the request, except as provided by subsections (2) to (5).(2) Where the landlord reasonably requests further information from the tenant about the proposed FTTP installation on or before the 28th day after the date of the tenant’s request the landlord may delay giving or refusing consent until the 7th day after the date on which the tenant provides any further information that the landlord requests where the following circumstances apply—(a) the installation of FTTP at the dwelling-house would require the landlord to obtain the consent of a superior landlord under the terms of a superior tenancy, and(b) the landlord seeks the consent of the superior landlord on or before the 28th day after the date of the tenant’s request.(3) The landlord may delay giving or refusing consent until the 7th day after the date on which the landlord receives consent or refusal from the superior landlord.(4) Where the landlord and the tenant agree that the landlord may delay giving or refusing consent, the landlord may delay until whatever date is agreed between the landlord and the tenant.(5) Where more than one of subsections (2) to (4) apply, the landlord may delay until the latest date to which the landlord may delay giving or refusing consent under any of the subsections.(6) This section applies to every assured tenancy other than a tenancy of social housing, within the meaning of Part 2 of the Housing and Regeneration Act 2008.”Member’s explanatory statement
This amendment introduces a right for tenants to request Fibre to the Premises (FTTP) installation, similar to the right to request keeping a pet, by ensuring that landlord consent for FTTP installation cannot be unreasonably refused and that decisions are made within a specified timeframe. This provision is intended to reduce delays in broadband infrastructure improvements in rented properties.
Baroness Janke (LD)
My Lords, in moving Amendment 134, I will also speak to Amendment 135. Both are also in the names of the noble Lords, Lord Black of Brentwood and Lord Best. I am grateful to Openreach for raising this issue with me, and to Generation Rent and the Good Things Foundation for their support. These amendments would introduce the right for tenants to directly request a full-fibre broadband installation. Tenants would be able to request from their landlord directly, who would have to decide within a specified timeframe. Landlord consent would not be able to be unreasonably refused.
Broadband was historically delivered through electrical signals in copper phone lines, but this technology faced limitations, including vulnerability to weather and limited information-carrying capabilities. A demand for connecting multiple devices grew. Copper networks have increasingly been replaced with fibre-optic cables, enabling more reliable broadband and faster download speeds for households and businesses across the UK.
Four years ago, less than a quarter of British homes and offices could access full-fibre broadband. Today, around seven in 10 premises, or 20.7 million, have access to full fibre, and gigabit-capable network coverage has increased from 40% in 2021 to 83% last year. This progress has been commendable, but there are still challenges to building this vital infrastructure, which is why I tabled these amendments to resolve an increasingly pressing matter.
Although the provision of ultrafast broadband has been mandated in new builds since 2022, tenants in older residential properties have to rely on freeholder permission to upgrade existing copper to full fibre. This can pose significant challenges to the provision of gigabit-capable broadband to residents, if landlords are difficult to identify or are unresponsive to requests for access.
It is estimated that there are hundreds of thousands of multi-dwelling units across the country whose tenants could be disfranchised from the benefits of gigabit-capable broadband. Although there are existing rights to enter communal areas in flats to repair the ageing copper network, providers cannot use these same rights to upgrade tenants to the latest technology, despite the benefits it brings.
Although the telecommunications code was amended in 2022 to help broadband providers get access to multi-dwelling units by providing a tribunal process, this route is often very ineffective, takes a great deal of time and cost, and results in properties still being bypassed. The law also allows providers to apply to the tribunal only when a tenant has asked for a broadband service, but if the building does not already have a fibre network in place, there is no service available for the tenant to request. As a result, tenants, often in lower-income areas, will be left with slower, outdated broadband options, restricting their ability to access vital public services, work remotely, and access online education.
Lord Best (CB)
My Lords, I have added my name to Amendments 134 and 135, tabled by the noble Baroness, Lady Janke, as has the noble Lord, Lord Black of Brentwood. The amendments seek to address a very real problem, as the noble Baroness described. Some renters are being prevented from getting advanced broadband because their landlord has not given consent for the installation of fibre to the premises, or FTTP. Openreach, by far the biggest provider, estimates that over 900,000 households in private rented accommodation are affected.
Access to fast, reliable broadband is vital to make a GP appointment, to use a bank account, to communicate with friends and family, and to shop online, and it is essential for home working. Today, adequate digital connectivity is almost as important a service as water or electricity. My home was upgraded from a hopelessly unreliable copper network to FTTP broadband, with greatly improved access to all the wonders of the internet. Why would any landlord fail to approve the installation of the necessary digital infrastructure? After all, better broadband would make their property easier to let and increase its value at no cost to the landlord.
It seems that this is not a problem of landlords rejecting requests—for example, because they wrongly fear the process will be disruptive. Rather, it is because the landlord is hard to identify or simply fails to respond. The landlord may be based overseas. They may simply not be bothered. The amendment would overcome this problem by giving the tenant the right to make a request for fibre to the premises—a request which must be considered within a fixed timescale and cannot be unreasonably withheld, just like the new renters’ right to request permission for keeping a pet.
Full-fibre broadband is mandatory for new homes. Landlord consent is likely to be obtained relatively easily from social housing providers, but some private sector renters are missing out unnecessarily. This needs to change.
Meanwhile, as well as representations from Openreach on the need for this amendment, I have heard from two other installers of fibre and the Independent Networks Cooperative Association—INCA. These have expressed some concerns. They fear that avoiding the need for the landlord’s participation in the installation process would give unfair competitive advantage to Openreach, which already has an engagement with the premises through its provision of the old copper wire system from yesteryear. The SME network providers are worried that, because Openreach is best able to install fibre without landlord consent, the amendment could give it more of a monopoly. The smaller providers point to the value of their approach, which involves them forming good relations with landlords: bringing the landlord on board ensures they know where best to drill holes for new cables, install wires across common areas, satisfy building safety regulations, et cetera.
While not addressing the problem of digital exclusion caused by unco-operative or absentee landlords, the case for ensuring a level playing field for competing providers also deserves attention. If the Government are minded to accept this amendment—I hope they will, for the sake of the tenants who can otherwise be denied all the huge benefits of fibre to the premises—new regulatory measures to accompany the amendment need to take on board the SME providers’ perspective.
With these comments, I am delighted to support the amendments.
Lord Cromwell (CB)
My Lords, I also support these amendments. I have one small niggle, which I will get to, but I live at the end of a very ropey copper wire system, so I yearn for the day when broadband reaches up into the Midlands—or, as it is known down here, the north.
My understanding is that Openreach, in the areas where it is installing, currently includes a building free of charge in its rollout programme. That could change, and it is not clear whether alternative network providers may charge for installing. The situation is not clear at the moment and is, of course, subject to change. Therefore, would the Minister consider it right to oblige landlords to take on the cost if one is imposed?
Baroness Thornhill (LD)
My Lords, I rise to give my support for Amendments 134 and 135 in the names of my noble friend Lady Janke and the noble Lords, Lord Black of Brentwood and Lord Best, who, in his usual style, has added some quality dimensions to this discussion. The noble Lord, Lord Cromwell, has given his usual nudge about something we might have forgotten.
In short, these amendments offer a simple, cost-neutral solution to a growing problem. Too many renters are still denied access to fast, reliable broadband, and there is a real risk of growing the digital divide as a result. The ability to work remotely and to access education and vital public services are basic needs in the modern world. Reliable broadband is not a luxury; it is a necessity as fundamental as water or electricity in our lives today, yet over 900,000 households are being left behind. This is often simply because, as has been said clearly, landlords are hard to reach for requests for fibre installation or are just not bothered. These amendments would introduce a clear, fair process, ensuring that tenants could request full-fibre broadband and receive a timely response. This is not about forcing landlords to pay but removing a passive barrier that is harming renters’ access to full-fibre broadband.
It is good to know that these measures are backed by many organisations, such as Generation Rent and the Good Things Foundation, and offer a cost-neutral way for the Government to improve digital inclusion, particularly for low-income renters. Importantly, yes, landlords benefit too, with fibre infrastructure clearly adding a long-term rental value to their properties.
This is a fair and practical step to connect more people and strengthen our digital infrastructure, so we strongly support these amendments—no surprise there—and urge colleagues to do the same. We look forward to the Minister’s response.
The Earl of Erroll (CB)
My Lords, I will say a few words, particularly in response to the comments of my noble friend Lord Cromwell about loading costs on to the landlords. The problem is that, if you are in the countryside, they want to charge a huge amount to get it to you. We have one or two cottages and, to get a fibre cable out to us, we were being quoted £15,000 at one point. We would be connecting about five properties at the end of it—rented properties and another house. The other complication is that, if one of them is a business, for example, there are different rules on what they are allowed to charge. A lot of this is in the original regulations telling BT and the other networks what they had to do, particularly when BT was trying to block other people having access to the houses. There are a lot of unfairnesses in the legislation, which Ofcom never dealt with properly. I am not sure where it has got to now, but there are lots of little wars going on.
It can be very expensive: it is not just a matter of connecting something to a roadside, as it is in the city. If you are going to be running it half a mile or so, you will find that you can be loaded with enormous costs, and that they want five-year leases and so on. Sometimes, you can tell that the price will be slashed soon, because they suddenly make a big sales pitch, trying to get you to take on a five-year commitment to five grand a year; that is the best sign that they are about to roll it out in a couple of years’ time. So things are not quite as simple as they seem.
Lord Jamieson (Con)
My Lords, I thank the noble Baroness, Lady Janke, for bringing Amendments 134 and 135 to the attention of the Committee today. These rightly highlight the growing importance of fibre-to-premises broadband and the many benefits that come with high-speed internet connectivity.
In today’s world, where remote working has become increasingly common and where online applications are used to complete everyday tasks such as banking, a fast, reliable internet connection is essential. Applications that require real-time communication, such as Zoom and Microsoft Teams, not to mention watching the odd video, depend on high-speed connectivity to function effectively. For the working day to run smoothly, a strong and stable connection is essential.
We are all familiar with the dreadful “buffer face”, that puzzled expression we adopt as we wait for our devices to respond. What should be a simple task can become an exercise in frustration, all because of poor internet infrastructure. As many noble Lords have mentioned, a large group of people are excluded because of a lack of fast fibre.
Fibre to the premises is a significant step forward. It is far less susceptible to weather-related interference, and it offers future-proof capabilities. We are supportive of ensuring everyone has access to such high-speed broadband, and it is essential if we are to have a successful, dynamic and modern economy.
However, there is a need to consider some of the complications, as the noble Lords, Lord Best and Lord Cromwell, and the noble Earl, Lord Erroll, have pointed out. As the noble Earl said, rural broadband is a big issue: while many broadband providers offer contracts with no upfront installation fees, the reality is that some properties require additional work, such as laying new ducts or trenching. For some home owners, this may lead to excess construction charges, which can range from a few hundred to several thousand pounds. How will this be addressed?
While installing in a stand-alone dwelling may be relatively simple, there is the issue of multi-dwelling units such as blocks of flats, which a number of noble Lords have raised. There are significant additional complexities there, such as the potential logistics if every single flat tenant could claim to have their own separate installation; ensuring that the building’s integrity and things such as fire safety are maintained in that building; and the impact on other flat owners and so forth. For multi-dwelling units, this needs to be done on a system basis, working with the owners and the tenants. There is a need to make the process simpler and to ensure landlord engagement.
It is essential that the Government look to address these issues, ensuring that unaffordable costs do not fall unfairly on landlords or tenants and that the complexities of installation in multi-dwelling units are addressed. The Government should actively promote awareness of initiatives that may help to offset these costs and find solutions to complexities. Clear communication and guidance can also help property owners better understand their existing infrastructure and anticipate potential expenses.
The Government should consider how best to promote fast-fibre internet with affordable, practical solutions, looking to address potential costs and to deliver those practical solutions to the more complex multi-dwelling units.
Baroness Taylor of Stevenage (Lab)
I thank the noble Baroness, Lady Janke, for her amendments regarding the right for private rented sector tenants to request the installation of telecommunications apparatus, and the noble Lords, Lord Best, Lord Cromwell and Lord Jamieson, and the noble Baroness, Lady Thornhill, for their comments on this group. I completely understand the reason why the noble Baroness raised this important issue.
Digital infrastructure absolutely underpins the UK economy. It is a key driver of productivity and will only grow in importance over the coming decade—there is definitely no going back on this. That is why the Government are committed to delivering nationwide gigabit coverage by 2030, reaching a minimum of 99% of premises in the UK. No one can now deny that digital infrastructure is as vital as all the other utilities we expect to have access to.
As of March this year, just under 87% of premises in the UK can access a gigabit-capable connection. But the Government are very aware of concerns around the speed of deployment in the multiple dwelling units, such as blocks of flats, that the noble Lord, Lord Jamieson, just referred to.
Amendment 134 would introduce an implied right for tenants to make a request in writing for the installation of fibre to the premises—fibre optic cables. These cables are capable of providing gigabit broadband directly to the home. The amendment would provide that landlords may not unreasonably refuse such a request and that they must respond to the request within 28 days.
Amendment 135 sets out the formalities of such a request and provides circumstances in which it is reasonable for a landlord to refuse it, including where the landlord would be in breach of an agreement with a superior landlord. It also sets out how these provisions may be enforced.
These amendments are intended to reduce delays in deploying broadband infrastructure improvements in rented properties. However, the Government are aware that issues with the speed of deployment in urban areas have related to multiple dwelling units in particular, such as blocks of flats, rather than the rental sector in general. The amendments may not address the problem of slow deployment in multiple dwelling units. For example, leasehold flats in multiple dwelling units that are not rented, which outnumber rented flats within those units, would not be covered by these amendments. Further, leasehold flats in multiple dwelling units that are rented would not necessarily benefit from the right to request fibre to the premises because of the requirement for superior landlord agreement.
We therefore believe that further consideration of how such an intervention should be targeted is required before any intervention is undertaken. We understand that network operators have strongly differing views on whether and how government should intervene here—points mentioned by the noble Lords, Lord Best and Lord Cromwell—and they have concerns that any such intervention could have unintended consequences. In particular, there are concerns that intervention without proper consideration may impact the telecoms network operator market in such a way that could harm competition and investment and, in fact, slow down deployment rather than speed it up.
Given these matters, we do not consider the amendments to be appropriate. However, I assure noble Lords that that is not to say the Government are turning a blind eye to the issue. We recognise that more could be done to ensure that residents living in blocks of flats are not left behind as the rollout of gigabit broadband continues at pace across the UK. We are receiving positive responses to our work with local authorities and housing associations to facilitate deployment in social housing multiple dwelling units. Officials are also actively considering options to identify what would be the best interventions to facilitate gigabit broadband deployment in privately owned multiple dwelling units. We are actively working on that.
On the point made by the noble Lord, Lord Cromwell, and the noble Earl, Lord Errol, about the cost to landlords and the potential costs in rural areas of implementing this, I do not have an answer. I will talk to my colleagues in DSIT and come back to the noble Lords on those important points.
I hope that my words provide reassurance to the noble Baroness that the Government are seriously considering what we consider to be a very important issue. I therefore ask that the noble Baroness withdraw her amendments.
The Earl of Erroll (CB)
The Minister said, significantly, that the Government are going to connect 99% of premises. That is not enough, looking forwards, because a lot of people sometimes move around, travelling. Nowadays, when you are not in a premises, you rely on broadband connections for satnavs and perhaps doing something remotely because you are travelling but need to connect with work over broadband. We need to cover the whole country, not just premises. That was the big flaw in the earlier work by these operators. I ask the Minister not to make the same mistake again. We should not forget that BT still owns Openreach. Even though it has been legally separated, it is not completed yet. So the Minister should beware of what she is told.
Baroness Taylor of Stevenage (Lab)
The noble Earl makes an excellent point. Anyone who has travelled on the east coast main line will be incredibly frustrated about the dipping in and out of the broadband signal, and if you go through the Hatfield Tunnel on the A1, you will lose your broadband there as well. So he makes an important point.
The Bill is of course about housing, which is why we are considering the housing aspects of it, but I am sure my colleagues in DSIT are very aware of the absolute need to make sure that we have good broadband connection wherever we are in the country.
Baroness Janke (LD)
I thank the Minister for her comments, and I am very interested to hear how the Government will move forward on this. As they have rejected this amendment, I would be very interested to see what measures will be taken. Whatever reassurances we have in here, there are still large numbers of people who are digitally excluded and, as other Members have said, they are entirely reliant on broadband connection for so many things, whether it is medical appointments, work or for economic reasons. It is a real inequality and a great exclusion if they cannot have reliable connections. I hope that this will be a priority and that the Minister will inform us—perhaps in a letter—about what developments are taking place and by when. She mentioned some dates and I should be interested to see them. With those reassurances, I withdraw the amendment.
Renters’ Rights Bill
Tuesday 6th May 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-IV Fourth marshalled list for Committee - (1 May 2025)
Member’s explanatory statement
This limits the exception to providing a written statement of terms to cases where there has been an implied surrender and re-grant of a previous assured tenancy.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I will start with government Amendments 136, 138 and 139. These amendments make provision for the requirement to provide a written statement of terms for tenancies that become assured after they have begun. A tenancy may become assured during its lifetime for a range of reasons; for example, because it becomes the tenant’s principal home, or rent becomes payable on the property.
Where this happens, landlords should be able to comply with the requirement to provide a written statement of terms. These amendments will therefore require landlords to provide a written statement of terms within 28 days of the tenancy becoming assured. Without this, landlords would be left in limbo, unable to comply with the duties in new Section 16D of the Housing Act 1988 to provide a written statement of terms at the outset of a tenancy, leaving them liable to penalties. It would also leave a tenant without the written statement of terms, a key benefit of the new system, despite their tenancy having become assured. I beg to move.
Baroness Thornhill (LD)
In view of the time that we have lost—and I must say publicly that I regret the pressure that we are putting ourselves under—I will just say that it is essential that written statements are mandated to help people resolve conflicts and provide evidence if disputes go to court. What these must contain, which is the essence of Amendment 140 from the noble Baroness, Lady Scott, is clearly important and needs to be widely known.
There is quite a lot in the Bill that we feel needs to be widely known, and we have all had concerns about the level of knowledge. All I will say, with my tongue in my cheek for things down the road, is that that is all the more reason to regulate those who act for landlords—such as letting agents—to make sure that they act professionally and inform their tenants correctly.
Baroness Scott of Bybrook (Con)
My Lords, Clause 14 aims to strengthen the transparency of rental agreements by requiring landlords to provide written terms at the outset of a tenancy. This is a welcome step towards ensuring that tenants are fully informed about their rights and obligations, and that landlords are held to account for the terms they offer.
Amendment 140, in my name, recognises that legislation alone is not enough. We must ensure that tenants, landlords and, indeed, any third-party contractors involved are informed and empowered. By requiring the Secretary of State to issue clear, accessible guidance, we help to make these rights and duties real and usable in practice. Without such guidance, even the most well-intentioned legislation risks becoming an abstract concept rather than a meaningful tool for change. This is why it is crucial that the Government take proactive steps to ensure that everyone involved in the rental process understands their roles and their responsibilities.
Amendments 136, 138 and 139, tabled by the Minister, seek to refine the process through which written statements of terms are provided. The intention, as I understand it, is to ensure that landlords are held to account for providing these terms in a timely manner, which is certainly a step in the right direction. However, we must be careful to consider whether the amendments fully take into account the diverse needs and circumstances of both tenants and landlords.
The Government have a clear opportunity here to provide a system that is not only fair and transparent but also practical and achievable for all those involved. We must ensure that these provisions do not overburden landlords with an administration task but, at the same time, protect the rights of tenants by providing them with the necessary information to make informed decisions about their tenancies. While the intention is to create more transparency, it is equally important, we feel, that we do not add unnecessary complexity or red tape that could inadvertently discourage smaller landlords or make the rental process more cumbersome.
In light of these considerations, I would like to ask the Minister one or two questions. First, is the Minister confident that the 28-day requirement for landlords to provide written statements will not lead to confusion or delays? This timeline, while designed to allow time for landlords to issue the statements, may in practice create gaps in communication, potentially leaving tenants in a state of uncertainty about their rights and obligations. How do the Government intend to mitigate these potential delays?
Furthermore, how do the Government plan to ensure that smaller landlords, who may not have the dedicated administration teams, will be able to comply with these provisions without facing excessive burdens? Small landlords, who often play a crucial role in our rental market, could face challenges in keeping up with increased administration requirements without support or resources. We must be mindful not inadvertently to create barriers that make it harder for these landlords to continue offering tenancies.
In conclusion, while we acknowledge the Government’s intention to improve transparency in tenancy agreements and better protect tenants, we must consider the real-world impact of these changes. We must ensure that reforms are workable for both tenants and landlords, without increasing the complexities of the rental process or creating unnecessary barriers to housing. The amendments, while positive in some respects, do not fully address the practical challenges landlords and tenants face. Is the Minister confident that these provisions will not place undue burdens on landlords, especially those at the smaller end of the market, and that they will effectively protect tenants’ rights without creating new avenues for confusion and non-compliance? The legislation must strike a balance that promotes fairness and transparency while also being workable for all parties involved.
Baroness Taylor of Stevenage (Lab)
My Lords, I have just a brief response to the points raised by the noble Baroness, Lady Scott; I also thank the noble Baroness, Lady Thornhill, for her comments.
Amendment 140 would require the Secretary of State to issue guidance on the new duty to provide tenants with a written statement of terms before a tenancy is entered into. We are already committed to supporting tenants, landlords and agents to understand and adjust to the new rules. I accept the point that the noble Baroness, Lady Thornhill, made about agents; I think we will come to that later.
We are engaging with stakeholders in developing the requirements for the written statement of term and are aware of how important it is for the sector to understand the duty. In response to the comments from the noble Baroness, Lady Scott, about small landlords and whether the 28-day period is reasonable, I am sure that will come out during our discussions with the sector. Because we are working that way, I am confident that we will be able to work through any pressures it may be concerned about. To help landlords and tenants, we will be providing a full suite of guidance, so these groups know exactly what the changes mean for them. For those reasons, I ask that Amendment 140 not be pressed.
Lord Jamieson
Member’s explanatory statement
This amendment is consequential on another amendment in the name of Baroness Scott of Bybrook.
Lord Jamieson (Con)
My Lords, the amendments in this group tabled in my name and that of my noble friend Lady Scott of Bybrook seek to limit the financial penalties by local authorities and probe the process on which non-judicial process is sought. Although it is right that those who deliberately flout the rules face financial penalties, it is also right that these financial penalties should be proportionate and applied fairly. Are fines of up to £40,000 reasonable? In many cases, they could be the equivalent of several years of rental income. We need a system that is balanced and just for both the tenant and the landlord.
Lord Hunt of Wirral (Con)
My Lords, I rise to speak to Amendments 153, 201, 217 and 241, in the name of the noble and learned Lord, Lord Etherton, who cannot attend the Committee today. I know the whole Committee will join me in wishing him well. These amendments seek to limit the financial penalty that local authorities can impose for offences under these clauses. In the absence of the noble and learned Lord, Lord Etherton, I will briefly set out my reasons for supporting his amendments in this group.
I should declare an interest that, as a practising solicitor for over 50 years, I am always concerned about penalties that are outside the judicial process, but my concern increases when the level of financial penalty is as high as is proposed. I agree with the noble and learned Lord, Lord Etherton, that the level of financial penalty set by the Bill is extremely high. A financial penalty of £40,000 would be ruinous for most landlords. According to the Government’s own Property Rental Income Statistics: 2024, the
“average income from UK property remained relatively stable at around £17,000 between 2018 to 2019 and 2022 to 2023”.
Therefore, a £40,000 penalty would, in effect, represent more than double the rental income of an average property.
In certain egregious cases, a penalty of that severity may seem appropriate, but those cases can be dealt with by the courts. We must ask ourselves what effect this new level of financial penalty that can be imposed by local authorities will have on landlords today. We have serious concerns that the risk of a large financial penalty being imposed may encourage existing landlords to leave the sector and discourage new landlords from entering it. A more reasonable level of financial penalty would prevent that chilling effect.
I have carefully heard the words of my noble friend Lord Jamieson on the Front Bench, and I know that my noble friend Lady Scott of Bybrook, also on the Front Bench, will surely agree with the noble and learned Lord, Lord Etherton, on this and consider the warning that we have given. Of course we accept that the Government will have their Bill, which should be effective in delivering its objectives, but we are seriously concerned and worried about the impact that these excessive financial penalties will have on the rental market.
The Earl of Kinnoull (CB)
My Lords, I am deeply grateful to the noble Lord, Lord Hunt, for introducing the amendments of the noble and learned Lord, Lord Etherton, so well. I spoke to the noble and learned Lord about these amendments before his illness, and I was going to pass on only two or three comments that I recall he made to me.
The £40,000 is a life-changing amount of money—I think that was the way he put it. The reason I have my iPad here is that he referred to the civil penalties under the Housing and Planning Act 2016, on which the MHCLG has issued a very helpful note. It is so complex that local authorities needed a 20-page note to tell them how to implement this. The maximum under that Act is £30,000, and I do not see why we have suddenly gone to a £40,000 world. The £30,000 was reserved for a relatively small number of offences, and each involved knowingly doing something truly evil and wrong. I feel that that, as a principle, is conceded, as it were, even though £30,000 is a bit rich. Therefore, I agree on the £40,000; I do not understand why we have had to go up from £30,000. With the next group, we will come to the issue of knowing and recklessness, which is deeply serious as well.
I will pause briefly on some of the amendments. Amendment 153 refers to a schedule. This is one of the ones where it is up to £40,000 currently. It refers to a very complex schedule—yet there is a recklessness trigger for a fine of up to £40,000. It seemed to me that that was not as serious as some of the things that are a £30,000 offence under the Housing and Planning Act 2016. So I was dubious about whether that was truly worthy of a £30,000 lump. I therefore agree very much with the £7,000, which is where the noble and learned Lord, Lord Etherton, had come to.
On Amendment 241, there are a couple of things here that trigger the £40,000. Again, recklessness is for mistakes made in giving data to the new database. When people give data to databases, it is inevitably quite boring, and things can go wrong. Recklessness is an incredibly difficult thing to cope with, as we will discuss next, no doubt. So I felt, again, that this was very different from the £30,000 triggers under the Housing and Planning Act 2016. I felt that there was a strong case for moving the maximum down to £7,000. I am going to stop there in the analysis, because it was better done by the noble Lord, Lord Hunt, but that line of thinking—bringing it down to £7,000 from £40,000—was intended to improve standards of justice because, if people have been truly evil and truly wrong, the courts are there for that. They are made for that, and they can be a lot heavier with people. But, for local authorities, roughly £7,000 per offence—it could be multiple offences, of course—or 50% of an average year’s rental income, would be proportionate.
Baroness Thornhill (LD)
My Lords, I have spent some time looking at this and I have listened very carefully to the amendments in this clause from the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, as well as listening to the words of the noble Lord, Lord Hunt, and the noble Earl, Lord Kinnoull.
I am neither a lawyer nor a solicitor, but we are troubled by Amendment 144 in particular, as it would in effect delete all of the new Section 16I of the Housing Act 1988, inserted by Clause 18. In doing so, it would remove the ability of local housing authorities to issue civil penalties for a range of offences, pushing them into the courts. Having listened to the noble Lord, Lord Hunt, and the noble Earl, Lord Kinnoull, I think that there probably is a debate about what should be pushed back to the courts, but in general I see a legitimate role for local authorities to issue penalty notices. I also feel that in much of the Bill we have talked about the courts’ capacity to deal with things, so I would be a little reluctant to increase the burden on the courts, which we are already arguing are stretched.
I would also be interested in hearing from the noble Baroness, Lady Scott, why Clause 15 of the previous Government’s Renters (Reform) Bill gave similar powers to the local housing authorities as in Clause 17 of this Bill, albeit with a much lower maximum fine. To us, the proposal undermines the regime in the Bill that empowers local housing authorities to issue civil penalty notices. It is part of the tools in the box to give local authorities more powers to enforce across the many and various sections of the Bill. If the one objective of the Bill is to raise standards and root out rogue landlords, the Bill is right to give greater powers to local authorities to do so and raise the level of fines that can be imposed to be an effective deterrent.
At this point, when the noble Lord, Lord Jamieson, very nicely pointed out the one person who has inherited and the this and the that—I do not think that those landlords need to be worried at all about this measure, as they are not the people whom the Bill is aimed at. In fact, there is a tiny degree of scaremongering in this. As I understand the aim, and I am sure that the Minister will correct me if I am wrong, we are looking at the bottom end of the market. The answer to the landlords mentioned in the list cited by the noble Lord, Lord Jamieson, is, “If it is so ruinous to you, don’t do it—don’t do the thing that will result in that fine being imposed”. I am absolutely certain that the majority of good landlords would go nowhere near it—but actually, as the noble Earl said, some of our worst landlords do terrible things. It is very often a shock to talk to the people who deal with bailiffs, evictions and all that, to actually see the conditions that some landlords will subject human beings to. But it is a legitimate argument to talk about what should go to the courts or not as a result of what we have been talking about.
Amendments in this group seeking to reduce the amount that a local authority can charge in civil penalties will be generally resisted by ourselves, precisely because this Bill enables these fines to be used as revenue to provide resources for a strong and effective enforcement service. The capacity and capability of local authorities to carry out positive enforcement is a serious matter—and, of course, we will cover that in the next group. Councils keep the fines that they impose, whereas fines from the courts go to the Treasury, although it must be said that the LGA is still concerned that there will be a funding gap, the amount of which is going to be fairly speculative at this stage, which makes the reasons for wide-ranging reviews, which we will discuss in later groups, to be imperative. Perhaps the Minister could give us some reassurances on funding.
Amendment 144 removes the power of local housing authorities to enforce several provisions in the Bill that we strongly agree with, such as purporting to end a tenancy by serving a notice to quit orally or serving a purported notice of possession—in other words, not using the Section 8 process. In other words, it is conning a tenant that they have to leave. Councils must have the right to enforce this, as it goes to the heart of the Bill.
Amendment 144 therefore reduces the powers of local housing authorities to enforce, and Amendments 146 and 154 go on to reduce the penalties that can be imposed, which we opposed. Amendments 147 and 155, as well as all the amendments from the noble and learned Lords, Lord Etherton and Lord Keen, and the noble Earl, Lord Kinnoull, are an interesting variation on that theme, using rental payment as a measure of the penalty. I can see some logic in that, given that rents vary enormously depending on the property. But two months’ rent in a small house in Lancashire might well be several hundred pounds, whereas a similar property in Hertfordshire might be several thousand. There is a fairness of argument there, which is probably why there is a range of fines the authority can use, and I am sure the noble Baroness will enlighten us.
Finally, we can agree on Amendment 157. The burden on local authorities cannot be understated, and therefore it should be contingent on the Government to specifically look at this aspect and not just rely on the LGA and others to point it out. We are not convinced that it needs to be in the Bill, but it should be a genuine commitment.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, for moving those amendments. I send my get-well wishes to the noble and learned Lord, Lord Etherton, as well, and thank the noble Lord, Lord Hunt of Wirral, for moving the noble and learned Lord’s amendments. I thank the noble Earl, Lord Kinnoull, and the noble Baroness, Lady Thornhill, for taking part in the debate.
It might help if I start with a brief bit of context. We are taking a clear escalatory approach to civil penalties here. Across the Bill, less serious, one-off breaches will be subject only to the maximum penalty of £7,000. Only if landlords persist in not signing up to the database or the ombudsman will they become liable for a civil penalty of up to £40,000—and that is the maximum. Where landlords continue to fail to remedy unacceptable conditions in a property, they may be faced with a civil penalty of up to £40,000 or indeed criminal prosecution. Where there is evidence that landlords and letting agents continue to discriminate in the letting process, they can face multiple fines. But as the noble Baroness, Lady Thornhill, said, good landlords—there are many of them—will not be subject to any of these fines because they do not commit the offences that would lead to those fines. The answer is to follow the outlines in the Bill and then there will not be any need for landlords to be fined.
Amendment 144 would remove the ability of local authorities to impose financial penalties for non-compliance with the tenancy requirements where this is not a criminal offence. Effective enforcement against landlords who flout the rules is a key part of ensuring that our reforms deliver their full benefits. Across the provisions in the Bill, as I said, we have taken a consistent, proportionate and escalating approach to penalties. The civil penalties of up to £7,000 for less serious or first-time non-compliance is an important part of that approach. Removing the ability of local authorities to impose civil penalties for non-criminal breaches of the tenancy requirement would create a gap. How would landlords who, for example, failed to issue tenants with a written tenancy agreement or ended a tenancy illegally be held to account? Transferring responsibility for determining fines for these breaches to the courts would be a poor alternative and, as mentioned by the noble Baroness, Lady Thornhill, it would unnecessarily increase pressures on the courts. We have had many debates about that in this House in response to other areas in the Bill. In response to the question from the noble Lord, Lord Jamieson, about the capacity of local authorities to deal with this, local authorities have significant experience of imposing civil penalties. I do not see a good reason for excluding breaches of the tenancy requirements from this well-established practice.
Amendments 137, 141, 149 to 151, 156, 158 to 164, 293 and 294 are consequential on Amendment 144 and remove references to new Section 16I of the Housing Act 1988, which Amendment 144 would delete. Amendment 146 would reduce the maximum penalty for a breach of the tenancy requirements from £7,000 to £5,000. Amendment 147 would, in the alternative, set the maximum penalty for a breach of the tenancy requirements at two months’ rent. Amendment 154 would reduce the maximum financial penalty for tenancy offences from £40,000 to £30,000. Amendment 155 would set the maximum penalty for tenancy offences at 12 months’ rent. Amendments 153, 201, 217 and 241 would reduce the maximum civil penalties for offences in relation to tenancy reform, illegal eviction, the database and the ombudsman from £40,000 to £7,000.
Civil penalties need to be set at a level that provides an appropriate punishment and acts as an effective deterrent to future non-compliance. To respond to the question from the noble Lord, Lord Jamieson, about the level of the fines, we have set the maximum civil penalty for offences across the Bill at £40,000. This mirrors existing maximum civil penalties for offences under the Housing Act 2004, which are currently £30,000, but this takes account of inflation since those came into force. We intend also to increase the Housing Act 2004 maximum penalties to £40,000, via regulations, to reflect those changes in the value of money. The £7,000 maximum penalty for breaches represents a similar percentage uprating to reflect inflation, compared with a maximum fine level of £5,000 for less serious non-compliance in other housing legislation; for example, the Tenant Fees Act 2019.
Increasing maximum fine levels to reflect inflation ensures that the deterrent effect of the penalties is maintained. However, I emphasise that these are maximum levels: they will not be the normal penalty level. Local authorities will need to look at the particular circumstances of each instance of non-compliance. They will need to take account of aggravating or mitigating factors and arrive at the final penalty in line with their policy. When considering whether to issue a civil penalty, local authorities are required to issue a notice of intent, allowing time for landlords to make representations. The local authority will need to be satisfied beyond reasonable doubt that the landlord has committed an offence. If the landlord disagrees with the imposition or amount of the penalty, they will of course be able to appeal to the First-tier Tribunal.
Lord Jamieson (Con)
On a point of clarification, if I may, the Minister has made it very clear that there will be a range of fines that a local authority will be able to impose, and, as the noble Earl, Lord Kinnoull, pointed out earlier, with the 2016 Act, there was—I am not sure that I would say very clear, but let us call it very extensive—guidance on what would constitute a fine, with what burdens of proof, and whether it was knowingly reckless or unintentional. Is it the intention of the Government to provide very clear guidance to councils as to what level of fines they should impose related to what level of offence and so forth?
Baroness Taylor of Stevenage (Lab)
I thank the noble Lord for his question. Of course, local authorities will need to have a clear rationale for why they have set a civil penalty at a particular level and apply aggravating and mitigating factors to that, but local authorities need to be able to pursue penalties that are high enough to deter landlords from committing offences, but not so high that they are unfair. I take his point about guidance, and I will come back to him on that point, if that is okay.
Setting maximum penalty levels by reference to rent received on a property introduces unnecessary complexity and runs counter to well established practice. The noble Baroness, Lady Thornhill, asked whether it could be set at levels of rent. Local authorities may take account of local rent levels when arriving at the final penalty. It is clearer and simpler, though, for the maximum to be prescribed and be the same wherever in England the same breach or offence is committed.
Amendment 157 would require the Secretary of State to make an annual statement to Parliament of the funding provided to local housing authorities to support their enforcement of the tenancy requirements. To respond to the point from the noble Lord, Lord Jamieson, about the cost to local authorities, we recognise that the enforcement duties we are placing on local housing authorities in the Bill represent an additional net cost. In accordance with the new burdens doctrine, we will ensure that additional burdens created by the new system are funded. We will set out the funding we are making available to meet those new burdens in due course.
We expect enforcing the new tenancy requirements to be a significant part of the additional costs on local authorities. Local authorities will, though, have flexibility on how they use the funding provided—a point made by the noble Baroness, Lady Thornhill—and we do not intend to specify the detail of what it should be used for.
For the reasons I have set out, I respectfully ask the noble Lord to withdraw the amendment.
Lord Jamieson (Con)
I thank noble Lords for their contributions to this group. I owe a particular debt of gratitude to the noble and learned Lord, Lord Etherton, for bringing amendments to this House. I also wish him all the best for his recovery. These amendments, while similar in spirit to ours, would go even further in addressing the limits placed on local housing authorities. The noble and learned Lord is right to highlight both the challenges faced by local authorities and the significant scale of the proposed fines.
As there appeared to be a little bit of confusion, let us be absolutely clear: we need powers to hold to account rogue landlords who deliberately and maliciously break the rules to the detriment of tenants. That is something we can all agree on. However, we need a system that is fair and proportionate and does not ensnare essentially innocent landlords who inadvertently —or not maliciously—fall foul of the rules. They need to be encouraged to stay in the rental game.
As my noble friend Lord Hunt said, we need more rental homes, we need people to stay in the rental market and we need more people to come into it. We need to be very wary of coming up with systems where they fear very significant fines that they may perceive as arbitrary. Hence, I was very keen to get clear guidance from the Minister about how these fines would be placed and at what levels. I look forward to hearing further from her on this. I also appreciated what the noble Earl, Lord Kinnoull, said around the 2016 Act and the importance of guidance on that.
I thank the Minister for her reply and the commitment to share some reasoning for the figures that the Government have arrived at and some guidance— it appeared she would, anyway. Without insight into the rationale for the figures selected and the thresholds imposed, we are left to critique in the dark. For scrutiny to be effective and informed, the Government must provide not just partial explanations but a full and transparent account of how these conclusions were reached. Only then can Parliament properly fulfil its role in holding the Executive to account. I hope that the Minister will enable us to do this by sharing some of the Government’s reasoning and further guidance on how those fines will be brought forward.
Getting penalties right is not a technical detail; it is fundamental to the fairness and effectiveness of a system designed to remedy an offence. Significant fines and penalties for rogue landlords are appropriate and proportionate. However, as I said earlier, significant fines for someone who unintentionally falls foul of the law would be inappropriate. We need to be careful and calibrated to ensure that they deter offences but do not distort the functionality of the housing market. Although we want to address rogue landlords, we also want a thriving rental market and to avoid deterring good landlords who might perceive a significant risk of large, arbitrary fines.
I will finish with this message: a well-designed penalty framework should uphold the law, encourage compliance and support the functioning of housing authorities. The success of this legislation depends not just on good intentions but on practical deliverability, balanced implementation and trust from those who must operate within it.
Baroness Thornhill (LD)
Before the noble Lord sits down, can I just ask him: did he really feel, in his time as chair of the Local Government Association and leader of a reputable authority, that local authorities were dishing out fines willy-nilly or were disproportionate in their measures when they were considering things? I found the opposite—there were times when I wished we would be a bit tougher and stronger and go a bit further. I do not recognise this picture that the noble Lord is painting: that landlords might perceive that it is terrible and feel bad about it. I genuinely believe that most good landlords have nowt to fear—it is not those that the Bill is gunning for. We have a duty to convey that message and not to make good landlords feel threatened by the fact that there is an escalation in fees.
Lord Jamieson (Con)
I thank the noble Baroness very much. She is absolutely right: most councils in this country are very good and proportionate and do not levy fines—or whatever—willy-nilly. I absolutely agree with that. However, it is very much in the eye of the beholder, and we need to do everything we can to encourage a successful and thriving rental market with good landlords. Within that, one needs to think what that single-, two- or three-home landlord will look at. They will see the potential risk of £40,000, and it is perception. I absolutely concur that councils act appropriately in many instances, but if a landlord feels that there is a risk, and particularly when that risk can be two, three, or, in some cases in the north of England, four years’ rent, they may just say, “I do not want to take that risk, I will sell my property”. That is one less house for somebody to rent and one more person on a council’s housing waiting list.
Baroness Taylor of Stevenage (Lab)
Before the noble Lord sits down, I am sorry, but I have to challenge that because the opposite to that is true. I think most good landlords are actually waiting for this to come into place because it damages their reputation when we have rogue landlords who cause their tenants the sorts of problems we are talking about. You will not come across the penalty regime unless you are the sort of landlord that causes your tenant problems. It is those landlords we want the Bill to impact.
Just to clarify the point on guidance, we will be issuing revised guidance on setting financial penalties to provide a national framework for local housing authorities. That will help to ensure the consistent approach which takes account of the seriousness of the offence and harm caused to the tenant and will help reduce the likelihood of reductions on appeal.
I want to be absolutely clear that this whole enforcement regime is aimed at those bad landlords we have heard too much about. Landlords want us to do this: they want to see that those people who do not do the job properly get an appropriate penalty for it.
Lord Jamieson (Con)
Can I just ask a point of clarification? The Minister talked about publishing guidance. Will that be available before Report so that we can consider the Bill in that context?
Baroness Taylor of Stevenage (Lab)
I will come back to the noble Lord on that point.
Member’s explanatory statement
This amendment is consequential on the amendment to clause 14 in the Minister’s name amending section 16D of the Housing Act 1988 to insert new subsection (6A).
“(6A) In any other case where a tenancy becomes a tenancy to which this section applies, the statement under subsection (2) must be given within the period of 28 days beginning with the date on which the tenancy becomes an assured tenancy.”Member’s explanatory statement
Where an existing tenancy becomes an assured tenancy, this amendment requires a landlord to provide a written statement of terms within 28 days rather than being required to provide such a statement before the tenancy is entered into.
Renters’ Rights Bill
Monday 12th May 2025
(1 year, 3 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-V(b) Amendments for Committee (Supplementary to the Fifth Marshalled List) - (12 May 2025)
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, it may not surprise noble Lords that, before we start the debate on the first group, I again remind the Committee of the protocol around declaring interests. As I mentioned last week, noble Lords should declare relevant interests at each stage of proceedings on a Bill. That means that in Committee, relevant interests should be declared during the first group on which a noble Lord speaks. If a noble Lord declared an interest during the previous two days in Committee, that is sufficient, but if this is their first contribution, any relevant interests should be declared.
Lord Shipley (LD)
My Lords, I thank the noble Lord for what he has just said, reminding us of the importance of declaring interests in Committee if they have not been declared so far, but will he make a statement to the Committee about the Government’s plans for further consideration of this Bill, given that we were promised six days of consideration? We lost more than two hours last week through dinner-hour business, and today—for extremely good reasons—we have now lost more than five hours of consideration. I hope the Government have now decided that they must give this Committee an extra day, because we were promised six days and we have not had six days. I hope the Government’s intention is not simply to go through the night tonight and through the night on Wednesday. This would not mean reasonable discussion of the 132 amendments that still stand to be debated in your Lordships’ Committee.
Lord Wilson of Sedgefield (Lab)
I thank the noble Lord for those comments. We will try to resolve this through the usual channels, but there are six days and this is the fifth day. We want to make progress today and we want to complete Committee on the sixth day, which is Wednesday this week.
Clause 17: Landlords etc: financial penalties and offences
Amendment 145
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment, and another in the name of Baroness Scott of Bybrook, seeks to apply the normal standard of proof for civil cases for these fines and probes the Government’s reasons for applying the criminal standard of proof.
Baroness Scott of Bybrook (Con)
My Lords, I want to make it very clear that we will not have had six days in Committee. I quite agree with the noble Lord, Lord Shipley.
I do not feel that I can open this group without paying tribute to the late noble and learned Lord, Lord Etherton. His amendments are why we are debating this important issue tonight. We will miss his insightful contribution to this Bill and to the House more broadly. We are a poorer place without him, and I send my heartfelt sympathies to his partner, his friends and his family for their loss. May his memory be a blessing.
This group follows on from a group on the previous day in Committee, but it focuses more specifically on the burden of proof applied in the determination of penalties. I will be brief, as on these Benches we simply have two questions for the Minister. I draw your Lordships’ attention to probing Amendments 145 and 152. We are concerned about the Government’s proposal to grant local housing authorities the power to determine whether a person is guilty of an offence under Section 16 without proper due process. Can the Minister kindly set out for the Committee how this provision is intended to operate in practice, and whether it will be subject to any appeal or review process?
I wish to draw attention to the principal reason for these probing amendments—the selected standard of proof. We are seeking to understand why there appears to be a lack of consistency in the standard of proof applied across different parts of the Bill. I have no doubt that many distinguished lawyers in your Lordships’ Committee will address this matter with far greater clarity and precision than I can. However, the question remains: why should different standards of proof apply within the same piece of legislation?
I appreciate that the Minister is herself not a lawyer and may wish to take some time to reflect and return to the Committee with a considered response, but can she kindly set out, either today or at a later stage, the rationale behind this apparent inconsistency? I beg to move.
Lord Hunt of Wirral (Con)
My Lords, I will speak to Amendments 148, 197, 200 and 242 on behalf of the noble Earl, Lord Kinnoull.
First, I join my noble friend Lady Scott of Bybrook by expressing my sincere condolences to the family and friends of the late noble and learned Lord, Lord Etherton. His reputation as an exceptional legal mind represents the very best that this House has to offer.
Secondly, I remind noble Lords of my own interest as a practicing solicitor.
These four amendments seek to make two substantive changes to the Bill. First, the removal of “reckless” would ensure that a landlord is guilty of an offence only if it can be proven that they wrongly relied on a ground for possession with actual knowledge of the offence. Secondly, the replacement of
“on the balance of probabilities”
with “beyond reasonable doubt” raises the standard of proof for these offences when the local authority is determining a case.
I expect that the Minister will oppose these amendments on the grounds that they will make it less easy for a local authority to find a landlord guilty of an offence. But surely the crucial point is that they would put a proper check on the incorrect prosecution of landlords that may arise from the new system of penalties that will be imposed by local authorities.
There is also a legitimate question about how we can be certain that local authorities will have the resources they need fairly to assess cases in which landlords are accused of an offence. We need a system that ensures that landlords are held to high standards, but surely that system has to be seen to be fair. Any system that makes landlords feel that they are perennially at risk of being found guilty of an offence, even without their knowledge, will only add to the chilling effect of the Bill on our rental market.
I also agree that the standard of proof where a local authority is making a decision on a case without recourse to the courts should be high. Local authority officers should be absolutely sure when making these decisions.
I have two questions for the Minister. First, will she take this opportunity to explain how a landlord who has been found guilty of an offence by a local authority will be able to appeal that decision? Secondly, will she please answer the question about appropriate local authority resources to enable them to administer these offences?
Baroness Thornhill (LD)
My Lords, first, I echo from our Benches the sincere condolences to Lord Etherton’s husband, Andrew, and their family. They really do have our most sincere condolences.
I also echo the concerns that were delivered in a rather measured way by my noble friend Lord Shipley regarding the way that things have gone along. I have also communicated that to the Minister.
We come to another key plank in the Bill, perhaps one less explored or spoken of but, in our view, massively important, that of enforcement. It is important to remind ourselves of the current state of affairs in the enforcement world, albeit very briefly, as this is not Second Reading. The reality is, as the noble Lord has just mentioned, that after decades of cutbacks, councils have gradually been reducing the number of staff in the areas of housing enforcement, decent homes and tenant matters. It is arguable that, as a result of this, they have failed over that same time to carry out proper proactive enforcement work, inevitably leading to more substandard housing, as, let us be blunt, the rogue landlords know they can likely get away with it.
The big change is, of course, Clause 107. It is an important section in the Bill and, in short, it very boldly states:
“It is the duty of every local housing authority to enforce the landlord legislation in its area”.
That is a very powerful change—it is not optional nor desirable, it is mandatory. The landlord legislation wraps up, of course, other requirements from other Acts, such as the Protection from Eviction Act 1977 and various housing Acts. It is a real step change from the current situation and it cannot happen too soon.
However, our concern is whether local authorities are tooled up for this. Are they ready and will they have the right resources? This is not a blame game; it is the reality. The Bill, as we discussed in a previous group, allows for two main activities to fund their enforcement activities—civil penalty notices, as previously discussed, and rent repayment orders, which we will get to sometime later. The importance of these funding streams is why we opposed any reductions in the previous group and why we have amendments in the next.
The amendments in this section centre around the burden of proof that local authorities can apply when taking civil action. I agree with the noble Baroness, Lady Scott, that we need to understand the rationale for using the criminal standard of proof “beyond reasonable doubt” as opposed to the civil standard “on the balance of probabilities”, and vice versa—all the more so given the increased powers that are being granted under the Bill. It needs to be stated that there are many and they are quite complex. I confessed earlier that I am no lawyer, but even I could see that some of our officers might need to get their heads around some of these changes.
Given that I have argued previously that local authorities will need this money to fund enforcement activities, Amendments 145 and 152 seek to lower the burden of proof to
“on the balance of probabilities”,
thus making it easier for local authorities to impose civil penalties, whereas Amendments 197 and 200 seek the opposite.
I also note that in the Renters (Reform) Bill, Clause 15 had the higher proof. I look forward to hearing the reasoning as to why there has been a change. In short, these are legitimate questions. Consistency and clarity are essential and I look forward to the Minister’s replies, particularly on the notion of recklessness and the culpable mind in Amendments 242 and 148.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, may I say how sorry I am to have to deal with Lord Etherton’s amendments after his sad passing? I did not have a long time to get to know him, but during my time in this House, I truly appreciated both his engagement and his wisdom on this Bill and his courtesy and kindness. I know that he will be greatly missed by the House and I add to what other noble Lords have said in sending my condolences to his husband and his close friends and family. I understand that his wonderful legal brain will be a sad loss to this House, and we will all miss him. I am very sorry that he is not here today to complete the work that he started on the Bill. As the noble Baroness, Lady Scott, said, may his memory be a blessing to all those who knew him.
I thank the noble Baroness, Lady Scott, and the noble Lord, Lord Hunt, for speaking on behalf of Lord Etherton in this debate on the amendments on financial penalties, and also the noble Baroness, Lady Thornhill, for her comments on these. I will make the declaration up front that I am not a lawyer either, so I rely on others for legal advice on this part of the Bill.
Starting with the amendments in the name of the noble Baroness, Lady Scott, Amendment 145 would replace the criminal standard of proof with the civil standard of proof for breaches of the tenancy requirements which are not criminal offences. These breaches can, by virtue of continuing or being repeated, form part of a criminal offence. We consider that it is necessary, therefore, for the criminal standard of proof to apply.
Amendment 152 would reduce the standard of proof from “beyond reasonable doubt” to “on the balance of probabilities”, where local authorities are imposing civil penalties as an alternative to prosecution for tenancy offences. Where civil penalties are imposed as an alternative to criminal prosecution, it is necessary for the same criminal standard, “beyond reasonable doubt”, to apply. That is already the case, for example, for civil penalties imposed as an alternative to prosecution for offences under the Housing Act 2004, such as failure to comply with an improvement notice. For these reasons, I ask the noble Baroness not to press her amendments.
I now turn to the amendments tabled by Lord Etherton, and spoken to on his behalf today by the noble Lord, Lord Hunt. Amendments 197 and 200 would, conversely, require local authorities to meet the criminal, rather than civil, standard of proof when imposing civil penalties for rental discrimination and rental bidding breaches.
The standard of proof is lower than that which applies to the imposition of financial penalties for breaches of other requirements introduced by the Bill. This is because, unlike those other breaches, rental discrimination and rental bidding breaches cannot lead to a criminal offence if the conduct is repeated or continued. As such, rental discrimination and rental bidding cannot result in the landlord being prosecuted or given a £40,000 civil penalty, and are subject only to the lower £7,000 penalty. We therefore think it appropriate that local authorities need to prove these breaches to the civil standard, “on the balance of probabilities”, rather than the criminal standard, “beyond reasonable doubt”.
The noble Lord, Lord Hunt, raised the issue of resources, and I will answer that with two points. One is that the Government have committed to assess the financial impact of this on local authorities, and have committed to new burdens funding. Secondly, those fines will be available for local authority use for this purpose, or other purposes, if they wish to use them in that way.
The noble Lord, Lord Hunt, asked about appeals. Local authorities can consider evidence and decide whether, for example, the individual concerned was aware that the information they provided might be false or misleading, and if so, whether it was reasonable for them to submit it, or if they took an unjustified risk in doing so; that is the point about recklessness.
The legislation also provides safeguards. In the case of prosecution it would be for the court, not the local authority, to decide whether the accused had been reckless. In the case of a financial penalty, the landlord has the right to make representations before a penalty is imposed, and a right of appeal against the imposition or the amount of the penalty.
Amendment 148 would narrow the offence of misusing a ground for possession to evict a tenant when possession would not be obtained on that ground. It would do so by removing the element of recklessness from the offence. Amendment 242 would narrow the offence of providing information to the database operator that is false or misleading in a material respect in the same way.
To commit the first of these offences, a landlord, or person acting or purporting to act on their behalf, would need to know that the landlord would not be able to obtain possession on that ground. If a landlord, or person acting or purporting to act on their behalf, was simply being reckless as to whether the landlord would be able to do so, it would not amount to an offence.
I do not think that limiting the offence in this way is necessary or helpful. Clearly, landlords should not be penalised for minor mistakes, but recklessness goes beyond making a mistake. It entails taking an unjustified risk, and landlords should not take an unjustified risk when their action may result in someone losing their home. It is, of course, the case that the offence is committed only if the tenant actually surrenders possession. Making enforcement in every case dependent on being satisfied to the criminal standard that the landlord, or those acting or purporting to act on their behalf, knew that the landlord would not be able to obtain possession using a ground for possession, would make it too easy for unscrupulous landlords and agents to escape enforcement.
Similar arguments apply in relation to the database offence. To require knowledge to be proved in every case would make it too easy for unscrupulous landlords to submit false or misleading information in purported compliance with database requirements.
It is well-established in legislation for offences relating to the provision of false or misleading information to include the mental element of recklessness, including in housing legislation. It is used, for example, in relation to the provision of false and misleading information to local authorities in connection with their functions under the Housing Act 2004—an offence that is prosecuted by local authorities.
In short, we consider that the mental state of recklessness is appropriate to apply to these serious offences, so I kindly ask that the noble Baroness considers withdrawing her amendment.
Baroness Scott of Bybrook (Con)
My Lords, first, I am really disappointed because a number of noble Lords who have been involved in all these debates over the past four days in Committee are unable to be in their seats because of the later time of day. That will not help us scrutinise this Bill as we should.
I thank all those who have contributed on Amendments 148, 197, 200 and 242, which are now in the name of the noble Earl, Lord Kinnoull. Noble Lords are absolutely right to highlight the issue of consistency —an issue we on these Benches intended to raise today —but my noble friend Lord Hunt also introduced an important new concern: the threshold of proof required by local authorities before a financial penalty can be imposed. On matters such as these, it is vital that we draw on the expertise of the legal profession to improve the Bill’s drafting, and I hope the Minister will seek the wise counsel of noble Lords such as my noble friend as these matters are taken back to the department.
As noble Lords have rightly pointed out, the financial penalties under consideration are significant. Many landlords are small-scale or so-called accidental landlords, who may not be in a position to absorb such fines. It is therefore entirely appropriate that the Committee seeks clarity on the methodology, consultation process and factors, such as the ability to pay, used in determining these thresholds.
Given the scale of these penalties, the standard of evidence and the threshold for their imposition must be carefully examined, and my noble friend set out with clarity the issues that may arise without a sufficient burden of proof, and the legal argument underpinning these amendments. There is legitimate concern about penalties being applied without adequate legal scrutiny, potentially undermining due process. We therefore welcome these amendments and believe my noble friend Lord Hunt has made a compelling case. When large fines are at stake, a high level of rigour and certainty must be reflected in the legal standard applied. What is more, any concerns expressed on these matters should not be dismissed too readily and should be carefully considered, but at this point I withdraw my amendment.
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment seeks to probe the Government’s willingness to recognise in law the close family ties many people have with their first cousins once removed and other removed cousins.
Baroness Scott of Bybrook (Con)
My Lords, the amendments I have tabled in this group are to probe the Government’s decision to define a family in the way they have in Clause 21. The Explanatory Notes to this part of the Bill state:
“Subsection (4) provides that where there are two or more tenants and one of the tenants is a family member of the guarantor, if the family member dies then the guarantor will not be liable for rent on or after the date of their death”.
The Bill defines a family member in such a way that excludes anyone more distant than a first cousin. It is essential that the definition of a family in law reflects the family units we see in our day-to-day life. In many tightly knit communities across this country, families still live close together, with many cousins, both near and distant, having strong family ties to each other. In these communities, it seems very likely that a second cousin might step in to help as a rent guarantor, and surely that person falls within the intention of this part of the Bill.
It seems strange that the Government would seek to recognise the relationship between two first cousins but ignore the relationship between second cousins. The example I gave shows how a second cousin might, because of their close family ties, help a family member out as their guarantor, but the Bill would not include that person within the tightly defined family under the Bill. Will the Minister explain why the Government have defined the family in this way? Will she also explain why a second cousin who acts as a guarantor for their family member is treated as a second-class citizen compared with their other closer cousins? We are also interested in the case of smaller families, where perhaps an only child chooses to help a family member who is more distant on paper but who in reality is their nearest kin. There will have to be a definition of “family” in the Bill. We understand that, but we need an explanation about why this definition of the family is being proposed. I beg to move.
Baroness Grender (LD)
My Lords, while it is understandable that some individuals have close bonds with more distant relatives, extending the definition of “family member” to include removed or second cousins could complicate the interpretation and enforcement of these provisions, which currently offer a clear and practical framework. Broadening the definition further could introduce uncertainty for landlords and tenants alike, potentially leading to disputes over familial links and undermining the protective aims of the clause.
For those reasons, we do not support these amendments but look forward to getting on to the next group of amendments, where we believe that the issue of guarantors will become less important if a certain amendment is accepted, therefore diminishing the need for this debate.
Lord Northbrook (Con)
My Lords, I support the amendments in the name of my noble friend Lady Scott of Bybrook, but I want first to express great sympathy to the husband of Lord Etherton.
It seems entirely sensible to widen the definition of family within the Bill to include first and second cousins. I cannot see any reason for refusing that.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendments relating to guarantors and family members, as well as the noble Baroness, Lady Grender, and the noble Lord, Lord Northbrook, for contributing to the debate.
Amendments 167, 168 and 169 would expand the definition of “family member” used in Clause 21 to include the grandchildren of aunts and uncles as well as siblings of grandparents. This would absolve these individuals from liability for rent owed after a tenant had died when they acted as guarantor.
I understand the noble Baroness’s motivation in probing this definition of family. She sometimes accuses me of not listening, or of not thinking these things through, but I have carefully considered the balance of these provisions. They protect bereaved guarantors from financial hardship while allowing landlords to keep guarantors in place where it is reasonable to do so.
The definition of “family member” reflects the need to encompass more distant family members who might commonly be used as tenancy guarantors. While we understand that more distant relatives than those covered in the definition may rarely be used as guarantors, defining family members for the purposes of this legislation means that a line needs to be drawn somewhere. This definition does not seek to disregard or downplay any family links between relatives who are not included within that definition—some of my second cousins might have something to say if I tried to do that.
It is worth noting that landlords holding guarantors liable in these scenarios is already uncommon, and most landlords would already act compassionately towards a deceased tenant’s family. Furthermore, by removing fixed terms, a personal representative of the deceased tenant can end the tenancy by giving a landlord two months’ notice. We believe that this strikes a balance that is fair to tenants, guarantors and landlords alike. I therefore ask the noble Baroness, Lady Scott, not to press her amendments.
Baroness Scott of Bybrook (Con)
I am grateful to the Minister for her response, but I do not think that we have quite got to a better understanding of the Government’s reasons for defining a family in this way; it is just that they are going to define a family in this way.
I point out once again that many families are of different shapes to the one described in the Bill. We feel strongly that it would be a strange outcome if slightly more distant cousins were not protected by the legislation, but close cousins were. We have set out clearly that many people have very close family ties with their slightly more distant cousins. We feel that the Government have failed to adequately explain why those individuals should not have the same rights based on their family ties as other members of the family.
We reserve the right to come back to this on Report, but we hope that Ministers will listen to the argument that we have made today and consider improving this part of the Bill to properly reflect the family relationships that many people have in in this country. At this point, I beg to leave to withdraw my amendment.
“Restriction on landlord’s ability to require tenant to provide guarantor(1) A relevant person must not, in any of the circumstances set out in subsection (3), require a person, as a condition of the grant of a relevant tenancy, to provide a guarantor in relation to the observance or performance of the tenant’s obligations under the tenancy.(2) For the purposes of this section, requiring a person to provide a guarantor includes accepting an offer by that person to provide a guarantor.(3) The circumstances are—(a) that the person has paid a tenancy deposit or has been assisted under a deposit scheme,(b) that the person is required to pay rent in advance of one month’s rent or more, (c) that on a reasonable assessment of their means the person’s income (including state benefits received and any other lawful source of income) is sufficient to enable them to pay the full rent due under the tenancy,(d) that arrangements will be made for housing benefit or the housing element of universal credit to be paid directly in respect of rent to a relevant person,(e) that the relevant person has entered into a contract of insurance under which they are insured against non-payment of rent, or(f) such other circumstances as may be prescribed by the Secretary of State.(4) In any other case where a relevant person lawfully requires a person, as a condition of the grant of a relevant tenancy, to provide a guarantor, the sum for which the guarantor may become liable under the relevant guarantee may not exceed a sum equal to six months’ rent.(5) In any case where a relevant person lawfully requires a person, as a condition of the grant of a relevant joint tenancy, to provide a guarantor, the sum claimed under the guarantee may not exceed such proportion of the loss as is attributable to the act or default of the individual tenant on whose behalf the guarantee was given; and if such proportion cannot be proved, may not exceed the sum obtained by dividing the total loss by the number of tenants.(6) In this section—a“guarantor” is a person who enters into a guarantee in relation to a relevant tenancy;a“guarantee” is a contractual promise to be responsible for the performance of an obligation owed by the tenant to a relevant person under the tenancy if the tenant fails to perform the obligation;a“deposit scheme” includes a scheme whereby a sum payable by way of deposit or a bond or guarantee is provided by a local authority, registered charity or voluntary organisation for the purpose of providing security to a landlord for the performance of a tenant’s obligations under a tenancy;a“tenancy deposit” has the same meaning as in section 212(8) of the Housing Act 2004;“relevant person” has the meaning given by section 16M(1) of the 1988 Act.”Member's explanatory statement
This new clause would restrict the circumstances in which a landlord can request a guarantor.
Baroness Lister of Burtersett (Lab)
My Lords, I shall speak also to Amendment 265. Both amendments aim to strengthen the very welcome anti-discrimination provisions in the Bill. I am grateful to colleagues who have added their names and to Shelter for its help.
Amendment 170 sets out the circumstances in which a landlord may not require a tenant to provide a guarantor, a practice that has increasingly become a precondition of a tenancy for certain tenants—namely, those in receipt of social security, black renters, women, families and disabled renters—and one that could therefore be used as a way of circumventing the Bill’s anti-discrimination clauses.
The spirit of the amendment is the same as that behind the government amendment in the Commons which will prevent landlords demanding multiple months’ rent up front. To quote Independent Age, which is among the many organisations supporting our amendment,
“this is a sensible measure that safeguards against the risk of solving one problem (excessive rent in advance demands) only for it to be replaced with another (excessive reliance on guarantors)”.
Already, over the last five years, 550,000 private renters were unable to rent a home that they wanted because they did not have a guarantor that met the landlord’s requirements.
I know and respect that the Government do not want to prohibit the use of guarantors altogether, and my noble friend the Minister explained why in her helpful post-Second Reading letter. However, the amendment would not do that. It simply sets out the circumstances in which a landlord could not ask for a guarantor, and those circumstances reflect the National Residential Landlords Association’s guidance on appropriate guarantor use—that is, where a tenant cannot prove that they can afford to pay the rent. However, recent research by Shelter has shown that in practice guarantor requests often do not follow that guidance. Thus, the amendment is not radical but merely serves to ensure that guarantors are used as intended.
The case for ensuring that the use of such requests is limited is a strong one and is very much in line with the aims of the Bill. First, as noted already, it would help to safeguard the Bill’s anti-discrimination measures. Requests for a high-earning or home-owning guarantor are too often used in a discriminatory manner. Renters who receive social security, have a disability or are members of a racialised minority are all significantly more likely to be asked for a guarantor. Similarly, as Independent Age notes,
“requiring a guarantor can be a way for landlords to discriminate against older renters”.
Secondly, and related, the groups most likely to face a guarantor request are also those least likely to be able to meet one. Some 45% of benefit recipients and 43% of families struggle to provide a guarantor, compared with just 24% of those not receiving benefit or without children. The NUS believes that the amendment would make a huge difference to student renters, especially working-class, international, estranged or care-experienced students, who are likely to face difficulties finding a suitable guarantor. Become has highlighted the problems finding a guarantor faced by care-experienced young people more generally; its FoI research found that only around two in five local authorities provide a guarantor scheme for them.
Thirdly, in practice, fewer than 3% of landlords have attempted to pursue a guarantor for unpaid rent in the past two years. Moreover, insurance offers a sensible option for covering that risk.
Fourthly, the argument that the unfettered freedom to request a guarantor provides an essential lifeline for tenants with poor credit and/or problem debts is, Shelter argues, “a disingenuous one”, because there is evidence that landlords already avoid such tenants because of the manner in which tenant referencing is done. Those are not the tenants who are most likely to be able to find a suitable guarantor.
As well as the Renters’ Reform Coalition, of which Shelter is a member, and Independent Age, those calling for limitations on the power to require guarantors include the Mayor of London and Unison. I very much hope that my noble friend the Minister will be willing to discuss what is possible between now and Report and that if she cannot accept this amendment would consider proposing an alternative. Otherwise, I fear that some of the good intended by the Bill’s anti-discrimination measures will be undone in practice.
Amendment 265 would repeal the right to rent provision introduced in the Immigration Act 2014. It requires landlords, including those taking lodgers, and letting agents to check prospective tenants’ immigration status to confirm they have the right to rent in England before granting a tenancy. Letting a property to someone without the right to rent can now be punished with a fine of up to £20,000 or a five-year prison sentence.
Baroness Kennedy of Cradley (Lab)
My Lords, I rise briefly to support Amendment 170 in the name of my noble friend Lady Lister of Burtersett. I declare my interests as a trustee of the Nationwide Foundation.
There is a growing use of guarantors in the PRS. Generation Research last year found that 30% of renters who moved in 2023-24 had been asked to provide a guarantor. Requesting a guarantor is clearly being overused and is moving towards becoming standard practice. Moreover, a guarantor in many cases has proved to be unnecessary. Shelter found that only 2.9% of landlords attempted to pursue a guarantor for unpaid rent in the last two years, despite its estimate showing that 1.85 million renters had been asked to provide one. Guarantors are overused, unused and inherently discriminative, and make renting unnecessarily burdensome. Where a renter can prove through an affordability assessment that they can pay their rent, a guarantor should not be asked for.
Amendment 170, or one like it on Report, is a necessary addition to the Bill. Will my noble friend Lady Taylor of Stevenage consider this amendment favourably or bring one very close to it back on Report? Will she also consider developing national guidance for fair and proportionate referencing? Although we may talk about this tomorrow, will she also consider adding information on guarantors to the private rented sector database?
Baroness Grender (LD)
My Lords, I support Amendment 170 in the name of the noble Baroness, Lady Lister of Burtersett, to which I have put my name, along with Amendment 265 from my noble friend Lord Tope. As the two previous speeches have explained, the amendments attempt to ensure that the dangers of discrimination are not unintended consequences of the Bill. As we dismantle one source of insecurity—the abolition of Section 21—we must be vigilant that new discriminatory practices do not simply rise in its place.
Requiring a guarantor is often presented as a simple piece of standard referencing—a lifeline for vulnerable tenants—but in reality it is quite the opposite. It adds a significant and often insurmountable hurdle for many prospective tenants, typically imposed in addition to demanding a deposit, the first month’s rent in advance and passing an affordability assessment. Landlords already possess simple tools to assess a tenant’s ability to pay and to mitigate potential financial risk. Tenant referencing, rent guarantee insurance and deposit protection schemes provide those robust safeguards. When tenants can demonstrate they can afford the rent, requiring a guarantor becomes unnecessary and serves only to narrow the pool of renters.
The demand for guarantors is an unnecessary additional hurdle that disproportionately impacts those on low incomes, those from low-income backgrounds, those without family support networks, benefit recipients, women, single-parent households, black and Bangladeshi households in particular and, most shockingly, people with disabilities. A renter with a disability is 20% more likely to be asked for a guarantor, and a black renter 66% more likely. This is not a lifeline for the vulnerable; it is more like drowning. Independent Age tells us that this is a problem for older people, too. An older renter who can perfectly afford the rent, secure in their pension income, has recounted facing questions about their income and being asked for a guarantor.
A self-employed single mother who could pay six months in advance, topped up with universal credit, was asked for a guarantor with an income of £45,000 per annum. That is £15,000 above the UK median income. And there will be people, of course, who do not know someone with that level of income.
Throughout our debates, we have heard much about arrears, sometimes as if the problem is endemic. However, government statistics state that 2% of private rented sector tenants reported being in arrears in 2023-24; even the English Housing Survey put it at around 5%. While that is still too high, it does not reflect certain assumptions that all tenants are inevitably going to be in arrears and therefore need a guarantor.
Amendment 170 seeks to bring sense and proportionality to this practice. It does not ban the use of guarantors; it simply and reasonably restricts their use to circumstances where a prospective tenant cannot demonstrate that they can afford the rent. As the noble Baroness, Lady Kennedy of Cradley, so ably put it, over the most recent two-year period, only 3% of landlords have attempted to claim lost rent from a tenant’s guarantor. When landlords have attempted this route, it has proved much harder than the standard insurance products to indemnify against non-payment.
The Government have rightly listened to calls to limit excessive upfront payments. If we tackle one form of financial barrier used to exclude tenants, we must tackle the other to prevent some landlords simply switching tactics—which I think is the greatest fear of noble Lords who support this amendment. Without this amendment, there is a significant risk that limiting rent in advance could inadvertently lead to an even wider reliance on guarantor requests, thus undermining the Bill's anti-discrimination provisions.
This amendment is a sensible, proportionate step that ensures landlords can still use guarantors when genuinely needed, while protecting vulnerable renters from being unfairly shut out of the market. I hope the Government will consider and adopt this amendment or agree to discuss a possible alternative.
Lord Tope (LD)
My Lords, I added my name to Amendment 265 and, in speaking briefly on it, I thank the noble Baroness, Lady Lister, for the way she introduced both Amendment 265 and 170, which I also support, although I did not have the opportunity to add my name to that one as well.
First of all, I declare an interest a co-president of London Councils, which is the body that represents all 32 London boroughs and the City of London. I am also, inevitably, a vice-president of the Local Government Association.
I think the point has been very well made, not least by the noble Baroness, Lady Lister, and I do not want to repeat the arguments at this time of night—although I would very much like to have done so. Instead, I shall ask the Minister one thing. I hope, in a minute, she is going to say that the Government are going to take this opportunity to repeal that part of the Act and, I hope, support these amendments. If she does not, however, I say that it is widely agreed, and indeed has been agreed by a High Court judge, that the right to rent is discriminatory. Therefore, can the Minister give us any evidence that it has had any effect in actually reducing illegal migration? Has it achieved its purpose in any way? If it has not, in its 10-year life, why on earth are a Labour Government keeping it in this Bill when they have the opportunity, in this legislation, to remove something that is both ineffective and discriminatory?
Baroness Hamwee (LD)
My Lords, as my noble friend Lord Shipley might have said, and with apologies to Robert Frost:
“I have promises to keep,
And miles to go before I sleep”.
My promise was to support Amendment 265. I knew that the noble Baroness, Lady Lister, would be as thorough as ever. When she started to say the word “efficacy”, I thought it was going to turn into “ethics”—but maybe that as well.
I simply want to record my support. However, given today’s White Paper, I do so without much expectation, as has been the case so often in the past on this issue. Nevertheless, my enthusiasm for the amendment is entirely disproportionate to the time I have taken— I promised it would be within a minute, and it is.
Lord Jamieson (Con)
We have heard some compelling arguments from across the House on the very important issues here. I thank the noble Baroness, Lady Lister of Burtersett, for her cogent and careful explanation of the reasons for bringing forward her amendments.
The issue we are addressing today is of great importance, particularly given that the Bill removes the options for tenants to pay rent in advance. Furthermore, the Minister has declined to support our amendment, which would have allowed for an arrangement between two consenting adults to agree on such a payment structure. This is a missed opportunity. Although His Majesty’s Opposition have not tabled an amendment to this group, we share the serious concerns that have been raised and I will try not to repeat the many arguments that have already been made.
Unfortunately, the Government’s proposals, in their current form, appear to pay little more than lip service to fairness. In practice, they fail to provide meaningful protection to those most at risk of exclusion from the rental market. Let us be clear about the deficiency of Amendments 170 and 265: they specifically prevent landlords requiring a guarantor in a wide range of circumstances, yet there remains ambiguity as to whether the amendments would still allow landlords to accept a guarantor if offered. I thank the noble Baroness, Lady Lister of Burtersett, for being very clear that they could still accept it, but that does create some ambiguity.
While we recognise that requiring a guarantor can be a significant barrier for many prospective tenants, particularly those from vulnerable backgrounds, the guarantor system serves a legitimate function where it is used proportionately. It can provide a safety net for tenants with limited financial histories, such as students, individuals supported by local councils or those whose circumstances might not meet the traditional expectations of landlords. However, the Government’s approach to rent in advance is inconsistent with the rest of the Bill. If tenants are not allowed to offer rent in advance as an alternative to a guarantor, we must ask: how will the Government ensure that fair and proportionate mechanisms are put in place to assess risk?
The private rental market is not a one-size-fits-all model; it encompasses a diverse range of tenants, from students and graduates to care leavers and older renters. How do the Government plan to accommodate those who may not have access to a guarantor but are still financially reliable? Crucially, where does the space exist in this framework for discretion, mutual agreement and choice between two consenting adults—tenants and landlords?
Furthermore, the Secretary of State’s proposed power to allow insurance-based alternatives to guarantors raises significant concerns. Can the Minister say how accessible these insurance products are likely to be and what steps are being taken to ensure that they do not create another costly barrier for tenants? As it stands, the insurance model seems unlikely to provide a fair and proportionate solution to the challenges that tenants face. These are not abstract concerns: the provisions, as drafted, place undue strain on tenants and their families without achieving the balance that the Government claim to seek. Unless there are significant revisions, this issue will undoubtedly return with force on Report.
As has been mentioned, the Bill has generated substantial interest across the rental sector, with campaigns led by the National Union of Students being particularly striking. Students across the UK, especially those from marginalised and underrepresented backgrounds are sounding the alarm. Guarantor requirements have emerged as one of the most significant barriers to accessing stable, affordable housing.
As the NUS has clearly outlined, these requirements disproportionately affect working-class students, care-experienced young people, estranged youth and international students—groups already navigating considerable challenges in their pursuit of education. Many of these students face an additional hardship: they do not have a family member in the UK who can meet the often arbitrary financial thresholds demanded by landlords. As a result, they are forced either to pay up to a year’s rent in advance—an impossible ask for many—or to turn to expensive guarantor services. We now find ourselves in the deeply perverse situation where it costs more to rent a home if you are poor.
Guarantor requirements contribute to this divide, by insisting that students find someone, often someone who earns up to 80 times the monthly rent and is based in the UK, to guarantee their tenancy. We are systematically locking out those who cannot meet these criteria. No one should be denied the opportunity to pursue academic excellence simply because of who they know or, more importantly, who they do not know. This is why these amendments fail, why the NUS and student representatives worked so tirelessly to bring this reform forward in the other place, and why it is so vital that we do not let this opportunity slip through our fingers in this House.
I focused much of my speech on the barriers faced by students, but it is essential to remember that this issue also affects many other vulnerable groups, none more so than care leavers. I speak as an ex-leader of a council, where I spent much time trying to enhance the position of care leavers. Having already overcome considerable challenges in their lives, they should not face yet another hurdle in their pursuit of independence. How can we in good conscience expect care leavers to comply with a condition that they simply cannot meet on their own? This also demonstrates the complexity of the situation, as often, their local councils—including Central Bedfordshire while I was there—were often willing and keen to provide guarantors to ensure that care leavers were on an even playing field to those from better financial backgrounds.
As I have outlined, the restrictions on rent in advance and lack of objective criteria for when a guarantor is required will only entrench existing inequalities. Penalising individuals who may be financially reliable but lack family support or financial connections to meet the arbitrary thresholds demanded by landlords is unjust. This is not just an issue of housing, it is an issue of fairness, opportunity and basic dignity.
Housing is not merely a financial transaction, it is the foundation of stability, security and opportunity. When we deny people access to housing because they cannot meet arbitrary demands for a guarantor, we are closing doors not only to homes but to education, career advancement and future independence.
The noble Baroness, Lady Lister of Burtersett, raised a very valid issue regarding the right to rent and the fact that introducing what may seem quite a sensible rule leads to complications and places landlords in an awkward situation if they do not fully understand the legislation in front of them. Earlier today, we heard a number of noble Lords admit that they were not lawyers. It is also unreasonable to expect every landlord to be a lawyer. Where the law is complex, we need to make it simple and easy to comply with. This is one of our major concerns with this legislation.
In conclusion, I ask the Minister to listen to the voices of those most affected by these provisions—the students, care leavers and low-income tenants—and make the necessary changes to ensure that the Bill delivers fairness for all.
Baroness Taylor of Stevenage (Lab)
My Lords, before I respond directly to the amendments, the noble Lord, Lord Jamieson, talked about denying people access to housing, including students, care leavers and people on low incomes. The fact that so little social and affordable housing has been provided over the last 14 years is a very strong reason why we are in the situation that we now are. That those people have not been able to find affordable housing is largely due to the housing policies of the previous Government. I want to put that on the record before giving my answers on my noble friend’s amendments.
I thank my noble friend Lady Lister of Burtersett for her amendments relating to guarantors and the right to rent. I add my thanks to Shelter, which has provided so much advice and support during the passage of this Bill, for which I am very grateful. I also thank my noble friend Lady Kennedy, the noble Baronesses, Lady Grender and Lady Hamwee, and the noble Lords, Lord Tope and Lord Jamieson, for their comments.
Amendment 170 seeks to restrict the circumstances in which a guarantor could be required by a landlord. I appreciate that underlying this amendment—tabled with characteristic clarity, commitment and compassion by my noble friend Lady Lister—is the concern that those who do not have access to a guarantor will find it more difficult to find a home in the private rented sector than those who can obtain a guarantor. I make clear to my noble friend and the Committee that our approach to this issue is underpinned by the need to provide tenants with the rights and protections that they deserve. At the same time, we wish to guard against any unintended consequences that may, for some tenants, make renting more challenging. I recognise that obtaining a guarantor can be difficult for many prospective tenants. The Government are clear that landlords should consider tenants’ individual circumstances when negotiating rental contracts.
The noble Lord, Lord Jamieson, seemed to indicate that there was some sort of compulsion for landlords to find a guarantor. If they wish to come to an agreement without one, they are more than able to do that. What they cannot do under the Bill is require significant sums of rent in advance. That is what was really discriminating against people. Those incredibly high sums of rent required in advance were making it difficult for people to rent.
However, it is important to acknowledge that, in many circumstances, the use of guarantors can provide landlords with the confidence to let their properties to tenants who may otherwise find it difficult to secure a tenancy in the private rented sector. This includes tenants with a history of rent arrears, people with incomes that fluctuate from month to month and those with no previous rental history—for example, students or young people moving out of home for the first time. Prohibiting landlords from accepting large amounts of rent in advance will benefit all tenants by giving them the confidence that the maximum financial outlay needed to secure a tenancy will not exceed the cost of a tenancy deposit and the first month’s rent.
The Government recognise that providing a UK-based guarantor may be difficult for some prospective students, including international students. Under the Renters’ Rights Bill, landlords will continue to be able to offer tenants who cannot provide a UK-based guarantor with the alternative of purchasing rent guarantor insurance. The measures set out in my noble friend’s amendment would inadvertently risk blocking certain types of renter from accessing accommodation in the private rented sector altogether, despite the amendment’s honourable intentions.
Turning to my noble friend Lady Kennedy’s question on guarantors, the Government are clear that landlords should consider each prospective tenant’s circumstances individually, including when it is appropriate to require a guarantor. They should not apply blanket requirements for guarantors to all tenants. In response to her other question, the landlord’s database will act as a record of landlords and properties rather than of individual tenancies. Therefore, it would not be appropriate for landlords to record the risk-mitigation measures that they have put in place for a particular tenant on the database. She also made a point about guidance on guarantors. I will take that back to the department to consider further.
I assure the Committee that we have carefully considered the extent to which different practices act as barriers or enablers to accessing the private rented sector. That is why we are taking this action to limit rent in advance through the Bill. I am always happy to meet my noble friend to discuss this further but, for all these reasons, I hope she will withdraw her amendment.
I turn to Amendment 265, which would abolish the right-to-rent scheme that applies in England. Right to rent was introduced to ensure that only those lawfully in the United Kingdom can access the private rented sector and—this is important—to tackle unscrupulous landlords who exploit vulnerable migrants, sometimes by letting properties that are in very poor condition indeed. Some landlords who rent to those who are here illegally are criminal operators and we all have a shared objective to drive them from the market—I think everybody around the Chamber would agree with that.
We have been absolutely clear that discriminatory treatment on the part of anyone carrying out the right-to-rent checks is unlawful; the dreadful examples given by my noble friend illustrated that. The checks apply equally to everyone seeking accommodation in the private rental sector, including British citizens, and I will just elaborate a little further on that. The right-to-rent scheme is capable of being operated proportionally by landlords and letting agents in all cases. The very purpose of the statutory code of practice on avoiding unlawful discrimination when conducting checks recognises and seeks to address the risk of discrimination.
Baroness Lister of Burtersett (Lab)
My Lords, I am very grateful to everybody who spoke. I will not go into any great detail in response, given the late hour. I do not think that my noble friend the Minister answered the question posed by the noble Lord, Lord Tope, which was on whether the right to rent has had any effect in reducing illegal migration. I do not know if she would care to answer that question now.
Baroness Taylor of Stevenage (Lab)
I do not have any statistics in front of me, but I will come back to noble Lords on that point.
Baroness Lister of Burtersett (Lab)
I thank my noble friend. I am grateful for the support that I received. I was slightly confused, I must admit, by the noble Lord, Lord Jamieson, because I was not sure whether he was supporting my amendments or not. He said that they were ambiguous, but I think his approach was perhaps a bit ambiguous—and I cannot resist pointing out that right to rent was introduced by his Government, and we are now saddled with it.
I am disappointed, but perhaps not surprised, that my noble friend said that there is no plan to be shot of it especially, as the noble Baroness, Lady Hamwee, said, in the light of today’s White Paper. It is not exactly conducive to it, but it is important still to come back to the point.
I was also a bit disappointed that my noble friend did not feel able to give a bit more on the question of guarantors. She said that the proposed amendment would inadvertently block certain groups and could have unintended consequences. Everyone who spoke to this amendment accepted that it may be that it is not quite right, but that it is aiming to do something that in fact supports what the Government are trying to do.
Although she very kindly said that she is willing to discuss it, I did not get the sense that there is a willingness to discuss it in terms of perhaps bringing forward a government amendment that would achieve what we are trying to achieve but without the unintended consequences. Given the late hour, however, I beg leave to withdraw my amendment.
Lord Shipley
Member's explanatory statement
This amendment and others in the name of Lord Shipley aim to ensure that the provisions contained in section 22 apply to joint tenancies as well.
Lord Shipley (LD)
My Lords, there are four amendments in this group relating to Clauses 22 and 23 on notices to quit, so I wish to move Amendment 171 and speak to Amendments 172, 174, and 175.
The background to these amendments has been raised by front-line advisors of Citizens Advice. I thank them for their contribution to our consideration of this Bill, and I hope the Minister will be able to allay the concerns that they have expressed when she responds. These concerns relate to how tenants serve, withdraw or reduce notice in joint tenancies, and the length of notice that tenants must give to leave before the expiration of an eviction notice that they had been served using the new, no-fault grounds 1 and 1A.
It may come as a surprise to some to realise that, in joint tenancies, one tenant can serve a notice to quit to the landlord, ending the tenancy for all tenants without the other joint tenants knowing that this has happened. Tenants remaining in the property might not know that a notice has been served until the landlord expresses an intention to issue a claim for possession on the basis that the tenancy has been ended by a notice to quit. This would put the remaining tenants in a very vulnerable position, at risk of homelessness and liable for court costs. This is the status quo with periodic tenancies, but it could become a more common problem when all tenancies become periodic. It is important for one joint tenant to be able to end a joint tenancy unilaterally—I accept that—but a mechanism is essential to ensure that all joint tenants are notified.
Similarly, while it is welcome that the Bill provides for reduced notice by agreement between landlord and tenant, it should be stipulated that this is only where all joint tenants agree in writing. Otherwise, there is a risk that a departing joint tenant and their landlord will agree to bring a tenancy to an end very quickly, potentially without the remaining joint tenant being aware. In terms of the withdrawal of notice, there is a similar problem. In theory, one joint tenant could issue a notice to quit, and the other joint tenant and the landlord could agree that it will be withdrawn. The solution is to require that the agreement of all joint tenants is needed for the withdrawal of a notice.
There is a further issue when a tenant serves notice, but when the other tenant would have sought to transfer the tenancy solely to them if they had known notice was being served. This happens most often when joint tenants go through a relationship breakdown and the tenant who leaves serves a notice to quit, sometimes with the intention of harming the remaining tenant. Yet the remaining tenant could have gone to court to get an injunction to prevent the departing tenant from serving the notice to quit, allowing time for the tenancy to be transferred to them under family law. The remaining joint tenant would then retain the security of tenure and not be made homeless. It is important to note that many of these cases involve children.
When a tenant receives an eviction notice based on the new no-fault grounds 1 and 1A, they must still give two months’ notice, even if they need to leave the property before the expiration of the eviction notice. Yet in a fast-moving rental market, tenants often have to move quickly to secure an appropriate new home before their eviction notice expires; tenants may therefore face having to start a new tenancy before their current one has ended in order to avoid homelessness. There would be a new deposit, a first month’s rent, and often household bill costs on the new property, while also paying rent and household bills on their current home. This creates a very high-cost burden for tenants and can push those on a lower income into significant debt or put them at risk of homelessness if they cannot cover these costs or find a property with an aligning tenancy start date. This issue will be amplified with the Bill’s increase in tenant notice from one month to two.
This group of amendments would, first, require joint tenants to be notified by both the landlord and any tenant giving notice, that a notice to quit has been submitted and the tenancy will come to an end on a specified date. We should note that this amendment reflects the notification requirements of Section 130 of the Renting Homes (Wales) Act 2016.
Secondly, the amendments would ensure that a tenant’s notice to quit can be reduced or withdrawn, through agreement with a landlord, only if all joint tenants agree to it in writing.
Thirdly, they would allow withdrawal of a tenant notice in circumstances where a transfer or assignment of the tenancy to a remaining tenant is a viable option, which would remove the need to anticipate and pre-empt a notice to quit with an injunction.
Finally, they would reduce the notice a tenant must give to one month when notice has been served to them on grounds 1 and 1A, which would give much-needed flexibility to tenants and help them manage the high cost of moving, which is unaffordable to many low-income renters.
I hope the Minister will give due consideration to those issues, which I think are very important. I have learned a little about joint tenancies that I did not know before Citizens Advice got in touch. I hope that the Minister will be willing to give further consideration and detail to this so that, on Report, we can produce the amendments that are necessary to solve the problems that have been identified.
Baroness Coffey (Con)
My Lords, I was intrigued by the amendments from the noble Lord, Lord Shipley, today and it is interesting to hear that they have come from Citizens Advice. I am conscious that things have evolved over time, and he mentioned relationship breakdown. As somebody who used to rent with other people, I know there was always a certain risk when you took on a tenancy that somebody could walk out and you would be left liable.
I guess I am trying to understand—perhaps I was not listening quite closely enough—whether we will get to a point where, instead of people coming together, this will drive more accommodation into houses of multiple occupation.
I will give your Lordships my personal experience. I was working for a very large company when I moved to another city, which reflected the job situation that I needed. There is no doubt that I deliberately sought out situations that were not exactly HMOs but where individual contracts and tenancies were allowed with the landlord, so that it would not fall on my shoulders to think about these issues.
I suppose I am trying to understand how this amendment would address the situation of making sure that there are enough tenancies and enough accommodation available, without putting more risk on to the landlord. We are already seeing quite a substantial change. I understand why the Government set this out in their manifesto and similar. I appreciate that there may be some differences on some of the impact but, perhaps when the noble Lord, Lord Shipley, follows up—I am happy to discuss this outside—it would be useful to discuss how much of a genuine, as opposed to theoretical, problem this really is.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Shipley, for bringing these amendments to the Committee. As we on this side have consistently said throughout, we support the Bill’s overarching aim to create a fairer and more secure private rental sector. However, if it is to deliver on that promise, it must engage with the way that people rent in reality, not in theory. Joint tenancies are a common and practical arrangement, as we have heard, whether between couples, friends or flatmates. However, as currently drafted, the Bill leaves considerable uncertainty as to how these tenancies will be treated, particularly when one party wishes to leave.
Amendments 171 and 175 rightly seek to bring joint tenancies fully and clearly within the scope of the Bill. Without this clarity, both tenants and landlords could be left navigating ambiguity, with little guidance in law and potentially significant consequences in practice.
Similarly, Amendments 172 and 174 focus on the mechanisms for ending a joint tenancy. This is a matter not just of legal process but of fairness and practicality. Tenants must be afforded flexibility, particularly in cases of relationship breakdown or changes in household arrangements, while landlords should not be left in legal or financial limbo.
In that context, it is right to raise the issue of subletting, which is closely tied to how joint tenancies evolve and adapt over time. When a tenant is not using all or even part of their space, subletting enables the more efficient use of underoccupied homes. This is particularly important in areas facing acute housing shortages, where every single room matters. Subletting arrangements can offer a pragmatic solution for tenants trying to manage their finances, respond to personal changes or simply avoid exiting a tenancy altogether. It can help maintain housing stability where one joint tenant moves out, by allowing a new occupier to contribute to rent without formalising a new tenancy agreement from scratch. Moreover, subletting can play a role in addressing the chronic supply issues affecting the rental sector. It offers access to more affordable rents, supports tenants’ incomes and introduces much-needed flexibility into an often rigid system.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Shipley, for his amendments, which relate to tenants ending an assured tenancy and joint tenancies. In doing so, I thank him for raising the very important issues brought to him by Citizens Advice, which has been in touch with the department as well. I thank Citizens Advice and all the other stakeholders for engaging with our officials on these issues. I thank the noble Baronesses, Lady Coffey and Lady Scott, for their comments too.
Where a joint tenant has served a notice to quit, Amendment 171 would require any agreement to a notice period of less than two months to be with not just the landlord, as the Bill requires, but with all other joint tenants as well. Although I genuinely think there is merit to this approach, I am cognisant of the potential impacts on tenants who do not wish to inform their co-tenants that they are leaving. There may be a number of reasons why that might be the case. We would need to give very careful consideration to any change in this direction, to make sure we understand any impacts that it might have. We are currently working through that.
Amendment 172 would allow a tenant to provide only one month’s notice to end an assured tenancy if the landlord had already provided a notice of their intention to seek possession using ground 1 or ground 1A. The Government understand that tenants may find new properties to let within the four-month notice period the landlord has given them, and that market pressures would mean that, ideally, they could go when they need to. However, it is right and fair that tenants provide landlords with the usual two months’ notice so that landlords have sufficient notice, as they may need to change or alter their plans as a result. We think that this strikes a fair balance. Tenants will benefit from slightly longer notice periods, and it is right that landlords can plan for the ending of the tenancy too. Nothing prevents the agreement of a shorter notice period. We expect that, in many cases, landlords will gladly facilitate a quicker end to the tenancy to allow them to sell or move in more quickly.
The noble Baroness, Lady Scott, raised a number of questions around subletting. I will come back to her on those points.
Amendment 174 would require joint tenants to notify each other when serving a notice to quit an assured tenancy, and landlords to inform all joint tenants that such a notice has been served and to provide a copy of the notice. The Bill does not require joint tenants to inform each other when ending an assured tenancy. I understand the point that there is an inherent risk that tenants may not find out until late in the notice period that their tenancy is ending. However, at the moment, the Government are concerned about the potential impact—for example, on domestic abuse victims—of being required to inform the perpetrator that they are ending a tenancy, possibly in order to flee. On the balance of risks, we believe the needs of domestic abuse victims must be allowed to prevail, although I recognise it is a difficult decision and we are giving it further consideration.
Finally, Amendment 175 would require all joint tenants to agree to withdrawing a notice to quit. This amendment is unnecessary, as it has already been established in law that all joint tenants must agree to positively sustain the tenancy. It is very unlikely that a court would determine that a single tenant could unilaterally withdraw a notice to quit, because there is not the positive consent of all tenants. For those reasons, I ask the noble Lord not to press his amendments.
Lord Shipley (LD)
My Lords, these are essentially probing amendments and I am glad that the Minister and her department have had discussions with Citizens Advice. I understand some of the points that she has made. To take up the point mentioned by the noble Baroness, Lady Coffey, I think the aim is to avoid unintended consequences in a new Bill such as this. So it is important that all these issues are thought through and examined so that the best answer can be found. I hope it might be possible, between now and Report, for some of the issues that the Minister has raised to be looked at in detail. I shall look carefully at her response in Hansard to see whether there are ways in which some of the problems that have been identified, and some of the responses with perhaps unintended consequences that the Minister has identified, might find a solution. With that, I beg leave to withdraw the amendment.
Lord Roborough
Member’s explanatory statement
This amendment is intended to probe why the government has sought to remove section 25(1) of the 1988 Act completely.
Lord Roborough (Con)
My Lords, I rise to move Amendment 176 and speak also to Amendment 177, in my name. Before I begin, I refer the Committee to my interests as set out in the register, as a farmer, landowner and residential landlord. In particular, I have a number of houses occupied by employees under assured agricultural occupancies.
These two amendments are probing amendments, intended to allow the Committee to understand better how the Government sees these provisions of the Bill operating and also to probe whether the impact of the Bill in this area may have unintended consequences that need to be resolved. Before moving on to the detail of the discussion, I shall follow my noble friend Lady Scott, who on an earlier group underlined the importance of being able to offer on-site accommodation to agricultural employees.
I have three herdspeople, and one relief herdswoman, who rise daily at around 3.30 in the morning to milk. Being a short walk from the herd and the parlour is critical to their employment conditions. Those herdspeople also take primary responsibility for animal health within the herds, as well as the linked young stock. Again, being on site is vital to allow frequent inspections of the animals to ensure that they are doing well. There is also an important security consideration in having employees on site and able to deal with any malicious trespass, animal escapes and so on.
In short, this may not be a matter of huge general interest, but it is critical to farming in general, and to livestock farming in particular, that accommodation is available on site for these employees. When they leave, it needs to be available for their successors. However, we must also recognise that farm workers may have lived for many years, and even decades, in a community, and that options for them to stay in the area even when employment ends are desirable.
Beginning with Amendment 176, my Explanatory Notes indicate that leaving out this paragraph is intended to probe why the Government have sought to remove Section 25(1) of the 1988 Act completely. Since the 1988 Act, it appears that agricultural occupiers with an assured agricultural occupancy are entitled to remain in that occupation, even if they leave the employment of the landlord, as long as they remain in agricultural employment.
Omitting this subsection could mean that agricultural occupiers retain protection even after their qualifying employment ends. I ask the Minister whether that is the intention. The subsection may be being removed because it refers to fixed-term tenancies, which the Government are seeking to abolish in the Bill. However, in this case, it is linked to fixed-term employment. It appears that the Government may not have considered the importance of this link and the necessity for landlords to be able to recover agricultural accommodation linked to employment. I also ask what impact this will have on assured agricultural occupants in tied agricultural dwellings where, if they are no longer employed in agriculture, it may well be a breach of planning regulations.
Amendment 177 is a similar probing amendment. Ground 16, for recovering possession of an assured agricultural occupancy at the end of employment, was omitted from the Housing Act 1988. This created a headache for agricultural employers, but in practice its implications have been rather limited, as departing employees often leave for other employment with accommodation included, or because the open market rent for quality rural accommodation tends to be unaffordably high for those working in agriculture.
In the Renters’ Rights Bill, the Government have continued to omit the ability to recover accommodation at the end of employment—or at least that is what I thought. On an earlier group, the Minister said that
“we appreciate that the agricultural sector has distinct requirements, and it is often vital for workers to live on-site to carry out their duties, as the noble Baroness, Lady Scott, very ably described to us. That is why we have included ground 5A”.—[Official Report, 24/4/25; col. 859.]
However, it does not appear that ground 5A is applicable to landlords and assured agricultural occupants to ensure that houses can be recovered at the end of employment, as it is omitted as being a ground. I would be most grateful to the Minister if she could explain how she sees it working in practice for agricultural employers to recover vital accommodation at the end of employment.
These assured agricultural occupiers will also gain greater protection, given that grounds 2ZC and 2ZB are not available for use. I ask the Minister why the Government think this is appropriate. Why are agricultural landlords being treated differently from other landlords and are not able to regain possession of the properties after the landlord changes under Section 18 of the Housing Act 1988 or after taking over a tenancy?
In a previous group, the noble Baroness, Lady Grender, argued for making grounds 2ZC and 2ZB discretionary. In our view, this introduction of legal uncertainty would make the complexity even worse. From my limited exposure to this Bill, I am not sure how easily anyone will be able to administer all tenancies captured by it without a law degree. This discretion may elevate that base level of expertise to actually practising at the Bar. Given that it is largely estate agents and land agents who manage tenancies, it is important to make the Bill’s provisions as clear-cut as possible.
I also ask the Minister whether the Government have considered the impact of this Bill on a particular practice that we believe will deliver unintended consequences. Many agricultural employers, when housing employees, have understandably sought to avoid creating assured agricultural occupancies by serving notice before a tenancy begins and classifying that tenancy as an assured shorthold tenancy. This allowed serving a Section 21 notice with certainty that the house could be recovered at the end of employment to ensure it was available for the next employee. As a consequence of this Bill, those employees or tenants will now gain what appears to be greater protection than originally intended. Would the Minister consider adding a provision to allow landlords and employees in this position to change the status of those tenancies, potentially to assured agricultural occupancies, before the Bill takes effect? I beg to move.
Baroness Coffey (Con)
My Lords, I will speak to my Amendment 182. I am a great supporter of the policy of right to buy and right to acquire. I think it is one of the best policies of the past 50 years, making sure that people had investment in their communities and were able to determine exactly how different things in their homes looked. Basically, it made sure that we had a greater proportion of owner-occupiers.
During my time as a Member of Parliament, I had not realised that, in effect, there had been discrimination against people living in the countryside. I discovered this when busily propagating some of the latest policies that my party was putting forward and had it said to me very squarely on a doorstep in a particular housing estate in Rendlesham in Suffolk. I was told that I was doing a load of good, but, frankly, it meant nothing to them because they had already tried to acquire their housing association home and had been told that they could not.
Lord Best (CB)
My Lords, I want to say a few words about Amendment 182 in the name of the noble Baroness, Lady Coffey—not, I am afraid, in support of it. Is it fair that tenants residing in rural properties should have different treatment from those in the rest of the country? I have been responsible for a number of rural housing schemes—indeed, I recently chaired the Devon Housing Commission, looking at the issues facing communities in Devon—and I suggest that there are a number of reasons why it is fair to treat tenants in rural areas rather differently from those in the rest of the country.
First, it is much more difficult if a property is sold and therefore does not come back for reletting. We now know, Right to Buy being a matter of history, that after a period you will not get the relets, the opportunity for more people to enter those properties, in the years ahead. It is more difficult to replace properties in a village than in a town. If we lose the six houses that we have built in that village, they are gone for ever. It often takes years to acquire a site, convince the parish council and deal with the landowners. It takes a very long time to get those six homes built and we do not want to lose them if we can possibly help it, because in the future we will regret that.
My second reason is that the amount of social housing—housing association and council housing—in rural areas is appreciably less than in the rest of the country. It is about 11% for areas classified as rural locations compared with 17% for the rest of the country, including the rural areas, so there are already signs of acute shortage of affordable social housing in many areas, and we cannot really afford to lose what we have.
The third reason is that most of the developments in rural areas, or village areas, are small developments, and there is therefore no requirement to do affordable housing—to have a proportion of the homes that are available at subsidised low rents—so most of the development that is going to happen in rural areas, being less than 10 homes, is not going to have any affordable housing attached to it. We have to hang on, if we possibly can, to the properties that we have and then relet them later on.
My fourth reason is that, as the noble Baroness said, prices are higher but wages are lower. It is much more difficult in rural areas for local people to find any housing other than social housing that they can genuinely afford. There are the retirees moving in—in the case of Devon, from the south-east very often into the south-west. There are more affluent commuters paying more than locals can afford on their salaries. There are second homes—we are going to be talking soon about short-term lets, Airbnb and holiday lets—so locals are priced out, and it becomes a precious commodity to retain those few rural social houses, so I am afraid that I am unable to support Amendment 182.
Baroness Grender (LD)
My Lords, these Benches recognise the vital importance of our rural and agricultural communities, who operate under the more specialised and long-standing tenancy agreements. Such tenancies often span many years, involve successive generations and reflect a connection between the land and those who work it, going well beyond the norms found in other areas of the rental sector. We fully appreciate the challenges that tenants and landlords may face under those arrangements, particularly when legislation risks creating ambiguity or disruption.
When I looked at these amendments, it struck me that discretionary rather than mandatory powers would be a very useful thing to have, so it is hugely ironic that the noble Lord, Lord Roborough, raised my own amendments on this issue. I would have thought that a discretionary approach for any decision in the courts may well be useful in this context. However, while we are sympathetic to the concerns raised, that sympathy does not translate into ready support for Amendments 176, 177 and 182. It is our understanding that the Bill will not apply to residential property let under a farm business tenancy or an Agricultural Holdings Act tenancy but will apply to any residential property on a holding that is subsequently sublet on what we now know as an assured shorthold tenancy, and it will in future have grounds for possession as set out in other parts of the Bill.
We also understand that a process will be in place for landlords to avoid inadvertently creating assured agricultural occupancies, and we fully back the words of the noble Lord, Lord Best, as ever, with regard to rural communities and retention of, in particular, social housing. We believe firmly that local authorities know best and should be given the powers to make decisions over those social homes, with the right level of localism and autonomy. With that said, we look forward with interest to hearing the Minister’s response but remain unconvinced by these three amendments as set out.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Roborough, and the noble Baroness, Lady Coffey, for their amendments, and the noble Lord, Lord Best, and the noble Baroness, Lady Grender, for their comments.
I turn first to Amendments 176 and 177 in the name of the noble Lord, Lord Roborough. Amendment 176 seeks to reverse the Bill’s removal of Section 25(1) from the Housing Act 1988. The noble Lord stated that he is seeking to probe why we are making this change. The answer, I am sure he will be pleased to learn, is simple and straightforward. After this Bill is implemented, Section 25(1) of the 1988 Act will be a spent provision; that is to say, it will have no effect. That is because it deals with what happens when statutory periodic tenancies arise upon the end of a fixed term of an assured agricultural occupancy. Statutory periodic tenancies will no longer exist after the Bill is implemented, nor will fixed terms. Indeed, all assured tenancies, including assured agricultural occupancies, will be periodic tenancies. The provision in Clause 25 is purely a consequential amendment, tidying up this spent provision from the 1988 Act following our reforms.
Amendment 177 seeks to allow the eviction of tenants with assured agricultural occupancies under ground 2ZC. This would reduce the security that these tenants currently enjoy. The noble Lord, Lord Roborough, has highlighted that he is seeking to probe why the Bill is expanding the restrictions on when assured agricultural occupancies can be evicted. With respect, this represents a misunderstanding of what the provision is doing. Clause 25 contains technical and consequential amendments to the assured agricultural occupancy regime that aim to maintain the status quo in light of our reforms. It includes preventing landlords from evicting those tenants under the employment ground—now 5C—as well as ground 5A and the new superior landlord grounds. These grounds cover circumstances where tenants under assured agricultural occupancy tenancies cannot currently be evicted. They are being amended or introduced by the Bill, and, as such, may pose a risk to tenants’ security in the new system. Rather than expanding the restrictions on evictions for such tenants, this provision will broadly maintain the status quo. For those reasons, I ask the noble Lord, Lord Roborough, not to press his amendments.
Amendment 182, in the name of the noble Baroness, Lady Coffey, would prevent any secondary legislation laid under the power in paragraph 65 of Schedule 2 exempting the rural sector from the right to acquire—and, more widely, seeks to ensure that residents in properties in rural areas have the right to acquire. The provisions in paragraph 65 of Schedule 2 allow the Secretary of State to lay regulations specifying types of assured tenancies to which the right to acquire would not apply. This consequential amendment allows the government to consider whether any of the existing right-to-acquire exemptions that apply to assured shorthold tenancies should be transferred across to the new regime. The amendment from noble Baroness, Lady Coffey, would prevent this power being used to exempt the rural sector from the right to acquire. Rural properties are currently exempt in designated rural areas, which are generally settlements with fewer than 3,000 people—the noble Lord, Lord Best, mentioned the Devon Housing Commission, which he has ably chaired, and he has made me aware of the conclusions of that commission.
This is designed to protect affordable housing in areas, both rural and urban, where replacement is often not viable due to its high costs, planning restrictions or land constraints, for example, and it is necessary to ensure the supply of rural affordable housing. The Government have no plans to change this, although it may be helpful if I comment briefly on the right to acquire. To qualify for that, tenants must have spent at least three years as a public sector tenant and occupy an eligible property. That applies whether they are in a rural or an urban area. However, there are important exemptions, such as those for the rural sector and for properties built or acquired by housing associations using their own funds. These restrictions aim to strike a balance between promoting home ownership and protecting social housing in areas or situations where it is most needed. The noble Baroness, Lady Grender, and the noble Lord, Lord Best, reflected some of the reasons that might be the case.
The Government recently consulted on reforms to right to buy, seeking views on eligibility criteria, the minimum and maximum percentage discounts, further protections for new-build properties and replacement of the homes sold. That consultation closed on 15 January and we are considering the responses received. We will provide more information on the next steps in due course. Importantly, the right to acquire was not included in that consultation; the Government will consider whether any changes should be made to the right to acquire in the light of future changes to the right to buy.
Baroness Coffey (Con)
Could the Minister address the situation where housing associations are selling off rural housing on the open market to the highest bidder, rather than to the tenants?
Baroness Taylor of Stevenage (Lab)
We hope to provide more financial sustainability to housing associations through our funding mechanisms, which I hope will prevent them having to do that. The Government have no current plans to change the right to acquire. On that basis, I ask noble Lords not to press their amendments.
Lord Roborough (Con)
My Lords, I am grateful to all noble Lords who have spoken in this short debate, in particular to my noble friend Lady Coffey for her comments on agricultural tie dwellings. I am also grateful to the Minister for providing a very helpful clarification. The question mark remains about what happens to dwellings that have an agricultural restriction on them which are occupied by agricultural employees after they cease to be agricultural employees but may be protected in their tenancy under the Bill. I hope she might write to me on that but, in the meantime, I beg leave to withdraw.
“13A In section 553 (effect of repurchase on certain existing tenancies (England)), in subsection (2)—(a) in paragraph (a), omit the words “or an assured tenancy”;(b) in paragraph (b), omit the words from “or in accordance” to the end of that paragraph (including the “and” at the end of that paragraph);(c) omit paragraph (c).13B In section 554 (grant of tenancy to former owner-occupier), in subsection (3)— (a) omit paragraph (c) (and the “or” at the end of that paragraph);(b) after paragraph (b), insert—“(ca) an assured tenancy, or”.13C In Part 4 of Schedule 2 (grounds for possession: secure tenancies), in paragraph (1)(c), omit the words from “which is neither” to the end of that paragraph.”Member's explanatory statement
This makes further amendments to the Housing Act 1985 which are consequential on the changes made by Chapter 1 of Part 1 of the Bill.
Member's explanatory statement
This brings the wording into line with the definitions used in the Agricultural Holdings Act 1986.
Lord Best
“Regulatory Enforcement and Sanctions Act 2008
57A In Schedule 3 to the Regulatory Enforcement and Sanctions Act 2008 (enactments specified for the purposes of Part 1), in the suitable place insert—“Tenant Fees Act 2019 (c.4)””Member's explanatory statement
This amendment integrates the Tenant Fees Act 2019 into Schedule 3 to the Regulatory Enforcement and Sanctions Act 2008. It enables a Primary Authority to support local authorities to give assured advice to lettings agents on achieving compliance under the Tenant Fees Act 2019. Providing this advice will support lettings businesses and reduce pressure on local authorities' enforcement teams.
Lord Best (CB)
My Lords, I repeat my declaration of interest as a vice-president of the Chartered Trading Standards Institute as well as of the Local Government Association.
Trading standards represent an important ingredient in achieving the objectives of the Bill: they are the front line in enforcement of key measures of good practice by property agents carrying out lettings activities. To assist local businesses of all kinds and the trade associations that represent and advise them, arrangements are in place for primary authorities—local authorities able to provide specialist advice on a range of consumer protection legislation. Primary authorities cover different aspects of property matters and support property agents, as well as their trade association Propertymark and the Property Ombudsman. These arrangements enable authoritative assured advice to be given to property agents, who can then rely on that advice in dealing with any query or dispute. It relieves local authorities’ enforcement teams from dealing with queries, complaints and misdemeanours that could be avoided if assured advice was available.
Demand for high-quality advice is likely to grow as a result of the Renters’ Rights Bill. More landlords are likely to make use of letting agents to ensure that all regulatory requirements are being met. The letting agents, in turn, need the best possible advice on the extensive legislative measures that affect their client landlords. A problem here, however, is that current arrangements for assured advice do not extend to aspects of lettings activities in the Tenant Fees Act 2019. This legislation bans agents from charging fees to tenants as well as to landlords. Since the introduction of that legislation, local authorities have been anxious for this area of letting agency work to be included in the assured advice arrangements.
This small amendment would mean that lettings advice covering the Tenant Fees Act, on which property agency businesses can rely, would at last be available, and that local authority enforcement authorities can act with confidence. It is an entirely helpful amendment in tidying up a piece of defective legislation, and it fully supports the objectives of the Renters’ Rights Bill. I am not expecting passionate expressions of support from lots of your Lordships for this somewhat technical amendment, but I hope the Minister will say that it meets with the Government’s approval. I am pleased to move it.
Baroness Thornhill (LD)
I am going to disappoint the noble Lord, Lord Best, as I rise very briefly because I feel that this ties in quite neatly with his later amendments on letting agents becoming more professional and having better qualifications. Any means that will reduce the pressure on local authority enforcement teams are very much to be welcomed. The amendment is techy but simple, and I think it could be effective.
Lord Jamieson (Con)
My Lords, I also thank the noble Lord, Lord Best, for moving this very sensible amendment, which is thoughtful and well-considered.
The integration of the Tenant Fees Act 2019 into the framework of the Regulatory Enforcement and Sanctions Act 2008, through Schedule 2, is not just a technical improvement but a step towards greater coherence and clarity in an already highly complex area of legislation. In a Bill of this scope and detail, ensuring that our legislative frameworks align and complement one another is not only sound law-making but essential for those responsible for implementation on the ground. Was that passionate enough?
The practical implications of this amendment deserve the Committee’s close attention. In essence, it would allow primary authorities to give assured, legally backed advice to letting agents on how to comply with the Tenant Fees Act 2019. Supporting letting agents through legislative transitions in this way will help avoid confusion and ensure compliance from day one—a key goal for any regulatory change.
As the noble Baroness, Lady Thornhill, mentioned, the amendment would also relieve pressure on local enforcement teams, many of which operate with limited resources, in both finance and capacity. By reducing their workload where possible, we enable these teams to concentrate on the most serious breaches—rogue landlords, unsafe housing and the exploitation of vulnerable tenants—where intervention is most urgently needed.
This approach is not without precedent. Organisations such as the Lettings Industry Council have consistently called for greater clarity, guidance and consistency in how regulations are enforced across local authorities. Integrating the Tenant Fees Act into this structure directly supports those calls and shows that the Government are listening to those working on the front line of regulation and compliance.
We are, therefore, sympathetic to the spirit of this amendment. It offers practical benefits to tenants, agents and enforcement authorities alike. We believe that it would contribute to a more effective, fairer and more streamlined regulatory environment.
Baroness Taylor of Stevenage (Lab)
My Lords, I am not sure whether it is because of the late hour, but my Whip, sitting on the Front Bench with me, just sent me a dancing emoji, as if to show me how to show passion when responding to amendments. I will do my best.
I thank the noble Lord, Lord Best, for his amendment, which would allow for the Tenant Fees Act 2019 to be included in the primary authority scheme. This would provide estate and letting agent businesses with the option to receive assured advice on complying with its regulations. The scheme allows the local authority nominated as a primary authority to provide assured advice to businesses that operate across multiple local authority areas, which helps those businesses comply with regulations. The scheme has the potential to streamline the interpretation of regulation for business. It can also be a more efficient approach to regulation for local government.
I welcome Members of the House sharing their views on this matter and we will undertake to consider this amendment further. For now, and for those reasons, I ask the noble Lord to withdraw his amendment.
Lord Best (CB)
I am much encouraged by that response from the Minister, and I am happy to beg leave to withdraw my amendment.
“Charities Act 2011
66A (1) The Charities Act 2011 is amended as follows.(2) In section 117 (restrictions on disposition of land: general), in subsection (2)(b)(ii), after “less” insert “or which are assured tenancies”.(3) In section 120 (requirements for leases which are for 7 years or less)—(a) in the heading, after “less” insert “or which are assured tenancies”;(b) in subsection (1), the words from "a lease" to the end become paragraph (a);(c) after that paragraph insert “, or(b) a lease that is an assured tenancy within the meaning of Chapter 1 of Part 1 of the Housing Act 1988.””Member’ s explanatory statement
This amends the Charities Act 2011 so that the disposition of leases which are assured tenancies will be subject to the requirements in section 120 of that Act.
(i) before the regulations come into force, or(ii) when or after they come into force under a contract entered into before then, or by the acceptance of an offer made before then.”Member’ s explanatory statement
This brings the wording in clause 32(5)(a) into line with the wording used in the new Part 2 of Schedule 6 which would be inserted by the amendment in my name.
“Restrictions on conversion of assured tenancies to short-term lettings(1) Where a property has been let subject to an assured tenancy or assured shorthold tenancy at any time in the preceding three years, it must not be let as a short-term rental property within the meaning of section 228(2) of the Levelling-up and Regeneration Act 2023 unless a change of use has been permitted under the Town and Country Planning (Use Classes) Order 1987 (S.I. 1987/764) as amended by subsection (2).(2) In Schedule 1 of the Town and Country Planning (Use Classes) Order 1987 (S.I. 1987/764), at the end of part C insert—“Class C7. Short term rental property
Use of a dwellinghouse for commercial short-term letting, within the meaning of section 228(2) of the Levelling Up and Regeneration Act 2023.””Member’ s explanatory statement
This clause requires planning consent for assured or assured shorthold tenancies to be converted into short-term lettings.
Lord Best (CB)
My Lords, I apologise for leading two groups of amendments in a row.
Amendment 185, in my name and the names of the noble Lords, Lord Truscott and Lord Young of Cookham and the noble Baroness, Lady Thornhill, seeks to add a new clause to the Bill that would require planning consent before assured or shorthold tenancies can be converted into short-term lettings. The definition of “short-term letting” is defined in the Levelling-up and Regeneration Act 2023. These lettings are often referred to as “Airbnb lets”, although several companies handle them.
I note that the amendment would not affect the letting of spare rooms to supplement the family income or temporary use of an owner-occupier’s home, when, for example, they are away on holiday. Instead, the amendment would cover the switching of privately rented properties from ordinary, longer-term lettings for those living and working locally to short-term lets for visitors. This phenomenon is having a serious impact on housing shortages in a number of tourist hotspots. In some places, the loss of PRS lettings has reached critical proportions, from seaside towns to national parks and historic cities. Appallingly, there are many examples of landlords serving notices to quit—thereby evicting tenants—so that long-established renters can be replaced with higher-paying lettings to tourists.
According to AirDNA, which tracks the lettings by Airbnb and similar companies, York saw an increase of nearly 30% in short-term lets in the city between August 2021 and August 2023. York now has more than 2,000 such lets. In Coniston, in the Lake District, 50% of homes are not lived in full-time. In the picturesque town of Salcombe, Devon, it is understood that around 40% of the accommodation now comprises second homes or short-term lettings; I commend the relevant section in the Devon Housing Commission report on that.
The switching phenomenon also has a particular relevance in London: a survey by the property consultants, Savills, found 117,000 homes listed for short-term letting on the Airbnb and Vrbo websites last year in just 12 London boroughs. The survey found that over half were let for more than the 90 days permitted in London and, in the central London boroughs, 40% of the private rented sector was let on a short-term basis. In many other European and American cities, action is being taken to address this problem. Indeed, Wales and Scotland have legislated to reduce the impact of losing homes for locals to rent.
In England, the Levelling-up and Regeneration Act 2023 has provided the basis for a start to be made. The Act requires the Secretary of State to introduce mandatory registration for short-term lets. This measure would provide local authorities with an evidence base on which to decide whether the level of short-term lettings in their area should be restricted. Regulations under the Levelling-up and Regeneration Act would prohibit the use of short-term lets of non-registered properties. Introducing registration would be a good starting point but, so far, no action has been taken.
In February 2024, Michael Gove, then Secretary of State, announced that the Government would be taking this issue to the next stage, using the planning system to control switchovers to short-term lets where the local planning authority deemed this necessary. To inform the details of this new regime, a government consultation considered the introduction of a new use class for planning purposes, enabling local authorities to refuse permission for a change of use from a long-term to a short-term letting. This consultation exercise produced near-unanimous agreement that such action would be an invaluable mechanism to discourage further expansion of the so-called Airbnb sector in specific places. The Government of the day pledged to take this forward at pace. Sadly, no action followed.
The previous Government reformed the tax regime for furnished holiday lets, and this has now come into force. The change removes a strong incentive for flipping properties from long-term to short-term letting, but the Renters’ Rights Bill may mean that more landlords are now being tempted to flip their properties, making the introduction of a new use class, which would enable councils to intervene, the more urgent. Amendment 185 is intended to provide the opportunity for the Government to progress the action needed to amend planning law by creating a new use class for short-term lettings, empowering each local authority to decide whether it is in the interests of their community to permit changes of use from long-term to short-term lets. The Minister for Housing and Planning in the other place, Matthew Pennycook, has demonstrated an appreciation of this issue and has promised to take further action—but when?
If the Minister is not able to accept this amendment, it would be helpful if she could update the Committee on the timetable for introducing first, the short-term lettings registration scheme and, secondly, the legislation to create a new use class for short-term lets. Action is overdue. I beg to move.
Lord Truscott (Non-Afl)
My Lords, as mentioned previously in Committee, I declare my interest as a landlord and former long-term tenant in the private rented sector. I support the amendment from the noble Lord, Lord Best, on short lets requiring planning consent for properties to be converted into short-term lettings. As your Lordships’ House would expect, the noble Lord, Lord Best, has made the case convincingly.
His Majesty’s Government should include this amendment in the Bill, because there is an undoubted link between the reduced availability of long lets, especially for local residents, and the exponential rise in Airbnb and other short-let platforms. A register, while welcome, will mainly chart the huge and expanding nature of this part of the PRS, which is already having such a deleterious effect on the provision of long-term accommodation for locals and their communities. The Minister may say this amendment is not a matter for the Bill, but it is. The Bill will accelerate the trends of short lets and reduce long lets unless amended. By introducing periodic tenancies with a minimum two-month notice period, it will simply introduce another class of short lets protected by law and destabilise the long-term lets market.
The PRS has not grown in the last nine years, as I mentioned previously in Committee. The Bill, by prohibiting upfront rental payments and fixed-term tenancies, will lead to evermore landlords moving to short lets. This trend is completely ignored by the Bill but will follow as surely as night follows day.
Tenants will be able to give two months’ notice on day one under the proposed legislation. Why should they do that? Because long lets are up to four times cheaper than short lets in, for example, the London Borough of Camden. Once tenants move in, the length of their tenancy will be impossible to police. If tenants move out after only a month rather than the minimum two, how will that be monitored and by whom? It will result in widespread short lets by the back door. A tourist could simply move into what was previously a long let, give two months’ notice and save thousands of pounds. It would just take a little fib on the part of the tenant.
A landlord will have no way of knowing a tenant’s real intentions under periodic tenancies, so will put up the rent, assuming that all long lets can become short lets. The distinction between short and long lets will disappear, with implications for rent levels. Neither the prohibition of mutually agreed fixed-term tenancies nor advanced rental payments were in Labour’s election manifesto, so I am at a loss to understand why these two essential measures to provide stability and certainty to the market have become non-negotiable. The majority of tenants want fixed terms, so I fail to see why HMG think they know better than the tenants themselves. Reducing the supply of long lets as ever more landlords gravitate towards more profitable short lets will mean that rents will assuredly go up, not down, and the losers will be the tenants, especially local residents and their sense of community.
The noble Lord, Lord Best, mentioned London and Devon. I have quoted before how some London housing blocks have become over 90% Airbnb or similar short lets. Local residents are squeezed out. Devon is a county I know well; I am a Devonian. The noble Lord, Lord Best, quoted the example of Salcombe, Devon’s answer to Saint-Tropez. Similar cases can be quoted throughout the West Country and Wales, including Cornwall. However, as the noble Lord said, it is not just coastal resorts and historic cities such as Bath, which I also know well, and York, that are affected. Areas around Birmingham have also become short-let hotspots.
Of course, it is not only the UK. Airbnb and the like have reached saturation point in Spain, in cities such as Barcelona and on Tenerife. It has become so bad, with locals priced out of accommodation, that tourists have been assaulted in restaurants and on beaches. As I mentioned, short lets are far more profitable for landlords than long lets. Airbnb and other short-let platforms are becoming increasingly dominated by professional landlords, as regulation is either non-existent or very light-touch.
By way of comparison, long-let residential property is already governed by 170 laws and regulations. The attractions for landlords to move to short lets is obvious and will be enabled by this Bill. Apart from the further regulatory and legal provisions in the Bill, long-let landlords will be asked by HMRC to make quarterly tax returns by April 2026, and new EPC regulations could cost anything up to £15,000 per property. Estate agents must report long-term rentals to HMRC in this country. Airbnb and the like do not, and I suspect that tax evasion is rampant.
Renting out flats or rooms on Airbnb or other short-let platforms undermines long-term rentals, legitimate B&Bs and smaller hotels, all of whom must pay taxes, abide by a host of regulations, employ local people and support local economies. With more and more remote professional landlords, Airbnb does none of that. The idea that Airbnb and other similar platforms allow a few grannies to innocently rent out their spare rooms is far from the true picture.
The impact of short lets is also pernicious. They undermine any sense of community, create nuisance for full-time residents and can be a security risk for blocks of flats, with Airbnbers having raucous parties and coming and going at all hours of the night and day. As the noble Lord, Lord Best, said, research has found that half of London’s 117,000 short holiday lets are being rented out illegally. In Westminster, where over 50% of residents live in rented property, council leader Adam Hug has said that short lets
“can hollow out long-term residents, making neighbours subject to significant noise disruption, fly-tipped waste linked to short-term let properties”.
In 2015, there were fewer than 30,000 short lets in London. This more than doubled throughout 2016, peaking at over 100,000 in 2019. As Tom Copley, Sir Sadiq Khan’s London Deputy Mayor for Housing, said,
“we need to bring those properties back into use as long-term rented properties or long-term properties for people to buy and live in as owner-occupiers”.
This Bill as drafted will legalise ever more short lets, as tenants will be able to legally move out of a property after just two months.
I had experience of an Airbnb rented flat in a block where short lets were banned under the lease. The owner was fully aware of this fact and kept denying the property was rented out on Airbnb, despite the property being advertised openly on the website. Airbnb takes no action in these situations. In our case, it took over two years for the owner to be forced to abandon Airbnb, despite his flat being the only short let in the block. People were coming and going every few days, and wear and tear on the communal areas and concern for security were considerable.
The only action which reined in the current leaseholder was a threat by the excellent managing agent to go to court to get him to forfeit the lease. HMG have previously said this option will be banned, so I wonder how such situations could be resolved in the future. I would retain the nuclear option of forfeiture but exclude it for death and other relatively minor transgressions.
Lord Young of Cookham (Con)
My Lords, I too have added my name to the amendment from the noble Lord, Lord Best, and want to add a very brief footnote to the two speeches that have already been made.
It is at times like this that we miss the contribution of the late Baroness Gardner of Parkes, who many of us will remember intervening forcefully whenever short-term lettings were mentioned, reminding us of the erosion of rented property in London, but also, as the noble Lord, Lord Truscott, mentioned, some of the problems in large blocks of flats when short-term tenants cannot conform to the normal rules.
What we need here is a balance. There is a role for short-term lettings and Airbnb to play as part of a portfolio of opportunities in a coastal resort or, indeed, in a capital city. But what we have at the moment is a one-way street of erosion of long-term property for rent into short-term lettings. If we are to have a balance and get it right, it should be the local authority which should be in a position to strike that balance. I am sure the Minister, as a distinguished leader of a local authority, would agree that local authorities are best placed to do this.
I think I am right in saying that, until fairly recently, you actually needed planning permission to move from long-term to short-term letting, but, in a move to deregulate and make it easier to move from one use class to another, that requirement to get planning consent to move from one use to another was waived in the 2010 or 2015 Parliament, apart from in London.
It was retained in London, and only in London, where, if you want to short-term rent a property, you can only do so for 90 days—a rule that is ineffective unless it is enforced, and many local authorities find it difficult to enforce . What this amendment seeks to establish is whether the Government are minded to extend from London to other parts of the country that type of restriction to stop what is, at the moment, a one-way street.
I just add a rider to what the noble Lord, Lord Best, has suggested. If you need planning consent to go from long-term to short-term, I do not think you ought to need planning consent to go back the other way. In other words, it should be a hurdle to get over, but if you want to revert to long-term renting, you should not have to go through the process again. If one looks at various parts of the country, in some coastal areas, one in 10 homes are now short-term lets or second homes. Roughly 24 homes a day are being lost through this process, so I hope the Minister will be able to respond sympathetically to the thrust of this Bill, and say that there are plans to give local authorities the powers that I think they need to get the right balance in the tenures in their area.
Baroness Coffey (Con)
My Lords, I live not far from Aldeburgh, not too far from Southwold, so I am very conscious of the issues that have arisen from people acquiring homes and then turning them into short-term rentals. It is a really important part of the coastal economy, but I would suggest in a different way that, in fact, the changes made to the tax situation, where it was possible to offset mortgages and all sorts of expenses, led to a significant increase in the price that people were prepared to pay for houses. I saw this in Southwold, where I got a lot of angry letters—admittedly from people who had done just this thing. What happened was that neighbouring houses that had been priced only a few years earlier at something like £300,000 to £400,000, were now selling for over £1 million. This was done on the basis of the short-term property rental that was possible.
However, what concerns me about this particular amendment is that it does not account for those people who are moving into a place to make it their permanent home. At the moment, this amendment suggests that, if it has been used at all for long-term tenancy, it should be excluded or need further planning permission. I suggest that there are plenty of people who are trying—whether in rural or coastal areas—to make their long-term home, but want to take advantage of the times when they themselves choose to go on holiday to be able to get some rental income. It is a perfectly sensible way, at times when people choose to be away potentially at the height of season, to gain that extra income. While I am sensitive to the issues raised by the noble Lord, Lord Best, and my noble friend Lord Young of Cookham, I think that we need to explore what happens when the property transitions from one owner to another so that they can use their new family home in the best way possible, not only to enjoy that home but potentially to make sure that it gets used all year round.
Baroness Thornhill (LD)
My Lords, I support Amendment 185 in the name of the noble Lord, Lord Best, and signed by the noble Lords, Lord Young and Lord Truscott, and me. It has been explained very fully and in detail, so it needs no further repetition or expansion from me. Indeed, from our many and various discussions or Oral Questions during House business, we are all only too aware of the problem, both here and abroad. The loss of properties from the long-term private rented sector into the much more lucrative and less regulated short-term lettings is causing considerable problems in some parts of the country, as outlined in detail by the noble Lord, Lord Best.
It is a fact that some communities—I am sorry to keep stressing that, but I feel it is important to keep a balanced perspective on this—are being hollowed out as locals cannot find somewhere to rent for the longer term, nor can they find somewhere that they can actually afford to buy. They therefore feel that they cannot remain in their communities. Some areas where short-term lets proliferate can, as we have also heard, be the result of regular antisocial behaviour, which can be of various types, from the very obvious noise nuisance to the degradation of neighbourhoods. Any moves to incentivise landlords back into the long-term private rental market are therefore welcomed by us on these Benches and anything to deter landlords from flipping, as outlined by the noble Lord, Lord Young, will also be supported by us.
We recognise the willingness of both the previous Government and this Government and the difficulties of efforts to balance the needs of tourists, home owners and local residents. It is tricky, because balance is key and individual local plans should be able to reflect each local authority’s needs and circumstances.
To help local authorities, as we have already heard, there was the mandatory registration scheme proposed by the previous Government. That was very positive, as it would improve transparency and ensure compliance with local regulations. However, I note that, in parliamentary debates on the Bill, Housing Minister Matthew Pennycook stated that the previous Administration’s proposals to clamp down on holiday lets
“did not go far enough”.—[Official Report, Commons, Renters' Rights Bill Committee, 5/11/24; col. 238.]
and that his Government are considering what additional weight to give local authorities to enable them to better respond to the pressures that they face, as a result of what have been called “excessive” concentrations of short-term lets and holiday homes in some parts of the country.
To keep this brief and to sum up, it would be welcome to have, before Report, an update on the mandatory registration scheme and any other powers that have been taken forward on this Bill or in other legislation, including actions on companies that take no action, as was well outlined by the noble Lord, Lord Truscott. We could therefore judge whether this amendment is a helpful addition to take forward on Report or is completely unnecessary. I look forward to the noble Baroness’s response.
Lord Jamieson (Con)
My Lords, I thank the noble Lord, Lord Best, for proposing this amendment. It raises a serious solution to one of the most acute crises affecting the private rental sector: the supply of housing. I also thank the noble Lord, Lord Truscott, my noble friends Lord Young and Lady Coffey, and the noble Baroness, Lady Thornhill, for their comments. There is a fair degree of support for this from all sides of the Committee.
Noble Lords will remember that this is one of the themes that these Benches have been most concerned about. My noble friend Lady Scott highlighted the reduction in housing supply on the first day of Committee. Savills reported seeing a 42% reduction in the number of rental properties available on its books in the first quarter of this year. Data compiled for the National Residential Landlords Association found that 41% of landlords say that they plan to cut the number of properties that they rent out in the next 12 months. This is highly concerning, given that the supply of available rental properties is already falling.
TwentyEA found that the supply of properties available to let has dropped by 1% compared to the first quarter of 2024 and has plummeted 22% below the 2019 pre-pandemic levels. Currently, only 284,000 rentable homes are available nationwide—a decline of 18% from last year and 23% from 2019. In the first quarter of 2025, 15.6% of new property listings for sale were previously rental homes. This is a sharp increase from 9.8% in the same period of 2024. Renting is no longer simply a transitional phase or fallback option for many people. It is a deliberate and legitimate long-term housing choice. Renting offers flexibility, mobility and freedom from the financial and practical burdens of home ownership, but tenants cannot benefit if there is simply not enough supply.
The noble Lord, Lord Truscott, raised, as did many others, the risks associated from the Bill accelerating this trend to short-term lets such as Airbnb and other types. This amendment from the noble Lord, Lord Best, would contribute to the solution. Where there is not enough supply of available rental accommodation and many landlords are planning to sell up, working to reduce the amount of short-term lettings could protect the currently available supply and hopefully prevent further reductions.
Planning consent helps local authorities manage the shift and safeguard their rental supply, especially in high-demand areas. This is especially true given the highly regionalised disparities in supply deficits of private rental housing. As the Bill goes forward, we need to ensure that local authorities have sufficient capacity in their planning teams and, in this context, to consider whether licensing may also be an effective tool in this area.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Best, for his amendment, which seeks to restrict the conversion of assured private rental sector tenancies into short-term lets, and the noble Lords, Lord Truscott, Lord Young and Lord Jamieson, and the noble Baronesses, Lady Coffey and Lady Thornhill, for taking part in this debate.
The Government recognise that while short-term lets can benefit the tourist economy, they can also impact on the availability and affordability of housing, including in the private rented sector. I understand noble Lords’ frustration that little has been done to assess the impact of this as its development has accelerated over recent years.
As we have discussed at earlier stages of the Bill, we share concerns that landlords may be leaving the private rented sector to instead provide short-term lets. The noble Lord, Lord Jamieson, gave some figures about reductions in the rental market, but statistics released on 28 April from Rightmove’s rental tracker told a very different story. Its property site found that the number of new properties coming to the market in March was 11% ahead of the same period last year, while the overall number of rental properties is 18% up on 2024, just months before the legislation is set to come into force this summer, so there are differing opinions about the impact.
To address the issues that noble Lords have raised, the Bill includes a provision to ensure landlords will not be able to evict tenants simply to return the property to a holiday let. As many noble Lord will be aware, we have also abolished the furnished holiday lets tax regime. As a result of that measure, landlords will no longer be incentivised by the tax system to make their properties available as short-term holiday lets rather than longer-term homes for people who want to live and work in the area.
The Government will also introduce the short-term lets registration scheme, as legislated for in the Levelling-up and Regeneration Act 2023. The scheme will collect crucial data on the sector and ensure that all providers of short-term lets are aware of their legal responsibilities to ensure that health and safety standards are met in their property.
With regard to the comments made by the noble Lords, Lord Best, Lord Truscott, Lord Young and Lord Jamieson, we are committed to robustly monitoring and evaluating the reform programme and have set out how we are developing our approach in the impact assessment for the Bill. Our approach builds on the department’s existing long-term housing sector monitoring work, and we will conduct our process impact and value-for-money evaluation in line with the department’s published evaluation strategy. We are not going to just drop the Bill and leave it; we will continue to monitor the situation.
The noble Lord, Lord Best, and the noble Baroness, Lady Thornhill, asked when the register will be operational. The Government are keen to introduce the registration scheme for short-term lets in England as soon as possible. The initial phase of digital development is now complete and public testing is planned to start in the next 12 months. During this next phase of work, we will test a working interface with a small number of users to make sure that the systems and processes are robust and effective before publicly launching a first version of the service. It is on its way; we have started working on it and will bring it forward as quickly as we can.
The noble Lord, Lord Truscott, asked a question about energy performance standards for the PRS and short-term lets. On 7 February this year, DESNZ launched a consultation on increasing minimum energy efficiency standards in the domestic private rented sector. The consultation includes proposals for rented homes to achieve an EPC C or equivalent by 2030. DESNZ is also seeking views on whether short-term lets should be included in the scope of these changes to help ensure a common standard across all private rented properties.
The proposed amendment seeks only to allow councils to place restrictions on the change of use from a private rental property to a short-term rental property and would not affect the change of use of owner-occupied properties. The amendment seeks to achieve this via a change to the Town and Country Planning (Use Classes) Order 1987. However, it would not have the intended effect, as the use classes order does not permit the change of use in the way proposed.
I assure noble Lords that we are carefully considering what additional powers we might give to local authorities to enable them to respond to the pressures created by short-term lets. However, I also recognise the complexities of introducing such restrictions, so I believe we need to explore the various potential levers that could help achieve that better balance that we all want between housing and the tourism economy before moving forward. I therefore ask the noble Lord, Lord Best, to withdraw his amendment.
Lord Jamieson (Con)
May I seek a point of clarification before the Minister sits down? If I heard correctly, she said that the legislation would come into force this summer. Does that mean that everything will be in place, including things like the database, ensuring that there is court capacity and so forth?
Baroness Taylor of Stevenage (Lab)
The comment related to the finishing of the Bill. There may be subsequent work to be done on it after that.
Lord Best (CB)
I am grateful to noble Lords around the Committee for their support for the amendment. I thank the noble Lord, Lord Truscott, who emphasised the urgency of the situation, and the position in many other places—Paris, Barcelona, Menorca, Santa Monica —where other countries are getting ahead of us in taking action that we should probably learn from. He mentioned, as did the noble Lord, Lord Young, the disruption to other residents that comes from short-term lettings, and the nuisance of parties, fly-tipping and security problems. That is not the main reason for the proposed amendment, but it is an important additional factor, which emphasises its importance.
The noble Lord, Lord Young, said that we must strike a balance between the interests of the tourism industry and the interests of those who are looking for somewhere to live—and the local authority is best placed to do that. The noble Baroness, Lady Coffey, was a bit worried about owner-occupiers being badly affected and not being able to let out their properties, when they were on holiday, for example. I think the amendment takes care of that; it certainly should. It is not the individual owner who lets out their spare room, or even the whole house, for a week or two that we are talking about here; it is the businesses that operate on some scale.
I am grateful to the CPRE, the Countryside Charity, for helping to formulate the amendment, and I give many thanks to the noble Lord, Lord Jamieson, who made important points. We must protect the current supply of accommodation at a time when we are worried about the loss of any homes, which are badly needed. I will withdraw the amendment, but, as I do so, I thank the Minister for telling us about registration. I think that the timescale was that testing would take place for a new registration scheme for short-term lettings over the next 12 months, with a first version then being tried. It is all good stuff, but it sounds slightly slow—the “as soon as possible” bit was the best bit.
The Minister said that other solutions, alongside the possibility of introducing a use class that works—that must be part of it—were being considered. Pulling the right levers is obviously going to be important. Yes, the Government are prepared to do something, but they should take away the message that the speed at which it is done will be important too. We cannot let this fester much longer. With those comments, I beg leave—
Baroness Coffey (Con)
The noble Lord referred to my comments. What I was doing was reading out his amendment where it says:
“Where a property has been let subject to an assured tenancy or assured shorthold tenancy at any time in the preceding three years, it must not be let as a short-term rental property … unless a change of use has been permitted”.
I was trying to understand whether, when there is a change in ownership—not just any old renting out if somebody goes away—that would prevent a new owner-occupier being able to do what is suggested without planning permission. I was just trying to understand his own amendment.
Lord Best (CB)
I am grateful for that point, which sounds entirely valid. We may need to refine still further the amendment that we are all working on. I beg leave to withdraw the amendment.
“(ai) after subsection (1) insert—“(1AZA) But that is subject to subsections (1ZA) to (1ZC).”;(aii) in subsection (1ZA), for “But in” substitute “In”;(aiii) after subsection (1ZB) insert—“(1ZC) Section 11 does not apply to a lease of a dwelling-house in England which—(a) was an assured tenancy immediately before the commencement date (which has the meaning given by section 146(3) of the Renters’ Rights Act 2025), and(b) was granted—(i) for a term of seven years or more, and(ii) by a person other than a private registered provider of social housing.”;”Member’s explanatory statement
This ensures than an existing assured tenancy of a fixed term of 7 years or more - which will become a periodic tenancy by virtue of the Bill - does not come within section 11 of the Landlord and Tenant Act 1985 as a result of that change. Accordingly, repairing obligations will continue to be governed by the tenancy.
Member’s explanatory statement
This is consequential on the new paragraph 3D inserted by clause 33(1) now referring to leases of more than 21 years (instead of 7 years).
“(2) In Schedule 1 to the 1988 Act, paragraph 8 (lettings to students that are not assured tenancies) is amended as follows— (a) after sub-paragraph (1) insert—“(1A) But that is subject to sub-paragraphs (2B), (2C) and (5) to (7).”;(b) after sub-paragraph (2) insert—“(2A) Regulations under sub-paragraph (2) may, in particular, specify as a body of persons—(a) the members, or(b) a class of the members,from time to time of a housing management code of practice which is specified for this purpose by regulations under sub-paragraph (2).(2B) The Secretary of State may by regulations made by statutory instrument—(a) specify a class of building, and(b) provide that a tenancy—(i) does not fall within this paragraph if the dwelling-house is in a building of the specified class, or(ii) falls within this paragraph only if the dwelling-house is in a building of the specified class.(2C) The Secretary of State may by regulations made by statutory instrument—(a) specify a student landlord or a class of student landlord,(b) specify a class of building in relation to the specified student landlord or specified class of student landlord, and(c) provide that, where the landlord is the specified student landlord, or a student landlord of the specified class, the tenancy—(i) does not fall within this paragraph if the dwelling-house is in the specified class of building, or(ii) falls within this paragraph only if the dwelling-house is in the specified class of building.(2D) Regulations under sub-paragraph (2B)(a) or (2C)(b) may, in particular, specify as a class of building—(a) the buildings, or(b) a class of the buildings,from time to time subject to a housing management code of practice which is specified for this purpose by regulations under sub-paragraph (2B)(a) or (2C)(b).(2E) Regulations under sub-paragraph (2C)(a) may, in particular, specify as a class of student landlord—(a) the members, or(b) a class of the members,from time to time of a housing management code of practice which is specified for this purpose by regulations under sub-paragraph (2C)(a).”;(c) in sub-paragraph (3), for “the power conferred by sub-paragraph (2) above” substitute “a power conferred by this section”;(d) after sub-paragraph (3) insert—“(4) Regulations under this paragraph—(a) may make different provision for different purposes;(b) may make supplemental, consequential, incidental, transitional, transitory or saving provision.(5) The question of whether or not a tenancy is within this paragraph is to be determined by reference to the circumstances at the time when the tenancy is granted. (6) A change in the circumstances after that time does not affect whether or not a tenancy is within this paragraph, except in a case where—(a) the tenant is entitled to possession of the dwelling-house at a time after the tenancy was granted, and(b) at the time when the tenant is entitled to possession—(i) condition A is met (see sub-paragraph (8)),(ii) condition B is met (see sub-paragraphs (9) and (10)), or(iii) both of those conditions are met.(7) In such a case, the tenancy ceases to fall within this paragraph (and accordingly this paragraph ceases to prevent the tenancy from being an assured tenancy) at the time when the tenant is entitled to possession.(8) Condition A is met if—(a) the tenancy was granted by a body of persons who were, at the time of the grant, a specified landlord solely by reference to a code of practice, but(b) at the time when the tenant is entitled to possession of the dwelling-house, the landlord (whether that is the body of persons who granted the tenancy or a successor in title) is not a student landlord.(9) Condition B is met if—(a) at the time when the tenancy was granted—(i) regulations under sub-paragraph (2B) or (2C) were in force, but(ii) those regulations did not prevent the tenancy from being within this paragraph, but(b) at the time when the tenant is entitled to possession of the dwelling-house—(i) regulations under sub-paragraph (2B) or (2C) are in force, and(ii) those regulations prevent the tenancy from being within this paragraph.(10) But condition B is not met in any circumstances that are specified, or are of a description specified, for this purpose by regulations made by the Secretary of State.(11) For the purposes of this paragraph—(a) “student landlord” means an institution or body of persons specified, or of a class specified, for the purposes of this paragraph (see sub-paragraph (2));(b) “housing management code of practice” means a code of practice approved by the Secretary of State under section 233 of the Housing Act 2004 (codes relating to the management of HMOs or excepted accommodation);(c) a building is “subject to” a housing management code of practice if it—(i) is a particular building subject to the code, or(ii) is of a class of buildings subject to the code;(d) a reference to—(i) a class of the buildings from time to time subject to a housing management code of practice, or(ii) a class of the members from time to time of a housing management code of practice,includes the buildings or members that are from time to time in a class provided for in the code of practice;(e) a body of persons are “a specified landlord solely by reference to a code of practice” if they—(i) are a member of a housing management code of practice that is specified by regulations under sub-paragraph (2A), and (ii) are not specified by regulations under sub-paragraph (2) as a body of persons otherwise than as a member of that code of practice.””Member’s explanatory statement
Paragraph 8 of Schedule 1 to the Housing Act 1988 provides for certain student lettings not to be assured tenancies. This amendment would enable the exemption to be limited to buildings of a specified class; and for regulations to operate by reference to codes of practice approved under section 233 of the Housing Act 2004.
Lord Black of Brentwood
“Discrimination relating to pets(1) A relevant person must not, in relation to a dwelling that is to be let on an agreement which may give rise to a relevant tenancy—(a) on the basis that a pet would or may live with or visit a person at the dwelling if the dwelling were the person’s home, prevent the person from—(i) enquiring whether the dwelling is available for let,(ii) accessing information about the dwelling,(iii) viewing the dwelling in order to consider whether to seek to rent it, or(iv) entering into a tenancy of the dwelling, or(b) apply a provision, criterion or practice in order to make people who would have a pet live with or visit them at the dwelling, if it were their home, less likely to enter into a tenancy of the dwelling than people who would not.(2) Subsection (1) does not apply if—(a) the relevant person can show that the conduct is a proportionate means of achieving a legitimate aim, or(b) the relevant person can show that the prospective landlord of the dwelling, or a person who would be a superior landlord in relation to the dwelling, is insured under a contract of insurance—(i) to which section 40 does not apply, and(ii) which contains a term which makes provision (however expressed) requiring the insured to prohibit a tenant under a relevant tenancy from having a pet live with them at the dwelling or to restrict the circumstances in which such a tenant may have a pet live with them at the dwelling, and the conduct is a means of preventing the insured from breaching that term.(3) Conduct does not breach the prohibition in subsection (1) if it consists only of—(a) one or more of the following things done by a person who does nothing in relation to the dwelling that is not mentioned in this paragraph—(i) publishing advertisements or disseminating information;(ii) providing a means by which a prospective landlord can communicate directly with a prospective tenant; (iii) providing a means by which a prospective tenant can communicate directly with a prospective landlord, or(b) things of a description, or things done by a person of a description, specified for the purposes of this section in regulations made by the Secretary of State.”
Lord Black of Brentwood (Con)
My Lords, I will speak also to my Amendments 192 to 196 and 198, which are also signed by my noble friend Lord Lexden and, with the exception of Amendments 193 and 198, by my noble friend Lady Coffey. I am very grateful to them. Given the hour, and as we are discussing animals, it is right to acknowledge that they are clearly night owls.
The purpose of the amendments is to insert a new clause to extend pre-tenancy discrimination protections to pet owners. In an earlier debate on this Bill in Committee, I set out why this legislation is so important and why pet owners need certainty and clarity about its application. These amendments build on that debate on a further, very specific issue.
Although the current version of the Bill provides protections after tenancy begins for pet owners, requiring landlords to consider pet requests reasonably, I am concerned that these are rendered ineffective if pet owners are excluded before tenancy agreements are even offered. As I have made clear before, I am delighted that the Bill rightly seeks to prevent pre-tenancy discrimination against tenants with children and those who are benefit claimants, but I believe these welcome provisions should also be extended to tenants who already own pets and are seeking a new place to rent. Currently, they are unprotected. Without such a measure, there is a real risk that landlords will automatically disadvantage or reject applicants simply based on the issue of pet ownership.
The truth is that pet ownership is, regrettably, already currently treated as a de facto disqualifier by many landlords. Applicants can be dismissed outright on the sole basis of owning a pet, with no requirement to justify the decision. This renders any post-tenancy pet consent rights in the Bill practically inaccessible for existing pet owners who are moving home, who are barred from progressing past the application stage in the first place.
As the Minister rightly highlighted during our debate last week, the pet provisions in the Bill are fundamentally based on the principle of reasonableness, and that is absolutely right. However, as it stands, a landlord is not technically required to consider in any form a pet-owning applicant and can reject them outright without appropriate safeguards in place. This creates a gap. Although existing tenants may benefit from protection, prospective tenants looking to move may not have the legal support to make a reasonable request to keep a pet at the point of applying for a tenancy. I fear this will continue to result in pet owners facing the heartbreaking decision of having to choose between a home and their pet, as many thousands of homes will remain closed to them.
The proposed clause, with consequential amendments, offers a balanced solution. It does not require landlords to accept pets unconditionally. Instead, it prevents landlords automatically rejecting applications on the grounds of pet ownership while retaining their ability to refuse consent on reasonable grounds after an application has been successful. That seems to me to be the right way to deal with this matter.
Lord Lexden (Con)
My Lords, I am glad, as always, to support my noble friend Lord Black, whose commitment to animal welfare is well known. His proposed new clause and his amendments in this group represent a further stage of his determined efforts on behalf of beloved pets and their owners. The principle underlying his proposed changes is simple: fairness in the rental market must apply at the first stage of the process, which is when an application is made for a tenancy.
As my noble friend pointed out, the Bill rightly prohibits pre-tenancy discrimination against those with children or in receipt of benefits. Similar protections should be extended to those who own pets, who at the moment face rejection of an application for a tenancy on that one ground alone. The new clause does not compel landlords to accept pets unconditionally; it simply introduces fairness by ensuring that applications cannot be dismissed out of hand just because a pet is involved.
As my noble friend has made clear, we need to bear in mind the terrible position in which the absence of fairness places pet owners at the moment. The heartbreak of being forced to choose between a home and a companion animal is one that no tenant should have to make. I hope the Government will give very careful consideration to my noble friend’s constructive proposals.
Baroness Coffey (Con)
My Lords, I put my name to these amendments. I must confess I did not quite understand Amendments 193 and 198, so I did not put my name to them, but I am grateful for the explanation that my noble friend has given. There is no doubt that the availability of private rental in having pets is considerably smaller. I am conscious that when I moved to Suffolk, I think it was back in March 2010, when I was looking for places to rent—not to holiday rent, but to rent properly as a home—had I not had my dog Rizzo at the time, more than 200 properties would have been available, but when it came to any landlord that would even encounter having a dog, the number was reduced to four, and this in an area of 300 square miles.
It gave me a clear insight into the restrictions placed on people who want to move with their family—and pets are considered often part of that family. As has been mentioned elsewhere, there was certainly a premium to pay, as a consequence of what property was available, for the opportunity to have Rizzo come and visit on a regular basis.
I was struck by one issue in the amendments that my noble friends have tabled, to do with mortgaged premises. I have been pretty horrified to learn, in the variety of casework that I have undertaken over the years, about the artificial restrictions placed on mortgages that people have taken up. They have simply told me, “I’m not allowed to do this”. I felt that this was too good an opportunity to miss; that is why I signed my noble friend’s amendment.
As my noble friend Lord Lexden said, this is plain discrimination against people who have not yet been able to secure a home in a particular area. These are sensible additions to the Bill. I am aware that your Lordships have, overall, welcomed the opportunity to try to remove these exclusions on keeping pets in homes that people are renting. I hope the Minister will look kindly on these amendments to make sure that this part of the potential loophole is addressed and filled.
Baroness Hayter of Kentish Town (Lab)
I do hope that the Minister will not agree to this. I have a flat that I live in part-time but sometimes rent, and I am allergic to animals. The idea that I would have to consider and take an application from someone with a pet, when I could not possibly have them living there because of my allergy, seems to me quite unfair. They would come to see the flat and waste their time when there is no chance in the world that I could let it to someone with a pet. I do hope that we will not go the way of forcing somebody like me to waste someone’s time in going to see a property. There is no way that I would be able to have an animal in the flat that I live in at other times.
Baroness Scott of Bybrook (Con)
My Lords, I thank my noble friend Lord Black of Brentwood for his amendments. I also thank my noble friends Lord Lexden and Lady Coffey for their contributions, as well as the noble Baroness, Lady Hayter, who makes it very clear that we need to have a balance.
This group seeks to address the growing concern among renters, but we must also consider the valid and practical concerns of landlords. Although these proposals aim to prevent blanket bans on pets in rental properties, it is essential to recognise that there must be legitimate reasons for any restrictions. Many tenants may view their pets as family members, as we have heard, but we must also acknowledge the potential challenges and consequences of allowing pets in rental properties. These are challenges that can affect property maintenance, insurance costs and, as we have heard, the well-being of other tenants. A balanced approach is needed, one that considers the rights of tenants and the legitimate concerns of landlords and property owners.
Landlords are often responsible for the upkeep of the property and ensuring the safety and comfort of all tenants. Allowing pets may also complicate insurance policies, leading to higher premiums or even exclusions in certain cases. These concerns are not trivial and must not be dismissed lightly, but rather addressed in a way that is both fair and proportionate. The amendment in this group recognises the need for a balanced approach that takes into account the rights of those tenants and the legitimate interests of landlords.
We on these Benches have made our position clear on previous days in Committee. We continue to advocate for a balanced solution that respects the needs of both tenants and property owners. Ultimately, these amendments contribute to a more equitable housing market, where tenants with pets are not excluded from their right to live in a home that suits their needs. They also ensure that the landlord can continue to manage their properties responsibly with the appropriate protections in place.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Black of Brentwood, for his amendments relating to pets and rental discrimination, and the noble Lord, Lord Lexden, the noble Baronesses, Lady Coffey and Lady Scott, and my noble friend Lady Hayter for their comments on these amendments.
Amendments 190, 192, 193, 194, 195, 196 and 198 would extend the core rental discrimination provisions of Chapter 3 to prospective renters with pets, protecting them from any unfavourable treatment in the letting process. We know that pets bring a huge amount of joy to their owners—even Wilberforce, the snake we heard about the other day—and we are committed to supporting responsible pet ownership in the private rented sector.
However, it is our view that extending our rental discrimination provisions in this manner would not be proportionate, nor is it necessary. The Bill already contains measures to ensure that landlords cannot unreasonably withhold consent when a tenant requests to have a pet in their home. Landlords must consider all requests and provide valid justification if consent is refused. This ensures that tenants are not unfairly prevented from keeping pets while still allowing landlords to consider legitimate concerns such as property suitability lease restrictions—the other day we discussed superior leases, which may have clauses about pets—or potential issues with other residents, as my noble friend Lady Hayter mentioned.
Tenants will be able to escalate unfair decisions to the PRS ombudsman, who will have strong powers to put things right, such as compelling a landlord to take a specific action, issue an apology and award financial compensation. Given that, I kindly ask that the noble Lord consider not pressing his amendments.
Lord Black of Brentwood (Con)
I am grateful to all who have taken part in this short debate, particularly my noble friend Lord Lexden, who rightly told us about the heartbreak that can follow when tenants have to choose between a home and a pet, something that happens far too often and which the Bill is determined to diminish. I am also grateful to my noble friend Lady Coffey, who brought to bear her considerable experience and expertise in this area. We should take her comments very seriously.
I say to the noble Baroness, Lady Hayter, that of course I understand the issue that arises from allergies; I am unfortunately allergic to pollen and there is little I can do to avoid it. She is right, and that is why we have to strike a balance. As my noble friend Lady Scott said, this is all about balance between the rights of tenants and those of landlords. I believe that these amendments strike that balance, which is why I tabled them.
I am grateful to the Minister for her comments and her understanding. She has been very constructive throughout our Committee discussions on pets, and I thank her for that. When we last discussed these matters in Committee—last week, I think—she talked about some of the guidelines being drawn up to go alongside this legislation when it comes into force. It occurs to me that this might be one of those areas where there could be some form of guidance to landlords that would ameliorate some of the problems. If she would be happy to do so, perhaps she might look at that and talk to the various animal charities concerned; I know they would be happy to help. In the meantime, I beg leave to withdraw the amendment.
Baroness Scott of Bybrook
Member’s explanatory statement
This is a probing amendment that would allow the landlord to invite any person to offer an amount of rent under the proposed letting value.
Baroness Scott of Bybrook (Con)
My Lords, my amendments in this group are intended to probe the Government’s decisions on rental bidding and to better understand the rationale behind this section of the Bill. I begin by drawing your Lordships’ attention to Amendment 199A tabled in my name. I wish to understand why, if a tenant or prospective tenant offers a lower rent than the proposed letting value, the landlord is prevented from accepting it. If a tenant is able to secure the property at a more affordable rate, this seems a fair and beneficial outcome. If the proposed letting value is set unrealistically high, allowing offers below that figure provides an important market correction, one which benefits tenants. This is particularly relevant in weaker rental markets where negotiating powers often lie disproportionately with the landlords. I simply ask the Minister: did she consider this before putting it forward?
On these Benches, we recognise the difficult balance the Government are attempting to strike between preventing unfair and unaffordable rent increases and ensuring that the proposed letting value reflects proposed market conditions. Market conditions are, of course, determined by the supply of homes and the market rent must still incentivise landlords to remain in the sector to provide the housing capacity that we urgently need. This brings me to our intention to oppose the question that Clause 58 stand part of the Bill. The rent-setting process must be transparent, and must be free to function. We should not pretend that we can fix prices without distorting the market signals that allow for an efficient and well-resourced housing market. We must be careful not to introduce policies that mask the simple fact that we need more homes of all types. We on these Benches are committed to working with the Minister to that end, but I first ask her: has she considered whether these measures may in fact obscure the true demand within the rental sector? Understanding that demand is key to delivering the right supply and the right homes built in the right places.
Further, has the Minister considered the impact on labour mobility? Tenants in rent control units may be discouraged from relocating for jobs or education, thus reducing workforce mobility. With over 800,000 vacancies, we should not be inadvertently curtailing the movement of our workers. Finally, I wish to probe whether the Government have fully considered the potential impact on new renters compared with existing tenants. No one on these Benches doubts the Minister’s intentions; we simply fear that the department has not paused to fully reflect on these key issues.
I turn to Amendment 199B, also in my name. I will cheekily anticipate that the Minister may say, in response to this probing question: “Yes”. The Bill attempts to define the term “relevant person” in Clause 58(6) but, before the Minister reaches that definition, I wish to question its adequacy and its clarity. Is there any formal process to designate someone as a relevant person or is this determined on a case-by-case basis? Further, how is the term “acting indirectly” to be interpreted? Does this include property agents or other advisory parties? Crucially, what is meant by “purporting to act”? I am sure that those with legal expertise in this House will argue that this is a loaded term that depends heavily on interpretation. I would be grateful if the Minister could offer her understanding of it and, importantly, explain how consistency in interpretation will be ensured.
Clause 58 represents a significant shift. With that must come clear answers. I hope the Minister will help your Lordships’ House to understand the Government’s thinking more fully. I beg to move.
Baroness Coffey (Con)
My Lords, I support my noble friend in these amendments. Two different things are going on here, one of which is not allowing the market to work. I am trying to understand what evidence there is to suggest that this is a real issue.
I will give a personal story. When at university, a group of us wanted to rent a house. Under the rules of the university, you could live only at a certain distance, and so on. Not wanting to take a 12-month tenancy, we were particularly attracted by and sought out houses that would require only a nine-month tenancy. The landlady we were involved with used to make considerably more rent in the summer through tourists and short-term lets, but also gave students the opportunity not to take on the liability of the year. That helped keep rents relatively low. I am sure that your Lordships can imagine that such a scenario, while it may seem niche, was still very important to students at that time, and so was the availability of houses reflecting that opportunity. In effect—this is nothing to be embarrassed about—we gazumped by being prepared to sacrifice a living room and turn it into an extra bedroom. It also gave a little more rent to the landlady, which was a factor when, I was led to believe, 46 groups went to see that house wanting to secure the tenancy.
While I completely understand some of the intentions of this clause about not getting into ridiculous bidding wars, I am surprised, given the real scarcity in certain parts of the country of private sector rentals, as to why we would want to unnecessarily put such handcuffs on the landlord to accept only the rent they advertise and not be creative about the situation in which prospective tenants may find themselves.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for tabling her amendments relating to rental bidding. I also thank the noble Baroness, Lady Coffey, for contributing. I will respond to the two probing amendments in a moment. First, however, I will set out to the Committee why I consider her fundamental objection to Clause 58 —which will end the unfair practice of renters being pitted against each other in bidding wars—to be misplaced.
The measures in Clause 58 will require landlords and persons acting for them, for example letting agents, to state a proposed rent in any written advertisement for the property. Landlords and those acting for them will then be prohibited from asking for, encouraging or accepting bids above this price. To respond to the comments of the noble Baroness, Lady Scott, these are not rent controls—the landlord may advertise the property at the rent they wish to achieve, but they cannot then increase that rent as other bidders come along. Currently, too many tenants suffer from a lack of transparency in the lettings process. I cannot imagine the heartbreak of thinking that you have found a property at a rent that you can afford only to discover that the landlord or letting agent has pushed other tenants to offer more. Their experience is not that of a viewing but of a kerbside auction. The impact on renters of the practice is clear and our measures will end it for good.
This is a specific problem that we are trying to target, and the majority of landlords do not engage in rental bidding. However, we are trying to stamp out the egregious practice of a minority of landlords who exploit the fact that, particularly in hot rental markets, there is a lack of supply relative to demand. Tenants can be pitted against each other in ways that ensure the rent of a tenancy escalates to a point beyond what many of them can afford, or which, if they can afford it, puts an incredible financial strain on them.
I visited a housing site in Greenwich this week and I heard that, in some parts of London, a house in the private rented sector will cost a public sector worker 94% of their salary just to pay the rent. These measures will improve the experiences of prospective tenants across England and provide clarity to all those involved in the lettings process.
Amendment 199A would remove the prohibition on landlords inviting or encouraging a tenant to offer to pay an amount of rent that exceeds the stated rent. If this amendment were taken forward, landlords would fall foul of the rental bidding provisions only if they accepted rent at a level above the stated rent, not if they invited or encouraged its payment. While I welcome the scrutiny—and I genuinely do—of our rental bidding measures, I am concerned that this amendment would risk allowing a form of rental bidding to continue to be practised. Under this—
Baroness Scott of Bybrook (Con)
Sorry. While we are talking about this, does the Minister not think that what could happen—and what may happen—is that the level of rents will be above what they would normally be, because the landlord is going to go for the absolute maximum they can? Is that not a danger?
Baroness Taylor of Stevenage (Lab)
I think I answered this question under a previous group on a previous day. This is not intended to be rent cap; it is intended to stop the practice of changing the rent once the rent for that property is published. It will be up to landlords to advertise the property at a rent they think they can achieve for that property and, once they have advertised it at that price, they will not be able to increase that rent when things subsequently come along.
Under this amendment, a landlord could lawfully encourage bids above the advertised price, take the property off the market and then use any bids received to establish a higher price at which to relist it. I think that would start to have an inflationary effect on rents. I am not suggesting that this scenario would be commonplace, but it would be lawful and, if it were to occur, it would clearly be to the detriment of prospective tenants. I therefore consider that our belt-and-braces approach of prohibiting both the accepting and encouraging of bids to be the right one and I ask the noble Baroness to withdraw her amendment.
Finally, Amendment 199B seeks to remove
“by any other relevant person”
from the definition of “stated rent” in Clause 58(4)(b). As I have explained, the rental bidding clauses prevent a landlord, or person acting for them, inviting, encouraging or accepting an offer of rent higher than the “stated rent”. The term “stated rent” is defined as the rent originally proposed in the written advertisement, either by the person who is now doing the inviting, encouraging or accepting of higher offers or, as the case may be, any other relevant person.
A “relevant person” could be either
“the prospective landlord, or a person acting or purporting to act directly or indirectly on behalf of the prospective landlord”.
The latter would usually be a lettings agent, but it could also be a more informal relationship such as a friend of the landlord. It is necessary for us to avoid a loophole whereby, say, the landlord publishes the advertisement containing the stated rent and then asks his friend or letting agent to carry out the rental auction.
As such, the Bill is drafted deliberately to ensure that the prohibition applies in those circumstances, as well as the more straightforward scenario in which it is the landlord who publishes the advert and then proceeds to carry out the rental auction. I therefore ask the noble Baroness to not press this amendment.
Baroness Scott of Bybrook (Con)
I thank the Minister for her reply, and for the insight into this issue from the noble Baroness, Lady Coffey. On these Benches, we recognise the challenging balance the Government are seeking to achieve: protecting tenants from unfair and unaffordable rent increases, while also ensuring that the proposed letting value remains aligned with the functioning market.
These market conditions are of course shaped by the availability of housing, and any rent-setting approach must still offer sufficient incentives for landlords to stay in the market and to continue providing the homes that our communities so urgently require. I thank the Minister for her answers, but I urge her to truly reflect on the points that we have raised, to carry them back to her department and, if necessary, to come back with her continued engagement with the House.
This group of amendments, like many others, is not overtly political; it consists of serious and practical probes into serious and practical issues. In our pursuit of stronger protections for tenants, we must be careful not to deter landlords or make it unfeasible for them to continue to provide the homes our communities so badly need. These are concerns that many landlords share, and we believe that they must be at the forefront of the Government’s thinking. We ask them to go back to reflect on what we have brought forward. I ask the Minister to step back and consider any unintended consequences of this part of the legislation—or, at the very least, to acknowledge the genuine concerns of those who oppose this part of the Bill. Having said that, I beg leave to withdraw my amendment.
Lord Jamieson (Con)
My Lords, I will speak to the amendment in the name of my noble friend Lady Scott of Bybrook, which rightly brings the issue of abandonment to the attention of the House tonight.
I wish to be brief, but I will take the opportunity to pose several questions, so that the Minister can set out the Government’s position. The Government are correct to note, in their Explanatory Notes, that Part 3 of the Housing and Planning Act 2016, which sought to address the recovery of abandoned properties, has never been brought into force. However, in light of the significant changes now proposed to the grounds for possession, I ask the Minister: have the Government sought to revisit this? With the departure of Section 21 and the insistence that landlords must rely on specific grounds for possession, as outlined in Schedule 1, what options are available to a landlord if a tenant abandons their property?
I would welcome clarity on several practical matters. For example, is there a requirement for specific types of evidence of abandonment, in terms of format, scope or detail? How many attempts must a landlord make to contact the tenant? I understand that this may appear later, but, as the Government have refused to implement these changes gradually, these really are burning questions.
Next, with no distinct legal ground for abandonment, how does the Minister propose to ensure that landlords understand how to use grounds 8, 10 or 12, which appear to be the only potential avenues in such cases? Additionally, I would be grateful if the Minister could outline the current average wait time for a court order in such circumstances. What, if anything, is being done to address the underlying causes of tenant abandonment?
I fully recognise that this issue extends beyond housing policy alone. However, ensuring that tenants are able to remain in their homes, and feel secure in doing so, is not only beneficial to them but vital to the health of our wider society and economy. In connection with this, I also ask: from the landlord’s perspective, how is one expected to assess the risk of a tenant returning after a property is believed to have been abandoned?
It appears there is currently no specific legal ground for possession on the basis of abandonment. While the Minister may point out that the incidence of abandonment is low, this is not a justification for leaving the issue unaddressed, particularly now, when the framework for possession is being overhauled. Getting abandoned properties back into the rental market will allow others to benefit from that tenancy and a tenant who has abandoned a property to not accumulate further unpaid rent.
I ask whether the Government gave any consideration to amending Part 3 of the Housing and Planning Act, especially in light of the proposed removal of assured shorthold tenancies, which Part 3 originally referenced.
I hope the Minister will take this opportunity to provide clarity and, where necessary, commit to reviewing this area further. I look forward to her response.
Baroness Williams of Trafford (Con)
My Lords, before the Minister stands up to respond, I just make the point that it has gone midnight. We did not start consideration of Committee until 8.30 pm. That has meant that people have gone home without putting forward their amendments, and there has not been proper scrutiny on the last few groups. The Committee has done amazingly well to get as far as it has, but it has now gone midnight. I do not know if the Whip intends to resume the House.
Lord Wilson of Sedgefield (Lab)
I will resume the House at the appropriate time. This is not the first time where debates have gone beyond midnight: on day 1 of Report, the Great British Energy Bill went to 1 am. I do not intend to take this much further. I want to stop at Amendment 206, which is another two groups, and then that will be it. Hopefully, we will be finished very shortly.
Baroness Williams of Trafford (Con)
The reason we are on the penultimate group is because people have not been in the Chamber to move their amendments in Committee. There have been very short debates in Committee, and some very important groups in Committee have just been glossed over—that is my point.
Lord Wilson of Sedgefield (Lab)
As I said, I want to get to Amendment 206. There is only one amendment that has not been moved. There have been other debates that have gone on until 1 am. If we spent less time discussing this aspect, we could finish quite soon.
Baroness Taylor of Stevenage (Lab)
My Lords, the central aim of the Renters’ Rights Bill is to give tenants more security in their homes. Landlords must not be able to evict tenants without a ground for possession, as defined in Section 8 of the Housing Act 1988, which we are expanding and refining to ensure that landlords can gain possession where proportionate.
The noble Baroness, Lady Scott of Bybrook, supported by the noble Lord, Lord Jamieson, has stated that they do not support Clause 61 standing part of the Bill. This clause will repeal Part 3 of the Housing and Planning Act 2016, which, if brought into force, would have allowed landlords to take possession of premises they believed to be abandoned without a court order. However, Part 3 of the 2016 Act was never brought into force. It also wholly pertained to assured shorthold tenancies. Those tenancies will cease to exist in the private rented sector after the implementation of the Bill. The repeal of Part 3, therefore, is necessary to maintain a coherent statute book.
As I mentioned, Part 3 of the 2016 Act would have enabled landlords to reclaim possession of properties under an assured shorthold tenancy that had been abandoned without a court order, provided they had issued three warning notices without response and the tenant was in rent arrears. While we acknowledge that genuine abandonment can present challenges—I dealt with a case that had gone on for years and years in Stevenage—not only for landlords but also for the wider community, these provisions were not the appropriate solution. At the time, they were criticised as a rogue landlord’s charter, and it is appropriate that they were never implemented.
Where abandonment has occurred, landlords will need to establish a ground for possession. It is likely that, in abandonment scenarios, tenants will also be in rent arrears, making those grounds for possession applicable. Landlords may also rely on breaches of tenancy agreements, such as clauses prohibiting prolonged unoccupancy or on grounds relating to deterioration of the property. In clear-cut situations, implied surrender may also apply—for example, where tenants have returned the keys and the landlord has accepted them even if no formal notice was given.
It is vital that tenants have access to justice when facing the loss of their home. Landlords must not be enabled to take possession without a valid ground. Clause 61 ensures the removal of these redundant provisions from the statute book. I commend this clause to the Committee.
Lord Jamieson (Con)
My Lords, I will not do a full closing speech. The purpose of this was for the Minister to give us some thoughts on how you might deal with abandonment rather than going through a lengthy court case when clearly the property has been abandoned. I would be very grateful if, before Report, the Minister could give this some thought. None of us wants abandoned properties; we want them back in use and available for rent. We do not want people accumulating rental deficits that have to be chased through the court. There clearly is a special case here that needs to be considered. I look forward to the Minister giving us a thoughtful response before Report on how we address the issue of abandoned properties. None one on either side of the Committee wants abandoned properties.
“Student accommodation that is not an HMO(1) Schedule 14 to the Housing Act 2004 (buildings which are not HMOs) is amended in accordance with subsections (2) and (4).(2) After paragraph 3 insert—“Buildings occupied by students: England
3A (1) Any building in England—(a) which is occupied solely or principally by persons who occupy it for the purpose of undertaking a full-time course of further or higher education at a specified educational establishment, or at an educational establishment of a specified description, and where the person managing or having control of it is the educational establishment in question, or(b) which is occupied solely or principally by persons who occupy it for the purpose of undertaking a full-time course of further or higher education at an educational establishment and where the person managing or having control of it is a specified person or a person of a specified description.(2) In—(a) sub-paragraph (1)(a) “specified” means specified for the purposes of that sub-paragraph in regulations made by the Secretary of State;(b) sub-paragraph (1)(b) “specified” means specified for the purposes of that sub-paragraph in regulations made by the Secretary of State;and the regulations may (in particular) provide that an educational establishment is specified, or of a specified description, for the purposes of sub-paragraph (1)(b).(3) Those regulations may, in particular, specify—(a) as a description of educational establishment for the purposes of sub-paragraph (1)(a), or(b) as a description of person for the purposes of sub-paragraph (1)(b),the members from time to time, or a description of the members from time to time, of a housing management code of practice which is specified in the regulations.(4) The Secretary of State may by regulations—(a) specify a class of building, and(b) provide that a building—(i) does not fall within this paragraph if it is of the specified class, or(ii) falls within this paragraph only if it is of the specified class.(5) The Secretary of State may by regulations—(a) specify a building manager or a class of building manager,(b) specify a class of building in relation to the specified building manager or the specified class of building manager, and(c) provide that a building which the specified building manager, or a building manager of the specified class, manages or has control of—(i) does not fall within this paragraph if the building is of the specified class, or(ii) falls within this paragraph only if the building is of the specified class.(6) Regulations under sub-paragraph (4)(a) or (5)(b) may, in particular, specify as a class of building—(a) the buildings, or(b) a class of the buildings,from time to time subject to a housing management code of practice which is specified for this purpose by regulations under sub-paragraph (4)(a) or (5)(b).(7) Regulations under sub-paragraph (5)(a) may, in particular, specify as a class of building manager—(a) the members, or(b) a class of the members,from time to time of a housing management code of practice which is specified for this purpose by regulations under sub-paragraph (5)(a).(8) For the purposes of this paragraph— (a) “building manager” means an educational establishment or other person managing or having control of a building;(b) “housing management code of practice” means a code of practice approved by the Secretary of State under section 233 (codes relating to the management of HMOs or excepted accommodation);(c) a building is “subject to” a housing management code of practice if it—(i) is a particular building subject to the code, or(ii) is of a class of buildings subject to the code;(d) a reference to—(i) a class of the buildings from time to time subject to a housing management code of practice, or(ii) a class of the members from time to time of a housing management code of practice,includes the buildings or members that are from time to time in a class provided for in the code of practice.”(3) Any regulations made by the Secretary of State under paragraph 4 of Schedule 14 to the Housing Act 2004 before the coming into force of this section are to continue to have effect on and after the coming into force of this section as if made under paragraph 3A of that Schedule (inserted by this section).(4) In paragraph 4 (buildings occupied by students)—(a) in the heading, after “students” insert “: Wales”;(b) in sub-paragraph (1), in the words before paragraph (a), after “building” insert “in Wales”.(c) in sub-paragraph (2), for “appropriate national authority” substitute “Welsh Ministers”.(d) in sub-paragraph (3), for “appropriate national authority” substitute “Welsh Ministers”.(e) in sub-paragraph (4)—(i) in the words before paragraph (a), for “appropriate national authority may have regard to the extent to which, in its opinion” substitute “Welsh Ministers may have regard to the extent to which, in their opinion”;(ii) in paragraph (a), for “authority” substitute “Welsh Ministers”.(5) In consequence of the other amendments made by this section—(a) in paragraph 16E(3) of Schedule 2 to the Finance Act 2019 (inserted by Schedule 1 to the Finance Act 2025) (meaning of “institutional building”), in paragraph (i)(i) and (ii) (buildings occupied by students), for “paragraph 4” substitute “paragraph 3A or 4”;(b) in the Capital Allowances Act 2001, in section 270CF (exclusion from qualifying use: residential use), in subsection (1)(b), for “paragraph 4” substitute “paragraph 3A or 4”.(6) Any regulations made by the Treasury under paragraph 16E(3)(i)(ii) of Schedule 2 to the Finance Act 2019 before the coming into force of this section which designate provision as provision corresponding to paragraph 4 of Schedule 14 to the Housing Act 2004 are to continue to have effect on and after the coming into force of this section as if they designated the provision as provision corresponding to paragraph 3A or 4 of that Schedule.”Member's explanatory statement
Paragraph 4 of Schedule 14 to the Housing Act 2004 provides for certain buildings used as student accommodation not to be a house in multiple occupation. This amendment would enable the exemption to be limited to buildings of a specified description; and for regulations to operate by reference to codes of practice approved under section 233 of the Housing Act 2004.
“Training and qualifications of property agents managing assured tenancies(1) The Secretary of State may by regulations require that individuals undertaking the activities of a property agent in respect of management of assured tenancies must have, or be working toward, specific mandatory qualifications, as defined by regulations to demonstrate competency to undertake their property agency roles.(2) Regulations under this section—(a) are to be made by statutory instrument;(b) may make provision generally or only in relation to specific cases;(c) may make different provision for different purposes;(d) may include supplementary, incidental, or transitional provision;(e) must specify classes or types of employees who must be qualified and the appropriate qualification level for each such group;(f) must specify syllabuses and testing methods for qualifications;(g) must specify means of training provision and minimum training hours;(h) must specify requirements for continuous professional development;(i) must approve providers for the provision of training and qualifications.(3) A statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.”
Lord Best (CB)
My Lords, this is a slightly longer amendment, but I will take it at a brisk pace. Amendments 203 and 204 in my name and the names of the noble Lords, Lord Young of Cookham and Lord Truscott, and the noble Baronesses, Lady Hayter of Kentish Town and Lady Thornhill, relate to the implementation of recommendations from the governmental regulation of property agents—ROPA—working group, aimed at protecting consumers from dodgy or inept estate agents, letting agents and managing agents.
Your Lordships have considered and endorsed the case for regulating property agents on a number of occasions since the ROPA report was published by the Government in 2019. Your Lordships’ Industry and Regulators Committee endorsed the recommendations only last year. Indeed, the Housing and Planning Minister, Matthew Pennycook MP, has made clear that the Government accept the case for regulation of the sector, so there is no need for me to rehearse the arguments again. Indeed, the professional bodies and trade associations, including the Royal Institution of Chartered Surveyors, the Property Institute, Propertymark and the Lettings Industry Council have persistently supported the ROPA agenda. Those who would be regulated are as keen on regulation as those consumers who would be protected by it.
However, I fear that the Housing Minister feels that the new measures for ROPA will have to wait until a later date. It is possible that the forthcoming leasehold and commonhold reform Bill will include regulatory measures for the managing agents of leasehold property —a part of the property agency sector where there have been many complaints of abuses and incompetence. However, that Bill only covers leasehold property and is unlikely to incorporate lettings agents, and its timetable is uncertain. The Renters’ Rights Bill presents an important opportunity to take a first step towards creating a proper regulatory framework for the property agency sector. This Bill is concerned with the deal faced by renters and letting agents, who are involved with half the properties in the PRS. This is a chance to raise standards, and a timely one.
The ROPA working group, in recommending the creation of a regulator for property agents, emphasised the need for proper qualifications as well as adherence to a code of practice. At present, anyone can set up a property agency business overnight with no experience of property matters.
Amendment 203 would require the relevant agents to have or be working toward mandatory qualifications. Since the Bill relates only to lettings, its requirement for proper qualifications can affect only lettings agents; and since setting up a fully-fledged regulator just for lettings agents could be seen as disproportionate, this amendment is strictly limited to the requirement for qualifications, which is the most basic of a regulatory regime.
However, without the establishment of a regulator, how can even this somewhat tentative step be taken toward creating a more professional property management sector? Who, in the absence of a regulator, can enforce the new regulatory requirements for qualifications set out in Amendment 203?
Local Authorities’ Trading Standards Officers could check that legal requirements are being met in their area, but, to protect the consumer, a robust national mechanism is needed to operationalise this amendment’s requirements for agents to hold the necessary qualifications before acting for landlords and taking responsibility for rental properties.
Lord Young of Cookham (Con)
My Lords, once again I follow in the slipstream of the noble Lord, Lord Best, and have added my name to one of his amendments. I commend the work that he has done on this particular subject.
The only point I want to make is to draw attention to the growing gap between the qualifications that are needed to manage a block in the social sector as against those needed to manage a block in the private sector. I take the view that, whether you live in a block managed by a social landlord or a private landlord, you are entitled to the same quality of management, professionalism and competence.
Two years ago, we had the then Social Housing (Regulation) Bill. That set out requirements of qualifications for those in the registered social landlord sector, and it required some 25,000 people to go out and get qualifications. Senior housing managers have to have a level 4 housing qualification and senior housing executives need level 5. One could make the case that requirements are even more necessary in the private sector, because it does not have the overall protection that the social housing sector has with either local authorities or registered social landlords.
There is now a growing gap between the relative qualifications you need, depending on whether the block is in the private or public sector. Although some progress has been made in driving up the standards of lettings agents, there is still some way to go. I hope the Minister will be able to express some sympathy for these two amendments. As the noble Lord, Lord Best, indicated, if we do not make any progress with this Bill, we will be back with the leasehold Bill later in the Session.
Baroness Hayter of Kentish Town (Lab)
My Lords, I have also put my name to Amendment 203 and I declare a non-financial interest as chair of the Property Institute, which favours regulation of all property agents, as the noble Lord, Lord Best, has said. Amendment 203 is about safety, security and the good management of people’s homes. I think we all agree that residents deserve to be safe in their homes, but in rented accommodation it is impossible for residents to do everything themselves, because the building and the environment are actually owned and managed by the landlord.
The noble Lord, Lord Young, intimated that, in the case of social housing, it actually took the death of Awaab Ishak to bring forward mandatory qualifications for those who manage social property. As he said, however, there is no equivalent for private property, where unqualified and even rogue agents take responsibility for vital parts of the building’s upkeep, its safety, its access, its insurance and its legality. Unlike other professions handling legal and financial transactions, most of which are regulated, there are no mandatory qualifications or any minimum requirements for property agents, even when they are managing the money of assured tenancies. The absence of regulations clearly can lead to the mismanagement of deposits and rents and legal non-compliance, very often through ignorance rather than wickedness.
Managing shared buildings, particularly tall ones, is extremely complicated and demanding, and growing more so. There are a lot of new energy-efficient rules, quite rightly; there are increasing tenant demands for involvement, quite rightly; there is the rising cost of insurance; and there is more focus on legislation on health and safety, particularly after Grenfell. All these are complicated issues that need to be handled by a professional in the private rented sector, which houses, of course, many vulnerable people.
The private rented sector is often the home of people who can least afford to pay for any additional services, and, if they are paying too much in rent, they cannot even heat the property, and that can be because of mismanagement. It should be obvious without, I hope, having to wait for a death in the private rented sector, that all managing agents looking after homes should be properly competent and qualified. It is a job for professionals, not amateurs.
This amendment is a way forward. We are not talking about an expensive thing to run; it is not asking for very much. It asks simply that those who are paid to manage rented properties know what they are doing and have the qualifications to prove it, so that landlords would employ only agents capable of managing homes legally and honestly. Let us not wait for a tragedy: let us do it now. We owe it to all residents to make sure that the state requires those managing their homes to know what they are doing.
Lord Truscott (Non-Afl)
My Lords, I rise to support Amendments 203 and 204, in the name of the noble Lord, Lord Best, and others. I declare my interest as a leaseholder, as well as a landlord and former PRS tenant. Noble Lords supporting these amendments have already made a cast-iron case for requiring property-management agents to have relevant training and qualifications, and for these requirements to be legally enforced.
I have dealt with a number of property management agents. Some have been excellent and others have been appalling. It seems extraordinary to me that property agents who may deal with millions of pounds of property and revenue are currently not required to have any professional qualifications or training whatever. Some agents I have dealt with in the past have no property qualifications and had little or no understanding of property law or lease enforcement. There is no other sector that I am aware of where individuals dealing with such large amounts of money and such valuable assets can be wholly unqualified and virtually unregulated.
Anyone can set themselves up as a property agent, with little or no knowledge of the sector. Many property agents are, of course, very professional, but the rogues and amateurs undermine the reputation of the whole property sector. This must end, as we have heard. For that reason, I wholeheartedly support these two amendments and urge the Minister to accept them.
Baroness Coffey (Con)
My Lords, I oppose this amendment. It is rare that I am out of step with my noble friend Lord Young of Cookham, but I am concerned that overregulation of aspects of employment is—how can I put it?—a solution waiting for an extensive problem. One of the things that these amendments do is to yet again give considerable powers to others to set all sorts of training expectations. Candidly, and certainly in the private market, there are simply too many sectors in which government and Parliament seek to rip away control instead of the individual having that engagement and relationship.
We already have the property redress scheme in place, of which letting agents and people who manage properties have to be a part. Do not get me wrong: there are plenty of landlords who are not necessarily doing what they should, at the moment, but there are already mechanisms to put this in place. I do not believe that qualifications, training schemes or similar will make a particular difference.
I am also conscious of what happened with social housing, particularly some of the significant failures that we sadly saw in aspects of local government and housing associations. There was a feeling that something must be done. I am conscious, however, that that does not mean that we need to paint every letting agent or property manager with the same brush. For me, this is overreach on behalf of Parliament and, again, I would like to see the evidence for why we need to go to this extent and why yet another profession that has minimal regulation today now needs to be heavily regulated.
It is again a barrier that would put up agencies’ costs. This is the reality of having to deal with this sort of regulation: the person who pays is the renter, not the landlord. We have to bear in mind that, with the cost of living challenge that we are facing—still the number one issue for the electorate in this country—we are here tonight considering an amendment that will continue to put costs on people who are trying to pay their rent. This is the sort of economic situation that we need to consider for every regulation where we are adding extra barriers to entry to make sure that we keep in mind the people who want to just get on with their lives and have good relationships. They can change in the private sector; that is much harder for people in the social rented sector but, even then, we may have gone slightly too far. We must continue to consider the economic impact on people in this country with every regulation that we pass in this House.
Baroness Warwick of Undercliffe (Lab)
My Lords, I will speak briefly in support of the noble Lord, Lord Best. I declare an interest, which I recently gave up, as the chair of the Property Ombudsman board. Perhaps I can provide some of the evidence that the noble Baroness, Lady Coffey, wanted because, in 30 years of dealing with complaints about property agents, the Property Ombudsman has seen many disputes that probably would not have occurred had those agents undertaken formal training and qualifications.
In 2023—the latest statistics we have—the ombudsman resolved over 2,200 letting disputes. Of these, over half concerned the management of tenancies where the main issues were the agents’ performance in organising and communicating repair and maintenance issues. For the majority, dissatisfaction in these disputes concerned simple and consistent communication around timescales and, in general, managing expectations. Training for agents on how to manage tenant and landlord expectations would have stopped many disputes arising in the first instance.
In addition, there were more than 500 disputes that related to complaint handling. Again, agents currently do not take a consistent approach to complaint handling, which often leaves both tenants and landlords frustrated. It became very clear to me in my time at the Property Ombudsman that to provide a professional and consistent level of service to tenants and landlords, many letting agents would benefit from formal training. It would not only help agents to provide a better service but set consistent expectations for consumers, meaning that relationships between agents, tenants and landlords would improve.
In my brief intervention, I reinforce the RoPA report recommendations of the noble Lord, Lord Best, indeed reinforced by the work of my noble friend Lady Hayter, that the elements required to implement a training and qualifications regime are already in place. I hope it would not be too significant a leap for the Government to make training and qualifications a mandatory requirement for all letting agents.
Baroness Grender (LD)
My Lords, talk about save the Best until last—well, until the penultimate. The breadth, depth, knowledge, understanding and experience of the names backing these amendments is fascinating and extraordinary. I thank all noble Lords. I speak on behalf of my noble friend Lady Thornhill who also put her name to both amendments. She signed these amendments and we backed them because it is so astonishing that property agents still, today, have none of these qualifications and that anyone can be set up and become a lettings agency. It is staggering given the amount of expertise that they need in order to advise landlords and tenants on these significant complex legal issues in exchange for the not insignificant amounts of money they get for doing that very job.
Propertymark and others are pressing for this. They know that there are people out there who are not doing a good job, as the noble Lord, Lord Truscott, described, and that they are letting the side down and giving good lettings agents a terrible reputation. It is in everyone’s interest that this aspect of the private rented sector is regulated, precisely because the UK property market is very heavily regulated already, with strict laws governing tenants’ rights and landlords’ obligations across many different Acts. Knowledge, understanding and training around that is absolutely critical.
Qualified property agents should possess the knowledge and expertise to navigate this minefield. Legal compliance and risk management are essential. The list of what they have to do already is long and complex and the Bill will add to it, which is why a transition timeline is essential, with thorough, clear guidance as to what is expected, when and by whom. Landlords are rightly worried about this, and I hope that the Minister can reassure the sector on that particular issue of timeline.
It is worth stressing that without proper qualifications, agents risk costly legal battles, fines and damage to their own professional reputation. We have heard that there are already qualifications out there. The sector is keen to get going and roll them out, but they need that push; that degree of compulsion. Amendments 203 and 204 would provide that. Qualifications demonstrate that the agent is knowledgeable about market trends, property evaluations, but also, importantly, ethical practices and transparency itself. All these things are needed. This would create a virtuous circle, boost tenants’ confidence and make landlords more likely to trust their investments with a qualified agent who would also be able to conduct property inspections, manage maintenance, repairs and rent collection and handle financial management. Surely this has to be done with real professional skill, reducing the risk of disputes and maintaining property value. Those agents who get ahead of the curve and get qualified now will become the best. They will stand out from the crowd in a competitive marketplace.
If the Bill is about raising the standard in the private rented sector, rooting out the bad guys and making a once-in-a-generation shift in private renting, this is such an important part of the equation. The Government must grasp it, grasp it soon and get on with it. At the end of the day, it is not just about bricks and mortar, but people’s homes and livelihoods. I ask the Minister: if not this Bill, where and when?
Lord Jamieson (Con)
My Lords, I thank the noble Lord, Lord Best, for bringing Amendments 203 and 204 before your Lordships’ House today. They propose the insertion of new clauses after Clause 63 and rightly focus on training property agents and the enforcement of agent qualifications. I also thank the noble Lord, Lord Young, who raised the important aspect of parity with the social rented sector, and the noble Baroness, Lady Hayter of Kentish Town, who said that, actually, this is very complex, that people need to understand it and that inadvertent mistakes and omissions are frequently made. The noble Baroness, Lady Warwick of Undercliffe, gave us some statistics—I could not write them down quickly enough, but I am sure I will get hold of them sooner or later. The noble Baroness, Lady Coffey, made a good point, which I will come back to, about proportionality and the risk of overregulation—something that noble Lords may have heard once or twice from this side of the Chamber. I also thank the noble Lord, Lord Truscott, and the noble Baroness, Lady Grender, whose comments I will also come back to.
Your Lordships’ House is correct to consider the value of proper training and qualifications, and the benefits this knowledge can bring to the property market. I shall focus my contribution on the impact that training can have in reducing the risk of regulatory breaches, thereby benefiting tenants. Not only will well-trained agents develop a broader and more cohesive understanding of the law but their ignorance, and the potential for breaches arising from a simple lack of understanding, will be greatly diminished. With this, significant benefits will also be felt by local authorities, as fewer cases of regulatory breaches will be brought to their attention for resolution.
Such a reduction in caseload is particularly important at a time when local authorities are tasked with implementing the Secretary of State’s reorganisation plans as outlined in the devolution White Paper. As your Lordships’ House will be well aware, local authorities are currently operating under immense pressure—facing financial constraints, staffing shortages and increasing responsibilities. It is not just a case of money; I know from my experience with local authorities and their housing teams that it is a lack of enough trained people. We need to seek to minimise the pressure that we put on them.
We must explore proactive measures such as ensuring that property agents are properly trained and qualified from the outset. By doing so, we not only improve standards across the sector but allow local authorities to focus their limited resources on strategic priorities rather than enforcement. However, as the noble Baroness, Lady Coffey, said, there is an issue of proportionality. We must ensure that any powers we pass to the Secretary of State are proportionate and can be implemented. While ministerial oversight is, of course, necessary in certain respects, we must be cautious about top-down regulation of key aspects of training and enforcement.
If we are truly committed to getting this right, we must resist the temptation to defer action or consign this matter to the “deal with it later” category. This argument has been, and will no doubt continue to be, clearly articulated across this House. Not placing provisions in the Bill is not only inadequate but raises more questions than it answers. We must understand the Minister’s intentions fully before we consider granting such significant powers to the Secretary of State. Nevertheless, the intention behind these amendments is well placed. Educating letting agents is vital, as they occupy a central role in the rental housing market and have a direct impact on whether tenants are treated both fairly and lawfully.
Exploring ways to enhance tenant protection without compromising housing supply should be at the front and centre of the Government’s thinking. It is vital that we establish clear, accessible means to ensure that landlords understand their rights and responsibilities, and the regulatory framework in which they operate. Property agents must be at the heart of this ambition.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Best, for his amendments relating to the regulation of property agents. I also thank the noble Lords, Lord Young, Lord Truscott and Lord Jamieson, and the noble Baronesses, Lady Grender and Lady Coffey, who have all spoken in this debate, as well as my noble friends Lady Warwick and Lady Hayter.
Amendment 203 would enable the Secretary of State, through subsequent secondary legislation, to introduce professional qualifications for property agents who manage assured tenancies. I am very grateful to the noble Lord, Lord Best, for his continued engagement on such an important topic—I do regard it as such. He is an ardent campaigner for driving up standards across all property agents, not just letting agents, who are the focus of this amendment.
The Housing Minister and I have had a number of conversations with the noble Lord on how best to raise levels of professionalism. We recognise the challenges that tenants and landlords can face when using letting agents. Many agents provide a good service, but some do not.
The Government are committed to ensuring that landlords and those living in the rented and leasehold sectors are protected from abuse and poor service at the hands of unscrupulous agents. On the point from the noble Lord, Lord Young, about parity with the social housing sector, we want to ensure consistency with our work to drive up management standards in the social housing sector. We are aware that in some blocks, including those managed by social landlords, managing agents will be providing services for both leaseholders and social housing tenants. It is important to ensure that any measures we bring forward on managing agent regulation take full account of other legal requirements, including qualifications proposed for the social housing sector.
Protections are already in place to make sure that both tenants and landlords are treated fairly by letting agents and can hold them to account. This includes the Tenant Fees Act 2019, which bans most letting fees and caps tenancy deposits paid by tenants in the private rented sector in England, and the requirement for all property agents, including letting agents, to be members of a government-approved redress scheme.
The Housing Minister made a Written Ministerial Statement on 21 November 2024 which set out the Government’s intention to revisit the 2019 report from the noble Lord, Lord Best, on regulating the property agent sector. We continue to engage across the sector to improve standards among property agents. We welcome the ongoing work being undertaken by the industry itself, as well as by the noble Lord, Lord Best, and my noble friend Lady Hayter.
We are continuing to consider this issue carefully and have already announced our intention to introduce minimum qualifications for property managing agents of leasehold properties and estate managers of freehold estates, and to consult on this issue this year. We will set out our full position on the regulation of letting, managing and estate agents in due course. I thank my noble friend Lady Warwick for the strong evidence she provided about why that is necessary.
Amendment 204 would have the effect that a property agent who manages assured tenancies may be part of a mandatory redress scheme only if they meet the relevant qualification requirements. In practice, this amendment would place responsibility for ensuring the appropriate property agent has the relevant qualifications on the Property Ombudsman and Property Redress. It would also give these redress schemes the power to award a financial penalty for non-compliance.
The main role of redress schemes is to deal with individual complaints by tenants against their agent. The existing redress schemes have a number of levers at their disposal, including the ability to award compensation to a tenant or a landlord where things have gone wrong. They may also expel members from their scheme. However, redress schemes are not designed to be enforcement bodies, so it would not be appropriate to give them powers to issue a financial penalty. Such measures should be reserved for enforcement authorities, such as local authorities. Furthermore, expulsion from or failure to join a redress scheme will not expressly prevent an agent from trading, although it does mean that the agent is in breach of regulations and liable for enforcement action by the local authority.
The question of who is best placed to enforce qualification measures is important and is certainly something the Government are taking into account as part of their consideration of the regulation of managing, letting and estate agents. As I have mentioned before, we will set out our position on this in due course. I am happy to meet the noble Lord, Lord Best, and any other noble Lord to discuss this issue further. However, with these assurances, I hope that the noble Lord will withdraw his amendment.
Lord Best (CB)
My Lords, I am deeply grateful to all noble Lords who have spoken. The noble Lord, Lord Young, drew attention to the fact that social housing providers are now required to have qualifications, and the same should go for the private sector—perhaps even more so. The noble Baroness, Lady Hayter, reminded us of Awaab’s law, introduced by the previous Government after the death of little Awaab Ishak, and the dangers of housing management not operating smoothly and for the safety of the occupiers. She said that this business was a job for professionals—for properly qualified people—and so it is.
I am grateful to the noble Lord, Lord Truscott, who made the point that managing agents, property agents and letting agents are dealing with millions of pounds-worth of clients’ money. It is actually billions rather than millions. A really serious commitment is required of these agents. The noble Baroness, Lady Coffey, was not so sure that qualifications and training would make any difference. I think this is a bit out of step with the sector itself, the profession, which is asking very urgently for regulation to drive out those who are not worthy of being part of that profession, just as we would expect accountants, doctors and lawyers all to have qualifications before they undertake important tasks.
“Mediated rent pauses (housing conditions)(1) This section applies where—(a) there is a tenancy to which section 9A of the Landlord and Tenant Act 1985 applies;(b) it appears to the tenant that the landlord has breached the covenant implied by that section; and(c) it appears to the tenant that the landlord has failed to carry out works necessary to remedy any such breaches within the timeframes set out in regulations made by the Secretary of State under section 10A(3) of that Act.(2) A tenant is entitled to make arrangements to pay rent to an independent individual, rather than to the relevant landlord.(3) The independent individual must not pass any rent paid under subsection (2) to the landlord until there has been a determination or agreement between the landlord and tenant as to the landlord’s liability for any breach of the covenant implied by section 9A of the Landlord and Tenant Act 1985.(4) Where a determination or agreement under subsection (3) sets a time by which works are to be completed, the independent individual will—(a) release any rent paid under subsection (2) to the landlord if the works are completed by that time;(b) release any rent paid under subsection (2) back to the tenant if the works have not been completed by that time.(5) In this section an “independent individual” means the independent individual responsible for investigating complaints made against members of a landlord redress scheme under section 65.”
Baroness Bennett of Manor Castle (GP)
My Lords, all the bright-eyed and bushy-tailed Members of the House who are still here at 12.47 am will note that I am not the noble Baroness, Lady Jones of Moulsecoomb. My noble friend is the Green lark, and I am the Green owl, so you get me after midnight.
I agree with the comments of the noble Baroness, Lady Williams of Trafford. The hashtag I often use is #Nowaytorunacountry. I take the systematic approach to this and suggest that your Lordships’ House urgently needs to think about a reset of our sitting hours.
I rise to move Amendment 206 in the name of my noble friend. This is a very straightforward, positive, friendly amendment aiming to assist the Government to ensure that this legislation can be enforced and can make a real difference. We know that so many renters are trapped in mouldy homes with leaking roofs and heating and hot water systems that are not working. When renters find themselves in those kinds of situations, this amendment would give them the right to pay the rent to a third-party body. My noble friend Lady Jones has suggested the new ombudsman, but we are very open to other suggestions as well. There are other ways of doing it. The amendment is written in a neutral way.
This is to deal with the situation where a landlord refuses to carry out essential repairs, yet the tenant is in a situation where they still have to keep paying for this utterly inadequate accommodation. The arrangements under this amendment would be that, if a landlord carries out the works and ameliorates the problems, the independent third-party would send them the full amount of rent due. If not, the tenant could get a full or partial refund, which they might well otherwise have to go to court to try to recover.
This is both a fair and an effective provision. It punishes the bad landlords and does not impact on the good ones. From the Government’s point of view, this is a constructive suggestion to help make sure that this legislation delivers on its stated aims. With those brief remarks, I beg to move.
Baroness Coffey (Con)
My Lords, this in effect creates a formal escrow process. One of my proudest achievements was to organise a student rent strike, admittedly some time ago, as noble Lords may recognise. At the time, the university accommodation was due to be dismantled at the end of the year and as a consequence it felt like the university was not taking various matters very seriously.
I happened not to be a paying student at the time; I was a vice-warden in a hall of residence. So I did help them, but I insisted that, if I was to help them, they would have to pay over their rent to avoid being evicted. We did that by handing the money to the student union, to effectively act in escrow. As a consequence, repairs were made and everyone ended up happy—apart from the university, which did not like my role in that at all.
The reason I tell that story is that it matters that tenants should be able to withhold cash going directly to a landlord when the landlord is, frankly, taking the mickey. Awaab’s law has already been mentioned and Clause 63, which we did not specifically address, is already extending that to the private sector, and I welcome that. We need to work out a much easier way for people to effectively deploy this escrow approach. That is why I am supporting the amendment.
It is fair to say that we need to make sure that any such processes are easy to administer. Going a little bit further, there is a regularly read out statistic that something like 15% to 20% of housing benefit—or housing support, whether as direct housing benefit or through universal credit—is thought to go to properties not deemed fit for rent. I went into a reasonable amount of detail on this with officials.
The philosophy explained to me by the Permanent Secretary and other officials was that the state thus far should not determine on behalf of the renter where they are going to live; it is an important right for the renter to make that choice—even though it felt repulsive to me that taxpayers’ money was being spent in, frankly, some pretty ropey places. From my visits to some different housing, I have to say it was quite extraordinary what was going on. Sometimes, I am afraid, the dilapidation was the consequence of the tenant not allowing repairs to be undertaken—but that is a minor aside. The point is that—whether it is private money, your own money or the state’s money going to a private landlord—it matters that we have habitable accommodation. Therefore, I strongly support the amendment from the noble Baroness.
Baroness Scott of Bybrook (Con)
My Lords, these amendments have raised the serious and emotive issue of the reality of tenants living in poor housing conditions and the remedies that are available when landlords fail to act. It is an area where frustration and vulnerability can understandably run high.
Amendment 206, moved by the noble Baroness, Lady Bennett of Manor Castle, on behalf of the noble Baroness, Lady Jones of Moulsecoomb, proposes a system of mediated rent pauses. Under that model, tenants would be entitled to pay rent to an independent individual rather than their landlord when repairs are not carried out within the expected framework. However, we must be clear-eyed about this. How would it operate in practice? Who would this independent individual be in real terms? Would it be the redress scheme ombudsman? If so, is it appropriate or even realistic for them to be holding and distributing rent payments? Would they have the resources, legal authority or financial infrastructure to do so? It is overcomplicated.
There is also the question of safeguards. What mechanisms would ensure that the process was fair to both parties? What happens if a tenant withholds rent on the basis of a dispute that turns out to be unfounded? How long might rent be withheld, and what impact would that have on smaller landlords with limited financial resilience? It is entirely right that landlords should meet their obligations to maintain safe and decent homes, but we should be cautious about creating a system that effectively withholds rent before any formal adjudication. That could introduce significant uncertainty into the private rented sector. Would this approach encourage resolution or would it risk entrenching disputes? Might it push responsible landlords out of the market while rogue landlords simply continue to ignore the rules?
In short, while the amendment is well intentioned, and of course we sympathise with all individuals living in poor conditions and battling with irresponsible and careless landlords, it raises complex questions about implementation and unintended consequences. On balance, we are not persuaded that the provision as drafted would be workable in practice. However, there must be a better, more practical way to ensure that tenants are protected without creating further layers of bureaucracy and pushing good landlords out of the market.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Jones of Moulsecoomb, for tabling Amendment 206, ably supported by the noble Baroness, Lady Bennett, who moved it, and I thank the noble Baronesses, Lady Coffey and Lady Scott, for taking part in the debate.
Amendment 206 would allow a tenant to pay rent to the ombudsman rather than their landlord if the landlord had failed to meet legal requirements on housing quality. I strongly agree with the desire of the noble Baroness, Lady Jones, to ensure that landlords remedy hazards in good time—we all know the outcome when that does not happen—but I feel that the Bill’s existing provisions are the best way to achieve that. The Bill will allow private rented sector tenants to challenge their landlord through the courts if they fail to comply with the Awaab’s law requirements, such as timescales for remedying hazards. Alongside that, it will allow us to apply the decent homes standard to the private rented sector, which is an important move.
The PRS landlord ombudsman will provide a new route of redress for tenants and will be able to investigate complaints about standards and repairs. The Bill will also strengthen rent repayment orders, including by increasing from 12 months to two years the amount of rent that a tribunal will be able to award a tenant. Tenants can seek rent to be repaid where a relevant offence has been committed, including offences related to housing standards, such as failing to comply with an improvement notice.
The amendment has the potential to be administratively complex and risks unintended consequences that might lead inadvertently to worse outcomes for tenants. For example, rent being held by the ombudsman could delay repairs in some cases if it made it more difficult for landlords to fund the required works, a point that I believe the noble Baroness, Lady Scott, referred to. Existing measures in the Bill place legal expectations on landlords about the quality of their properties and give tenants access to compensation if their landlords have not met obligations in relation to standards, as well as providing mechanisms through which landlords can be required to carry out repairs. I therefore ask the noble Baroness to withdraw the amendment.
Baroness Bennett of Manor Castle (GP)
My Lords, I thank the Minister for her response, and those who have taken part in this short but perfectly formed debate. I thank the noble Baroness, Lady Coffey, in particular for her support for the amendment. It is something we might come back to and look at the working of down the track. I also thank her for the fascinating tale of student days which, I think, took many of us back to our own student days. I think there was an expression of support from the noble Baroness, Lady Scott, for the intention if not the exact drafting of the amendment. I would stress that we are not wedded to the precise drafting, as we are in Committee; we would be delighted to work on the detail of the drafting as we go forward.
In response to the Minister’s response, I am afraid there is a phrase that I am sure is in the Civil Service handbook: “inadvertent consequences”. That seems to be the response that every Minister gives. More substantively, what the Minister said is that tenants can challenge through the courts and appeal to the ombudsman, and orders for action can be done. Those are all things that have differential levels of access depending on people’s capacity, people’s awareness, people’s ability to access those things—their time and energy and costs. The action proposed by this Amendment 206, however, is a really straightforward and simple way to give tenants the power to have control and agency for themselves, not relying on other bodies.
Having said all that, this is of course Committee, and I beg leave to withdraw the amendment while reserving the ability to come back on Report.
Renters’ Rights Bill
Wednesday 14th May 2025
(1 year, 2 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-VI Sixth marshalled list for Committee - (13 May 2025)
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, it may not surprise your Lordships that before we start the debate on the first group, I remind the Committee again of the protocol around declaring interests. As I have mentioned, noble Lords should declare relevant interests at each stage of proceedings on a Bill. That means that in Committee, relevant interests should be declared during the first group on which a noble Lord speaks. If a noble Lord has already declared an interest in Committee, that is sufficient, but if this is their first contribution, any relevant interests should be declared.
Amendment 206A
Lord Cashman
“Residential boat fees to be classified as rentThe rights set out in Part 1 of this Act extend to any individual—(a) for whom a boat is their only home, and(b) who is liable to pay a boat licence fee, boat registration fee, boat rental fee or mooring charges.”
Lord Cashman (Non-Afl)
My Lords, I apologise for racing here like a 15 year-old. I was under the impression that there was another Urgent Question, but there is no excuse.
Your Lordships will be pleased to hear that this is my first contribution in Committee, although I raised this issue at Second Reading. In moving Amendment 206A, I shall also speak to Amendments 262 and 271. While this is my first intervention, I am all too aware of the complexity of the Bill, so it is right that I give my gratitude to the clerks of your Lordships’ House who have advised me on how to proceed from the very beginning. Initially, it was my intention to bring forward one amendment to address the absence of rights and protections for permanent houseboat residents, those people who live permanently on houseboats along the rivers and inland waterways of the United Kingdom. After further advice, we have three amendments.
I am also grateful for the help I have received from Abbie North and Caroline Hunter from the University of York, Pamela Smith of the National Bargee Travellers Association and houseboat residents around the country. I am also particularly grateful to the noble Lords, Lord Young of Cookham and Lord Best, and the noble Baroness, Lady Miller of Chilthorne Domer, for their support and for adding their names to my amendments.
I believe that the amendments are straightforward in what they request, but I recognise that they could be complicated in their implementation. Amendment 262, calling for a review from the Secretary of State, I consider to be entirely reasonable, and I will consider returning to it at a later stage if there is no movement from the Government or commitment to it or its principles. I thank the Minister and her team and officials for requesting to meet me when I had, interestingly, just one amendment tabled. It was a frank, good-humoured discussion, and I am aware of the good faith concern that exists, but I was deeply disappointed to learn that such a reasonable amendment calling for a review could not be accepted and would, it was said, drain resources cross-departmentally. Amendment 262 is a perfectly reasonable ask, specifically since this issue has been shunted into the sidings by successive Governments since 2005, despite frequently being raised in another place and in your Lordships’ House.
These amendments address a series of wrongs that need to be righted. Relying solely on the Financial Conduct Authority and the tenuous protections of the Protection from Eviction Act 1977 is an insult to houseboat residents and just does not work. They need security of tenure and basic rights, hence the amendments.
The need for legislative action is becoming urgent. The rights and protections afforded by this Bill and other Acts of Parliament should apply to residential houseboat residents because they have tenancies and agreements for their moorings, a mooring fixed to a pier or the riverbank. They have to abide by all the obligations of residents within their local environment; additionally, they pay council tax, energy bills, water bills and insurance, but they are missing statutory rights and protections. They have even fewer protections when the owners of moorings propose increases to mooring fees, develop the site or, in some cases, refuse to renew licences.
The problem is growing. It is happening across the country, from Vauxhall to Chelsea to the Isle of Wight, in Manchester and Brentford and along the rivers and canals of the United Kingdom. Indeed, it is happening in Southwark. One solicitor specialising in this area said the calls are increasing monthly. We need these amendments. The calls are from people now facing not only eviction from their moorings but having to physically move their homes. They must take their homes with them or abandon them. She told me that these calls are often coming from vulnerable people, including disabled people who pay council tax and have leased residential moorings.
I am grateful of the South Dock Marina Berth Holders’ Association in Southwark for bringing its plight to my attention. Currently, plans are before the council that could force out residents, businesses and community hubs and demolish the entire site, a site providing marine facilities to more than 200 boats and more than 300 marina residents, which is further proof of the need for government action. I quote SDMBHA:
“Boaters have no legislative protection from exorbitant rises in mooring fees. Boaters have no security of tenure and are increasingly facing existential threats to their way of life which means that these communities and increasingly Boat communities across the entire country are experiencing huge existential threats”.
Southwark Council, which owns the site, has decided to look again, but the development threat hangs over yet another community of boat dwellers.
Time and again, I believe that Governments have dismissed these overlooked and often forgotten people. The excuse was that more evidence was needed. Well, it is there. I have outlined some of the evidence. The problem is growing and, as I said, will not be wished away. As homes become more difficult to rent and impossible to buy, people will turn to alternative sources, as we have seen with mobile homes and boats. People need places where they can live. The right to a home, a place in which to rest one’s head is a basic human right. Perhaps those who cannot afford to buy a place in London but may have some money will be tempted by one of the adverts at Limehouse Marina and elsewhere that encourage people to buy their floating home from £250,000 upwards, with flexible moorings, without security of tenure.
I have gone on longer than I intended. I know that the Minister, is sympathetic, but now is the time for action. The time for commitment is now. Therefore, I say to the Minister, if not now, when? There must be no attempt to kick this into the long grass again. Let us not say that we cannot do it because a mixture of different departments needs to deal with it or there are not enough resources. If the resources are not there now, when will they be? Meanwhile, evictions and homelessness among these communities will continue to increase. This needs political will and intention. I urge the Government, at the very least, to commit, within the legislation, to bring forward the review that I request from the Secretary of State. We can compromise on the length of time, but let us have a commitment to get it done. Let us deal with and recognise the needs of these people before these shameful situations turn into a national scandal. I beg to move.
Baroness Whitaker (Lab)
My Lords, I apologise for not being able to speak at Second Reading of this very welcome Bill, which will return that most valuable public good—security in one’s home—to so many people. I support all the amendments in this group and will speak to Amendments 206B and 275A, in my name and that of the noble Lord, Lord Bourne of Aberystwyth, whom I thank for his support. I thank Friends Families & Travellers and Garden Court Chambers for their expect advice, and declare various positions in relevant organisations, as set out in the register. I am also most grateful to the Public Bill Office for sorting out some last-minute corrections so rapidly.
Baroness Miller of Chilthorne Domer (LD)
My Lords, I have added my name to Amendments 262 and 271. I am very grateful to the noble Lord, Lord Cashman, for tabling them and for his excellent introduction, which explained the lamentable situation we have arrived at whereby people living on boats continually fall through the cracks between housing and what is now known as Defra. I will go a little bit into the history, so that the Minister will perhaps appreciate the need for action now.
Those with permanent moorings have some protection, although the cost of mooring fees and licences is an issue. I am especially concerned with those who do not have a permanent mooring and are classified as continuous cruisers, which means they can stay for a maximum of only 14 days in one place. This situation dates from the British Waterways Act 1995, when Parliament removed the need for boat dwellers to have a home mooring.
The Canal & River Trust, which is now responsible for our waterways, has embarked on a review by an independent commission. It says that the review will seek to implement any reforms, including any legislative changes, as soon as possible after its conclusion. Your Lordships may feel that that is a good way forward, but the problem is that housing is not reflected anywhere in the Canal & River Trust’s main purposes: waterways management, maintenance, environmental protection, and generating income to support its work, which might include development along the riverbanks. Your Lordships can see that nowhere is it tasked with looking after the rights of boat dwellers to a safe and secure home situation. All this amendment is asking the Minister to do is to ensure that this group of boat dwellers be considered within the scope and implications of the Bill. Defra formed a working group in 2017 to try to resolve some of these issues, but that was inconclusive.
Amendment 271 concerns the definition of a dwelling house. In 2016, the Planning and Housing Act placed a duty on local authorities to assess the housing needs of boat dwellers and bargees. However, the Act did not read across to the duties of the Canal & River Trust, in whose gift lie mooring and mooring regulations. As the riverbanks are continually assessed for development or leisure potential, the supply of moorings is constantly under threat. The ability to moor somewhere is obviously essential if a boat is your home. Given the Canal & River Trust’s rule that continuous cruisers cannot stay on any one mooring for more than 14 days, for a boat to remain a home there must be a supply of available moorings.
There is a lot of history to this, but I will not go into all of it because I do not want to detain the House. I simply mention that in 2004, I took part in a debate when the late Baroness Hanham was trying to pass an amendment to address this very issue. My noble friend Lady Hamwee made a very apposite point when she said that for
“the Office of the Deputy Prime Minister to refer the people involved to Defra and for Defra to tell them that it is a matter for the Office of the Deputy Prime Minister leaves us wondering what we can do to get bits of government not just to talk to one another but to find a solution to a very real problem”.—[Official Report,16/9/2004; col.1422.]
That was over 20 years ago. My right honourable friend Vince Cable raised the issue in 2006 when he was MP for Twickenham. He identified one reason why the navigation authorities and regulatory bodies are rather hostile to residential boat owners—the noble Baroness, Lady Whitaker, touched on this. He said that at best they tolerate them, but they do not see them as integral to canal conservation. So there was a certain amount of prejudice against boat dwellers and Travellers, and I do not believe that has changed.
The Minister who replied to my right honourable friend Vince Cable is now the noble Baroness, Lady Smith, Leader of our House. She said that a working group had been formed and that action in this area had been sought for a number of years. Well, that was 19 years ago and the solution is no nearer, because the department responsible for waterways never considers housing matters for boat dwellers, and the housing department, which has been through many names in time, does not relate to waterways issues. This Bill must break the mould and address this matter now.
Lord Young of Cookham (Con)
My Lords, I have an interest to declare, as my family owns land in Cookham with a quarter of a mile of river frontage along the Thames and one of its tributaries, but we have never accommodated houseboats. I have added my name to Amendment 262, so ably spoken to by Lord Cashman, and it is appropriate that houseboats are linked in this group of amendments with mobile homes, about which the noble Baroness, Lady Whitaker, has just spoken. In both cases, the home is owned or rented by the owner, but the land or water on which it rests is owned by somebody else. This leads to issues of security mentioned by the three previous speakers, as the home—which, as we have heard from the noble Lord, Lord Cashman, may cost a quarter of a million pounds—has really no value unless it is on land or secured to land. To that extent, there is some comparison with leaseholders, because the flat owner owns the flat, but he does not own the land on which it is based. That is the point that I want to make.
All three tenures—leaseholders, mobile home owners and boat owners—have varying degrees of security. Right at the top of the scale are leaseholders, whose rights have been progressively improved over the last 50 years, and more rights are promised in forthcoming legislation. Lower down the scale are mobile home owners. They have rights; as a Minister, I put on the statute book the Mobile Homes Act 1983. That legislation was then succeeded by other legislation, further improving the rights of mobile home owners. By contrast, houseboat owners are right at the bottom of the list and have very little security. So far, all Governments have refused to make any progress.
I will not repeat the problems facing boat owners that have been so ably mentioned, but I just make this point. In answer to a Question on 17 January, the Minister in the other place said:
“The government recognises that while the occupants of residential boats have the benefit of protection under the Protection from Eviction Act 1977 and wider consumer … legislation, they do not enjoy the same level of … security as those in the private rented sector. We will consider what action might be necessary to provide houseboat residents … with greater security in their homes”.
That is exactly what Amendment 262 does. It asks the Government to review the security of houseboat residents, which the Answer said they are going to do anyway. So, I honestly do not see why the Minister has any reason not to accept this amendment, as it simply is in line with an Answer given by her parliamentary colleague only three months ago.
Lord Best (CB)
My Lords, my name is down in support of Amendment 262 in the name of the noble Lord, Lord Cashman, which, as he so eloquently explained, calls for a review of the position of river houseboat residents. I also support his Amendment 206A, which would give houseboat residents similar protections to those afforded to renters in the Bill before us. Protections are needed for those on houseboats against evictions and massive increases in mooring fees and licences, which are simply not affordable to many who have made their homes on our rivers and canals.
I couple these houseboat amendments with Amendment 206B, so convincingly covered by the noble Baroness, Lady Whitaker, and supported by the noble Lord, Lord Bourne of Aberystwyth, which would enhance the rights of those living in so-called mobile homes, often known as “park homes”. There are obvious parallels between those living in mobile homes where the site is owned by someone else and those living in houseboats, where, again, the resident does not own the place where their home is situated, as the noble Lord, Lord Young, explained. In both cases, there is a need for protection just as much for the rights of those occupiers as for those living in permanent bricks and mortar homes that cannot be moved.
I pay tribute to the noble Baroness, Lady Whitaker, for her fearless campaigning for Gypsy and Traveller rights, and I will not attempt to speak on her expert amendments in respect of those communities.
My interest in respect of mobile homes stems from the Mobile Homes Act, which the former MP, Peter Aldous, introduced as a Private Member’s Bill and I piloted through your Lordships’ House in 2013. Today, some 200,000 people—many of them elderly—occupy such mobile homes, on about 2,000 sites. Although some are living in happy communities, there have been too many cases of unfair practices by site owners taking advantage of those residents.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, I apologise for not being present during Second Reading or the preceding Committee sittings due to a health issue. I declare my interest as a vice-president of the LGA.
I fully support this group of amendments and wish to speak in particular to Amendment 275A, to which I would have added my name if I had been more alert to the changes at the time. I am delighted to see Amendments 206A, 262 and 271, which cover the conditions of those living in boats. The noble Lord, Lord Cashman, has laid out the arguments for these amendments extremely eloquently.
Over the years, I have had several meetings with the National Bargee Travellers Association. These are a group of people within our community who have had a difficult time, as they have no permanent moorings. Some find they are constantly moving in order to comply with mooring conditions. This can be extremely disruptive, especially for those who have school-aged children or health appointments to keep. As my noble friend Lady Miller has said, this issue has been running for a very long time. It really is time that equality was brought to the issue for all those living on a boat as their home. There should be no difference between the way different houseboat dwellers are treated. Boat dwellers should have the same protection as those living on dry land: a safe and secure home.
The noble Baroness, Lady Whitaker, has set out the case for Amendments 206B and 275A extremely well. It is essential that all the facilities on site, including amenity blocks, are in a good state of repair and fit for use. Residents living on Gypsy and Traveller sites often experience poor living conditions, with inadequate mechanisms in place to hold landlords to account, especially on the maintenance of essential living facilities. The Renters’ Rights Bill presents a vital opportunity to address this, and we should grasp it.
Most significantly, the RRB abolishes assured shorthold tenancies and fixed-term tenancies. It also introduces an extensive range of further measures designed to enhance the rights of tenants, including applying the decent homes standard to the private rented sector and extending Awaab’s law to private rented sector tenancies. The Office for National Statistics conducted research in 2022 with residents living on private and local authority sites, who reported issues such as fly-tipping, vermin infestation, proximity to environmental hazards, dampness and leaks, and the general need for repair. This could be the environment which some children would consider their playground.
The current changes will not apply to buildings comprising essential living facilities, nor the caravans and mobile homes situated on a pitch on a Gypsy or Traveller caravan site. Together with the housing health and safety rating system contained in Part 1 of the Housing Act 2004, these measures are important means of policing housing standards. There is no justification for not applying these regimes to the buildings that Gypsy and Traveller households use as part of their home or mobile home when it is rented from a landlord.
The previous speakers have supported this group of amendments and I agree wholeheartedly with their comments. The protections afforded to tenants in bricks- and-mortar buildings must be extended to those whose homes are in caravans and mobile homes, as well as to the amenity buildings on the sites of these homes. I look forward to the Minister’s response.
The Earl of Lytton (CB)
My Lords, I welcome this group of amendments as a point of discussion and commend the noble Lord, Lord Cashman, on his introduction of it. As somebody who has spent 50 years in the property business, I am absolutely unsurprised that the noble Lord may have received a less than enthusiastic welcome from members of the Bill team, because his amendment raises a fundamental principle around what we are actually looking at: that is, whether we are looking at the use of land or the use of a water body, which we used to refer to as “land covered by water”.
It seems to me that the principles relating to those two are rather different. A fixed pitch for a caravan is fundamentally different in qualitative and quantitative terms from a mooring, which is, in essence, a connection to the shore but with the vessel fundamentally sitting over water. It is not just houseboats that are involved here. This is also about moorings in marinas, where the water body may be a tidal area, which one would assume might be in the possession of the Crown.
A fundamental difference here is that, where you have a house as a piece of real estate—in other words, land with bricks and mortar—it is fundamentally fixed and has a degree of permanence in law, unlike something that can be sailed away. To take another analogy, if somebody wishes to have a motor home and park it permanently at one location, does the same apply? Because that could be driven away; it is not in the nature of a permanent feature.
I do not have any particular problems with the provisions of this Bill applying more widely, if that policy decision is made here, but I do see a problem in terms of its application. This gets a little more complicated when you consider that the item occupied for this particular purpose may be something that somebody rents as an entirety—in other words, a boat and a piece of mooring and the water in which it floats—or may be something quite different, in terms of its nature, because the person who occupies the thing may actually own the boat and bring it there.
On the point made by the noble Baroness, Lady Whitaker, Awaab’s law might apply to the former instance, where the boat and the pitch are a complete package, rented as one element. However, it would not apply to an occupier of their own houseboat. However leaky the bucket may be, it is their responsibility and not the responsibility of the person from whom they are renting the mooring.
So I can see that there are a number of different ways in which this rather difficult cake gets cut, and I rise to clarify some of the points as a matter of land law rather than to pass judgment on whether, as a matter of policy, there should be the protections afforded under this Bill in whole or in part.
Baroness Whitaker (Lab)
I have the greatest respect for the noble Earl’s expertise in this area. However, I suggest that the key aspect which the Renters’ Rights Bill deals with is not essentially the physical structure of the home but the fact that it is somebody’s permanent home and they are the residents and rent it. Even if it were a balloon in the sky, if it were a permanent rented home, that is the criterion that should apply equal rights to the residential person. I will probably defer to the noble Earl’s expertise, but it does seem to me that renting your home is what matters, not what the home consists of.
The Earl of Lytton (CB)
I am grateful to noble Baroness, who has great wisdom in this area. I am a humble technician on these matters.
There is an issue of permanence: whether the item is in some way permanently fixed or adhering to the surface—or, if it was a house on stilts, glued to the bottom of whatever water body there is—or whether it is actually capable of being removed. Permanence is a bit of a problem, I agree. I dare say that the average static caravan might have a life expectancy of perhaps 20 years before it is effectively scrap. I do not know how long a houseboat lasts, because I have never asked anybody. I do know that, every now and again, they have to be hauled out of the water and taken away to some yard to have plates welded on the bottom, anti-fouling paint added and all sorts of other things done to make them fit for purpose. Therefore, they do not have that permanence of being permanently affixed to a site from which they cannot be removed without total demolition.
I see that as rather different from something that can be sailed away, driven away or lifted out of the water. It is a different nature of animal from what we understand as real estate. The real estate here would be the land covered by water or, in the case of a mooring in a marina, that bit of tidal water. For something that might be on wheels, the permanent bit is the pitch and not the device or box in which the living takes place. That is the break point that we are dealing with here. As I say, I make no policy judgment on this. I just say that there is a technical difficulty in real estate terms in trying to pin it down, which is why the noble Lord, Lord Cashman, got the reception that he described earlier.
Baroness Warwick of Undercliffe (Lab)
My Lords, I support my noble friend Lady Whitaker. I want to emphasise the shortage of appropriate accommodation for Gypsies and Travellers, particularly when the size of this community is growing. There are multiple disadvantages linked to insufficient quality accommodation on sites—not only poor education and physical and mental health outcomes but a sense of social exclusion from the wider community.
The dearth of GRT sites and accommodation can cause conflict and tension. Local councillors are beset with complaints if an unauthorised encampment appears in their area. Unauthorised encampments often result from a lack of suitable authorised places. The Government already know these issues, but they need the partnership of the housing sector to drive change and speed up delivery of sites. I know that the social housing sector would like to help the Government in breaking this cycle by providing sufficient and appropriate sites and accommodation. There are a number of measures that can be taken in partnership to deliver more homes, and reduce conflict and costs to the taxpayer.
Baroness Scott of Bybrook (Con)
My Lords, I thank all noble Lords who contributed. This is what makes this House so good at these sorts of debates, because expertise from all parts of this debate has been shown today.
These amendments draw attention to the housing circumstances of non-traditional tenures, in particular residential boat dwellers, mobile home residents and members of the Travelling communities. These are individuals and families whose housing arrangements, as we have heard, do not always align neatly with the frameworks established for the private rented sector.
The amendments in this group, most notably those from the noble Lord, Lord Cashman, and the noble Baroness, Lady Whitaker, raise legitimate questions, from the proposal to classify mooring fees and site fees as rent, to calls for formal reviews on how this legislation impacts riverboat dwellers, mobile home residents, and Gypsy and Traveller communities. The amendments ask us to think carefully about the scope and reach of the Renters’ Rights Bill. We on these Benches recognise that individuals living in houseboats, in mobile homes and on Traveller sites often face unique vulnerabilities, and we must be cautious not to exclude them from appropriate protections.
At the same time, it is essential that we examine whether the legislative instruments proposed in the Bill are the right fit for these circumstances, or whether we risk introducing unintended consequences for landlords, licensing authorities, the Canal & River Trust, which manages our waterways, or even the residents themselves. One of the questions here is whether the current legal definitions, such as “dwelling house” and “rent”, are suitable for application to mobile structures or moorings, as we have heard. However, we must also consider the interests and views of different Traveller communities. Have the Government undertaken proper consultation with these communities? Do they, in fact, want to be brought into the scope of this legislation, and on what terms? We must avoid legislating for communities without engaging with them first.
As we have heard today, particularly from my noble friend Lord Young of Cookham, these amendments do not seek sweeping or immediate change—rather, they propose reviews and clarifications—but even the suggestion of classifying moorings or site fees as rent could trigger significant changes to how the law treats these tenures. This could introduce unintended complexity for landlords, many of whom are small-scale, and lead to disputes where the legal framework is unclear or even inapplicable. More work needs to be done on this issue, in our opinion. As my noble friend said, that has already been promised by the Government. Finally, we must ask whether there is a clear and compelling case for bringing these non-traditional tenures within the scope of the legislation, or whether doing so risks creating unintended consequences for both the tenants and the landlords.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I first express my appreciation for starting these debates at a reasonable time today. We have been getting later and later, so I am very pleased. I hope that we finish them at a reasonable time as well.
I thank the noble Lord, Lord Cashman, and the noble Baroness, Lady Whitaker, for their amendments relating to non-traditional tenures, and all who have contributed to this debate. I agree with the noble Baroness, Lady Scott, in saying that it shows the best of this House when you get expertise like that from across the Chamber, from the noble Baronesses, Lady Miller, Lady Bakewell and Lady Warwick, the noble Lords, Lord Young and Lord Best, the noble Earl, Lord Lytton, and, of course, the noble Baroness, Lady Scott, herself.
I thank the noble Lord and the noble Baroness who have amendments in this group for their very helpful engagement on the issues they raised. Before I give my responses to the amendments, I say that I truly understand the frustrations felt by both of them, and those on whose behalf they speak, that these issues have not been addressed by successive Governments. Although I do not believe the Bill is the vehicle to address those issues, as I expect they will have anticipated from our meetings, I will continue to work with them to seek appropriate solutions to the issues they have raised.
I turn first to Amendments 206A, 262 and 271, tabled by the noble Lord, Lord Cashman. I thank the noble Lord for raising concerns about difficulties faced by houseboat owners in general and the houseboat owners in Chelsea who he has talked to me about in the past. Amendment 206A would give those who own or rent a houseboat and use the boat as their main residence the same rights under Part 1 of the Bill as renters of residential buildings. Although occupants of residential boats may benefit from some protection under the Protection from Eviction Act 1977 and some wider consumer protection legislation, the Government recognise that they do not enjoy the same level of tenure security as those in the private rented sector.
However, the Renters’ Rights Bill focuses on the law relating to rented homes, not owner-occupiers, and the tenancy reform measures in Part 1 focus on the assured tenancy regime, which applies to most private renters in England and relates to residential buildings. The assured tenancy regime does not apply to houseboats or other moveable property—an issue to which the noble Earl, Lord Lytton, referred in his intervention. Those in rented houseboats will have a licence to occupy the boat and will fall outside the assured tenancy regime that the Bill is concerned with.
Specifically on Amendment 262, as houseboats are predominantly owner-occupied—I understand that some are rented but they are mostly owner-occupied—and do not fall within the assured tenancy regime, it is therefore unlikely that a review of the impact of the Bill’s provisions would provide significant new insights into the issues affecting houseboat owners. Additionally, bringing houseboats within the scope of the assured tenancy regime, as proposed by Amendment 271, would raise fundamental and complex issues, about which I will explain a bit more in a moment, including what security of tenure means in relation to a chattel as opposed to land, and what the potential implications for moorings owners and navigation authorities might be.
The policy and legislative implications would be far-reaching and there would be a high chance of unintended consequences, as indicated by the noble Baroness, Lady Scott. The Government’s priority is to ensure the smooth and successful implementation of the measures in the Bill that are before the Committee today. On that basis, although I am very sympathetic to the noble Lord’s aims, I cannot support these amendments as they stand.
The Government will, however, continue to engage with parliamentarians and stakeholders on the complex issues about houseboats that the noble Lord has rightly and powerfully helped to highlight. The issues and history raised by the noble Baroness, Lady Miller, illustrated some of the complications in resolving these issues. I will add that providing additional security of tenure to houseboat owners would require engagement with a range of stakeholders, including more than 20 navigation authorities and the owners of land adjoining waterways, and that is just part of the complication here.
I understand that the noble Baroness, Lady Miller, said there was a working group 19 years ago in which my noble friend Lady Smith took part. I can say only that we have not been in government for the last 14 years so it has been difficult to move any of this forward.
The noble Lord, Lord Young, referred to security of tenure. As I said, providing additional security of tenure to houseboat owners would require the engagement of those navigation authorities and owners of land, and other users of waterways will have different needs and requirements that would also need to be taken into account. Security of tenure under the Housing Act 1988 applies to tenancies of buildings and land, so would not be suitable for licences to occupy boats without significant amendment. To bring rented houseboats within the scope of the legislation would require a detailed assessment of the implications for the assured tenancy regime and the changes being introduced through the Renters’ Rights Bill and other legislation that refers to it, and, as I said before, a high chance of unintended consequences.
The noble Lord, Lord Best, referred to unfair practice on mobile home sites. My email inbox indicates very much what some of those complications are, but I will talk about the mobile homes amendments now.
I thank my noble friend Lady Whitaker for her work to ensure that the Gypsy, Roma and Traveller community has a safe and secure place to live. I have had a number of conversations with my noble friend since I joined this House, and she knows that I share her concerns about some of the issues that she raises. She and I have had many discussions about this, particularly about the standards of communal facilities provided on sites occupied by the Gypsy, Roma and Traveller community. We understand the concerns and will continue to engage with parliamentarians and stakeholders on the complex issues about standards on those sites. For those sites owned and operated by local authorities, there is of course recourse both to the local authority’s complaints system and, if that is not successful, to the Local Government Ombudsman, although I appreciate that there are some unique difficulties for those communities in accessing those routes.
Amendment 206B would give those who own a caravan and use it as their main residence the same rights under Part 1 of the Bill as renters of residential buildings. That would include those who already have protections under the Mobile Homes Act 1983. For similar reasons to those that I have already set out in my response to the amendments in the name of the noble Lord, Lord Cashman, while I am sympathetic to the difficulties faced by mobile home owners, a different approach to addressing those difficulties is necessary from that proposed by this amendment. There would be a high risk of unintended consequences if an attempt were made to extend rights under Part 1 of the Bill, which is about rented homes, to mobile home owners.
The noble Baroness mentioned that the Mobile Homes Act 1983 confers on mobile home pitch agreements the key characteristics of a tenancy, rather than merely a licence to occupy. While there may be some similarities between the terms implied by the 1983 Act and the terms of certain tenancy agreements, the fact remains that those occupying pitches on caravan sites only have a licence to occupy the pitch. They have no interest in the land, and there would still be no intention by the site owner to create a tenancy between the parties. Moreover, the pitch agreement does not relate to the occupation of the mobile home itself, just the pitch on which it stands. In that sense, a pitch agreement and a secure or assured tenancy are fundamentally different types of agreement. To bring those with Mobile Home Act 1983 agreements within the scope of the assured tenancy regime, as proposed by Amendment 206B, would raise fundamental and complex issues, including what “security of tenure” means in relation to a chattel as opposed to land, and what the potential implications for caravan site owners might be.
Amendment 275A would commit the Government to carrying out a review of the implications of not extending the provisions of the Act to the Gypsy, Roma and Traveller community. Again, while I am most sympathetic to my noble friend’s aims, I cannot support the amendment as mobile homes are predominantly owner-occupied and do not fall within the assured tenancy regime, which the Renters’ Rights Bill is largely focused on. However, I understand and will further consider her points about the amenity blocks and how those issues may be addressed.
In addition, as the Renters’ Rights Bill is focused on the law relating to rented homes, it is unlikely that a review of the impact of the provisions in the Bill will provide significant new insights into the issues affecting mobile home owners. The Government’s priority is to ensure the smooth and successful implementation of the measures that are before the Committee today.
Lord Cashman (Non-Afl)
My Lords, this has been a very worthwhile and effective debate. Not for the first time in my short 30 years in politics, I think we have won the arguments but have lost the vote—should it ever be called.
I thank all noble Lords for their interventions. I hope noble Lords will forgive me if I pick out three of those who I call my friends—the noble Baroness, Lady Miller, and the noble Lords, Lord Young and Lord Best—for their very early guidance and support to me on this issue. The noble Earl, Lord Lytton, is right about the problems with what I am proposing. Indeed, the courts have exercised themselves greatly over the issue of land and chattels in relation to boats and fixings to piers. Arguably, that is why we need a clear definition and clear protections in law.
I associate myself with the other amendments in this group because I want to see more protections afforded to people, not fewer. Of course, I am disappointed by the Minister’s response. I expected more; I always expect more. I come from a profession—I have almost forgotten as it was many, many years ago—in which, if there was a problem, we went into a room and used our imagination to solve that problem, or at least to come up with suggestions for how to solve it. If, as politicians, in government and in opposition, we adopted the same process, people might forgive us more when we fail because our intention is to succeed for all the best reasons.
Of course, there are unintended consequences. I am told it fills lawyers’ pockets when such laws are passed and that happens. There are unintended consequences—the consequences of doing nothing. When I withdraw this amendment, those consequences will be the continuation of people being evicted from their homes, caravans and boats. The evictions and homelessness will be accompanied by families in despair. Having said that, I beg leave to withdraw the amendment.
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment probes why definitions which determine who is subject to housing laws, rights, and responsibilities can be amended by regulations.
Baroness Scott of Bybrook (Con)
My Lords, this group contains just one amendment, Amendment 206C, which stands in my name. This amendment probes why definitions that determine who is subject to housing laws, rights and responsibilities can be amended by regulation. This is yet another part of the Bill that is subject to change at the discretion of the Secretary of State.
Definitions in law are important. In this instance, the ability to change the definition of “private landlord”, “relevant tenancy” and “dwelling” for the purposes of determining which tenancies fall within the scope of the landlord redress scheme and the PRS database is a significant and fundamental power. Will the Minister say why the Government have sought to grant themselves this power through the affirmative procedure rather than through primary legislation? If the intent of these regulations is merely to clarify the position of superior landlords in certain circumstances, surely such clarification is best achieved through a full parliamentary process, one in which your Lordships’ House and the other place can explore the specifics and nuances of niche tenures such as student accommodation or temporary lets.
The Government have committed to lay these regulations as soon as possible following Royal Assent. We are aware that there are to be no transitional arrangements included in the Bill. In previous debates, we urged the Government to reconsider this approach and affirm their long-standing commitment to prospective lawmaking by providing clear commencement dates and reasonable transition periods for all new obligations. This would help protect both tenants and landlords from the risks associated with abrupt and unfair change. However, the Government were clear that they did not share this view. Despite that, can the Minister confirm when these regulations might come into force? Importantly, how are they going to be communicated to the affected parties given the absence of transitional arrangements? Like many aspects of this Bill, this provision is concerning, particularly given the lack of detail in the Bill. This is part of a growing trend from this Government, a pattern in not just this Bill but across others too. I hope we are not going into this, “We will commit now, but do later”. I beg to move.
Lord Marlesford (Con)
My Lords, I rise to support my noble friend very strongly. I declare my interest, as I have done before, as a Suffolk farmer who has converted redundant agricultural buildings into dwellings. It is all still part of the farming operation.
I have already warned the Government that they are in danger of relying on statutory instruments, Henry VIII clauses and subsidiary legislation for what will be primary legislation. The purpose of the Parliament is to legislate, in the first instance, primary legislation. The House of Lords, with its careful scrutiny of statutory instruments, has a particular role and record in doing this. So, this particular Bill is going, in any case, to have a lot of unanswered questions. We are going to try to ask most of those questions and get the Government to face up and give us the answers because it is a very bad principle of legislation for a Government to say, “Oh, we’ll leave that to the courts”, or something like that. That is not what legislating is about. It is important that we do not unnecessarily add into potential secondary legislation what should be primary legislation.
The Government have got to take this very seriously because this is a long and difficult Bill which has many dangers in it and ahead of it, not least—and I shall probably say this again—because the private rented sector plays an important part in the provision of housing. The provision of housing was one of the objectives of the previous Government and of this Government. It is also part of generating economic growth, which the Chancellor and the Prime Minister have repeatedly told us is their priority. I beg the Government to be more rigid and dissective in their thinking before rushing ahead with this legislation.
Lord Jackson of Peterborough (Con)
My Lords, I support my noble friend Lady Scott on the Front Bench and reiterate her very strong arguments and those from my noble friend Lord Marlesford just now.
We have seen a quite significant trend since the general election of the Government seeking to award themselves very wide-ranging, permissive powers in primary legislation with very little detail. That is a significant concern. Certainly, if the boot was on the other foot and a Conservative Government had brought forward a clause such as Clause 64, where we are being invited to take on trust the expeditious post-dated production of a statutory instrument and regulations, the party now in government would, quite rightly, have complained about that.
If we look at the detail, this is an extremely wide-ranging amendment. Clause 64(4)(b) talks about “relevant tenancy” and the adding or removal of any particular kind of relevant tenancy. On “dwelling”, paragraph (c) states,
“in addition to a building or part of a building, it includes any other structure, vehicle or vessel”,
and
“includes a building or part of a building, and anything for the time being included in the meaning of ‘dwelling’”.
That is a very wide definition to be in a Bill when we have an open-ended commitment to produce regulations without any date.
I think, and have said before, that the idea of retrospective legislation is poor. In a different context at the beginning of Committee in your Lordships’ House I mentioned this issue. It is very worrying that there is no opportunity for a period of amelioration and getting used to the regulations.
Finally, given all that, the chance of significant instances of litigation arising from this clause are pretty high, I would think. For those reasons, is the Minister able to write to noble Lords before Report at least to give an indication of when those regulations are likely to be published to reassure your Lordships’ House that this a one-off in terms of how wide and permissive these powers are? Frankly, it is not good enough. It does not allow us to analyse properly the efficacy of the policy and the likely impact it will have on any litigation for both landlords and tenants. I hope the Minister is able to take those issues on board.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendment regarding the definition of a landlord and thank the noble Lords, Lord Marlesford and Lord Jackson, for participating. Amendment 206C seeks to remove subsection (4) of Clause 64. This would mean that amendments to the definitions of “relevant tenancy”, “residential landlord” and “dwelling” set out in the Bill could not be made by regulations. This would affect Part 2, which includes the redress and database provisions.
I fully agree that any changes to the definition of those who bear responsibilities and benefit from rights under this legislation should be made with proper consideration. The definition of “residential landlord” under Clause 64 of this Bill has been drafted with care to capture the majority of typical private tenancies in England. However, the private rented sector has proven itself to be dynamic. I am sorry to say that the unscrupulous use of complicated arrangements, such as certain types of rent-to-rent schemes, has demonstrated the need for flexibility in how we define who is, or is not, in scope of private landlord redress or the database. We are also aware that other forms of occupation, such as occupation under licence, may benefit from the Part 2 protections in the future. A strong case may be made for expanding who is protected if certain arrangements proliferate following the implementation of the Bill.
Our focus at this time, however, must be on getting our reforms right for the millions living in typical private tenancies, rather than extending the redress and database provisions to other kinds of residential occupier whose needs and circumstances may be quite different from the majority. We have included a power to change the scope of Part 2 by regulations in the future if it is considered appropriate. The reason is that the introduction of mandatory landlord redress for the first time is a significant undertaking. The definition of “residential landlord” has been drafted, as I said, to capture the majority of tenancies. We have retained the flexibility to change the scope of rental agreements covered by the database and ombudsman in the future, should that be deemed necessary.
Baroness Scott of Bybrook (Con)
My Lords, I particularly thank my noble friends Lord Jackson of Peterborough and Lord Marlesford for their support on what we consider a very important amendment. I also thank the Minister, although I am surprised at her response on having a period of time to get communications in place. I will look back in Hansard but I think that, on a previous group, it was suggested that the implementation would come quite quickly after Royal Assent. If that is the case, I would quite like to know what the timings would be—whether it would be weeks or months—as and when those things are known.
On these Benches, we of course recognise that the Secretary of State should be afforded certain powers to deliver the content of legislation. However, the Government possibly have not fully considered the scale and scope of these regulatory powers, nor the level of trust that landlords, tenants and legislators must place in the Secretary of State on this issue. This is not about questioning the intentions of the Minister or others; rather, it is to suggest that significant changes should be subject to proper parliamentary scrutiny, and that both your Lordships’ House and the other place should be given the opportunity to fulfil their constitutional role—quite honestly, that is the reason we are here.
I believe that what the Minister was saying is that these powers are necessary, but I did not hear compelling justification for why that is the case. Perhaps at a later stage we might, as I said, have more information on this and the Minister might be able to give a better explanation and I would be very happy to have that in writing. However, at this point, I beg leave to withdraw my amendment.
Lord Hacking
Member’s explanatory statement
This amendment alters the Bill so that the Secretary of State must make regulations requiring a residential landlord to be a member of a landlord redress scheme, rather than leaving it to the Secretary of State’s discretion to make regulations.
Lord Hacking (Lab)
My Lords, we now move on to Clause 65. I have tabled a number of amendments in this group: Amendments 207, 210, 214, 215 and 216. All of them are directed at tidying up the terms of the Bill, but they are also rather complicated, so I must ask for the patience of the Committee as I go through them one by one, so that I get the argument right relating to each of them.
Amendment 207 takes us straight to Chapter 2 on page 99 of the Bill and landlord redress schemes. Clause 65(1) says that the Secretary of State
“may make regulations requiring a residential landlord to be a member of a landlord redress scheme”.
The difference of opinion that I have in moving this amendment is that that should not be in terms of “may” but “must”, because it is an essential feature of landlord redress schemes that all residential landlords join in.
Amendment 210 goes further into this section of the Bill. The requirement that I seek here is that there should be only one landlord redress scheme. I think that my noble friend the Minister is sympathetic to that. I would like it to be rather stronger and make it an obligation to have only one redress scheme.
We then move to Amendments 214, 215 and 216. Amendment 214 gives sympathy to those who are digitally inept, which certainly includes me. In that amendment, I seek a requirement to enable those who are unfamiliar with computers and other electronic devices to be able to enter the redress scheme and not be digitally excluded.
Amendment 215 is the most complicated of all my amendments. It would make it a condition of approval of a designated redress scheme that the Secretary of State should apply the test of what is considered appropriate and proportionate in support of tenants experiencing house-related problems. It is a matter of drafting, perhaps, but a matter of some importance.
Amendment 216 is very sensible and I hope that my noble friend the Minister will be able to help me here. I suggest that we should be quite sure that the duty of the Secretary of State is to designate one landlord redress scheme in the private sector, and no more than one.
I hope that I have covered all the amendments sufficiently and accurately. I beg to move.
Baroness Thornhill (LD)
My Lords, I wrote in my notes that this was “hopefully” the last day in Committee on the Bill, but I have now inserted “possibly”. Regrettably, it is my last day, because of an important appointment tomorrow that I cannot cancel.
It is appropriate for me to thank profusely all those who have helped me personally, and probably helped all of us, with their excellent briefings, as well as giving help with amendments—and, in my case, frantic email exchanges when I have not quite understood things. I refer to all those in the Renters’ Reform Coalition, the Local Government Association, the National Residential Landlords Association and Suzanne, the Independent Landlord, to name but a few.
This is a very important part of the Bill, and we largely support the first two amendments from the noble Lord, Lord Hacking, regarding having just the one scheme and changing “may” to “must”. However, I will speak to my Amendment 218, which is a simple probing amendment for what is a very complex issue. The Bill makes continuing or repeat breaches of the landlord redress scheme an offence, but not joining the scheme in the first place is merely a breach. That means that landlords can still be fined by the local authority for not joining but tenants cannot claim a rent repayment order as it is not an offence.
There is clearly an imbalance here; my amendment simply seeks to probe the Government’s reasoning for not making failure to join the scheme an offence in the first place, rather than waiting for landlords continually not to adhere to the new requirement. We want this failure to become an offence from the get-go because we believe that non-compliance with the redress scheme will have serious regulatory consequences, significantly impacting tenants’ ability to hold their landlord to account. That is the key matter on issues such as disrepair and the standard of the home. The rent repayment order gives tenants compensation for substandard accommodation and can incentivise them to report things in the first place. Interestingly, Generation Rent’s polling found that nearly one in three renters has had maintenance issues in their home, which they have reported, but their landlord has not dealt with—a simple but very telling snapshot.
In the Republic of Ireland, failure of a landlord to register a tenancy with the Residential Tenancies Board—the Irish equivalent to what we are proposing—is a criminal offence, punishable by imprisonment of up to six months and a fine of €40,000, with €250 payable each day of non-registration. Perhaps they take a rather different approach.
We are concerned that, as councils are already overstretched and currently have very little resource for proactive enforcement, an undetermined number of landlords could avoid joining the redress scheme initially as they will think being discovered by the council is low risk. The risk of being reported by their tenants—who would not be eligible for a rent repayment order, so there is no incentive for them—is also very low. Both aspects are not what we want. Therefore, we feel that this imbalance does not treat seriously enough the impact that non-compliance in these matters will have in undermining and frustrating one of the fundamental tenets of the new regulatory regime. I hope that the noble Baroness will allay our concerns.
Lord Jamieson (Con)
My Lords, I thank the noble Lord, Lord Hacking, for introducing this group of amendments, and the noble Baroness, Lady Thornhill.
The landlord redress scheme is a vital function of the Bill, and the onus is on all of us to ensure that the legislation is as effective and robust as it needs to be. I hope that the Minister will take the time to reflect on the constructive suggestions made by noble Lords and take them back to the department for further consideration. The fact that the Minister has tabled amendments is, I suggest, a recognition that the Bill is not perfect, even in the eyes of those charged with defending it.
Before I turn to the amendments tabled by the Minister, the noble Baroness, Lady Thornhill, and the noble Lord, Lord Hacking, I shall speak to those amendments in the name of my noble friend Lady Scott of Bybrook. Amendment 208 would require a residential landlord to be a member of the landlord redress scheme only if their tenant does not already have access to redress via a letting agent who is a member of another approved independent scheme. This would avoid duplication, unnecessary regulatory burden and the potential confusion between effectively being a member of two different schemes. This is vital, because clarity and efficiency in regulation are essential for compliance and enforcement.
Amendment 210A probes the Government’s proposed duration of the membership period for the redress scheme. This period is to be set by regulations, but as things stand there is no indication, or even a hint, of what that timeframe might be. Could the Minister provide some clarity on this point? Stakeholders need certainty to plan and prepare appropriately.
Amendment 210B seeks to require the Secretary of State to publish draft regulations establishing the landlord redress scheme within six months of the passage of the Bill. A clear, time-bound commitment is essential if the Government are serious about delivering this long-promised reform. Without a defined timeline, there is a risk that implementation will drift or be indefinitely delayed, to the detriment of all stakeholders—especially tenants. Could the Minister say what, in her view, constitutes meaningful progress and what timescale the department is working to?
Baroness Taylor of Stevenage (Lab)
My Lords, I thank my noble friend Lord Hacking and the noble Baronesses, Lady Scott and Lady Thornhill, for their amendments, and the noble Lord, Lord Jamieson, for moving the amendments proposed by the noble Baroness, Lady Scott.
Before I turn to the amendments, I note that the noble Baroness, Lady Scott, advised of her opposition to having Clause 65 stand part of the Bill. Clause 65 gives the Secretary of State power by regulations to require residential landlords to be members of a private landlord redress scheme. I note her concern over placing a legal requirement on landlords to join a redress scheme. However, having no legal obligation on landlords to do so means retaining the status quo, in which a very small minority of private landlords choose voluntarily to sign up to a redress scheme. I believe only around 100 landlords out of the 2.3 million in the country joined a previous voluntary scheme.
This lottery for private tenants is wholly unfair, particularly as those renting in the social sector have enjoyed universal access to landlord redress through the Housing Ombudsman service for decades. This Bill makes it clear that being a residential landlord is a serious commitment, which most landlords understand, and that it carries responsibilities and obligations towards a tenant. For those who do not understand this, we need to make it clear through the Bill.
Placing a legal requirement on landlords to be part of a redress scheme is necessary and key to delivering a long-promised government commitment. Access to justice for tenants should be not at the discretion of landlords but built into the new tenancy system, promoting high-quality, safe and secure privately rented homes.
Baroness Taylor of Stevenage (Lab)
I start with the amendments tabled by my noble friend Lord Hacking— I hope he is going to carry on saying “Hear, hear!” as I go through his amendments.
Amendment 207 would place a duty on the Government to lay regulations requiring residential landlords to be members of a landlord redress scheme, rather than giving them discretion to do so. I understand why my noble friend has put in this amendment and I reassure him that the Government are committed to requiring private landlords to become members of an ombudsman as soon as it is practicable to do so. However, it would not be beneficial to the sector for the Secretary of State to be obliged to require landlords to join an ombudsman scheme before being assured that it is ready to join. We have taken powers in the Bill to allow the Government to make sure that the ombudsman is introduced in the most effective way, with the appropriate sequencing. This will make sure the ombudsman scheme is ready to deliver a high- quality service at the point that landlords are required to join it.
Amendment 210 seeks to set out in legislation that only one redress scheme can operate in the private rented sector at any time. Amendment 216 similarly seeks to remove the ability to set out in regulations the number of redress schemes that can operate in the private rented sector at any one time. It is indeed our intention to approve a single redress scheme, as my noble friend outlined, which all private landlords will be required to join. However, as my noble friend has noted, the legislation allows at the moment for more than one scheme. There are an estimated 2.3 million landlords operating in England, letting their properties to 11 million tenants. Allowing for multiple schemes in legislation offers the Government the flexibility and assurance that, should demand for redress prove too much for a single provider to handle effectively, additional schemes could be brought into this space to take over some of the load.
This approach to allowing for the possibility of multiple schemes has precedent: for instance, in the Housing Act 1996, which makes provision for social housing redress as delivered by the Housing Ombudsman. It is therefore vital that the Government can set out in regulations the number of redress schemes that they will approve or designate for the private rented sector. This will allow the Government to set a limit at first of one scheme, with the assurance that this is not set in stone, should demand for redress prove too much for a single provider to handle effectively.
Amendment 214 would make it a statutory requirement for the private rented sector landlord ombudsman scheme to enable access to the service through offline routes. I fully agree with my noble friend on the importance of ensuring that those who cannot or do not wish to use a computer are still able to engage with the service and access redress. I am pleased to reassure the Committee that the Government intend to ensure that the scheme is accessible, including to those who require offline access. We will expect the new ombudsman service, regardless of whether administered by a public or private body, to meet the same set of high standards for accessibility as outlined in the government service standard and accessibility requirements for public sector bodies. There will be further opportunities for the Government to ensure that this is the case without amending the Bill.
Amendment 215 would expand the role of the private rented sector landlord ombudsman to provide support for tenants with housing-related problems that are outside of their landlord’s control, such as issues with employment, welfare or debt; I found the comments from the noble Lord, Lord Jamieson, about piecemeal amendments to the welfare system, as I think he called them, a little ironic in view of where we find ourselves with the welfare system. This amendment would be an additional responsibility for the ombudsman not directly linked to resolving disputes. We think that it is important that we focus on the main function of the ombudsman, rather than considering other functions that may slow down implementation or direct resource away from delivering against the core purpose of the redress service.
We recognise, of course, that tenants facing housing-related employment, welfare and debt problems should have access to support. It may be appropriate for the ombudsman to signpost tenants to, for instance, their local authority, Citizens Advice or tenant advocacy charities, but we do not think that any amendment is necessary for that to take place. For these reasons, I kindly ask my noble friend Lord Hacking to consider not moving his amendments.
I turn now to the amendments tabled by the noble Baroness, Lady Scott. Amendment 208 would exempt landlords from being required to join the private landlord ombudsman if they use a property agent who is a member of another approved independent redress scheme. We cannot have a situation where tenants have no route to redress for problems that are outside an agent’s control, such as where a landlord refuses to authorise large repair works or behaves badly toward the tenant. This is why we think that it is fair that landlords, including those who use a managing agent, can be held accountable if they have failed to resolve a tenant’s complaint satisfactorily.
We take seriously the noble Baroness’s concerns about duplication. Careful consideration will be given, during the implementation process, as to how the PRS landlord ombudsman service will interact with the agent redress provision. Our primary concern is that the service works effectively for landlords and tenants so that tenants can access redress where needed and treated fairly by the system, regardless of whether their landlord uses an agent.
Amendment 210A seeks to prevent regulations under Clause 65 requiring landlords to remain members of the redress scheme for a specified period after they cease to be residential landlords. Problems can occur for tenants at any point in the rental process, right up to the very end; in fact, the end of a tenancy can be an extremely stressful time for both landlord and tenant, with a lot of scope for things to go wrong as a landlord takes back possession of their property. Requiring landlords to remain members of the ombudsman for a reasonable amount of time once they have stopped being a landlord gives tenants the opportunity to seek redress for harm or inconvenience caused at the end of their tenancy.
As part of the implementation process, we will work with stakeholders to ensure that the period of time for which former landlords are required to remain members of the scheme is appropriate and proportionate. I assure the House that we are committed to ensuring that landlords who choose to leave the sector can exit the ombudsman scheme as quickly as possible; this is not a “Hotel California” ombudsman where you can check out but never leave. However, this needs to be balanced with giving tenants sufficient time for issues to come to light and for them to escalate complaints after their tenancy has ended.
Amendment 210B seeks to require a draft of the landlord redress regulations under Clause 65 to be published within six months of Royal Assent. We agree that transparency is important, and we are committed to giving the sector as much time as possible to prepare for the new redress requirements. However, it will be the published scheme, not the regulations—indeed, not regulations under Clause 65—that will set out how the private landlord redress scheme will operate.
We are committed to working with the sector to implement the PRS landlord ombudsman service smoothly. We intend for the details of the scheme to be published with significant lead-in time and to be piloted before landlords are required to be members. We do not think it would be right to place a legal requirement on the Secretary of State to publish draft regulations within a set time from Royal Assent. This is already a complex landscape, and work on this needs to be carefully thought through. Delivering it in a rush could be counterproductive, creating more problems down the line.
Amendment 212A seeks to remove the requirement for the redress scheme to provide for the appointment of a responsible individual to oversee the investigation and determination of complaints under the scheme. This individual will likely be known as the private landlord ombudsman. We believe that clear accountability is important to promote good performance. Responsibility and authority for oversight of the complaints handling process under a scheme must lie with a single accountable person. This is common practice across other redress schemes and we believe it is right that it should be the case for the private landlord ombudsman. We will set out in the regulations the process for appointing the responsible individual for the redress scheme.
Lord Hacking (Lab)
My Lords, I am very grateful to my noble friend the Minister for her very constructive reply. It happens many times in this House that, when we seek to change “may” to “must”, requiring more pressure to be put on the Government to commit to a certain form of action, the Government’s traditional reply is, “Leave it as ‘may’: you have our promise that we will do our best to bring this measure in and actually apply the ‘must’ test rather than the ‘may’”—so I accept all that my noble friend has said.
I was interested in her comments on the landlord redress scheme and the explanation that she gave for why it would be quite sensible as a starter to have more than one redress scheme in place, but the aim must be to have a uniform scheme in place as soon as that is possible. However, the most important thing is the obligation on every residential landlord to join the scheme. I hope the Government will concentrate on that and will not have the type of figures that my noble friend has given to the House about an earlier scheme with a tiny number of landlords joining it and with a great, great majority not. I think that is probably the most important thing.
I am very happy, therefore, in these circumstances to withdraw my amendment, based on the very helpful response that the Minister has just given to us.
“(2A) A scheme must not be approved or designated under subsection (2)(b) unless it satisfies the conditions set out in regulations made under section 66(2).”Member’s explanatory statement
This amendment provides that a landlord redress scheme must not be approved or designated by the Secretary of State for that purpose unless the scheme meets the conditions set out in regulations made under clause 66(2).
Member’s explanatory statement
This amendment clarifies that the Secretary of State is not required to make regulations under clause 65 before making regulations under clause 66.
Member’s explanatory statement
This amendment clarifies that the Secretary of State has a freestanding duty to make regulations under clause 66 which set out the conditions that must be met by a landlord redress scheme for the scheme to be approved or designated under clause 65(2).
Member’s explanatory statement
This ensures that a person who has been expelled from a scheme may join another scheme in appropriate circumstances.
Lord Hacking
Member’s explanatory statement
This amendment requires the database to be established within one year of the Renters’ Rights Act coming into force.
Lord Hacking (Lab)
I congratulate our Chair on going through these complicated provisions. She is doing very well and should receive congratulations from all of us.
We now move on to the chapter relating to the private rented sector database, which is an essential component in the efficient bringing in of the provisions of the Bill. The database should be set up even before the Act comes into force.
Amendment 219 seeks an obligation that the database operator must establish and operate the database within one year of the Act being passed. It seeks to set down a timetable for the bringing in of the database. All these amendments, like my earlier amendments, are meant to be tidying-up amendments and helpful to all of us taking part in this debate. The other amendments in my name in this group are Amendments 231 and 232. In an earlier version of the grouping, Amendment 237 was in this group but somehow it has disappeared. Can it be brought back to this group so we can discuss it as well?
Amendment 231 would require
“the database operator to ensure that facilities are available for persons to report breaches of any requirement”
by means other than a computer. I have already spoken to the problems of the computer inept, including myself, and my noble friend the Minister is sympathetic on that issue.
Amendment 232 would require
“the database operator to ensure that facilities are available for people to access information on the database, in situations where they do not have access to a computer or electronic device”.
Again, it would help those such as me, who are digitally inept.
Amendment 237 would remove
“the exception for landlords to be registered on the private rented sector database before a court can grant possession in cases”
under ground 7A of the Housing Act 1998, as amended; for example, proceedings brought by the landlord for possession for anti-social behaviour. That seems to be a sensible amendment. There should not be restraint on a landlord bringing such proceedings, which are socially vital for the community in which those tenants are playing a part.
Those are all the amendments. I hope I have been able to describe them lucidly and correctly to your Lordships. I beg to move.
Lord Best (CB)
My Lords, I will speak to Amendments 220 and 225. Amendment 220, in my name and those of the noble Lord, Lord Young of Cookham, and the noble Baronesses, Lady Thornhill and Lady Kennedy of Cradley, is the first of several amendments to support and enhance the Bill’s proposals for a PRS database. I am grateful to my noble colleagues and also to the Lettings Industry Council, Generation Rent, and the Large Agents Representation Group for help in drafting these amendments.
The database, as proposed by Clause 76, will contain some basic information about the landlord and the property. This will assist local authorities in the carrying out of their duties in the enforcement of required standards in the PRS—private rented sector. It will save councils time and money—chasing landlords for the information the council needs and locating properties failing to meet statutory requirements.
However, the database can do much more than this, and Amendment 220 makes it clear that it can have a wider, more significant role. It would surely be a wasted opportunity if the property database was of use only to local authorities. The amendment makes it clear that information on the database should also be available for the benefit of tenants, landlords and their agents. Not least, this new resource should enable landlords and agents to identify any obligation for them to obtain a licence from the local authority where the property is subject to a licensing requirement and would assist them in making such an application.
For tenants and prospective tenants, Amendment 220 makes explicit what is surely intended; namely, that the database is being created to provide important information for those seeking a property to rent who want essential details about their future home and its landlord.
Amendment 225 seeks to assist the new database process by clarifying that its functionality should allow data to be uploaded by landlords’ agents as well as by the landlords themselves; otherwise, landlords will need to be contacted constantly by agents to obtain the information they need. With around half of rented property being supported by lettings agents, this tweak is another reason why the amendment is a necessary addition to the Bill.
This property portal amendment is supported by those representing renters and those representing landlords and property agents. With the additional features that we will discuss in the next group, these amendments seek to ensure that the database has a transformative impact in raising standards, helping enforcement and widening knowledge of all the properties in the sector.
Baroness Kennedy of Cradley (Lab)
My Lords, I support Amendment 220, tabled by the noble Lord, Lord Best, to which I have added my name.
Amendment 220 neatly ensures that the Bill is clear about who the PRS database is for. I understand the Government’s need to consider privacy, but in doing so the Government need to remember why the PRS database is needed. It is about increased transparency, empowering renters so that they can make informed decisions about where they live and properly exercise their rights. Yes, support for landlords and, yes, a tool for local authorities to raise standards—these are the intentions of the database and always have been since we started to lobby for this Bill many years ago. Amendment 220 is a simple way for this to be made clear in the Bill.
I hope that my noble friend the Minister will accept this amendment. I also ask her to confirm that the Government’s priorities for the private rented sector database remain renter empowerment, support for landlords so that they are aware of their obligations, and providing an effective toolkit for local authorities to drive up standards.
Baroness Thornhill (LD)
My Lords, I will speak to Amendments 220 and 225, tabled by the noble Lord, Lord Best, and my Amendments 243 and 243A, all of which seek to strengthen and clarify the role of the new private rented sector database.
I also support Amendment 219, moved by the noble Lord, Lord Hacking. In so much of this Bill we lack a timeframe. Between us, we have tabled several amendments asking for clarification on timeframes. It is not just us seeking these timings but everyone who is impacted by the Bill.
This is an area of great potential. I confess to getting quite excited about it when I first realised that it was a real tool in the Bill. A well-designed database could be genuinely transformative, supporting better enforcement, empowering tenants and giving responsible landlords the tools that they need to navigate the system more effectively. The noble Lord and I have very similar thoughts on that. However, to achieve that, it must be more than just a repository of basic information, which is where I fear we are going. It must be useful, accessible and enforceable.
Amendment 220 seeks to make it clear that the database is a tool not just for local authorities but for public good. It should serve the interests of tenants, responsible landlords and good letting agents alike. In its current form, the Bill seems to emphasise enforcement utility but underplays the wider potential of the database as a source of transparency and information for all parties in the rental market. If we want this database to help drive up standards and support informed decision-making, we must set out that intention clearly.
Amendment 225 introduces two further practical improvements. First, it allows letting agents to upload information on behalf of landlords, a sensible provision given the role that many agents already play in managing compliance. Secondly, it proposes that the database should offer a portal to help landlords determine whether their properties require licensing under the local authority schemes and to apply for those licences where necessary. Too often, licensing rules can vary from one area to another and be hard to navigate, particularly for smaller landlords. A centralised, user-friendly tool would significantly improve compliance.
My Amendment 243 probes a critical issue: enforcement. The Bill states that landlords must be registered on the database along with each of their dwellings, but it is currently unclear what consequences there are for non-compliance. This amendment proposes that failure to register should be an offence, and we seek clarity from the Government on how these provisions will be enforced in practice. Without credible enforcement mechanisms, even the best-designed database risks being ignored by the very landlords it is intended to regulate.
Finally, Amendment 243A would give the Secretary of State the power to include links to useful resources on the database, such as the “My Housing Issue” gateway. Such signposts may seem minor, but they can make a real difference, especially for tenants who need guidance on their rights or for landlords seeking to meet their obligations. The database should not exist in a vacuum; it should connect users to help, advice and relevant legal frameworks.
These amendments may differ in focus, but they are united by a common aim: to ensure that the private rented sector database lives up to its promise and potential. It must be more than a tick-box exercise; it must be practical, enforceable and truly useful to the people it is meant to serve. I hope the Minister will give these proposals careful consideration, and I look forward to hearing the Minister’s response.
The Earl of Lytton (CB)
I will make just a couple of comments on the two amendments tabled by my noble colleague, the noble Lord, Lord Best. I start with Amendment 220 and the point made in support of it by the noble Baroness, Lady Thornhill, because what is proposed here is clearly, in effect, a public register. I was not absolutely sure that I understood whether that was delimited in certain ways by the reference to “other interested stakeholders”, whoever or whatever they might be in any given circumstance, but a public register is what we are dealing with.
If I may, I link this across to the next group of amendments, because it is appropriate to mention here that the noble Baroness, Lady Thornhill, has Amendment 222, which has an extensive list of requirements. I simply say that some of what she sets out there might need a rethink as to whether it is appropriate for that degree of detailed information to be on a public register, bearing in mind who else may have access to it and for what purposes.
I have a question on Amendment 225. I absolutely agree with the functionality point, and I add to that by saying that there must absolutely be an email communications option in any database of this sort. Given the state of the normal, regular postal service, having an email option and being able to flag up an alert system of some sort would be absolutely essential for any landlord, their agent or, for that matter, any renter using the database.
My question is to do with the way the database is applicable to local authority schemes. The noble Baroness, Lady Thornhill, confirmed what I believed to be the case: namely, that local authority schemes might vary considerably. If we have a national database, I simply ask how that deals with strictly local things on a per local authority basis. The rules of the game must obviously apply nationally, but the property concerned, the landlord and the renter in particular may be local. I simply flag up how that will function or whether there will be a subsidiary local authority subset on a per local authority basis.
If we have approach, and given the amount of data that the noble Baroness’s later amendment suggests, then, in terms of the amendments previously spoken to by the noble Lord, Lord Hacking, I suggest that we are looking at quite a considerable lead-in period in practical terms to get this database in place. If it is to be of use, it needs to start off as some sort of cut-down version in order to enable the essential information to be there, even if it is then expanded. I therefore see this being achievable by some sort of rollout over time. Trying to put it in place from day one would be a recipe for something approaching chaos.
Lord Thurlow (CB)
My Lords, I will briefly comment on two amendments in this group: Amendment 233 in the names of the noble Baroness, Lady Scott of Bybrook, and the noble Lord, Lord Jamieson, and Amendment 243 in the name of the noble Baroness, Lady Thornhill, about databases. I feel that we are overlooking the need to ensure that the rogues in the system are identified and banned or punished for bad behaviour. They riddle the rented sector, I am afraid.
The database is a great attempt to give transparency and clarity to mortgagees, as in one of these amendments, to tenants and to potential tenants to check on their potential landlords. It is not responsible landlords who are the problem; it is the rogues. Rogues like to be invisible. They do not want to be detectable. They certainly do not want enforcement proceedings served against them. Enforcement must have teeth. Without real teeth, there is little point in trying to catch the rogues. The database would go a long way towards achieving that, but I fear that there is not enough determination in the Government to really punish those who are determined to cheat.
Rogues can hide their properties under the names of shelf companies. They can be registered abroad. They can have a tangled web of subsidiaries and further subsidiaries. They will make themselves as invisible and undetectable as possible. I close by simply saying that these are good amendments, but I would love to see sharper teeth in the enforceability.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Hacking, for opening this group, as it marks the beginning of three vital debates on the database, which is an issue of great interest to stakeholders across the sector. There are 16 amendments in this group dealing with a range of quite complex issues relating to the database so, with the leave of the Committee, I will try to fully address the issues raised, but I might take a little extra time.
Before turning to our specific amendments and those in the wider group, I start by saying that the creation of a private rented sector database is a major change for landlords and tenants in this country. It is an opportunity to seriously improve transparency and outcomes for renters. We have expressed concerns on previous Bills about the overuse of regulation-making powers to deliver the statutory powers that the Government seek. Ministers should, we believe, set out clearly their plans in this Bill as far as is practically possible. Given the lack of detail in the clauses relating to the establishment of the database, we take this opportunity to ask the Minister to clarify the Government’s plans. If she cannot answer today, we will be very happy to have it in writing after today’s debate.
I start by addressing Amendment 228A, tabled in my name. This is a simple amendment that would ensure that the Secretary of State is required to make regulations to ensure that the database entries are regularly updated and maintained. It is essential that the accuracy, completeness and timeliness of the data be maintained if it is to be a useful resource for both tenants and for landlords. This is common sense, and this should be a requirement. I hope the Minister will agree to that. If the Government cannot accept this amendment today, will she please take this opportunity to explain why the Government feel that the Secretary of State should have discretion in this area?
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lords, Lord Hacking and Lord Best, and the noble Baronesses, Lady Scott and Lady Thornhill, for their amendments on database operation and accessing the database, and I thank the noble Baroness, Lady Kennedy, the noble Earl, Lord Lytton, and the noble Lord, Lord Thurlow, for their contributions. I believe that the noble Baroness, Lady Scott, spoke to Amendment 230, which is in the next group, and the noble Lord, Lord Hacking, spoke to Amendment 237, which is in group 6. I will respond to them when we get to those groups, if that is okay.
Baroness Scott of Bybrook (Con)
I apologise. I have two lists that have different numbers in them; I think they are one before the other.
Baroness Taylor of Stevenage (Lab)
When we get to this stage of a Bill, especially when we have three or four groups on the same subject, I am not surprised that people get them mixed up.
I start by saying that I very much share the sentiments of the noble Baronesses, Lady Kennedy, Lady Thornhill and Lady Scott, about the potential of this database to support both landlords and tenants. The noble Lord, Lord Thurlow, clearly set out why this is important for responsible landlords as well as tenants. I am sure that landlords who do a very good job, which is the majority of them, get incredibly frustrated by the minority of rogue landlords who certainly do not and I hope that this will help them as well.
Amendment 219 from my noble friend Lord Hacking proposes that a duty be placed on the database operator to ensure that the database be established and operational within a year of the Renters’ Rights Bill coming into force. I know the database will be a vital tool in raising standards in the private rented sector. I assure my noble friend and other noble Lords who raised the issue that we are aiming for the database to be active as soon as possible.
The database is being designed as a bespoke product to ensure that it aligns with the operational and legal details set out in regulations. We are currently focusing on getting the basic functionality right, testing with the sector and local authorities and developing guidance for users. Setting a timeframe for a database in the Bill is unnecessary and could be counterproductive. We simply cannot risk it being brought in when the secondary legislation or technology is not ready. This would make life more difficult for tenants, landlords and local authorities. For this reason, I kindly ask that my noble friend considers withdrawing that amendment.
I thank the noble Lord, Lord Best, for Amendment 220, which would require the legislation to state that the database will benefit landlords, tenants, local authorities and other interested stakeholders. I assure the noble Lord and the noble Baroness, Lady Kennedy, who spoke to this amendment, that the database is being designed for the benefit of all potential users, including tenants, landlords and local authorities. I recognise the positive intent behind the noble Lord’s amendment. However, the Government are already working towards that and we are continuing to focus on those user groups as the database is designed. I therefore do not believe it is necessary to accept the amendment and for that reason I ask the noble Lord not to press it.
Lord Hacking (Lab)
My Lords, I am very happy to withdraw Amendment 219. The Minister has done magnificently. May I just say on behalf of all of us that she is doing magnificently? She stumbled for a moment just now, but it is amazing that she has not stumbled before. She is covering her brief with extreme detail, and I thank her on behalf of everybody in the Committee.
My noble friend replied to my amendment, which seeks a definite date for the establishment of the private rented sector database. In a sense, I think my amendment was unrealistic because the development of a database obviously takes time. The promise has already been made by my noble friend that they are working on that database and recognise its importance, and that fully satisfies me.
Now I am going to place a burden on my noble friend because I had not seen that Amendment 237 had been regrouped and put into another group. The Whip has told me that I am not allowed to speak again on that amendment, but is there any chance of my noble friend replying to it now, immediately after I have made the case for it?
Baroness Taylor of Stevenage (Lab)
It is more appropriate for me to respond to that amendment in order because otherwise it would make it difficult for other members of the Committee to reply to it. I shall reply to it in the sixth group, and if my noble friend cannot be in the Chamber, I shall send him a response in writing.
Lord Best
“(d) entries containing details of landlord gas safety records and landlord electrical installation condition reports for dwellings which are or intended to be let under residential tenancies.” Member’s explanatory statement
This would include landlord records of gas and electrical safety checks in the PRS database. Permits the Secretary of State to make regulations to enable the PRS database to register landlord records of gas and electrical safety checks.
Lord Best (CB)
My Lords, I shall speak to Amendments 221, 224, 227, 229 and 230. These amendments are in my name and those of the noble Lord, Lord Young of Cookham, and the noble Baronesses, Lady Thornhill and Lady Kennedy of Cradley. The noble Lord, Lord Young, apologises for his unavoidable absence but underlines his support for the amendments. I thank all those noble colleagues for supporting these amendments.
The amendments relate to the content of the new database, a property portal. They add key items to the information to be provided. Amendments 221, 224 and 227 would add landlord records of gas and electrical safety checks, with definitions of what these comprise. Currently, there is a national digital register of all energy performance certificates, and these EPCs will be brought together with details of the letting. However, there is no register for the critical landlord gas safety or electrical checks. These are frequently lost or neglected, and tenants may be unaware of them. The PRS database provides an opportunity to have these vital safety certifications brought into the digital age and made available widely, to ensure the safety of rented property. Building safety is now a national concern, and details of these checks represent important content for prospective tenants as well as for local authorities.
Am I right in thinking that the Government intend to consult on further items to be covered by the database and that, as part of the consultation, there will be the opportunity to add items to go into this new portal? I would include many of the extra items listed in Amendments 222 and 228, in the names of the noble Baronesses, Lady Thornhill and Lady Grender. For example, listing rent levels would provide invaluable data for the First-tier Tribunals, which will be taking decisions on market rent levels. A further addition it would be good to see would be a categorisation of properties suitable for people using wheelchairs or with mobility problems. To have this information readily available via the database would be helpful not just to renters seeking accessible accommodation, but to the landlord with an adapted property who is looking for tenants who can make use of the adaptations.
Finally, Amendments 229 and 230 would require the PRS database to make use of the unique property reference number, to which the Minister has already referred, as the identifier for every property on the database. This valuable and reliable tool already exists as a means of identifying any specific property. Noble Lords may not be aware that all their homes already have such a number—a UPRN, which can dramatically speed up the search for a particular house or flat. The Bill provides the perfect opportunity to put this excellent facility to good use. A pilot scheme utilising UPRNs in Nottingham has demonstrated that councils get a sixfold return from investing in this approach and streamlining the property data for collection for their area. The noble Baroness, Lady Scott, jumped the gun in welcoming Amendment 230. I will save her having to do so again and thank her now.
In conclusion, and in relation to all the amendments in my name and those of colleagues, to whom I offer my thanks, I believe them to be acceptable and agreeable to the organisations representing renters, landlords and property agents. I hope that the Minister can support them and I look forward to her response. I beg to move.
Baroness Grender (LD)
My Lords, my Amendment 228 seeks to enhance transparency and oversight in the private rented sector by requiring the database to include information on tenancy disputes. This would cover a range of issues, including disputes about rent levels. It would also record the outcome of each case and how long it took to reach a resolution.
This is, at its heart, a proposal for greater clarity. It is not intended to be punitive, nor to cast all landlords in a negative light—quite the opposite. It is an opportunity to reward good landlords. Those who respond quickly to issues, resolve disputes fairly and demonstrate a commitment to their tenants should have that record reflected and recognised. Too often, the private sector operates in the shadows, with tenants unsure of their rights and little visibility of how disputes are handled behind closed doors. This amendment would bring to light that process by recording the nature of a dispute, the parties involved, the outcome and the time taken to resolve it. We would therefore create a more informed and accountable system.
For tenants, this information is empowering. It helps them to make better decisions about where and with whom they rent. For landlords, it provides an incentive to act responsibly and promptly, knowing that their actions contribute to a public record. For policymakers and regulators, it offers a valuable source of data to identify patterns, spot areas of concern and improve enforcement.
The inclusion of rent level disputes is especially important for improving transparency. At a time when affordability is a growing concern, making this information available would provide clear insight into how disagreements over rent are handled and resolved. It would help build a more accurate and evidence-based picture of where pressure points exist in the system. It would also help tenants and policymakers understand how rent issues are being addressed in practice.
In short, this amendment would help foster a culture of fairness, responsiveness and trust. These qualities are essential if we are to improve standards across this sector, and I hope the Minister will look favourably on it.
Baroness Kennedy of Cradley (Lab)
My Lords, I support Amendment 222 in the name of the noble Baroness, Lady Thornhill, and all the amendments in this group, including Amendment 228 in the name of the noble Baroness, Lady Grender, and the noble Lord, Lord Best, to which I have added my name. I declare my interest as a Nationwide Foundation trustee—I think I declared this last time I spoke, but I cannot remember, so better twice than never.
I am sure the noble Baroness, Lady Thornhill, will set out in great detail why the list of criteria is needed in the Bill. However, put simply, more detail on what the PRS database will contain needs to be in the Bill, which needs to set out core functions and minimum standards. Leaving the detail to be filled in later by regulation at the whim of a future Secretary of State is not acceptable. It will make the Bill less stable and requirements less easily understood. Landlords need clarity about what the law requires of them and tenants need clarity on what they can expect in terms of their rights.
I hope my noble friend Lady Taylor of Stevenage will bring back on Report an amendment that sets out minimum requirements for the PRS database that can sit in the Bill, to give clarity and direction akin to Amendment 222 in the name of the noble Baroness, Lady Thornhill.
Baroness Freeman of Steventon (CB)
My Lords, I have added my name to Amendment 222, in the name of the noble Baroness, Lady Thornhill. This Bill is very big and has wide-ranging impacts. Some are certainly planned, and others are possibly unplanned. It is vital that those impacts are evaluated. It is unfortunate that, at this stage, the evaluation plan is slightly unformed, but the impact assessment makes it clear that it is going to rely on some of the data collected in this database. Given that it is going to rely on that data, I think it has to be specified in the Bill.
For example, one of the prime aims of the Bill is to increase security of tenure, thereby reducing evictions and unplanned moves. The current source of that data is from the English Housing Survey, which suffers from the vagaries of any survey at the moment and questions about its validity. More importantly, it also does not have the necessary granularity, given that the local authority level is going to be the level at which this Bill is enforced. So we need the data that is going to be collected in this database in order to be able to tell whether the Bill is at all effective, and what other effects it might have.
That is true also of things such as rental increases, which it is trying to keep a lid on. If we do not have a record of those rental increases, we will not know whether it is effective. So I am concerned to hear tonight that the database may not even be fully in action within the first year of the Act being passed. How will we know what the effects are if the Act has already been in place for over a year before we measure some of these impacts? I would love to hear more from the Minister about what is going to be in the database and when those different aspects of the database are going to be active.
The Earl of Lytton (CB)
My Lords, I have already mentioned Amendment 222 in the name of the noble Baroness, Lady Thornhill, so I need say no more about it at this stage. I turn, then, to the one other amendment in this group that interests me: the one introduced by the noble Baroness, Lady Grender. The information that she proposes should be disclosed in the database is quite extensive. I have three points to make.
First, is the noble Baroness satisfied—and would the Minister consider herself satisfied—that, if there were an ongoing dispute, putting that data raw, on an incomplete process, would be free from creating a prejudice around the outcome? That might be in either direction; I am thinking only that this might be a quasi- judicial process of one sort or another. I just wish to flag that up.
Secondly, in any event, obviously, the database would identify both parties: the renter and the landlord. I assume that, when the noble Baroness says that her amendment would create a greater egalitarian thing, she is also happy with renters and landlords being mentioned, because the identity of the parties will be known. However, depending on the detail that goes in, there might be the disclosure of what might be described as more sensitive information related to the nature of the dispute; I wished to flag that up in case it had been overlooked. Bear in mind that, if we are talking about an open register, this goes to everybody, anywhere, who can tap into the information.
Thirdly, there is a whole issue here around the performance characteristics that sit behind this group of amendments, in terms of what is going on around the efficiency of the process through which information might be derived from this database. There must be a difference, I think, between the metadata from the processing of things, such as the speed at which things are dealt with and so on, the data on the types of disputes that might typically arise, including their frequency and distribution, and the individual data on the register. There will certainly be derivative information that does not necessarily require the total disclosure of all sorts of intricate and possibly personal details.
I would be very happy for the database to be used for the purpose of the further processing of non-personalised data of one sort or another for statistical and performance calculating processes. I am less clear, though, that that necessarily sits as a direct part of the database; that is, as a derivative of it. One must be careful about what one is expecting the raw data on a database to consist of; and about how it is going to be used as a derivative thereafter.
Baroness Thornhill (LD)
My Lords, first, I apologise to the Minister. I was remiss not to thank her before the previous group for the time she gave up to meet my noble friend Lady Grender and me to discuss the database. I know that she is always very willing to meet noble Lords and that she gives up a lot of her time. I hope she will accept my thanks now.
The amendments in this group continue to relate to strengthening the content, utility and functionality of the new private rented sector database. As has already been highlighted, the database could be a powerful driver of higher standards, tenant protection and, importantly, support for responsible landlords. But to fulfil that role, it must be built on comprehensive, reliable and adaptable foundations—something these amendments aim to deliver.
Amendment 222 is in my name, supported by the noble Baroness, Lady Freeman, whom I thank. I also thank the noble Lord, Lord Best, for his positive comments. The noble Baroness and the noble Lord both made some pertinent comments that I hope will add to the debate. Yes, the amendment sets out a broader and more ambitious vision for what information could be captured in the database from the onset. If this system is to be genuinely useful, it needs to go beyond the basics and include key documentation that reflects the safety, security and condition of the property. Renters deserve to know that the home they are moving into is safe, compliant and fairly let.
I say to the noble Baroness, Lady Kennedy, that I do not intend to go into great detail on this today, because time is of the essence. To sum it up, the point is to expose infringing, dodgy landlords. A good landlord has nothing to fear, but if things such as banning orders are on the site, this might incentivise landlords to not get themselves into that position in the first place. In Watford we have had issues with a landlord who is a prolific property owner. It would be very useful, and quite powerful, if people could see the number of offences under the name of a landlord. I accept the concerns expressed by the noble Earl, Lord Lytton. If there was any hope of any elements of my catch-all list being taken up, I would happily argue each one with him on a case-by-case basis.
Amendments 221 and 227, tabled by the noble Lord, Lord Best, would ensure that the database includes records of gas and electrical safety checks, and that, crucially, it can become a digital home for all these certificates. We already require these documents to be produced, so incorporating them into the national system should be a logical next step. Amendment 227 would even allow accredited safety certificate providers to upload directly, removing administrative burdens from landlords and improving data accuracy. This would modernise and streamline an essential part of the compliance process.
Amendment 228 in the name of my noble friend Lady Grender focuses on tenancy disputes—specifically rent levels and resolution outcomes. In the absence of reliable rent data, we lack the evidence base needed to track affordability—something that has come up before in the Bill—or understand the impact of policy changes. Including dispute outcomes would help tenants navigate the system more confidently and enable more informed decision-making by both renters and landlords. It also provides an accountability mechanism to ensure that the system is working as it should.
Amendment 224, also from the noble Lord, Lord Best, and which I support, is linked to these proposals and would reinforce the requirement for the database to include the right types of detail to make it genuinely functional for enforcement and policy use. I am sure we would all be willing to contribute to a general discussion on what that might be.
Amendment 229 introduces a small but important clarification to ensure that the database links records not only to landlords but to specific dwellings. This might seem technical, but it speaks to a broader point. The system must allow us to track the full history of a property and not just its owner, although the owner is clearly vital, especially the owner we have mentioned many times: the invisible, absent, non-contactable landlord. This is vital in cases where properties change hands but the issues persist. With reference to the local case that I referred to earlier, often it was just a family member’s name that had changed, so I think the more we can track down these infringing and rogue landlords, the better.
This brings me to Amendment 230, which would require the use of the UPRNs: unique property reference numbers. That is a new acronym for me. These identifiers already exist and are widely used in local government and in the property sector. Using them in the database would help standardise records, reduce duplication and enable effective data sharing across agencies—something that they, and all of us, think needs to be improved. It is a ready-made tool that would help knit together fragmented information across the sector and, as we have heard, it has proved effective.
These amendments work together to build a more useful, transparent and future-proof database that supports not only enforcement but renter safety, data integrity and informed policy-making for the future. Each of these proposals is practical, proportionate and grounded in existing obligations. What they offer is not duplication but integration. I hope the Government will recognise the value of taking a more ambitious approach to what the database can deliver and I am heartened by the comments that the noble Baroness has already made today.
Lord Cromwell (CB)
My Lords, I am entirely supportive of pretty well every amendment that has been put down on this—this blizzard of amendments about a database across four groups. I agree that there should be penalties for not participating in it. It has to be something that is not a nice-to-have add-on: it has to be core to everything. However, I will just give two notes of caution, the first of which goes back to the point made by the noble Earl, Lord Lytton. If you are going to start recording disputes on the system, there could be many, many reasons why a dispute runs for a long time. It would not necessarily be the fault of evil landlords. It could be illness on the part of the tenant; it could be a multitude of things. You have to be very careful there.
The second point is to be careful what you wish for. No one has suggested this so far, but is this database going to be searchable by tenant? Because a landlord looking at a tenant might search the database and find that every previous tenancy has ended in a dispute. Is that going to be a fair use of this database? Because it is a logical suggestion, looking at this from a landlord’s point of view, to look out for rogue tenants as well as rogue landlords.
Lord Jamieson (Con)
My Lords, I thank the noble Lord, Lord Best, for opening this group. The question of what data is recorded on the database is an important one and the Government need to give the sector greater clarity on their plans. Noble Lords need only look at some of the briefings provided by lettings agencies to landlords over the past few months to grasp the level of uncertainty around this Bill. For the benefit of both renters and landlords, we need greater clarity as soon as possible. As my noble friend Lady Scott of Bybrook said earlier from these Benches, we believe the Government should be more ambitious. We are broadly content with the direction of travel on greater transparency, but taking this forward through regulations is leaving landlords and tenants in the dark.
We support the challenge from the noble Lord, Lord Best, to the Government on the inclusion of gas and electrical safety checks within the PRS database. Amendments 221, 224 and 227, tabled by the noble Lord, Lord Best, all touch on this issue. The database makes use of official UPRNs and covers the full end-to-end process of property compliance, including the urgent need to mandate digital property safety certificates. This will certainly increase transparency for landlords and tenants. Including gas safety certificates and electrical installation reports would assist tenants who wish to confirm that their property is safe.
That said, we have some concerns about Amendment 227, which appears to place the burden of registering digital gas and electricity certificates on the certificate provider rather than the landlord. We do not think that responsibility should be placed on the providers without a proper impact assessment and a fuller understanding of how this would work in practical terms. Perhaps the Minister can commit to considering this proposal from the noble Lord between now and Report.
Amendment 222, tabled by the noble Baroness, Lady Thornhill, proposes expanding the types of information or documents that are required for registration on the PRS database. I commend the noble Baroness on her thoughtful drafting. This amendment highlights further the uncertainty and lack of clarity that have arisen from the Government’s decision to place broadly drafted regulation-making powers rather than detailed provisions in the Bill to enable their plans.
Finally, on Amendments 229 and 230, tabled by the noble Lord, Lord Best, it has already been noted that UPRNs are a universal means of identifying properties. They will be central to this system. The database should be as easy as possible to use for both renters and landlords. We accept that the noble Lord’s amendments are well intentioned and we will listen very carefully to the Minister’s response to them.
We have a separate concern. The Government do not have a strong track record on delivering large-scale IT projects. I make no political comment here. We share the concerns that have been raised by the noble Earl, Lord Lytton, and the noble Baroness, Lady Freeman, earlier, on the time that it will take to roll out this database. Can the Minister assure us that this project will be delivered—and delivered on time?
I hope that the Minister will give serious consideration to these well-intentioned and constructive amendments.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Best, and the noble Baronesses, Lady Thornhill and Lady Grender, for their amendments regarding which data should be recorded on the database. I also thank my noble friend Lady Kennedy, the noble Baroness, Lady Freeman, the noble Earl, Lord Lytton, and the noble Lord, Lord Cromwell, for their comments.
Amendment 222, tabled by the noble Baroness, Lady Thornhill, seeks to expand Clause 76 and mandate the information that landlord and dwelling entries on the database must contain. I thank the noble Baroness for her very thoughtful amendment and for meeting with me to discuss the database in greater detail before Committee. We certainly both appreciate the potential of the database.
I reassure her that we expect to collect much of the information that is set out in Amendment 222 on the database. Detailed regulations about the making of landlord and dwelling entries in the database will be made under Clause 78(1) in due course. Our approach to data collection takes account of the balance of benefits and burdens for different users, to ensure that it remains proportionate. However, I stress that it is vital that the database is designed in such a way that it can evolve to incorporate technological innovation and changes in the sector. Although I very much understand the points made by my noble friend Lady Kennedy and the noble Baroness, Lady Freeman, we do not think that, to accomplish this aim, the content of landlord and dwelling database entries should be mandated in the Bill. Rather, this detail should be set out in secondary legislation to ensure that the database can be more easily adapted to meet future circumstances.
Regarding points about when the database will be ready, we aim for the service to be operational as soon as possible following the passage of primary and secondary legislation. We are taking forward the digital development of the private rented sector database in line with the government service standard. We will conduct extensive testing of the new service ahead of implementation and continue to engage the sector on our proposals. We very much welcome the ongoing involvement of all those who have been helping us.
The point made by the noble Lord, Lord Cromwell, highlighted the importance of why we must take our time on development, design and testing. The noble Lord, Lord Jamieson, referred to the difficulty of IT systems. I have had them in past lives, so I know that this can be a tricky issue. However, we have been in government for only nine months, yet the noble Lord accused us of having a track record—or did he mean all Governments? I hope that he did.
Baroness Taylor of Stevenage (Lab)
Okay, fair point. We need to make sure that we do the development and the testing of the system carefully. I therefore ask the noble Baroness not to press her amendment.
Lord Best (CB)
My Lords, I am grateful to all noble Lords who have participated in this debate— mostly agreeing with the amendments, sometimes quite enthusiastically.
One thing we have perhaps not covered before is the providers of gas and safety certificates and electrical safety checks being the people who upload that information on to the database, rather than putting the onus entirely on the landlords. This sounds rather radical, but it is in fact quite an important piece of the jigsaw. We do this with our MOTs: it is the MOT provider who has looked after the car who sends the information to the DVLA; you can record this pretty much instantly, without a lot of hassle. This also already happens with energy performance certificates: it is the provider of the certificate who uploads it on to the database. So this is not a huge jump.
I was encouraged by the Minister’s comments, for which I express appreciation. Basically, we are all on side, and things will be added to the list of contents that are included in this, but I get the unfortunate feeling that we are going to take this at a rather gentle pace. We have to wait for the secondary legislation, extensive testing and trials, bringing forward each piece one step at a time. This may be sensible, but it will be quite frustrating, given that there is such potential. There is an opportunity here for the database to make a real difference.
I thank all participants, and the Minister in particular, but I urge that we press on with this as soon as possible, because it is a really valuable tool and will make a big difference. I beg leave to withdraw the amendment.
Renters’ Rights Bill
Wednesday 14th May 2025
(1 year, 2 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-VI Sixth marshalled list for Committee - (13 May 2025)
Baroness Thornhill
“(d) entries in respect of all landlord notices served under section 8 of the Housing Act 1988, to be registered within 7 days of service.”Member’s explanatory statement
This amendment seeks to require entries to the database to include notices served under section 8 of the Housing Act 1988 within 7 days of registration.
Baroness Thornhill (LD)
My Lords, I reassure noble Lords, with regard to time, that the amendments in this group, in my name and those of other noble Lords —and there are a quite a lot of them—all work together and function as a pack. Therefore, my description of these amendments working together will actually be quite brief. The amendments look to strengthen the link between compliance with the private rented sector database and the lawful use of eviction powers. I appreciate that I am pushing the envelope a little bit and I will be genuinely interested in the Minister’s response.
These amendments are rooted in a very simple principle. If we expect landlords to meet minimum legal obligations—and we do, and we hope for more compliance: that is what the whole Bill is about—such as registering on the new database, which, following our previous discussions, is going to be the whizziest, wonderful game-changer, there really must be meaningful consequences when they do not. Currently, the Bill does not explicitly tie database compliance to a landlord’s ability to issue a Section 8 notice. These amendments aim to correct that, or at least to open up a discussion about it.
Amendment 223 would require landlords to register any Section 8 eviction notice on the database within seven days of issuing it. This would support greater transparency, help local landlords and tenants track patterns of use and ensure that there is a reliable record of how and when eviction powers are being exercised. Can the Minister say how we gather that data accurately, if not through this? It is important data and without it we lose very valuable oversight.
Amendments 235, 238, 239 and 240 would prevent a Section 8 eviction notice being considered valid if the landlord has failed to comply with Clause 83(3) of the Bill—namely, the obligation to register themselves and their dwelling on the database. These are not minor or excessive requirements; they are fundamental baseline requirements for responsible landlords. It is entirely reasonable to say that, if these duties are not met, a landlord should not be able to proceed with eviction.
Amendment 236 provides necessary clarification, ensuring that this requirement applies to the entirety of subsection (3) and not just selected parts. Taken together, this group helps to make the database a functioning gatekeeper for landlord compliance. It reinforces the idea that legal powers, especially those as significant as eviction, should be available only to those who follow the rules. That in turn builds confidence in the system and protects tenants from being displaced by landlords who are themselves acting unlawfully. I hope the Minister will look carefully at these proposals. They are proportionate and targeted and go to the heart of what this reform is meant to achieve: a fairer and more accountable rental sector. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baroness, Lady Thornhill, for opening this group. The issues of database fees and possession restrictions are of real significance, and this group is therefore of considerable importance. Before turning to the wider contributions made today, I will speak to the amendments in this group that I have tabled. Amendment 228C seeks to probe the circumstances under which a landlord may be charged a fee under the regulations made under Clause 80. I would be grateful if the Minister could provide some clarity on this point. Under what conditions do the Government foresee such charges being applied?
Amendment 228E, also in my name, would prevent the costs of enforcement action against non-compliant landlords being charged to those who have complied with the requirements of this chapter. This part of the Bill seems entirely unfair on law-abiding landlords. We want to understand why landlords who are compliant must bear the costs of enforcement taken against those landlords who fail to comply with the law. Could the Minister explain why compliant landlords must bear the costs of enforcement targeted at those who fail to meet their legal obligations?
Amendment 228F seeks to remove subsection (4)(d), which includes the costs of enforcement action imposed by the Bill in relation to the private rented sector. Our original understanding was that these fees were intended to relate to the database, but this paragraph seems to be a classic case of Ministers seeking additional and wider-ranging powers as a belt-and-braces approach. This is not an acceptable way forward. We understand completely that the database must be funded and we accept that a fee is reasonable, but we need to make sure that the fees charged under this clause remain reasonable. We know that this will increase the costs of business for landlords, so we need to ensure that the costs are both reasonable and proportionate. We are concerned that this wide definition of “relevant costs” may result in unreasonably high costs.
Perhaps I can press the Minister to give the Committee some sense of what the fees will be like, and how increases will be managed. Ultimately, we must bear in mind that it is usually the tenants who bear these costs through their rents in the future. Overall, what are the predicted costs of setting up and running the database, and what are the costs likely to be to the landlord?
Many landlords are small-scale and independent; they are not corporate landlords, with legal teams and financial reserves. They are ordinary individuals, often renting out one or two properties as a way to supplement their pension or to provide long-term family support. For the database to function as intended, it must be financially accessible.
On Amendment 228G, clear communication of the changes of fees is essential. It builds trust and helps people plan their finances, but it also avoids any confusion or frustration.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Baronesses, Lady Thornhill and Lady Scott, and my noble friend Lord Hacking, who I do not think is in his place anymore, for their amendments regarding database fees and possession restrictions.
I will start with the amendments tabled by the noble Baroness, Lady Thornhill. Amendment 223 would mandate that the database operator establishes and operates the database so that it contains entries in respect of Section 8 possession notices, with such entries to be recorded on the database within seven days of the landlord serving them. I appreciate the intent behind this amendment. We are actively exploring collecting possession information on the database. We have identified various potential benefits to collecting this data—for example, it may support local authorities in identifying where possession grounds have been misused or where tenants are at risk of homelessness. It could also be useful to prospective tenants in making choices about where to rent, so I agree with her on that.
However, our research has also highlighted some challenges, particularly around accuracy and reliance on landlords self-reporting. We will need to consider carefully how these issues could be managed. I am also keen to impress upon the noble Baroness and the Committee that we do not think the information the database collects should be on in the Bill; we discussed that on the previous group. Our research has consistently demonstrated that it is imperative that the database can be adapted to meet future needs. Therefore, the data it collects should be set out in regulations. This is already possible through the regulation-making power in Clause 78, which the Government will use to outline registration requirements. Therefore, the amendment is unnecessary.
Amendments 235, 236 and 238 to 240, taken together, propose changing the Bill’s provisions so that landlords cannot serve notice for possession under Section 8 nor be granted repossession by the courts if they are not compliant with database registration requirements. In addition, the amendments would mean not only that landlords would need to be registered but that their entries would need to be up to date in order for notices served to be valid. The amendments from the noble Baroness, Lady Thornhill, would do this by adding a provision in the Bill for updating Section 7 of the Housing Act 1988, which refers to courts’ powers to order possession to be updated to effect compliance relating to the database.
The noble Baroness, Lady Thornhill, also proposes amendments to the wording of Clause 91 so that it refers to Section 83(3) as a whole. I understand that the noble Baroness is concerned with incentivising landlords to comply with regulation and therefore sees the value in replicating some of the safeguards that have been in place for serving Section 21 notices. I agree that landlords who have not met the basic obligation of registering on the database should not be able to gain possession of a property. This is an important incentive for landlords to register and supports the role of the database in driving up standards in the sector. However, the Bill will already update the Housing Act 1988 to prevent landlords being granted possession by the courts if they do not have an active database entry for themselves and the property. This is a proportionate approach to stop landlords being granted possession where they have failed to meet their obligations.
The Bill also clearly sets out our expectation for landlords to maintain active database entries and to ensure that these are up to date. I reassure noble Lords that landlords who do not have an up-to-date entry in the database will be subject to enforcement action by local authorities. Regulations will stipulate the requirements for active and up-to-date entries, and in the meantime the criteria for gaining possession as outlined in the Bill provides an appropriate level of protection for tenants against landlords who fail to register with the database without sanctioning landlords disproportionately. We do not want to risk creating a situation where landlords cannot use Section 8 grounds but have no alternative means of seeking possession. I therefore kindly ask the noble Baroness, Lady Thornhill, to consider not pressing these amendments.
Amendments 228C, 228E, 228F, 228G and 237A were tabled by the noble Baroness, Lady Scott. Amendment 228C would remove the ability to make regulations requiring the payment of a fee as part of renewals when database entries become inactive. I understand that the noble Baroness is seeking further information on the circumstances in which a landlord could be charged a fee under the regulations made under Clause 80. It is the intention that, in addition to an initial registration fee, there will be a fee at the point of renewal. An entry will become inactive if it expires at the end of a registration period and will become active again upon renewal. Landlords will not be charged for updates between renewal points. In cases where a landlord elects to make an entry inactive because they are no longer letting the property, they will not be charged. We will set out in detail when active entries become inactive, and vice versa, in secondary legislation. Timelines for registration and renewal will similarly be set out in secondary legislation.
Amendment 228E would place a requirement on Ministers to give two months’ notice of any fee changes to landlords with an active database entry. It raises a useful point to consider as we develop the database. We agree on the need for landlords to receive clear and timely communication about any changes in fees and to understand when a fee is required. As we develop the database, we are considering the required communications to landlords to help them understand their obligations, including payment of fees. We are also considering how we can design the database to facilitate this in a timely way. As we are already considering these points as we develop our proposals for implementation, we do not consider this amendment necessary.
Amendments 228F and 228G would remove the ability to set database fees with reference to costs of enforcing database requirements and to wider PRS enforcement costs respectively. This would mean that any fees could be calculated only by reference to operational costs and functions of the database. Effective enforcement is essential for the successful operation of the database. Without it, there will be no means to take action if landlords fail to sign up or provide the correct information. We have heard throughout the passage of this Bill the challenges with local housing authority resourcing and capacity for enforcement. Removing the option to factor in the costs of checking and taking action against any non-compliance would, in the long term, leave local housing authorities out of pocket and limit the database’s effectiveness.
As for wider enforcement costs, we believe that it is right that, as far as possible, the costs of enforcement should be met by those flouting the rules. Ultimately, all landlords, as well as the public and, most importantly, tenants, benefit from a well-regulated and enforced PRS. Clause 82 provides Ministers with the option of using a proportion of fee income to provide much-needed revenue to support enforcement activity. In answer to the questions asked by the noble Baroness, Lady Scott, about fees, the fee level will not be set arbitrarily. The Bill provides that the relevant costs that can be recovered via the fee can be based on the cost of establishing and operating the database and the cost of performing the functions required under the database legislation and of enforcing the database and wider PRS legislation. We will ensure that decisions about fees take into account a range of factors, including of course the burden on landlords. Fees will be set out in secondary legislation. We are in the process of developing a calculation and structure for fees. The fee level will need to reflect the operating costs of the digital tool, which is currently in development, and may also be used to fund local authority enforcement. We are in the process of designing the database as a bespoke tool, so we are developing our understanding of what our expected costs will be. This has been set out in the impact assessment. The costs may be subject to change as our plans for delivery and implementation develop, so I am not able to give the noble Baroness an exact answer at the moment.
Baroness Scott of Bybrook (Con)
Surely there is a budget, or even a proposed budget, that will go to the Treasury to deliver this scheme.
Baroness Taylor of Stevenage (Lab)
As with all future funding for our department and every other department, spending review bids have gone in. I will take her request back to the department to see whether we are able to be any clearer on that, but my understanding is that at the moment that we are not able to give an exact figure.
Noble Lords will be aware that these database fees will be set at a later point in regulations. I stress that in setting fees, we will ensure, and we have always been clear, that the fees will be fair and take into account the cost to landlords. The noble Baroness, Lady Scott, also asked me about the accountability of the database operator. I will write to her on that point, if that is okay. For the reasons I have set out I do not think that it would be beneficial to the private rented sector database, or the reforms more widely, to place these additional limits on what relevant costs may be recoverable via the database fees.
The Bill will make it a legal requirement for residential landlords to ensure that they and their rental properties are registered on the database before a court can grant a possession order and they can gain possession of their property. Clause 91(1) amends Section 7 of the Housing Act 1988 so that a court can order possession only where there is an active entry in the database for both the landlord and the dwelling. Clause 91(1) also stipulates that possession orders made on grounds relating to anti-social behaviour are exempted from this requirement.
Lord Hacking (Lab)
Before the Minister sits down— I am probably breaking the rules, but I do so for very good reason—I want to state to the Committee that that she was quite right on Amendment 237, and I was quite wrong.
Baroness Thornhill (LD)
My Lords, I thank the Minister for her response. I absolutely accept that my amendments were pushing at the boundaries. However, at their heart is protecting tenants from being evicted by a landlord who is acting unlawfully, almost as a matter of principle.
However, I accept that the Minister is confident that the Bill as it stands should drive compliance and that, therefore, my amendments will be unnecessary. My answer to that is that only time will tell. That leads us to group 13, where we will talk about reviews and why we need them. I thank the noble Baroness, Lady Scott, who articulated some concerns and felt that maybe we could open a dialogue on this issue. For now, I beg leave to withdraw my amendment.
Baroness Thornhill
“(e) create provisions for financial penalties for non-compliance with the requirements for a database entry, including, but not limited to, provision for a rent repayment order where a person has failed to ensure that a required entry is up-to-date and active.”Member’s explanatory statement
This amendment would include rent repayments orders for non-registration of the database created under this Act.
Baroness Thornhill (LD)
My Lords, I am working overtime tonight. In moving my Amendment 226 I will speak to my Amendment 257 and support a number of important amendments in this group, including those from the Minister and the noble Baroness, Lady Kennedy, whose contributions I look forward to.
As colleagues will know, rent repayment orders remain one of the few enforcement mechanisms that are available directly to tenants. That is the key. They are not just about recompense; they are about ensuring that landlords meet their legal obligations and that tenants are protected when they do not, and recompense is made. Amendment 226 seeks to ensure that rent repayment orders can be applied where a landlord has failed to register on the private sector database established by the Bill. If we are serious about transparency and raising standards, non-compliance with the system we are creating must carry real consequences. I am starting to feel like a broken record, but noble Lords will get the message. Otherwise, the credibility of the database and the wider enforcement regime is seriously undermined.
Amendment 257 seeks to extend rent repayment orders further to cover cases where landlords have failed to join a redress scheme or maintain active entries on the new database. This amendment relates strongly to amendments in the previous group and on the enforceability of the database. If we want a rental system that is responsive, accountable and fair, we must ensure that tenants have clear recourse when landlords do not engage with these fundamental duties.
I am grateful to the noble Baroness, Lady Kennedy, for Amendment 244A, which adjusts the standard proof in some cases to the balance of probabilities rather than beyond reasonable doubt. This change is both proportionate and pragmatic. We know that gathering evidence can be an enormous burden for tenants. This amendment helps to address that imbalance while preserving important legal safeguards in more serious cases.
I also welcome the suite of government amendments in this group, which bring clarity to how rent repayment amounts are calculated and to which offences fall within scope. These amendments, particularly those aligning the repayment period with a two-year window, provide much-needed consistency and support effective enforcement. The inclusion of new categories of offence and consequential changes to the Housing and Planning Act 2016 are helpful and align with the overall intent of the Bill. However, I gently emphasise that, while the government amendments are welcome, they will be significantly strengthened by the additions proposed in my amendments. There is little point in creating systems to register landlords and offer redress if we do not give tribunals the power to act when landlords ignore them. Rent repayment orders are not a silver bullet, but they are an important tool to renters. We should not pass up the opportunity to make them more robust, more comprehensive and more effective in practice. I beg to move.
Baroness Kennedy of Cradley (Lab)
My Lords, it is a privilege to speak after the noble Baroness, Lady Thornhill, because I agreed with every word she said in her excellent opening speech. I will speak to Amendment 244A in my name. This amendment would apply the civil standard of proof for rent repayment orders pursued only on the basis of a Protection from Eviction Act offence. By changing the evidential standard for these rent repayment orders from “beyond reasonable doubt” to “balance of probabilities”, Amendment 244A will provide parity with the normal work of the tribunal and provide encouragement to tenants and those who assist them to claim redress, which was Parliament’s intention by including Protection from Eviction Act offences among the things that rent repayment orders could be claimed for. In short, the current requirement of a criminal standard of proof thwarts that intention.
Rent repayment orders are brought in the first-tier property tribunal, and the first-tier property tribunal is not a criminal court. A rent repayment order is not a criminal prosecution. The first-tier property tribunal does not follow criminal procedural rules or result in a criminal sentence or criminal record if a defendant is convicted. However, the tribunals require a criminal standard of proof. In addition, rent repayment orders are often brought by self-represented applicants seeking to reclaim rent they have paid to their landlord as compensation, and legal aid is not available for rent repayment order claims. For these reasons alone, it is therefore inappropriate that rent repayment orders for Protection from Eviction Act offences should apply the criminal standard of proof.
Moreover, a civil claim in a civil court for a legal eviction or harassment applies the civil standard. This is despite the fact that civil claims typically attract much higher penalties in the form of civil damages, rather than just the chance to apply for repayment of rent paid. It is therefore logical and consistent to apply the civil standard of proof to Protection from Eviction Act rent repayment orders in line with the rest of the civil law, and this is what Amendment 244A does.
Why does getting rid of this illogical anomaly matter? First, the nature of Protection from Eviction Act offences means they are often impossible to prove to the criminal standard. Often, landlords change the locks on tenants and dispose of their possessions when renters are not at home. Illegal evictions and harassment occur in the privacy of a renter’s home, often without witnesses. The criminal burden places an extra, often insurmountable, burden on lay applicants to prove their case at tribunal. It also has a chilling effect of preventing claims being brought in the first place, as the evidence available for these offences is unlikely to meet the standard. Under the standard, therefore, renters cannot apply for rent repayment orders as they cannot prove their case beyond reasonable doubt, even where it is clear that an offence has occurred that only the landlord would be motivated to commit. This weakens enforcement and access to justice, and undermines the whole purpose of the rent repayment order legislation.
Secondly, the incredibly low number of rent repayment orders for Protection from Eviction Act offences demonstrates that the system is not working. Safer Renting and the University of York have done research which estimates that over the two-year period from 2021 to 2022, there were at least 16,000 illegal evictions—a figure which is almost certainly an undercount.
Meanwhile, data gathered by the organisation Marks Out Of Tenancy shows that, over the same time period, there were just 31 rent repayment orders on the Protection from Eviction Act ground that were successful. Despite the large number of illegal evictions recorded by individuals and organisations assisting them, people are not applying for rent repayment orders as a source of redress. The higher criminal standard results in tenants and those assisting them considering an application not worth pursuing.
Thirdly and finally, with the forthcoming abolition of Section 21, criminal and unscrupulous landlords, who are the minority of landlords, might take a calculated risk that they can save money by unlawfully evicting or harassing their tenants, as they know how hard it is for tenants to enforce against them in the First-tier Tribunal. Rent repayment orders are realistically the only option for renters to enforce their rights without legal representation. It therefore has never been more important to strengthen the rent repayment order regime for Protection from Eviction Act offences so that renters can enforce their rights and gain access to justice for these life-changing offences.
These offences are some of the most egregious a landlord can commit—illegal eviction, attempted illegal eviction and harassment. The physical, mental and financial impact of these offences on renters and their families cannot be overstated. I look forward to my noble friend Lady Taylor of Stevenage’s reply. I am sure she will want to reflect on the wider debate today. I hope she will agree to meet with me and Safer Renting—experts in this field—to discuss the aim of Amendment 244 before Report to see what can be done.
Baroness Bennett of Manor Castle (GP)
My Lords, it is a great pleasure and privilege to follow the noble Baronesses. They are clearly very powerful advocates for private rental tenants, who very much need them.
I will speak specifically to Amendment 257, to which my noble friend Lady Jones of Moulsecoomb attached her name; it having passed the lark hour, we are now into the Green owl hour of the evening. Before I do that, I want to mention that the noble Baroness, Lady Kennedy, made a hugely powerful argument on the inequality of arms in the rental tribunal. The judgment level the noble Baroness suggested is clearly the right one.
I will mostly speak to Amendment 257 which, as the noble Baroness, Lady Thornhill, clearly outlined, would enable the tribunal to make a rental repayment order where a landlord has failed to join a landlord redress scheme or have active entries in the private rented sector database. This is a simple and clear process in which the tenant can get what they are owed when the landlord has failed.
In preparing for this, I had a look at the Citizens Advice website and the advice it provides for tenants. It is telling that there has been real progress on some issues—for example, recovering rental deposits—in the past decade or so, but there are still far too many cases where renters are left stranded. People are in situations where they are left homeless or desperately trying to find a new rental property. Do they have the time, energy or resources to chase, go through the courts and take all of the procedures that they need to? This approach has worked well for tenancy deposit schemes. Renters get their money back from the landlord and all landlords know they need to register deposits or else pay the price. This is a proven system; it is a case of extending a proven system to deliver justice. Both the non-government amendments in this group are terribly important.
Lord Jamieson (Con)
My Lords, I thank all noble Lords for their contributions to the discussion on the seventh group of amendments, which addresses important changes to the rent repayment orders. These amendments seek to strengthen the mechanism by which tenants and local authorities can hold landlords accountable when they breach laws and ensure that rent repayment orders are both fair and effective.
The proposals tabled by the noble Baronesses, Lady Thornhill, Lady Taylor of Stevenage and Lady Kennedy of Cradley, raise significant points that warrant our attention. Among them, we see the suggestion to register RROs on a public database, which would make the existence of these orders transparent, allowing tenants and others to be aware of landlords with a history of non-compliance. This could serve as a powerful deterrent against landlords who might otherwise continue to disregard their responsibilities.
In addition, we see proposals to change the amount to be repaid in an RRO, as well as to extend the ability of tribunals to issue RROs in the case of non-registration on the public database. We need to ensure that the consequences for landlords are proportionate to the harm caused and that tenants receive a fair outcome. Although it is appropriate to have rent repayment orders where a tenant has been impacted or suffered a loss, as outlined so well by the noble Baroness, Lady Kennedy of Cradley, where a landlord has inadvertently breached a regulation and received a fine, but no harm has been done to a tenant, should they also receive a rent repayment order?
These Benches accept that rent repayment orders are an important tool for holding landlords to account and we welcome the intention to make these processes more accessible and transparent for tenants. However, we note that there are complex issues surrounding the practicalities of RROs, as I mentioned earlier, particularly in relation to the standard of proof and their scope.
Therefore, I ask the Government to respond to the following points. How do they propose to ensure that these amendments, particularly those relating to the registration of RROs, do not place unnecessary burdens on tribunals or create unintended consequences for landlords, who may not be aware of the rules? How do the Government intend to address the issue of non-registration on the database and the potential impact on landlords who fail to comply?
I thank the noble Baronesses, Lady Thornhill, Lady Bennett of Manor Castle and Lady Kennedy of Cradley. These are important questions and I look forward to hearing the Government’s response.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Thornhill, and my noble friend Lady Kennedy of Cradley for their amendments relating to rent repayment orders. I also thank the noble Lord, Lord Jamieson, for his contribution.
I will begin by responding to the amendments in the name of the noble Baroness, Lady Thornhill. Amendment 226 seeks to extend penalties for non-compliance with private rented sector database requirements. The Bill already includes a clear, proportionate and escalating approach to penalties against those who flout the rules. For initial or less serious non-compliance, local authorities can impose a civil penalty of up to £7,000— I think the noble Baroness, Lady Thornhill, said she was beginning to sound like a stuck record; now I feel like that as well. In the case of the database, that applies, for example, to a first failure by a landlord to register.
For serious or repeat non-compliance, local authorities can prosecute or, alternatively, issue a civil penalty of up to £40,000. In the case of the database, that applies, for example, where a landlord knowingly or recklessly provides information to the database operator that is false or misleading in a material respect. We will, through the Bill, significantly strengthen rent repayment orders because we believe they are a powerful mechanism for tenant-led enforcement.
In relation to the database, rent repayment orders are available where a landlord knowingly or recklessly provides false or misleading information to the database operator. They are also available where a landlord continues to fail to register or provide the required information to the database following a first penalty. These, though, are criminal offences, and it would not be appropriate to extend rent repayment orders to non-criminal breaches of the database requirements. Rent repayment orders are intended to act as a punitive sanction against landlords who commit criminal offences. Extending them to conduct that does not amount to an offence would undermine this.
Similarly, Amendment 257 would make rent repayment orders available for initial failure to be a member of the PRS landlord ombudsman and initial failure to be registered with the PRS database. My view is, as before, that it may be inappropriate to extend rent repayment orders to these non-criminal breaches. The new ombudsman and database are fundamental parts of our reforms, and of a better private rented sector with greater accountability. It is vital that they are robustly enforced.
We think the routes of enforcement currently in the Bill represent an effective and proportionate approach. We will monitor the use and effectiveness of rent repayment orders under the new, strengthened regime and consider whether further changes are necessary. Therefore I ask that the noble Baroness, Lady Thornhill, withdraws her amendment.
Amendment 244A, tabled by my noble friend Lady Kennedy of Cradley, seeks to lower the standard of proof to which the First-tier Tribunal must be satisfied before making a rent repayment order against a landlord for an offence of illegal eviction or harassment under the Protection from Eviction Act 1977. She set out very clearly and concisely why she was putting that forward with a very convincing argument.
I am clear that illegal eviction and harassment are serious criminal offences and that offenders need to be robustly punished. I accept that this happens too rarely at the moment. We are seeking to address this through the Bill by extending civil penalties, as an alternative to prosecution, to illegal eviction and harassment offences under the Protection from Eviction Act 1977.
My noble friend pointed out that the First-tier Tribunal is not a criminal court and asked why the criminal standard of proof should apply. The rent repayment order regime is predicated on an offence having been committed, and it is an established principle in law that offences are taken to have been committed when proved beyond reasonable doubt. Creating a lower standard of proof for the same offences for a finding of guilt in the tribunal compared with the criminal courts would be confusing, inconsistent and could be subject to a successful challenge.
We are also placing a duty on local housing authorities to enforce against specified landlord legislation, which includes illegal eviction and harassment under the Protection from Eviction Act 1977, and we are looking hard at how best we can support them do so effectively. This Government are determined to bear down harder on illegal eviction and harassment. We are concerned, though, about what impact this amendment could have on the integrity of the rent repayment order regime as a whole.
Rent repayment orders are predicated on an offence being committed. As I said, they apply exclusively to criminal offences, and the penalty can be a very significant one. The changes that we are making through the Bill both double the maximum penalty to two years’ rent and extend the circumstances in which the tribunal must award that amount. I recognise that illegal eviction may be hard to prove beyond reasonable doubt, but that is not a principled reason for a civil standard of proof to apply to obtaining a rent repayment order in respect of a serious criminal offence.
The severity of the penalties that, quite properly, apply in the rent repayment order regime mean that there would be serious questions about procedural fairness should the criminal standard of proof not be required. The criminal standard of proof will of course be required when a local authority issues a civil penalty for illegal eviction or harassment under new Section 1A of the Protection from Eviction Act 1977. All the other rent repayment offences would remain to be proved beyond reasonable doubt. Making rent repayment orders for illegal eviction and harassment subject to the civil standard of proof would create an anomaly and be a departure from a well-established position, which we consider would be hard to justify. Of course, I would be very happy to meet the noble Baroness, Lady Kennedy, and Safer Renting but, for now, I ask the noble Baroness, Lady Thornhill, to withdraw her amendment.
I will end with a brief—I promise—explanation of the Government’s amendments in this area. This Government view rent repayment orders as a critical part of ensuring higher standards and better compliance in the private rented sector; that is why we have significantly expanded them through the Bill. Government Amendments 244 to 248 aim to ensure that they work as intended in their application to the offence of breaching the restricted period after relying on the moving and selling grounds of possession, and the amended licensing offences are described correctly.
Baroness Thornhill (LD)
First, I thank the noble Baronesses, Lady Kennedy and Lady Bennett, and the noble Lord, Lord Jamieson, for their excellent, thoughtful and thought-provoking contributions.
We all agree, I think, that it is really disappointing that rent repayment orders—such a valuable tool—are so rarely used. Let us hope that the changes outlined by the Minister work and that the whole renting culture changes, with tenants’ empowerment. As we have gone through this process, we are beginning to see all the impacts of the Bill and how they should all work together to produce that change; perhaps an increase in the number of RROs will be an indication that things are improving.
I follow the logic of the Minister’s arguments, as on my previous amendments, but I hope that we have given her food for thought. I withdraw my amendment.
The Deputy Chairman of Committees (Viscount Colville of Culross) (CB)
I am going to have to beg your Lordships’ patience; I have quite a lot of pages to read through now.
Member’s explanatory statement
This enables a database operator to disclose information from the database to the Secretary of State.
“(aa) in line 5 of the table in that subsection, in the third column, for “control or management of unlicensed HMO” substitute “offences relating to unlicensed HMOs”; (ab) in line 6 of the table in that subsection, in the third column, for “control or management of unlicensed house” substitute “offences relating to unlicensed houses”;”Member’s explanatory statement
This updates the description of offences under section 72(1) and 95(1) of the Housing Act 2004 to reflect changes made to those provisions by clause 105 of the Bill.
Member’s explanatory statement
This amendment is consequential on the amendment in my name amending clause 99 to insert a new row into section 44(2) of the Housing and Planning Act 2016 to deal with this case.
“(aa) in subsection (2), after the first row of the table insert—
“an offence mentioned in row 2B of the table in section 40(3) | the period of 2 years ending with the date of the offence or, if the tenancy ends before that date, the date on which it ends”;” |
This provides that the amount of rent to be repaid under a rent repayment order in relation to an offence under section 16J(2) of the Housing Act 1988 is to be calculated by reference to the rent paid in respect of the two years prior to either the date of the offence, or if the tenancy ends before that date, the date on which it ends.
Member’s explanatory statement
This amendment is consequential on the amendment in my name amending clause 99 to insert a new row into section 45(2) of the Housing and Planning Act 2016 to deal with this case.
“(aa) in subsection (2), after the first row of the table insert—
“an offence mentioned in row 2B of the table in section 40(3) | the period of 2 years ending with the date of the offence or, if the tenancy ends before that date, the date on which it ends”;” |
This provides that the amount of rent to be repaid under a rent repayment order in relation to an offence under section 16J(2) of the Housing Act 1988 is to be calculated by reference to the rent paid in respect of the two years prior to either the date of the offence, or if the tenancy ends before that date, the date on which it ends.
Member's explanatory statement
This amendment would make the Decent homes standard apply to all homeless temporary accommodation provided under the Housing Act 1996.
The Lord Bishop of Manchester
I thought that my amendment was never going to come. Amendment 249 stands in my name, and I am glad to support Amendment 252, to which I have added my name, and Amendments 250 and 251 in this group. I declare my interest as co-owner, with my wife, of one rather modest apartment in the West Midlands, which we let out.
As someone who has chaired a wide range of housing associations, including a large local authority transfer and an arm’s-length management company, I have seen the huge positive impact that the decent homes standard has had since one was first applied to social housing. Not least, it has forced landlords to pay proper attention to their existing stock, rather than focusing all their energies and resources on new developments. Hence, I am delighted that this Bill will, for the first time, extend the standard to much of the private rented stock; it is a sector desperately plagued by underinvestment in repairs, maintenance and stock improvement. One in five privately rented homes does not currently meet the decent homes standard compared to 10% for social housing. More than one in 10 has a category 1 hazard, which is two and a half times the figure for social housing.
My amendment, along with those in the names of other noble Lords that I wish to support in this group, seeks to test whether there is appetite in your Lordships’ House to extend the application of the standard to others whose homes will not be covered as the Bill stands. Amendment 249 would make the decent homes standard apply to all homeless temporary accommodation provided under the Housing Act 1996. Record numbers of individuals, families and children are currently housed in temporary accommodation. Some 117,450 households were in temporary accommodation in March 2024, which was a rise of 12.3%, almost an extra one in eight, from the previous year. Extending the decent homes standard to this large group of people would enable those living in temporary accommodation to expect basic standards from their accommodation.
The very phrase temporary accommodation is something of a misnomer. Many of those who live in such properties are housed there for years at a time. Moreover, the same property may then be used for further so-called temporary tenancies. While I understand that sometimes it may appear better to allow a family to live for a short while in a property that is awaiting imminent major refurbishment or even demolition rather than leave the building empty, this is not what is happening in the vast majority of cases.
I have previously raised in your Lordships’ House the particular plight of children in temporary accommodation. I remember a very good conversation with the noble Baroness, Lady Scott of Bybrook, a year or two ago. The figure was then more than 130,000, and it is still rising. They are often housed many miles away from their schools and play friends. Managing an education in such a context is desperately difficult. Some schools in Manchester are already having to put on special provision for children living in temporary accommodation, so imagine what it means to have to do that in a home that does not meet a basic standard of decency. We are failing such children utterly. Alongside families with children, many residents in temporary accommodation have particular vulnerabilities in terms of health and are often not well equipped to advocate for themselves. A national standard will make a huge difference.
My amendment would close a glaring loophole in the current Bill whereby private landlords could escape the decent homes standard by switching to providing temporary accommodation. Allowing the poorest quality homes in our nation simply to move to another form of tenure without doing anything to tackle their condition defeats the whole object of extending the standard at all.
I shall not steal the thunder of the noble Baroness, Lady Grender, whose Amendment 250 would extend the standard to accommodation used by HM Armed Forces families, save to remind us that these households, containing those on whom we rely for our nation’s defence, deserve the very best from us.
Amendment 251 in the names of the noble Lord, Lord Tope, the noble Baronesses, Lady Lister of Burtersett and Lady Janke, and my right reverend friend the Bishop of Chelmsford, who cannot be in her place tonight, would extend the standard to accommodation provided for those who have fled war, terror and persecution and are now seeking, lawfully, to rebuild their lives here.
Amendment 252 in the names of the noble Baronesses, Lady Whitaker and Lady Bakewell of Hardington Mandeville, and the noble Lord, Lord Bourne of Aberystwyth, to which I have added my name, would extend the application of the decent homes standard to mobile homes that are rented for residential purposes. I have been a long-term advocate for the rights of Gypsy, Roma, and Traveller households, which often experience levels of prejudice beyond that of almost any other ethnic group in our society. They simply seek live a way of life that they have followed for centuries and have long been a vital part of the workforce, especially in rural areas where short-term temporary agricultural workers with high mobility are required at particular points in the seasonal cycle.
These amendments seek to extend to some of our most vulnerable or deserving households a standard that the Bill already agrees is the proper one for most of our citizens. I hope that in responding to the debate the Minister will be able to indicate some movement or at least offer scope for further discussions with us on these important issues ahead of Report.
Baroness Grender (LD)
My Lords, I support all the amendments in this group. In particular, I draw to your attention Amendment 250 in my name which would extend the decent homes standard to accommodation used by service families.
Our service personnel and their families make extraordinary sacrifices for our safety and security. The very least we owe them is decent housing. The current state of service accommodation is, in many cases, unacceptable. Satisfaction levels with both service family accommodation, SFA, and single living accommodation, SLA, fell to their lowest reported levels in 2023 impacting recruitment and retention. The Defence Select Committee reports that one-third of SLA and two-thirds of SFA are in such poor condition that they are essentially no longer fit for purpose. We hear persistent reports of damp and mould, inadequate maintenance and repairs and poor communication.
We cannot discuss the state of military housing without acknowledging the damaging legacy of some past decisions. The sale of 57,400 military homes to Annington Property Ltd in 1996 under the Conservative Government was described as a disastrous fire sale. The deal left the Government trapped paying rent and maintenance costs with no power to plan or make major upgrades. Indeed, the Public Accounts Committee concluded that service families were,
“badly let down for many years”
under the previous housing contracts. The taxpayer was left nearly £8 billion worse off due to that original deal, with money that should have been spent on maintaining homes lost.
The current Labour Government have taken welcome steps. They repurchased 36,000 homes from Annington in January, a deal that is expected to save £230 million a year in rent. A defence housing review was launched in February. A new consumer charter promises measures such as higher move-in standards, more reliable repairs and a named housing officer for every family. It is welcome that the MoD has agreed with the conclusion that the current complaints process is inefficient and that a new, simpler, two-stage process is being devised.
I now come to the “however” bit, I am afraid. The scale of the problem is immense, a result of historic underinvestment over decades. Estimates suggest billions are needed, potentially £2 billion to £2.4 billion for SFA alone, and more than £1.5 billion for SLA. I reassure the Minister that we did our costings in our manifesto and definitely identified funding in some of these areas. While investment plans are being set out, questions remain about whether funding will be sufficient and sustained to address the condition of the entire estate.
Amendment 250 is crucial because it would continue the work of my colleague in the House of Commons, Helen Maguire MP, a former captain in the Royal Military Police who served in both Bosnia and Iraq; it would reinforce the work of the MoD; and it would honour the Kerslake commission. It would ensure that the decent homes standard, which provides a very clear benchmark for acceptable housing quality, was legally applied to service family accommodation.
The amendment goes beyond acknowledging the problem of setting targets. It would establish a right to a decent home for those who serve our nation and their families. They deserve homes fit for heroes, and the amendment would be a vital step towards making that a reality. It would ensure accountability. It would provide service families with the basic standards that they have every right to expect.
I urge the Committee to support the amendment. After all, it is only right that our service personnel and their families live in safe, clean homes that meet basic, dignified standards, especially when they risk their lives to keep us safe. Pride in our Armed Forces must mean pride in how we house them.
Lord Tope (LD)
My Lords, I shall speak particularly to Amendment 251 in my name. I wholeheartedly agree with all that was said by the right reverend Prelate, and if we were able to his agree to his amendment now—the Minister could nod her head if that is about to happen—then we could bring an end both to what I am going to say and, dare I say, to some speakers on the next two amendments as well. The right reverend Prelate’s amendment would cover it all.
In the, I hope, unlikely event that that does not happen, I will speak to Amendment 251, which seeks to extend the decent homes standard to include asylum accommodation. In doing so, because I am going to speak with particular reference to the situation in London, I must again declare my interest as co-president of London Councils, the body that represents all 32 London boroughs and the City of London, and as a vice-president of the Local Government Association.
I spoke at Second Reading of the extensive evidence from London borough councils about the poor standards of asylum accommodation, particularly in London but by no means exclusively there. Many of the things that I said then and will say again today apply to too many other parts of the country. London boroughs have reported issues of low-grade temporary accommodation properties, with multiple category 1 hazards, leaving the private rented market and being procured by Home Office accommodation providers.
The Minister has received a letter from London Councils, signed by the lead spokespeople of all three parties on that body and the chief executive officer of the Chartered Institute of Housing, asking that the Government consider how the Bill can ensure inclusion of Home Office accommodation within its provisions to ensure that asylum seekers and refugees benefit from the same protections that all private and social renters receive. In her response, the Minister agreed to discuss these issues with the Home Office. I am grateful to her, as is London Councils, for arranging a meeting between officials and London Councils to discuss this in more depth. I understand that that meeting has now taken place, so I look forward to hearing from the Minister what conclusions she has drawn from those discussions and, more particularly, what action is now to be taken.
Extensive feedback from London local authorities has consistently highlighted evidence of poor standards across asylum accommodation. As we know, enforcement action is slow and all too often ineffective. There is also widespread concern, not just from London Councils and not just in London, that not including Home Office accommodation will inevitably result in a two-tier system in which a small minority of rogue landlords may be incentivised to procure poor-quality accommodation for use as asylum accommodation.
In Committee in the other place, the Government argued that extending the provisions of the Bill to asylum accommodation is unnecessary. I hope and believe that we have come a long way from that now, and that the Minister is convinced by all the evidence she has had from those working in the system that all is far from well. Clearly, there are practical difficulties of implementation to be resolved, but if there is a will then there is a way to do so. Including asylum accommodation in the provision of the Bill would be a strong incentive; not doing so would inevitably have the opposite effect. I look forward to hearing the Minister’s positive response.
Baroness Whitaker (Lab)
My Lords, I support all the amendments in this group and will speak to Amendment 252 in my name and those from the noble Lord, Lord Bourne of Aberystwyth, the noble Baroness, Lady Bakewell of Hardington Mandeville, and the right reverend Prelate the Bishop of Manchester, for whose support I am most grateful. The right reverend Prelate’s observations, drawn from experience, were extremely valuable. I also thank my noble friend Lady Warwick of Undercliffe for her earlier support for this amendment.
This amendment simply brings the homes that caravan dwellers rent within the scope of the Bill and is surely uncontentious. It is still not generally realised that, for the Romani Gypsies and Irish Travellers, who keep to their traditional—and legally recognised—way of life, a caravan which is their residence is as much a residence as any other dwelling and should be eligible for the same legal protection. The owners of such caravans should respect the decent homes standard as much as for any other rented dwelling, and, in many cases, this is sorely needed.
I know of a case where a new Gypsy and Traveller site, built only four years ago, was from the day the family moved in infested by rats, frequently flooded and subject to damp, mould, slugs, trip hazards, faulty electrics, a broken boiler and sewage back-up across the site. This had terrible effects on the family’s physical and mental health. Childhood asthma returned and medical treatment was needed. I remind the Committee that Gypsies and Travellers have the worst health outcomes of any minority ethnic group, and this example shows one reason why.
All these health and safety hazards were the result of structural issues in the rented amenity block and site as a whole, for which the site owner was responsible. The family contacted the site owner in over 50 emails over the years and went through the formal complaints process. When they contacted the Housing Ombudsman, they were told that cases concerning the management of Gypsy and Traveller sites were not investigated. Does that not make it clear that there is a lack of effective protection for families living on Gypsy and Traveller sites? Why should they not have equal protection and equal status with other renters? I know my noble friend the Minister understands this and I hope she will accept the amendment.
Baroness Coffey (Con)
My Lords, I have tabled Amendment 252A. I guess I am still learning about this Committee, because all the speakers have been exceptionally generous, saying that they support all the amendments in this group—perhaps they have not read my amendment, which excludes a certain number of properties from the decent homes standard. I think it is also fair to say that the only other amendment in this group that I actively support is that proposed by the noble Baroness, Lady Grender.
On Armed Forces accommodation, I ran some surgeries, because I was pretty appalled at the state and operations of the property arm of the Ministry of Defence, which contracted two different suppliers but did not seem to have a grip on what was going on. The change that happened nearly 30 years ago is, in hindsight, regrettable. It is why the previous Administration initiated the process, which I congratulate the Government on completing. One of the strategic changes that should help families in the Armed Forces is the move towards lifetime basing. This applies to the majority of our Armed Forces, although not specialist regiments like 23 Parachute Engineer Regiment—based just outside Woodbridge—which necessitate quite a number of people in rotation. Our Armed Forces, of course, deserve the best. There is nothing more concerning than somebody who is abroad thinking not only about the key strategic or tactical role they are playing but also the state of their loved ones’ housing back at home.
My Amendment 252A is driven by my concern about how, in effect, the policy of requiring EPC level C certificates for all private rented property risks removing many homes from the private rented sector across the country, particularly in rural areas. On applying the decent homes standard, EPC legislation, or the required minimum standards on energy efficiency, does not legally apply to social housing; instead, there is a target that is set which is expected to be met. We are now seeing a situation where the decent homes standard, which currently only applies to social housing, is going to be applied to the private sector. That is in a broad sense a good thing, but I am particularly concerned about aspects of it that will drive landlords out of the market and the effect on rural communities.
According to a survey conducted by MHCLG last summer, there are about 2.6 million homes that do not meet EPC level C and have a rating of D or lower. That is 60% of the private rented sector, so this is concerning. I completely understand the need to address fuel poverty; in the other House I founded the APPG on fuel poverty. I was particularly focused on off-gas grid, which of course covers a lot of rural communities, but also inner cities such as Manchester, Salford and the other areas represented by the right reverend Prelate.
We should bear in mind that the MHCLG currently estimates that 10% of those properties cannot in any way be upgraded to reach EPC level C. That still leaves 90%, but the challenge now is the variation in what is going on to upgrade those homes, some of which could require significant investment. Where it is reasonable—and by that I mean the amount of investment needed to make the adjustment—we should of course try to ensure that these properties are suitably warm. That would be helped if pensioners still had the winter fuel allowance and did not have to worry about whether they heat or eat. We must look at how we can address that without losing the housing capacity that is available.
Under the current regulations, there is a £3,500 cap on required investment to make the changes to get to the current minimum level E. As I say, I support the ambition to head that way, but now the proposed policy being consulted on is for a £15,000 cap on required investment, below which there would be no exemption. Let us get practical. I appreciate that the Minister may not be prepared for my question, but it should be considered by her department: what rural assessment has been conducted on this? It is standard government policy to undertake what is often known as rural-proofing when considering policies that will impact rural communities. I am genuinely concerned about that and about the possibility that the proposals for changing the methodology on ascertaining the EPC level will have a significantly detrimental effect on rural communities right across the country.
The Earl of Leicester (Con)
My Lords, I shall speak to Amendment 252A in the name of my noble friend Lady Coffey, which would exempt certain buildings from an EPC requirement. I hope that noble Lords were listening to what she said, because it is absolutely true: the methodology used for assessment of EPC is not foolproof. As my noble friend said, the assessment seems heavily weighted against older buildings, and while she referred to early 20th-century buildings, a decent proportion of houses in this country are from the 18th and 19th centuries. They have even greater problems: for instance, double-glazing is required as one of the ways to achieve EPC C. Many 18th-century and 19th-century houses have shutters, which, when closed at night, do a similar job, but that is not part of the assessment. Many such houses are in rural settings, so what my noble friend said is so true.
My noble friend alluded to the variation in assessment of EPCs by different assessors. As an experiment on one property that we own, we got two separate assessors in—they did not know that they were being tested against each other—and, you guessed it, each of them came up with a different EPC grade. That is a real problem; the assessment needs to be sorted out. I think it was in the newspapers that the Secretary of State for Energy Security and Net Zero, Mr Miliband, had a similar situation, with two different assessments.
On listed buildings, there has been a lot of campaigning by various organisations. You cannot take out 18th-century and 19th-century sash windows and replace them with double-glazing—at least, you can, but it completely ruins the look of the building. A number of people prefer to live in a house which looks nicer but might need a little more heating or a log burner.
As my noble friend said, the Bill is very likely to result in the law of unintended consequences. Many houses will be sold and lost to the rental market, and that will create for this Government and this country an even bigger problem. After the Second World War, some landlords—not that I would want to do this—even took the roofs off their houses so that they were no longer houses.
Finally, I am sorry, but I want to speak against Amendment 251 in the name of the noble Lord, Lord Tope. If we are to apply the decent homes standard to asylum accommodation, I am afraid that that has to be last in the queue while we sort out the accommodation for our own people in this country.
Lord Cromwell (CB)
My Lords, a number of speakers have driven home in detail the problems of rural areas with old buildings. The choice is quite simple: we either continue with the existing exemptions or knock down about a third of them and start again. Can the Minister tell us which it is going to be?
Baroness Janke (LD)
My Lords, I support my noble friend Lord Tope’s Amendment 251, which I have also signed. We have all spoken of the support we give this Bill because it offers the opportunity to address the problems and injustices suffered by renters in the PRS, which is the most insecure, most expensive and lowest quality of any tenure. However, the Bill fails to recognise that certain vulnerable groups of tenants suffer disproportionately, as we have heard, and need special measures to give them the level playing field they need to be able to live in suitable accommodation that is fair, reasonable and secure in the private rented sector.
Refugees and asylum seekers are just one such group, and their housing experience is in need of radical reform. My noble friend’s amendment, suggesting that the decent homes standard should apply to housing for refugees and asylum seekers, offers an opportunity to move forward.
However, the asylum housing system in the United Kingdom leaves tens of thousands of people in inadequate accommodation, where they often live for years in conditions that significantly undermine their physical and mental well-being. The current outsourcing of asylum housing to private companies has created a system that is marked by significant issues, including exorbitant costs, excessive profit making, substandard housing, and inadequate safeguarding and oversight. I read in the Sunday Times this week that the owner of one such company, Clearsprings Ready Homes, is now a member of the Sunday Times rich list as a result of rapidly expanding contracts from the Government at the taxpayer’s expense.
These providers need to be properly accountable. Refugee organisations report appalling conditions and many incidents of poor, unsafe and cold properties with infestations and mould. It should therefore form part of contracts with providers that the decent homes standard should apply to properties that are paid for by government. Taxpayers’ money is being used to fund substandard accommodation and providers are not being sanctioned. Many of those who are obliged to live in such misery are children, forced to live in virtual isolation and incarceration with housing conditions that are woefully inadequate for their needs. I therefore support my noble friend’s amendment and call on the Minister to reflect on this situation. If she is unwilling to amend the Bill, can she say what the Government are proposing to do to resolve the desperately pressing circumstances of refugees and asylum seekers and the housing crisis that they face?
Baroness Scott of Bybrook (Con)
My Lords, I thank all noble Lords who have contributed to this debate on the decent homes standard and its potential application across a broader range of accommodation types. As we have heard, the Bill introduces new powers for the Secretary of State to specify additional standards for qualifying residential premises, which offers the potential to raise housing quality and improve conditions for tenants across England. This is, in principle, a welcome ambition, particularly if it helps to extend protections to the most vulnerable in our housing system.
We must recognise the dignity of all residents, regardless of tenure. However, while the intention behind these amendments is laudable, it is vital to interrogate the practicalities and the legal impact of such proposals. For instance, how would the Government define “qualifying residential premises” in the context of asylum accommodation, where providers may be delivering services under a Home Office contract rather than under tenancy agreements? What enforcement mechanisms are appropriate in temporary or institutionally managed housing? Where would the burden of compliance ultimately fall?
We must also examine the legislative implications for landlords and housing providers, particularly those operating on constrained margins. Applying a uniform standard across such a diverse landscape of housing may sound straightforward in principle but in practice it could impose significant compliance costs, particularly in sectors such as mobile home parks or supported houses, where the business model and the regulatory framework already differ markedly from the private rented sector.
Stakeholders such as G15, representing London’s largest housing associations, have raised these very points, urging caution in implying one-size-fits-all approaches and stressing the importance of clarity, resourcing and consultation. Similarly, the Royal Institution of Chartered Surveyors has warned of the unintended market disruption that could follow from ambiguous or overly broad standards, particularly if applied unevenly or without sufficient support for implementation.
Amendment 252A, tabled by my noble friend Lady Coffey, seeks to exempt certain buildings from the requirements to maintain specified energy efficiency criteria, specifically those in rural areas, those that are listed buildings or those that were constructed prior to 1900. This raises an equally critical set of questions. As we have heard, many older and listed buildings simply cannot meet modern EPC targets, such as EPC C, without intrusive and costly works that may fundamentally alter their structures or even their appearance. The amendment, therefore, is a measured and proportionate intervention designed not to weaken the decent homes standard but to ensure that it is applied with practicality and flexibility where needed.
Finally, we must ask whether there is a clear and coherent framework in place for assessing which tenures and building types should fall under the decent homes umbrella and whether, without such a framework, we risk creating legal uncertainty or burdens that will ultimately be passed on to tenants themselves.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the right reverend Prelate the Bishop of Manchester, the noble Lord, Lord Tope, and the noble Baronesses, Lady Grender, Lady Whitaker and Lady Coffey, for their amendments on the decent homes standard and standards within the private rented sector. I also thank the noble Earl, Lord Leicester, the noble Lord, Lord Cromwell, and the noble Baronesses, Lady Janke and Lady Scott, for their comments in this group. Let me say how much I agree with the right reverend Prelate’s words about the decent homes standard and how dramatically that has improved homes in the social rented sector.
Amendment 249, tabled by the right reverend Prelate, would remove the power that allows Ministers to specify in regulations what types of temporary homelessness accommodation the decent homes standard will apply to. People living in temporary accommodation deserve a safe and decent home. I therefore agree with the right reverend Prelate’s aim of ensuring that such accommodation meets minimum decency standards. I can confirm that it is the Government’s intention that as much of this sector as possible is covered by the decent homes standard—I feel really strongly about this. I was told by the Mayor of London last week that one in 21 children in London are currently in temporary accommodation; that is probably more than one in each classroom of children. It is absolutely shocking that this is the case. Of course, the long-term answer is our commitment to the biggest increase in social and affordable housing in a generation. We have already invested £2 billion in making a start to help towards that situation.
However, it is important that I say that the pressures on the supply of temporary accommodation mean it is important that we carefully consider how we apply the standard to this sector. Having this power allows us fully to examine these issues and to consult. That will make sure that we strike the right balance between improving standards and avoiding risks to supply. I am of course very happy to meet the right reverend Prelate on this issue, because we all want the same outcome. For now, however, I ask that he withdraw his amendment.
Amendment 250, in the name of the noble Baroness, Lady Grender, seeks to bring service family accommodation provided by the Ministry of Defence within the scope of the decent homes standard provisions in the Bill. I certainly agree with her that the conditions of much of the service family accommodation that we inherited were absolutely shameful. I strongly agree that we owe our dedicated military personnel and their families safe and decent homes. However, as the Minister set out when this amendment was debated in the other place, bringing this accommodation within the scope of the enforcement system established by the Bill is not the right way to achieve this. I will explain why.
Our Government are determined to deliver homes fit for heroes. Noble Lords will be aware that the Ministry of Defence has recently completed a landmark deal to bring military housing back into public ownership—the deal that the noble Baroness referred to. This represents a once-in-a-generation opportunity to provide service families with a better standard of accommodation while contributing to our economic growth mission and boosting British housebuilding overall.
Alongside this deal, the MoD has started work on a new defence housing strategy, to be published later this year, to deliver a generational renewal of military housing. In April, the MoD announced a new consumer charter for forces family housing, which will form part of the strategy. The charter will introduce consumer rights for forces families, from essential property information and predictable property standards to access to a robust complaints system.
On standards, the MoD already uses the decent homes standard as a benchmark for service family accommodation. Homes below that standard are not allocated to service personnel and their families. The MoD uses its own higher defence “decent homes plus” as the target standard for service family accommodation. As part of the new strategy, the MoD is reviewing that target standard in line with the recommendations of the excellent Kerslake review that the noble Baroness referred to and the House of Commons Defence Committee.
On the specifics of the amendment, we consider that the approach we are taking in the Bill to apply and enforce decent homes for privately rented homes is just not the right one for service family accommodation. There are particular challenges in bringing accommodation within scope of local authority enforcement, including access to the more than 6,500 homes that are located “behind the wire” on secure sites.
The Government are already taking action to ensure that service personnel and their families have homes of the quality they deserve, as part of our commitment to renewing the contract with the people who serve us. By regaining ownership of military housing, we will now be able to embark on a substantive programme of redevelopment and improvement, which will enhance recruitment and retention in the Armed Forces and, with it, our national security. My right honourable friend John Healey, the Secretary of State for Defence, has set out his commitment to improved military housing and will report to Parliament later this year, when the defence housing strategy is published. Given this, I hope the noble Baroness will agree that her amendment is not required.
Amendment 251, in the name of the noble Lord, Lord Tope, would extend the decent homes standard provisions in the Bill to Home Office asylum accommodation. This would require such accommodation to meet the decent homes standard requirements and increase the scope for enforcement by local authorities. A number of noble Lords raised this issue during the Second Reading debate. Following that debate, as the noble Lord, Lord Tope, mentioned, officials from both my department and the Home Office met London Councils and the Chartered Institute for Housing to discuss their concerns. I can assure the Committee that the Government share the objective of ensuring asylum accommodation is of a good standard. However, I do not consider that this amendment is the right way to achieve this.
There are already robust processes in place in respect of standards for all types of asylum accommodation. The contracts that the Home Office has with accommodation providers explicitly include standards requirements based on the decent homes standard, as well as the Welsh quality homes standard and the Scottish housing quality standard. Those contracts, including the standards requirements, are publicly available to view on the GOV.UK website. There is also a clear complaints process in place. Inspectors inspect the properties on a targeted and rolling basis.
There are also several reasons why the amendment would not be appropriate to bring asylum accommodation within scope of the decent homes standard provisions in the Bill. First, these provisions introduce the decent homes standard for privately rented homes in England only, whereas there is asylum accommodation across the United Kingdom. Accepting this amendment would therefore result in a fragmented system, with different standards requirements and enforcement systems applying depending on where in the United Kingdom the accommodation was based. The Government wish to avoid this.
In addition, we wish to avoid situations in which requirements to comply with the decent homes standard would mean that certain types of asylum accommodation could no longer be used, even if there was no alternative. For example, we want to end the use of hotels over time, but it is sometimes necessary to meet the legal duty to accommodate destitute asylum seekers. That accommodation might not meet the decent homes standard requirements, such as full-board hotels where there are no kitchen facilities for asylum seekers to use themselves. I appreciate that they are certainly not ideal for families seeking asylum, and they would not meet the decent homes standard. Standards requirements already apply to asylum accommodation, and there are adequate routes of redress for occupants when things do go wrong. I therefore ask the noble Lord not to press this amendment.
Amendment 252, tabled by my noble friend Lady Whitaker, seeks to bring rented mobile homes within the scope of the decent homes standard provisions. While I am sympathetic to the aims of my noble friend, I cannot support this amendment, as the decent homes standard is not suitable for mobile homes. The decent homes standard has been specifically designed to apply to residential buildings. This is integral to the design and operation of the standard. For example, the housing health and safety rating system, the assessment method that underpins parts of the standard, was specifically developed to assess health and safety risks in buildings. As a result, it is not possible to apply and enforce effectively the decent homes standard in respect of types of accommodation that are not buildings. This amendment would therefore not achieve the desired outcome of improving the quality of rented mobile homes. I am, of course, happy to discuss further with her how we might seek to achieve what she has been trying to achieve for many years. Given this, I ask my noble friend not to press her amendment.
Finally, Amendment 252A, in the name of the noble Baroness, Lady Coffey, would limit the breadth of the decent homes standard as it applies to the private rented sector. We will be launching a consultation on the content of the decent homes standard for social and privately rented homes in the coming months. We will consider carefully the responses before finalising the detail of the standard. The regulations we will make to implement these requirements will then be subject to parliamentary scrutiny through the affirmative procedure.
I acknowledge that the PRS is a diverse sector with a broad range of differing housing types, and some may have features that, as the noble Baroness rightly pointed out and the noble Earl, Lord Leicester, mentioned, make it very difficult to meet certain aspects of a decent homes standard. We want landlords to take reasonably practicable steps to bring their properties up to standard, but we will not unfairly penalise those who are unable to do so. The legislation we are introducing will therefore provide local councils with a range of enforcement tools to respond to different circumstances. We will publish statutory guidance to support councils in dealing with such issues in a pragmatic and proportionate way that is fair both for tenants and for landlords.
Accepting the amendment would result in different standards applying to different types of PRS homes, which would make it harder for tenants and landlords to understand what requirements apply, and more challenging for local authorities to enforce. As I have stated, the legislation will provide local authorities with flexibility, and we consider that this will provide a more effective and fairer way of dealing with situations when a property cannot realistically meet the standard.
As I am the MHCLG Minister with responsibility for net zero, I have a lot more information on how we intend to operate EPC and the minimum energy efficiency standards in the private rented sector, and I am happy to write to the noble Baroness with a lot more detail rather than take up the Committee’s time tonight. But on that basis, I ask her not to move her amendment.
The Lord Bishop of Manchester
I thank all noble Lords who have taken part in this debate. It has been characteristically good natured and very well informed, and I am very grateful in particular for the way the Minister has responded to the various amendments in this group.
Because we are going to have a rather late night tonight, I will not say too much at this stage. I wish to respond to some of the comments made by the noble Baroness, Lady Coffey. I did not speak to her amendment in my introduction because I did not understand it in the form in which it appeared on the Marshalled List; I am very grateful to her now.
I guess I should declare an interest: my daughter lives in a pre-1800 former gamekeeper’s cottage in a very rural part of Devon. She is not a tenant because she managed somehow to negotiate a very favourable mortgage rate with “the bank of mum and dad”, with which I think many of your Lordships will be very familiar—all too familiar, I fear. I understand the complexities of trying to get that cottage up to anything like a decent environmental standard, so I have great sympathy.
The noble Baroness mentioned in particular the Church of England’s land. The Church Commissioners, which I chaired in succession to the noble and right reverend Lord, Lord Chartres, until about 15 months ago, currently has a development land portfolio sufficient for about 30,000 homes, and we would like to develop that out to make more homes for people to live in. We recently set up a group that I am now the chair of, the Church Housing Association, which was registered with the regulator about six weeks ago. It is looking to utilise more Church land, particularly land owned by parishes and dioceses, in order to produce more social housing, particularly housing at social rent level, across the country. I am hoping to meet with Homes England and others in the near future to progress that. My own diocese is going through a very determined process of evaluating all parsonages, selling the ones we do not need and investing the money in improving the ones we are going to keep. So I hope the noble Baroness will agree that this is the right way to take these matters forward.
I am very grateful for all that has been said tonight and I look forward to meeting the Minister to further some of the conversations we have had. For the time being, I beg leave to withdraw the amendment.
Lord Shipley
“Use of licence conditions to improve housing conditionsIn section 90 of the Housing Act 2004 (licence conditions), for “the management, use or occupation of the house concerned” substitute “all or any of the following—“(a) the management, use and occupation of the house concerned, and(b) the condition and contents of the house concerned.””Member’s explanatory statement
This amendment would enable local authorities operating selective licensing schemes to use licence conditions to improve housing conditions.
Lord Shipley (LD)
My Lords, I will also speak to Amendment 254 and, on behalf of the noble Lord, Lord Young of Cookham, Amendments 267, 268 and 269.
Amendments 253 and 254 would remove unnecessary barriers to the use of licensing schemes to improve housing standards. Licensing is an important tool for improving housing standards because it is proactive. It provides a means for local authorities to inspect privately rented housing using enforceable conditions, and to identify and resolve problems without the need for tenants to have complained.
Lord Jamieson (Con)
My Lords, I am grateful for the opportunity to speak on this group of amendments in this important debate concerning property licensing. This discussion touches on a particular practical part of the regulatory framework: how local authorities manage and enforce licensing regimes for rental properties and meet appropriate standards of safety and quality.
The amendments in this group, tabled by the noble Lords, Lord Shipley and Lord Young of Cookham, address both the effectiveness of the licensing schemes and the administrative burdens that they impose on landlords, local authorities and tenants alike. Amendments 253 and 254 in the name of the noble Lord, Lord Shipley, speak to the role of selective licensing in improving housing conditions and propose to extend the maximum duration of these schemes.
We already have selective licensing. UK government guidance is clear that local authorities can use this process to tackle poor housing conditions, as well as other issues. These are worthy proposals. We will listen carefully to these concerns and work with noble Lords across the House both to get the balance right and to ensure that the Bill plays its part in driving up the quality of housing, particularly in the areas where local authorities can clearly demonstrate poor housing conditions or evidence of anti-social behaviour.
However, we must also ask: are licensing schemes always the right lever for improving housing quality? In the right circumstances, licensing can help drive up standards, but, if it is poorly targeted or applied too broadly, it risks creating unnecessary bureaucracy and placing costs on good landlords while doing little to deter the worst offenders. We must guard against the risk of licensing becoming a tick-box exercise rather than a tool for real enforcement.
I thank the noble Lord, Lord Shipley, for introducing Amendments 267 to 269, tabled by my noble friend Lord Young of Cookham. They are pragmatic and draw on my noble friend’s extensive experience in both government and housing policy. They propose more proportionate licensing fees in large blocks, simplified procedures for name changes and facilitated bulk applications. All are practical measures designed to reduce red tape and bring common sense to what can sometimes be a cumbersome process.
Baroness Taylor of Stevenage (Lab)
I thank the noble Lords, Lord Shipley and Lord Young of Cookham, for their amendments relating to selective licensing, and I particularly thank the noble Lord, Lord Shipley, for moving the amendments from the noble Lord, Lord Young, in his absence. I thank the noble Lord, Lord Jamieson, for his comments.
Amendment 253, moved by the noble Lord, Lord Shipley, seeks to allow local authorities to use selective licence conditions to improve housing conditions. We acknowledge and share the noble Lord’s intentions to improve housing conditions. We believe that all renters deserve to live in safe, secure and quality homes. With the introduction of a decent homes standard and the application of Awaab’s law through this Bill, the Government will reform and improve conditions across the sector. We think it is important that these measures benefit all renters and local authorities in tackling poor-quality homes, regardless of whether they are in selective licensing areas.
Amendment 254, also in the name of the noble Lord, Lord Shipley, seeks to allow local authorities to increase the maximum duration of selective and additional HMO licensing schemes from five to 10 years. As many noble Lords will be aware, the Government recently removed the requirement to obtain Secretary of State approval to introduce larger selective licensing schemes. We think it is right that local authorities have greater autonomy to implement schemes provided that they meet the statutory criteria. However, we also recognise licensing schemes do, as noble Lords have said, place additional burdens on landlords. It is therefore important that local authorities monitor any schemes to make sure that they are proportionate and are continuing to achieve their aims. A maximum scheme duration of five years strikes the right balance in giving local authorities time to make this assessment, while also ensuring that landlords are not by default subject to increased regulation for prolonged periods. I therefore ask the noble Lord, Lord Shipley, to withdraw his amendments.
I turn now to the amendments in the name of the noble Lord, Lord Young of Cookham. Amendment 267 seeks to streamline the selective licensing application process and cap the total fee that local authorities can charge for licensing similar properties in a block under single ownership. The Government recognise that selective licensing imposes a burden on landlords. The financial and administrative cost can be particularly significant for large portfolio landlords, such as those operating in the build-to-rent sector.
Local authorities already have discretion to streamline licence applications and fees for landlords whose properties meet the requirements for block licences. Where appropriate and consistent with the aims of their licensing schemes, we would encourage local authorities to make greater use of block licences. This reduces the burden on large portfolio landlords and can better reflect efficiencies for local authorities in licensing such properties, for example, the ability to inspect multiple properties in a block during a single visit.
It is right that licensing schemes continue to be determined locally and that local authorities have the flexibility to decide the best application process and fees to support delivery of schemes. Placing a cap on application fees could cause issues due to regional differences in costs between local authorities and potentially undermine the success of some schemes.
Amendment 268 seeks to allow the transfer of selective licences in circumstances where the licence needs to be passed to an employee of the same corporate body. As noble Lords will be aware, under Section 91 of the Housing Act 2004, licences currently cannot be transferred, as the noble Lord, Lord Shipley, explained. A new licence application is needed where a change to a licence-holder is required after a licence has been issued. A crucial part of the application process is ensuring compliance with the fit and proper person test. This is designed to ensure that prospective licence-holders do not pose a risk to the welfare of tenants. I am sure it is not the intention of the noble Lord, Lord Young, but accepting this amendment might mean circumventing those important checks for any new licence-holders within the same organisation.
I accept that it may seem excessive for a local authority to require a full licence application to be submitted where a licence needs to be transferred due to changes in staff in cases where there are no other changes to the management or use of the property. We would encourage local authorities to take a proportionate approach in these cases, for example, by requiring only details of the new licence-holder to be provided in the application and charging a fee that covers only the essential parts of the application process, for example, the fit and proper person test.
Amendment 269 seeks to allow a local authority to grant a temporary exemption from selective licensing to an applicant where it has determined that it requires more time to process the relevant licence application. I recognise the issues this amendment attempts to address. Where a local authority has received multiple licence applications from the same applicant, it needs sufficient time to review them. As a result, applicants may receive a decision after the period they deem reasonable. I totally agree with the noble Lord, Lord Jamieson, about digitisation of this process and making the whole process more efficient.
Local authorities are already required to determine all licence applications within a reasonable time. We would encourage them to set out clearly their expected processing timelines when inviting applications. When planning a licensing scheme, local authorities should also carefully consider the level of resources needed to process applications to avoid large backlogs being created.
However, regardless of any challenges a local authority may face in processing licence applications, landlords with licensable properties should apply for licences. This ensures that they are protected from enforcement action being taken against them for having control of or managing an unlicensed property. With this in mind, I ask the noble Lord, Lord Young, not to press his amendments.
Lord Shipley (LD)
My Lords, I thank the Minister for her very full explanation. I think the best course of action would be to review in Hansard what she has said and look at ways in which we might progress some of these issues by the time we reach Report in a few weeks’ time. For the moment, I beg leave to withdraw Amendment 253.
Member’s explanatory statement
This replaces a reference to the improvement notice with the correct reference to the prohibition order.
Member’s explanatory statement
This amendment removes an amendment to section 33 of the Deregulation Act 2015 that is not necessary as a result of paragraph 68 of Schedule 2, which repeals this section.
Lord Cromwell
“Illegal evictions: police and local authority duties(1) Where a police force or local housing authority in England receives a complaint alleging that an offence or offences contrary to Section 1 of the Protection from Eviction Act 1977 (‘PFEA offences’) has been committed, it must—(a) notify the local housing authority (where the complaint has been received by a police force) or the police force (where the complaint has been received by a local housing authority) (‘the other party’) with responsibility for the area to which the complaint relates, and(b) co-operate with the other party to promptly and effectively investigate the alleged PFEA offence(s) and any offences committed at the same time, in furtherance of, or as a consequence of, the alleged PFEA offence(s).(2) Where a police force or local housing authority receives an allegation that PFEA offences are being committed or at risk of being committed, it must take reasonable steps to prevent those offences continuing or being committed, including, but not limited to, by cooperating with the other party and by taking reasonable steps to assist tenants to regain access to properties from which they have been unlawfully evicted. (3) The Secretary of State for Housing, Communities, and Local Government, and the Secretary of State for the Home Department must, within six months of the day on which this Act is passed, issue joint statutory guidance as to how police forces and local housing authorities are to discharge the duties in subsections (1) and (2).”Member’s explanatory statement
This amendment addresses the poorest end of the rental market by removing ambiguities between police and local authorities, clarifying police duties (illegal evictions often incorrectly seen as civil) and enabling efficient information sharing.
Lord Cromwell (CB)
My Lords, I am very grateful to the right reverend Prelate the Bishop of Manchester, the noble Baroness, Lady Kennedy of Cradley, and the noble Lord, Lord Best, for adding their names in support of the amendment. I thank the noble Lord, Lord Hogan-Howe, who cannot be here at this time, but who has authorised me to say that he both supports the principle of the amendment and believes that it is deliverable in practice. Given the role of the police in this amendment, his assessment and support have been invaluable. I am also grateful to the organisations Safer Renting and ACORN for their assistance in highlighting the urgent need for this amendment, and to the Bill team for working their magic in drafting.
At Second Reading, I underlined concern about those at the bottom end of the rental market; here are the economically and socially vulnerable. They are the most likely to face illegal and sometimes forcible evictions. They are also often the least equipped to resist illegal evictions. It is this shadow private rented sector, the lowest part of the rental market, that most needs help and, in particular—as so often with the legislation that we like to pass in Parliament—needs proper support through effective and well organised enforcement of renters’ rights in what can be a wild world of criminal landlords who pay little mind to the niceties of tenancy agreements when removing tenants. That is what this amendment seeks to address.
Illegal eviction is defined in the Protection from Eviction Act 1977 as a criminal offence—it was referred to earlier this evening by the Minister as a serious criminal offence—that can include physical force, the changing of locks, depriving renters of essential services, and other forms of interference and harassment. Figures from 2022 show that 8,750 illegal evictions were reported in that year; the actual number will, of course, be higher than this. The noble Baroness, Lady Kennedy of Cradley, earlier cited a figure of about twice that. However, currently prosecutions for illegal evictions are very low. The police do not act in 91% of cases, making an enforcement rate of below 0.3%. I underline that this is not to blame the police; rather, it arises from a legislative ambiguity that needs resolving.
While the Protection from Eviction Act 1977 set out the legal definition of illegal eviction as a criminal offence, it did not include a duty on the police to enforce the protections. The results of this have been, first, ambiguity of responsibility between local authorities and police as to which is the enforcing agency. This, in turn, has led to councils and police each referring renters to the other organisation. Secondly, the police have almost always held the incorrect belief that illegal evictions are a civil matter.
The amendment also takes into account the need to be realistic about overstretched police time and resources. The duties under this amendment have two aspects: reporting and intervening. On reporting, in the interests of joined-up working, the police will notify the local housing authority when a complaint has been made, and vice versa, when a complaint is received by the housing authority.
The immediate anxiety here is to avoid imposing an additional reporting burden on front-line officers and officials. But any incident raised with the police or the local authority gets reported, or it certainly should. That report can simply be electronically copied to the other so that both can be aware, spot patterns and so forth. So it is not really “more flipping paperwork”, because adding a cc to a report is not really very onerous.
Lord Best (CB)
I shall confine myself to two sentences, because the exposition from my noble friend covered the ground so admirably. I can only imagine the nightmarish, Kafkaesque scene whereby a family is being turned out of their home and call the police, who, if an officer turns out at all, take the side of the landlord, who is committing a criminal offence. What seems badly needed is the clear statutory guidance proposed by this amendment, coupled with the instruction that prevention of cruel and illegal evictions by landlords has to be grounds for both co-ordination and intervention by the relevant police force and the local housing authority working together. I support this amendment.
Baroness Thornhill (LD)
I want to scratch lots of bits out, since the noble Lord, Lord Best, was so succinct.
Amendment 258 is in the name of Lord Cromwell and has notable signatories, and the noble Lord sold this amendment well. In short, this is an amendment that should not be needed, if the police and local authorities did their jobs correctly, as per the law, as outlined in the Protection from Eviction Act. This amendment is rightly seeking to reinforce what should be happening but we know is not. The already mentioned organisation, Safer Renting, monitored data from its clients over a given period, which revealed that, when the clients were going through an illegal eviction, and while it was in progress they called the police for assistance, worryingly in only 9% of cases did the police actually go to the property and assist the tenants. Therefore, as the noble Lord said, in 91% of cases they either failed to turn up, or turned up and sided with the landlord.
Interestingly, so concerned was Safer Renting about these statistics that it decided to do something about it. To its credit, in partnership with the Metropolitan Police and the GLA, it developed a training course for officers. Approximately 8,000 officers took the training but, sadly, this did not mean it recorded any significant improvement when talking to its clients, which begs a lot more questions that are probably not answerable here.
As has already been said by several noble Lords, it is imperative that the police understand the harassment before and during an illegal eviction—or, indeed, what constitutes criminal offences—and, most importantly, that they co-operate with the local authorities charged with the role of prosecuting these rogues and criminal landlords. Shockingly, that is not always happening. Safer Rentings’ illegal eviction count for England and Wales in 2022-23 showed 8,748 illegal evictions—that is one every 67 minutes.
It is not necessary for the police to prosecute these offences unless they witness criminal actions taking place alongside the eviction, but it is crucial for them to understand the law both to refer them to the local authority and to co-operate with the authority’s investigations. We support this amendment, but we hope the Minister will reassure us that it is not needed.
Baroness Scott of Bybrook (Con)
My Lords, Amendment 258, tabled by the noble Lord, Lord Cromwell, aims to provide greater clarity for local housing authorities and police forces in responding to cases of illegal eviction. Illegal eviction is a serious offence; it is not simply a housing matter but often a brazen abuse of power that leaves some of our most vulnerable renters without recourse. That said, we have reservations about the practicalities of this proposal, but I have listened to the noble Lord, Lord Cromwell, having asked the noble Lord, Lord Hogan-Howe, his views on it.
In essence, the amendment would place a statutory duty on police and councils to notify each other when a complaint of illegal eviction is received, to co-operate in investigating the offence and to take reasonable steps to assist the tenant. The intent here is understandable —tenants report illegal evictions and are, as we know, bounced between bodies, with the police saying it is a civil matter and councils struggling with limited capacity. Although the intent behind the amendment is undeniably well-meaning, we just have to pause and ask whether it might inadvertently entrench confusion within the statutory framework rather than resolving it.
Without clear definitions, the proposal to impose duties on local housing authorities and police forces to co-operate and assist opens the door to operational ambiguity. What exactly constitutes “reasonable steps to assist”, and what measurable outcomes are expected from this co-operation? Without these clarifications, there is a real risk of creating more confusion for the very tenants we want to protect.
We also want to be very careful about the practical burdens. As the noble Lord, Lord Cromwell, said, both councils and police forces are grappling the whole time with existing resource shortages. This amendment adds new responsibilities without addressing the underlying issue of capacity. Should we not first evaluate whether these agencies are equipped to handle their current workload before we impose further duties? What assessments have been made of the additional resource implications of this?
There is great merit in the principle behind the amendment—namely, the need for clearer co-operation and more decisive enforcement—but there are significant questions about whether, as drafted, it achieves that aim in a proportional, workable manner.
I agree with the noble Baroness, Lady Thornhill, and I ask the Minister: is the guidance clear enough, particularly to police forces, that it is an illegal act and it is against the law? Is there enough guidance? Are they being told exactly what they have to do? Do local authorities have clear guidance about looking after the tenant, which is their responsibility if they have been evicted and they are homeless at the time? Can this not be done in a different way by insisting that the Home Office work with MHCLG to try to embed the guidance that is already there and insist that both organisations deliver what they should be delivering at the moment?
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Cromwell, for his amendment and for meeting me to discuss it. The amendment would place a duty on local authorities and police forces to share information regarding alleged offences contrary to Section 1 of the Protection from Eviction Act 1977. I thank the noble Lord, Lord Best, and the noble Baronesses, Lady Thornhill and Lady Scott. Local authorities and police forces would also have a duty to co-operate in the investigation of these offences and take steps to prevent offences from occurring or continuing, as well as assisting tenants to gain access to properties from which they have been illegally evicted. The Secretary of State would be required to produce statutory guidance outlining how these duties would be discharged.
The Government are clear that illegal eviction is unacceptable. Changes introduced in the Bill will further empower local authorities to penalise those who illegally evict, giving them the option to issue a financial penalty of up to £40,000 as an alternative to prosecution. Illegally evicted tenants are also entitled to receive a rent repayment order. Local authorities will be provided with new investigatory powers alongside the powers that police forces have to investigate and prosecute breaches of the Protection from Eviction Act 1977.
However, I am concerned about the administrative burden that a reporting duty might place on police forces. The department is trialling approaches to improving multi-agency targeting and the disruption of rogue and criminal actors operating throughout the private rented sector. For example, Liverpool City Council’s private sector housing intelligence and enforcement taskforce—a snappy title, I know, but it does what it says on the tin—has successfully carried out joint operations with Merseyside Police and the Home Office. The Government will continue to explore how we can encourage more effective collaboration between the police and local authorities.
I am happy to add this topic to the agenda for the meeting that I have already agreed to with my noble friend Lady Kennedy and Safer Renting, and to take another look at the existing guidance to make sure that it does what it needs to do. With that said, I respectfully ask the noble Lord, Lord Cromwell, to withdraw his amendment.
Lord Cromwell (CB)
I thank the noble Lord, Lord Best, and the noble Baroness, Lady Scott, for their contributions.
I do not want to detain the Committee too long, but I say to the noble Baroness, Lady Scott, regarding her comments on co-operation and working it out in detail, that we found, in trying to specify every detail of what would go into the database, that it is much better to let the two responsible bodies work it out for themselves. They are grown-ups and they can work that out.
With regard to it being a further duty on the police, it is not a further duty but an existing one; it clarifies what they are supposed to be doing. I do not want to pray in aid the noble Lord, Lord Hogan-Howe, too much in his absence, but he certainly felt that that was a realistic thing that they could deliver without their resources being too stretched.
Sharing information and co-ordination is something that we ought to be able to take for granted, but it is a “nice to have”. The really important bit is that they intervene when people are being illegally evicted and that the police take that responsibility firmly on themselves. That is currently not the case, because they still have this ingrained idea that it is a civil offence, not a criminal one, which is incorrect.
That said, I am grateful to everyone for their comments. I look forward to the meeting. I am grateful to the Minister for agreeing to meet the tenant groups, which are passionately convinced that this amendment is essential. On that basis, I beg leave to withdraw the amendment.
“Energy Act 2011”Member’s explanatory statement
This amendment gives authorities the power to use this data to enforce minimum energy efficiency standards.
Baroness Bennett of Manor Castle (GP)
My Lords, on behalf of my noble friend Lady Jones of Moulsecoomb, I will move Amendment 259, a three-word amendment that provides argument for the value of explanatory statements. As this explanatory statement says, the addition of “Energy Act 2011” would give local authorities
“the power to use this data”—
about home energy efficiency—
“to enforce minimum energy efficiency standards”.
As we have discussed often on this Bill, many renters are stuck in cold, damp, leaky homes. Sometimes there are very simple and cheap fixes, such as adding or topping-up loft insulation. Sometimes they are more complicated and challenging fixes, such as insulating solid wall properties. This amendment gives local authorities the power to obtain and use energy efficiency information to help private renters. This could allow housing officers to support tenants in the most poorly insulated homes or, importantly, it could support councils to develop the street-by-street insulation programmes that can bring economies of scale and support widespread installation of insulation.
The case study is quite an old but lovely one. In Kirklees, a Green councillor, Andrew Cooper, was one of the driving forces behind a street-by-street insulation programme. The noble Lord, Lord Cameron of Chipping Norton, claimed credit for it, which may be the first time that we have seen a Green achievement being so claimed. I saw reports on how that worked out afterwards. One of the things that really came through was how much people are concerned about cowboy builders, which might be true of landlords as well as tenants, but that they trust their local authorities. That street-by-street process works well, but to make that happen you need the data. That is what this modest amendment is designed to achieve. It builds on the positive Clause 134, which will give local authorities more data to support tenants and take enforcement action against failing landlords.
Given the hour, I will leave the noble Baroness, Lady Hayman, to explain Amendment 274, which is related to this. I hope that the Minister can set out—briefly, given the hour—how the Government plan to ramp up support for domestic energy efficiency, especially for private renters. As we have just heard, so many are in vulnerable situations. Given the cost of living crisis, this is often seen as an environmental measure, but it is a crucial anti-poverty measure. We need to make this as easy and simple for local authorities to achieve as possible. I beg to move.
Baroness Hayman (CB)
My Lords, I declare my interests as a previous chair of Peers for the Planet and a director of that organisation. I will speak to my Amendment 274, which is supported by the noble Baroness, Lady Penn, who cannot be in the Chamber this evening. It continues the theme of energy efficiency that the noble Baroness, Lady Bennett, has just spoken about on her Amendment 259. She dealt specifically with the issue of data on energy efficiency. I wish to contribute particularly on the issue of financing energy-efficiency measures. This is the first time that I have spoken in Committee on this Bill, mainly because of my interaction with the Minister and her officials in the run-up to it, during which several issues were clarified very helpfully.
The issue of improving energy efficiency in the private rented sector has been discussed at length and on multiple occasions in this House. I hope that the current consultation will go some way to address the lack of coherent and consistent long-term policy certainty in this area, because it has suffered from stop-go and from changes of administrations and forms of assistance that have been incoherent and stopped us making progress. Of course, one of the main issues preventing progress in this area is funding, so my amendment seeks to break through some of the barriers to progress by requiring the Government to publish a road map on how private finance initiatives could be scaled up to support the funding of energy-efficiency measures.
Other speakers in the Committee have pointed out the problems that exist because of the quality of the stock in the private rented sector. As the right reverend Prelate the Bishop of Manchester pointed out, nearly half the housing stock in the private rented sector has an EPC rating below C. Although fuel poverty has fallen 35% among owner-occupiers and 54% among council tenants since 2010, it has fallen only 4% for private renters. Their homes are still disproportionately damp and cold, causing both short- and long-term health issues, with higher bills adding insult to injury. Of course, this is an issue where we should take action not only because of the need to help people in this situation but because of the detrimental effects this has on our achievement of net zero and improving our energy security.
However, while there has been widespread agreement about the value of improving energy efficiency, finance has always been an obstacle to progress. The costs of improving the quality of housing will be substantial, as others have said, given where we are starting from, and it is not realistic to expect the Government to foot the bill in its entirety, nor to put intolerable burdens on landlords. We need to find a way to finance these improvements that will work for tenants, landlords and the public purse. I recognise that the Government are doing some work on this and looking at how barriers can be overcome. The green home finance accelerator fund, due to end in June, has a number of projects looking specifically at rented properties and a number of pilot schemes. I would like to hear from the Minister what steps the Government plan to take in response to what they are learning from the experience of the fund and to what timetable they will be working.
There is also a growing number of innovative private sector finance mechanisms that deserve serious attention. As the UK Sustainable Investment and Finance Association recently reported, the high upfront costs of installing energy-efficient technologies remain the biggest challenge for landlords, and ensuring that there is private capital to support this process, and investment to help drive down the costs of energy efficiency, is paramount. To meet this challenge, a number of policy proposals have been made that my amendment would prompt the Government to consider. The UK Green Building Council, for example, has proposed a warm home stamp duty incentive, where stamp duty would be adjusted up or down depending on the EPC of a property and a rebate would be triggered within two years of purchase if the energy efficiency of the home had been improved.
The Local Government Association has recently recommended that the Government should incentivise landlords through tax rebates. France has added energy efficiency improvements to the list of deductible costs of managing a property, such as legal fees or insurance. Within the UK, Scotland has introduced low-interest loans for landlords. Such loans could be linked to the property, rather than the individual, for which there is the precedent of the interest-free loans that were available to install renewables.
Property-linked finance has been deployed in several other countries, and these are all measures that deserve serious consideration by the Government. They could cut through the Gordian knot of all agreeing that a great deal needs to be done but no one being able to see how it could be financed.
I hope that when the Minister responds, she will provide a little more detail on the Government’s thinking in this area, particularly on ways of incentivising landlords and how the Government intend to make progress in an area about which much has been said but too little has been done.
Baroness Grender (LD)
My Lords, I thank the noble Baronesses, Lady Hayman and Lady Bennett, for tabling these amendments and generating this debate. We on these Benches support both amendments. Every renter has the right to a warm and energy-efficient home as part of a decent standard of living. Improving energy performance in private rentals not only is vital for tenants’ comfort and reducing fuel poverty but contributes to the all-important climate target.
I thank the LGA for its briefing. It is concerned about how enforcement will be enhanced to ensure that minimum energy-efficiency standards in the PRS are upheld. As we know, the sad reality is that some landlords continue to let out inefficient, poorly insulated properties, leaving tenants with high energy bills and cold homes. Indeed, tenants in the private rented sector living in the least efficient homes are paying as much as an additional £1,000 a year on their energy bills, compared with someone living in a relatively energy-efficient home. As we heard in previous discussions, an expansion of the rent repayment orders to cover situations where a landlord lets a property that fails to meet the minimum energy-efficiency requirements would mean that if a landlord breached energy standards, for example by renting out a property below the legal EPC threshold, the tenant or council could apply for an order to reclaim up to 12 months’ rent, which we think will be a powerful deterrent against non-compliance.
Amendment 274, tabled by the noble Baroness, Lady Hayman, is an extremely useful step towards the ultimate goal of making homes warmer and more sustainable. It proposes a clear government strategy to unlock private finance, for example with green loans or incentive schemes for landlords to retrofit insulation and efficient heating. It makes me a little nostalgic for something that we think was an excellent model, but it was on a wider infrastructural basis. I refer to the Green Investment Bank, which was introduced in the early days of the coalition Government. The National Audit Office praised it for having a clear rationale, mission and objectives, backed by sound oversight. The then Department for Business, Energy and Industrial Strategy, the NAO and the Institute for Government all concluded that it had largely been successful in scaling up the UK’s green investment during its early years. It invested £3.4 billion into green projects, attracting £8.6 billion of private capital—a healthy £2.50 of private investment for every £1 of public money. Its portfolio was expected to deliver a 10% return by 2017. Sadly, in 2015, the Conservatives flogged it off and that 10% return was not realised. I would love to be able to tempt the Minister to look at that model as a really interesting way of pulling in investment.
I thank the noble Baroness, Lady Bennett, for recalling the excellent Kirklees Council scheme. I think it was the local authority with the largest number of retrofitting and insulation projects. It was award winning. I would not want to miss the opportunity of mentioning that my noble friend Lady Pinnock was then leader of Kirklees. It drew on finance that it received for an infrastructure project; it decided to insulate across every tenure in the largest local authority area. I believe that it is still the largest local authority area, unless anyone wants to correct me.
These remain excellent examples of how facilitating investment in measures such as insulation, efficient boilers and double glazing, the Government can ensure that landlords have the means to comply with higher energy requirements rather than simply exiting the market or passing the costs on to their tenants. We therefore welcome this proposed roadmap and data collection and look forward to hearing the Minister’s response.
Lord Jamieson (Con)
My Lords, we all want to see energy efficiency, better homes for tenants and reduced fuel poverty but, as we discussed earlier this evening, this needs to be done in an affordable and pragmatic way that does not force older, rural and heritage homes out of the rental market. Amendment 259 in the name of the noble Baroness, Lady Bennett of Manor Castle, seeks to extend the powers of local housing authorities to use available data to enforce and exercise their functions under the Energy Act 2011. As the noble Baroness has established, that Act provided obligations on landlords to meet certain energy efficiency requirements for their properties before they are able to let their properties to tenants.
Clause 134 already enables local housing authorities to use the information they possess to enforce housing offences and other functions under a wider range of legislation than was previously permitted in the Housing Act 2004. This amendment would therefore extend the already expanded remit of Clause 134 to the domain of energy efficiency. We understand the intentions of the noble Baroness in this amendment and will be interested to hear the response from the Minister.
However, I question the necessity of the amendment. The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015, made under the Energy Act 2011, already provide for the energy efficiency regulations to be enforced by local authorities in the case of domestic private rental properties and by trading standards in the case of non-domestic private rental properties. Those enforcement authorities are empowered by the 2011 Act to impose monetary penalties of up to £5,000 for any landlord who breaches the energy efficiency regulations. Given the powers that already exist and the highly significant changes to energy performance certificates that the Government plan to implement, this amendment appears unnecessary.
A review of energy efficiency improvements required and the methods for funding these improvements would be more appropriate, which is why we support Amendment 274 from the noble Baroness, Lady Hayman, supported by my noble friend Lady Penn. This amendment would simply require the Secretary of State to publish a roadmap for using private finance initiatives to provide the funding for any required improvements to energy efficiency for the private rental sector. This is a sensible and measured approach to the issue at hand, as opposed to any prescriptive requirements. I look forward to hearing the Minister’s response.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baronesses, Lady Jones of Moulsecoomb and Lady Hayman, for their amendments relating to minimum energy efficiency standards, and the noble Baroness, Lady Bennett—who I think described herself as the Green night owl—the noble Baroness Lady Grender and the noble Lord, Lord Jamieson, for contributing to the debate.
I turn first to Amendment 259 in the name of noble Baroness, Lady Jones of Moulsecoomb. This amendment would allow information given to local authorities by tenancy deposit scheme administrators to be used by local authorities for a purpose connected with their functions under the Energy Act 2011, including enforcement against breaches of minimum energy efficiency standards under the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015. I reassure the Committee that local authorities are already equipped to enforce the private rented sector minimum energy efficiency standard of an EPC rating of E.
In February, a consultation was published to amend regulations and raise energy efficiency standards in the private rented sector, addressing fuel poverty and carbon emissions. The consultation proposes that local authorities will be empowered to issue fines of up to £30,000 for non-compliance with the new minimum energy efficiency standards in the private rented sector. To respond to the point from the noble Baroness, Lady Grender, officials from the Department for Energy Security and Net Zero are exploring support for enforcement in collaboration with stakeholders, including local authorities.
Local authorities often identify non-compliance during other property engagements and can take appropriate action. A local authority may issue a compliance notice to a landlord suspected of breaching the energy standard. If the landlord fails to comply, the authority has the power to issue a penalty notice. Of course, I recognise the value that data plays in aiding enforcement, which is why we have widened access to information for other enforcement purposes through the Bill. For these reasons, I ask the noble Baroness, Lady Bennett, on behalf of the noble Baroness, Lady Jones of Moulsecoomb, to withdraw the amendment.
Amendment 274, from the noble Baroness, Lady Hayman, would require the Secretary of State to publish a road map for scaling up private finance initiatives to support the funding of energy-efficiency improvements in privately rented homes within six months of the passage of the Bill. I strongly support improvements to energy efficiency in privately rented homes. The Government have pledged to take action to stand with tenants and deliver the safety and security of warmer, cheaper homes. In February, we published our consultation on improving energy-efficiency standards in the private rented sector in England and Wales. The consultation closed on 2 May. We are analysing the responses and expect to publish a government response later this year.
I appreciate the intention behind the amendment, as we recognise the important role that private finance will play in supporting the private rented sector to meet the proposed energy-efficiency standards. We are currently considering the consultation feedback and options to further support landlords to make the necessary improvements to their property. I believe that the amendment is not necessary as the information on support, including private finance to fund energy-efficiency improvements in privately rented homes, will be available shortly.
Baroness Bennett of Manor Castle (GP)
My Lords, I thank the Minister for her response and everyone who has taken part in this short debate, which was marked by a remarkably strong degree of agreement. Everyone agrees that home energy efficiency is something on which we really need to take vital action. I was reminded of a stat, which I learned probably a dozen years ago, that British homes were, in terms of energy efficiency, the second worst in Europe, behind Lithuania. I am not quite sure how Lithuania has done in those 12 years since then, but I know that we have made very little progress.
I will briefly pick up a couple of technical points. The noble Lord, Lord Jamieson, and the Minister both talked about local authorities having enforcement powers or, indeed, enhanced enforcement powers. But you can take enforcement only when you have the information—the data—that enables you to know when to take action. Just guessing which might be the homes that are not great is not a really effective way to proceed.
I thank the noble Baroness, Lady Grender, for the Lib Dem support for this amendment and also for embracing Kirklees. Everyone wants to embrace Kirklees, and really where we want to get to is a situation where we can embrace every town and city in the country with the same kind of project, particularly with those street to street-type arrangements.
I have one final comment. The noble Baroness, Lady Hayman, spoke about long-term policy certainty, which reminded me of going—I think it was in 2012—to the Insulate UK presentation. It was the insulation industry’s annual expo, and the whole industry was shutting down because the funding had disappeared. That boom-bust, boom-bust has been an enormous problem. We have not mentioned this yet, but, of course, we are talking also about huge numbers of opportunities, particularly for small independent businesses in every town and city up and down the land, if we find the funding and if we find the data and the push to make it happen.
I reserve the right to come back to this to look technically at the details, but in the meantime, of course, I beg leave to withdraw the amendment.
“(a) in subsection (5)(a), omit “known), and” and insert “unoccupied), or;””Member’s explanatory statement
This amendment seeks to allow the 24 hours’ notice requirement for an inspection under Section 239 of the Housing Act 2004 to be served solely on the property’s occupier.
The Lord Bishop of Manchester
My Lords, in moving this amendment, I am grateful for the help of the Greater Manchester Combined Authority, which has worked with local enforcement teams in my diocese to help us get to this amendment.
Local enforcement will be vital to making the intention of the Renters’ Rights Bill a reality, including the extension of the decent homes standard. However, an amendment to the power of entry that councils are going to use to enforce that standard is needed so that negligent or criminal landlords do not get a tip-off of inspections in advance, which would allow them to frustrate that process or to put pressure on the tenant. Enforcement officers would never tip off the proprietor of an off-licence in advance of an under-age mystery shopper trying to buy alcohol or cigarettes but, as currently drafted, this Bill will require enforcement officers to give landlords a 24-hour tip-off for any formal inspection of compliance with the decent homes standard.
The power of entry under the Bill comes from Section 239 of the Housing Act 2004. It is completely appropriate to give notice to the occupier—I mean, it is their home; they are probably the one who made the complaint that led to environmental health officers or enforcement officers wanting to come round to have a look at it—but why on earth do we give the landlord that 24 hours’ notice? Indeed, we know already from what enforcement officers tell us that, where there is a requirement to tip off landlords, it allows criminal landlords to take lawful countermeasures. These include things such as forcibly removing tenants from an overcrowded property, pressuring tenants not to let enforcement officers into their home or taking retaliatory action, which can dissuade tenants from pursuing complaints. They can also prompt them to withdraw complaints; indeed, there is every reason why a tenant may not want the landlord to know that they have made a complaint at this early stage of the process.
Finally, I would urge that focusing the notice requirement on the occupier is consistent with equivalent enforcement legislation. For example, council enforcement officers’ powers of entry under the Environmental Protection Act 1990 include no requirement to give notice to a property’s owner.
Unlike the noble Baroness, Lady Bennett of Manor Castle—I see that she has just left us—I am not a night owl: should it get to midnight and I am still here, these fine ecclesiastical robes will, like Cinderella’s dress, turn to rags. I trust that we can have an effective but brief debate on what is, I think, a simple and clear proposal. I hope that the Minister will agree that this is a timely and sensible amendment. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I thank the right reverend Prelate the Bishop of Manchester for this amendment on powers of entry into properties. Of course, there is a fine line here: we are trying to balance landlords’ rights to know what is going on in their properties, especially regarding enforcement, with the rights of the occupiers of the property to be informed when powers of entry are being exercised by enforcement authorities.
The amendment would remove the current requirement for a notice to be provided to both the owner and the occupier of the property before the authority can exercise any power of entry under Section 239 of the Housing Act 2004. This would mean landlords not having to be told that their property is going to be entered for survey or examination. I would argue that the owner of the property should have the right to be informed both that their property will be investigated by enforcement authorities and that the authority will exercise its power of entry into the property. This is the case as things stand now, and I believe that that is how it should remain.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the right reverend Prelate the Bishop of Manchester for his Amendment 260 and the noble Baroness, Lady Scott, for her comments. This amendment to Section 239 of the Housing Act 2004 seeks to enable local authorities to inspect PRS properties without the need to give 24 hours’ notice to property owners where the property is unoccupied, while retaining the notice requirement for tenants.
Section 239 currently requires local authorities to provide 24 hours’ notice to owners—if known—and occupiers before an inspection can take place. We are aware that the current requirement to provide property owners with 24 hours’ notice enables some unscrupulous landlords to hide evidence of breaches of PRS legislation, intimidate tenants and obstruct inspections. We recognise that the current notice requirement may, in some circumstances, hinder local authorities’ ability to address tenants’ unsafe or hazardous living conditions effectively.
While we are supportive of any efforts to improve local authorities’ ability to enforce against rogue landlords and appreciate that this amendment is in support of that objective, we must carefully consider its implications. We will continue to have conversations with the right reverend Prelate and with stakeholders, and we welcome noble Lords sharing their views on this matter so that the Government can take them into consideration. For these reasons, I ask the right reverend Prelate the Bishop of Manchester to consider withdrawing his amendment.
The Lord Bishop of Manchester
My Lords, this has been exactly the brief debate that I was hoping for on this matter. I am very grateful to all noble Lords for exercising restraint. I am particularly grateful to the Minister for her response, and I look forward to continuing those conversations. We have time before the Bill is finalised to get this right, and therefore I beg leave to withdraw.
Baroness Thornhill
“Review on impacts of the Act on private rented sector(1) The Secretary of State must conduct a review of the impact of this Act on the private rented sector.(2) The review must, in particular, assess the impact of the Act on—(a) the supply of housing in the private rented sector,(b) rent levels and affordability,(c) the security of tenure for tenants,(d) the regulatory and financial burden on landlords, and(e) any other factors the Secretary of State considers relevant. (3) In conducting the review, the Secretary of State must consult—(a) representatives of tenants and landlords,(b) local housing authorities, and(c) any other persons or bodies the Secretary of State considers appropriate.(4) The Secretary of State must lay a report on the findings of the review before Parliament no later than two years after the day on which this Act is passed.(5) The report must include—(a) the findings of the review, and(b) any recommendations for legislative or policy changes the Secretary of State considers necessary.”Member’s explanatory statement
This amendment requires the Secretary of State to review and report on the impact of the Act on the private rented sector, including housing supply, rent levels, tenant security, and regulatory burdens, within two years of its enactment.
Baroness Thornhill (LD)
My Lords, Amendment 263 is in my name, and was kindly signed by the noble Baroness, Lady Freeman of Steventon. My noble friends Lady Janke and Lady Grender will speak to their own amendments in this group, and we will all aim to be brief due to the lateness of the hour.
All through every day of this Committee, there has been a series of common threads, regardless of the groupings. One such thread is the uncertainty of the impact on the supply of homes to the private rented sector. We have had claims and counterclaims, but the reality is that no one knows exactly what will happen yet, because this is a genuinely radical Bill. A sub-theme, if I may call it that, has been the plea throughout the Bill’s passage for various aspects of it to be reviewed. My amendment tries to pull these concerns together and seeks to provide an honest, full and all-embracing review to be presented to Parliament no later than two years after the passing of the Act.
Two years seemed like a long enough time to gather data and see trends, but not too long to make changes, if it were apparent that changes needed to be made. The proposals in the Bill are so far-reaching, the legalities complex and the regulations as yet largely unknown and awaiting guidance or agreement through secondary legislation. But the impact of them could, we hope, be extremely positive and change the rental market for the better—or it could be a total disaster. We have certainly had plenty of hyperbole and tub-thumping rhetoric to that effect. Maybe it will simply be somewhere in between: the curate’s egg.
This amendment tries to cover all the important key indicators. As the explanatory statement says, it
“requires the Secretary of State to review and report on the impact of the Act on the private rented sector, including housing supply, rent levels, tenant security, and regulatory burdens, within two years”
of the Bill’s enactment. It also helpfully suggests who might be consulted upon, but—also helpfully—it includes the option for whomsoever is deemed appropriate by the Secretary of State.
I do not think it would be helpful at this time of night to expand on why each of these things is extremely important, but we know that they are, and that is why they are listed in the amendment. For that reason, we would like to see this, or something very similar, on the face of the Bill. I beg to move.
Baroness Grender (LD)
My Lords, having been extremely brief on everything, I beg noble Lords’ indulgence on this issue, which is extremely important. I sincerely hope we make a bit of progress on it. I want to thank the Renter’s Reform Coalition for their very hard work on this amendment, indeed, on the whole of the Bill. I also thank the noble Baroness, Lady Lister of Burtersett, who strongly supports this amendment but is unable to be here tonight.
While this was debated on Report in the House of Commons in terms of its drafting, the original proposal was ruled out as not in scope of the legislation. Therefore, this is a new draft to reframe it as a review of the impact of the Bill on rents. The amendment has been redrafted in response to that feedback. To be clear, according to the Renter’s Reform Coalition, the likely projection of increase in rents as a direct result of the Bill is limited to the net core cost to landlords of £12 per home per year or 0.1% of mean annual rents. I will explain why rents continue to be a problem in spite of whatever the impact of the Bill is likely to be according to the coalition.
This amendment proposes that the Secretary of State must within 18 months of passing the Bill establish a body to report on the impact of the Act on rent levels in the private rented sector. A report published under this proposed new clause would include an analysis of any changes in average rent levels, an overview of the historic affordability of properties and consideration of proposals for improving the affordability of properties. The report should also include characteristics such as age, income and employment status.
Some of the context will be very clear to noble Lords. Private tenants have the highest weekly housing costs of any housing tenure, with lowest income tenants in particular often spending huge proportions of their income on rent. On average, renters spend 34% of their household income on housing, compared to 19% for mortgagors and 26% for social renters, and high rents hit poorer tenants hardest. One in three private renters spends at least half of their monthly household income on rent alone. Nearly 30% of private renters struggled to pay their rent in 2022.
England’s rent burden as a share of disposable income is among the highest in Europe. An analysis from Generation Rent has shown that not a single borough of inner London is affordable for roles across education, healthcare, social care, construction, retail, commerce and hospitality. Recent data released by Zoopla shows that renting a new home is on average £270 per month more expensive than in 2021, meaning that rents have increased by more than £3,000 annually in just three years. An increase in housing affordability would enhance the Government’s objective of driving growth. New research from the Mayor of London, London Councils, Trust for London and G15 shows that a 1% increase in housing affordability in this city could yield a boost of £7.3 billion in economic output over a decade. This research clearly showed that worsening housing affordability has a negative impact on productivity.
We welcome the fact that the Government are ending the bidding wars, but without also including something that acknowledges the issue of rent—and this is a very small version and modest in terms of what it does to the Bill—rents will remain too high across the board, and there will be no measures within the Bill to tackle that issue, or the current measures will be limited.
The amendment stipulates that any report made would need to include proposals for improving the affordability of rent levels in the private rented sector, but it does not prescribe what those policies should be. A report of this nature is an invaluable opportunity to consider the factors that make renting increasingly unaffordable and measures to address these factors in the round. Undertaking this thorough assessment of this complicated issue will take time, given the various intersecting factors that are contributing to the unaffordable nature of renting.
The report could consider: supply and demand in the private rented sector; the role and long-term future of the local housing allowance; the shortage of social housing; the effects of various kinds of rent control and stabilisation measures in comparator nations; an assessment of the potential impact of introducing any kind of rent measures—our preference would be for rent smoothing, as we have discussed several times, not rent controls; any impact on rent prices since the passing of the Act; and other relevant factors. In other words, this is not about being prescriptive but about studying all the impacts on rent. The impact report proposed in this amendment would provide an ongoing mechanism for acknowledging the scale of the affordability crisis. It would provide an opportunity for the Government thoroughly to assess the available evidence on unaffordability in England.
This amendment, as I have said, would not commit the Government to any one policy or approach but aims to gather evidence, data and information in a way that we do not believe is currently sufficiently gathered, and neither does the Renters’ Reform Coalition. It is also an opportunity for the Minister to commit publicly to further considering how to bring rents down in relation to incomes. I will draw my remarks to a conclusion, but this amendment is simply seeking to strengthen what the Government are already trying to do to improve the private rented sector. Without this piece, there is something very substantial missing. I look forward to hearing the Minister’s response.
Baroness Janke (LD)
My Lords, my Amendment 273 would require, within 12 months of implementation, a report on the impact of the Bill on BME and ethnic groups. I thank Race on the Agenda and Shelter for their briefings.
The private rented sector has the highest number of ethnic minorities relative to other tenures—23% compared with 19% among social renters, and 8% among owner-occupiers—yet black renters are disproportionately faced with barriers that prevent them securing a home in the sector compared with white renters. Generation Rent’s 2024 survey of private renters around the UK revealed that minority-ethnic renters were significantly more likely to face obstacles in accessing new tenancies. Racial minority respondents were almost twice as likely to have been refused a tenancy when they attempted to move home, with 12.5% reporting this experience compared with 6.3% of white British or Irish renters. Some 7% of England’s population are BME, yet in June 2024 20% of homeless households were BME; 8% of households living in poor conditions were BME compared with 3.5% identified as white households.
It is well-documented that black and minoritised groups experience both income and wealth inequality. This makes it much more difficult for these groups to cushion the shocks of rent increases or large deposits, pushing them deeper into problem debt with the associated mental health difficulties that that brings. Measures in the Bill, such as banning discrimination against people on benefits and families with children, should help reduce discrimination against BME groups, as will the ending of the bidding up of rents and the constraints on upfront payments. These are also positive measures.
I will end with a comment from Race on the Agenda.
“We note that although some provisions are made in the Bill to address housing discrimination in general terms, there is a problem as the Bill has not conducted a full racial impact assessment and does not sufficiently include robust measures to tackle racial discrimination in housing and homelessness”.
I hope that, in the light of this, the Minister will embrace the need for the review set out in this amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baroness, Lady Thornhill, for opening this group and introducing her Amendment 263. This amendment would require the Secretary of State to review and report on the impact of the Act on the private rented sector, including housing supply, rent levels, tenant security and regulatory burdens, within two years of its enactment.
We on these Benches do not support reviews for the sake of reviewing. They often consume time and public funds, and require precise delivery in order to answer the questions they set out to answer. However, this legislation poses a significant risk to the market. Noble Lords from across the Committee agree that we must protect tenants and ensure they have access to secure, stable and decent housing at a fair price. We have been clear this Bill does not deliver that.
The Government must review the efficacy of the Bill and be held accountable for the decisions they have taken and insisted on. To achieve this, we need a functioning market with an adequate supply of good-quality homes to meet a growing demand. Ensuring the availability of homes is key to making accommodation attainable and keeping rents affordable. Any legislation in this area must strike a difficult but essential balance between these competing interests. Only by getting that balance right can we hope to achieve an efficient and effective rental market. We, along with the many stakeholders we have consulted, believe that a review is necessary and that it should be brought before Parliament.
I am keen to know whether the Government are giving the amendments in the names of the noble Baronesses, Lady Grender and Lady Janke, serious consideration. Can the Minister say how the success of this Bill will be judged? What does success look like in the eyes of the Government?
In our view, the fear and uncertainty surrounding this Bill is already having a negative impact. On the first day in Committee, I quoted figures from Savills and I will underline them once more. According to Savills, the number of rental properties available on their books in quarter 1 of 2025 is down 42% compared with the same period in 2024. That is 42% fewer homes for families, and 42% less choice for people searching for somewhere to live. If the Government are confident in the positive impact of this Bill, what reason does the Minister have for not reviewing its effects on the housing market, specifically its impact on the availability of rental homes, rent levels, house prices and the demand for social housing? If the Bill were to have a damaging effect on the rental market, surely Ministers would want to know.
Getting this balance right is paramount. It is the difference between a functioning, accessible rental market and one that is suffocated. It is the difference between tenants being able to find a secure and affordable home, and landlords leaving the sector altogether. I look forward to the Minister’s response.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baronesses, Lady Thornhill, Lady Grender and Lady Janke, for their amendments, which propose several different types of reviews to the future Act, and the noble Baroness, Lady Scott, for her comments. I have to ask why we do not have a functioning effective rental market—we were not in government over the past 14 years.
Amendment 263, tabled by the noble Baroness, Lady Thornhill, would introduce a legal requirement for the Government to carry out a review of the Bill’s impact on the private rented sector. This review would be conducted, and subsequently reported to Parliament, within two years following the Bill’s receipt of Royal Assent. In particular, it would require the review to consider the Bill’s impact on supply, rent levels, security of tenure and the burdens on landlords. It also prescribes that the Government must consult with representatives of landlords, tenants and local authorities during the preparation of such a review.
I know the Committee shares my interest in the practical impact that this legislation will have on the private rented sector. I reassure the Committee that this interest is at the heart of the Government’s commitment to monitor and evaluate robustly the impact of our reforms. Our approach will build on the department’s existing monitoring of the housing sector. Our process, impact and value for money evaluation will be conducted in line with the department’s published evaluation strategy. Our monitoring work will make use of a range of data, including the results of the English Housing Survey, data from relevant stakeholders, including local authorities, and data generated from the reforms themselves. We will also deliver an evaluation involving extensive data collection through interviews, surveys and focus groups. These will be conducted with a range of stakeholders, such as tenants, landlords, letting agents, third sector organisations, delivery partners, the courts service and government officials. Monitoring data from existing surveys and new data produced by the reforms will supplement these findings.
I can also reassure the Committee that the conclusions of our evaluation will be published in a timely manner, in line with our broader policy on the publication of research. This includes an interim evaluation report on the processes, early impacts and intermediate outcomes, which we will produce in the early years after implementation. I hope this gives the Committee confidence that the Government’s proposed approach to monitoring and evaluation is the right one. Setting an arbitrary deadline for this process, as the amendment moved by the noble Baroness, Lady Thornhill, would do, we believe represents an unnecessary step. On that basis, I ask the noble Baroness to withdraw her amendment.
Amendment 270, in the name of the noble Baroness, Lady Grender, would mandate that the Secretary of State carry out a review of rent affordability in England, with a report to be laid before Parliament within 12 months of the Bill receiving Royal Assent. This amendment would require this review to be wide-ranging, encompassing the affordability of rents across both the private and social sectors, the impact on tenants, and regional differences. It would also require specific assessment of the effectiveness of measures to control excessive rent increases and the uptake and outcome of the tribunal.
As I already noted, the Government are committed to very robust monitoring and evaluation of the private rented sector reform programme. We will also continue to monitor trends across the industry as a whole, using a range of data sources, which include the Valuation Office Agency rental prices data, the Office for National Statistics rental price index, and data from the English Housing Survey and the English Private Landlord Survey. This will enable us to respond to unexpected impacts or unwelcome outcomes and initiate appropriate changes where these are needed.
Finally, Amendment 273, from the noble Baroness, Lady Janke, would introduce a legal requirement for the Government to produce a report on the impact of the Bill once it is an Act on different racial and ethnic groups in the private rented sector. I have already outlined at length our broader plans for assessing the impacts of the Bill. Regarding specific impacts on racial and ethnic groups in the sector, the department follows the Ethnic Group, National Identity and Religion guidance published by the Office for National Statistics. Ethnicity statistics are regularly collected and published by the department about tenants and landlords to understand the demography of the private rented sector through the English Housing Survey and the English Private Landlord Survey. This data supports our continued compliance with the requirements of the public sector equality duty and wider government responsibility by contributing to the race disparity audit.
It is also worth stressing that, in keeping with the public sector equality duty, once the Bill is an Act, Ministers will continue to have due regard to the equality impact of decisions on groups by reference to relevant protected characteristics. This includes the protected characteristic of race.
Baroness Scott of Bybrook (Con)
I understand the collection of the data, which I think is excellent so that we know what is going on, but how is that going to be scrutinised by Parliament? Will that come in a report? If it is, when will that first report come to Parliament for scrutiny?
Baroness Taylor of Stevenage (Lab)
I will write to noble Lords confirming the policy on publication of research. I think it is a matter of publication and then for Members to call it forward if they wish to scrutinise it further.
Baroness Thornhill (LD)
I thank the Minister for that. I am glaring at the noble Baroness, Lady Scott, because she filched one of the things I was going to say, but she is absolutely right—great minds think alike. Although we are coming at the Bill from completely different positions, we are agreed on this issue. Her summary of my Amendment 263 actually said it all as to why we feel we need something in the Bill.
If the Government are confident about the way they will monitor and evaluate, why not put something in the Bill? As for an arbitrary date, surely, after two years—bearing in mind that you can come back whenever you like within that period—you will have some indication of the trend. That is what is bothering us: the uncertainty and radical nature of the Bill, which we hope will be successful.
We reserve our right to come back to this issue, but for now I beg leave to withdraw my amendment.
Captain of the Honourable Corps of Gentlemen-at-Arms and Chief Whip (Lord Kennedy of Southwark) (Lab Co-op)
My Lords, it is now 11.41 pm. We have made good progress scrutinising the Bill this evening, having completed 13 groups of amendments. We have three groups remaining. Given the hour, and as agreed by the usual channels, I will now resume the House, and we will return to complete the remaining three groups after Second Reading of the Public Authorities (Fraud, Error and Recovery) Bill tomorrow.
I am grateful to all the staff of the House who have stayed so late to support us tonight, and on Monday. I particularly want to thank the staff in the Public Bill Office for their work to facilitate proceedings. I greatly appreciate all the work they have done, along with that of the other staff of the House, including the clerks, doorkeepers, attendants, catering staff and Hansard reporters. I look forward to completing Committee on this important Bill.
Renters’ Rights Bill
Thursday 15th May 2025
(1 year, 2 months ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 60-VI Sixth marshalled list for Committee - (13 May 2025)
Lord in Waiting/Government Whip (Lord Katz) (Lab)
My Lords, before we start the debate on the first group, it may not surprise noble Lords that, in place of my noble friend Lord Wilson of Sedgefield, today I remind noble Lords, for the final time in Committee, of the protocol around declaring interests. Noble Lords should declare relevant interests at each stage of proceedings on a Bill, which means that relevant interests should be declared during the first group in which a noble Lord speaks in Committee. If today is a noble Lord’s first contribution, any relevant interest should be declared when they first speak.
Amendment 275B
Baroness Coffey
“Designated rural areas: revocation(1) Within six months of the day on which this Act is passed, the Secretary of State must, by regulation, revoke the designation of parishes as rural areas for the purposes of Right to Buy if they meet the condition in subsection (1).(2) The condition is that the population of the parish exceeds 3,000 people, according the 2021 United Kingdom census.”Member’s explanatory statement
This amendment seeks to ensure that the Secretary of State updates the designation of rural areas for the purposes of Right to Buy, so that parishes which now have a larger population (such as Colden Common or Rendlesham, in Suffolk) are no longer designated.
Baroness Coffey (Con)
My Lords, I am continuing the discussion that I brought to the Committee with Amendment 182. At the time, I referred to the fact that there were other amendments that were relevant to that debate but, because they were not before your Lordships, I could not speak to them. That was because there was a bit of a dispute about whether this amendment was in scope. It comes back to the issue of people in social housing and whether they have the right to buy or to acquire, which we discussed at length on Monday. I recall that one of your Lordships expressed some damning doubt about all this, but the whole point of this amendment is to address the question: “what is rural?”
One thing that noble Lords may not be aware of is that, when these powers were set up, what actually happened—particularly on right to acquire—was that in 1997 a whole bunch of statutory instruments were put into place naming individual parishes and parish areas. County by county, right across the country, whole lists were put in place. Curiously, some of the places not included were perfectly rural and below that so-called 3,000 threshold, used generally by government to consider the difference between somewhere considered rural and not.
With reference to this amendment, what has happened over the years is that places have grown. Some of these villages have deliberately become areas of growth. I will mention a couple. I happen to know parts of Suffolk and Hampshire reasonably well, having lived there for many years. There are places such as Four Marks, near Alton, in Hampshire, or Colden Common near Winchester. I was particularly inspired by the story that I told the Committee about my discussions with residents of Rendlesham in Suffolk—but there are more and more.
Instead of trying to get into some kind of hybrid situation, I thought that it would be worth while to not deprive people due to the fact that, if they lived in a different place where the population was over 3,000, they would not have that arbitrary rule—because then they would be able to have that, if we did it by the threshold of what is considered rural rather than what is named, or not. To that end, this was supposed to be a combined debate, as I still feel that it is somewhat unfair that many people cannot acquire their house from social housing, particularly in the countryside, and I still think that the issue needs redressing. This is a mechanistic way of making sure that the threshold applies for rural social housing—if it is still in a genuinely rural area—but if it is no longer realistically a rural area people should be able to acquire the right.
Baroness Scott of Bybrook (Con)
My Lords, the amendment tabled by my noble friend Lady Coffey raises an important and timely issue: the need to revisit and update the designation of rural areas for the purposes of the right to buy. The proposal is clear. It would require the Secretary of State, within six months of the Act passing, to revoke rural area designations for parishes where the population now exceeds 3,000 people, based on the 2021 census. The rationale is that, as we have heard, some areas that were once small villages have grown significantly and may no longer meet the criteria originally used to justify rural protections under the scheme.
We recognise the logic behind this approach. Designations made years ago may no longer reflect the current character of certain parishes, and it is only right that we review such classifications to ensure that they are based on accurate and up-to-date information. However, while we understand the intention behind the amendment, we believe that a more considered and locally informed approach is needed. First and foremost, this should be done in consultation with local authorities, which are best placed to assess not just the population figures but the broader housing context within their communities. A numerical threshold alone does not tell us whether a parish still functions as a rural settlement, nor whether it has the capacity to replace any lost social housing.
Indeed, we would argue that the conversation should be based not solely on population size but also on the number of homes in the settlement, specifically the number of affordable or social homes available, and the prospects for building more. In many villages, even those with more than 3,000 residents, the opportunity to build new homes, let alone new affordable ones, is extremely limited. Planning constraints, infrastructure challenges and community sensitivity all contribute to a situation where, once a home is sold under right to buy, it is unlikely to be replaced. That is why the protection of the existing social housing stock is so vital in these areas. Without it, we risk hollowing out rural communities, pricing out local families, draining the workforce and diminishing village life.
While we support the principle of ensuring that designations are kept up to date, we believe that any such change must be grounded in a wider understanding of rural housing dynamics. This means not just reviewing census data but supporting councils to update and verify housing data and allowing for flexibility where a parish may meet the population threshold but still faces acute rural housing pressures. This is not simply a technical matter of numbers; it goes to the heart of how we preserve the character and sustainability of rural communities. Let us ensure that any change to rural designation is made with care, with consultation and with full awareness of its consequences.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, before I make my comments on the noble Baroness’s amendment, I hope that the House will indulge me for a few brief moments as we start our final day in Committee on the Renters’ Rights Bill. First, let me say how noticeable it has been that, while we may have debated and occasionally had our differences on the detail of the Bill, there has been a great deal of consensus across the House on the need to improve the renting landscape for tenants and for the vast majority of good landlords. Those landlords who choose to exploit their tenants and game the system not only make their tenants’ life a misery but undercut and damage the reputation of others. It is time that we took the steps in this Bill to put that right.
The Bill has shown the best of our House, with noble Lords providing their expertise, knowledge, wisdom and thoughtful reflection to improve the legislation before us. I am most grateful for the engagement before and during the passage of the Bill. We have had some unusual and difficult sitting hours on the Bill, largely because of other business of the House and in no way because of unnecessary or lengthy contributions to our deliberations. I therefore thank all noble Lords for their patience and good humour during late sittings. I am very grateful to the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson, on the Opposition Front Bench, the noble Baronesses, Lady Thornhill and Lady Grender, the noble Earl, Lord Kinnoull, and the right reverend Prelate the Bishop of Manchester, not to mention noble friends on my own Benches for a deal of passion and enthusiasm.
I thank the Bill team, my private office and the doorkeepers and staff of the House, including the clerks and catering staff, who have stayed, sometimes into the early hours, to make sure we are all safe and looked after, and the Hansard team, of course, doing their brilliant work. I thank the usual channels, which have been negotiating to make sure we complete Committee in good time. Last, and by no means least, I thank my Whip, my noble friend Lord Wilson, who is not in his place today but who has sat patiently beside me, sometimes carrying out extreme editing of my speeches. I forgive him for that—he did not get his hands on this one—and I am very grateful to him.
There are millions of renters and landlords out there who are awaiting the passage of the Bill to ensure that the renting minefield is fairer, safer and more secure. As we move forward to Report in early June, I look forward to continuing to engage and work with your Lordships to make sure that this is the best Bill it can be. In the meantime, thank you for making my first time taking a Bill through the House such a collaborative and positive experience.
I thank the noble Baroness, Lady Coffey, for her Amendment 275B to revoke the designation of parishes as rural areas for the purposes of right to buy where the population exceeds 3,000 people. The amendment would require the Secretary of State to revoke the rural designation of any parish with over 3,000 inhabitants for the purposes of right to buy. It would not have any impact on the right to acquire housing association property in rural areas. I have to say that this amendment is a bit of a stretch for the scope of the Bill, but it is important that I should respond to the noble Baroness’s concerns.
Under Section 157 of the Housing Act 1985, the Secretary of State has the power to designate by order certain areas as rural—typically, settlements with populations under 3,000. A landlord in a rural area may impose restrictions on the buyer of a right to buy property, to prevent the property being sold again, without the former landlord’s consent, other than to a local person or back to the landlord. The noble Baroness’s amendment would remove the ability of landlords to include resale restrictions on properties sold under right to buy in those designated rural areas where the population was above 3,000, which currently helps preserve homes for local people in perpetuity. The noble Baroness, Lady Scott, is quite right to say that, if we were going to make any changes to this, it would have to be done very carefully, and definitely in consultation with local people and local authorities.
These exemptions are in place to help retain affordable housing in communities where replacement can be unfeasible due to high build costs, planning limitations and land availability. We have heard much about that in the discussion on this and other Bills and the Government do not intend to remove these protections. On this basis, I ask the noble Baroness, Lady Coffey, to withdraw her amendment.
Baroness Coffey (Con)
My Lords, I have heard from both Front Benches and there is clearly no appetite for this. I am just very conscious that there are some areas that have grown substantially over more than 25 years. There is a substantial amount of new housing going in, including new social housing, but, because of the designations set in stone in 1997, some people are being denied the opportunity they expected to participate in owning a home that they might not be able to afford initially but might in time. It is something I had hoped would be considered a little further, but I understand where both Front Benches are coming from and I beg leave to withdraw.
Baroness Coffey
“Right to mobility aids(1) A relevant person must not, in relation to a dwelling that is to be let on an agreement which may give rise to a relevant tenancy, decline a reasonable request from a tenant to install mobility aids in the dwelling.(2) The provision in subsection (1) applies only where the tenant is able to arrange for the payment and installation of the aid themselves.(3) For the purpose of this section, a “mobility aid” is a device or piece of equipment installed in the property to assist in the occupier’s mobility around the property.”
Baroness Coffey (Con)
My Lords, the reason for this amendment is that I looked carefully at some of the previous debates on the broader issue of trying to help people stay in their home, even though they might be in pretty long tenancies. I myself was a tenant of one landlord in this city for 11 years. I did actually suffer a Section 21 eviction—but there we go. Nevertheless, I think that there were some gaps in the suggestions put forward. In particular, I am thinking about amendments we debated that would have required a local authority assessment to have been undertaken in advance of any installation of equipment.
Another amendment would have capped the cost allowed to an unknown figure. That also did not extend to social housing. I am very conscious that that is the case for a lot of legislation. One part of the Bill tries to bring standards from social housing into the private rented sector, but I am learning during this process quite how many things do not apply to social housing that we expect in the private rented sector. This is a good example.
I am conscious that, for many people, it would be far easier to help them stay in their homes, which is one of the key elements of health and care strategies put out by a variety of Governments over many years. Instead of having to go through quite an awkward process, if a tenant wanted to make changes to their home—which they would pay for—in regard to what is a protected characteristic, they should be able to do so without having to go through all sorts of hoops. My intention is to make it a lot easier for people to continue to enjoy their lives in the place they call home. I beg to move.
Lord Shinkwin (Con)
My Lords, I support Amendment 275C in the name of my noble friend Lady Coffey. I apologise to noble Lords that this is the first time I have spoken on the Bill. I thank my noble friend for tabling this amendment, for a number of reasons: first, as someone who, as a result of injury, has had to be far more reliant on the mobility aid that is my wheelchair than is usual; secondly, because I recognise that one’s disability and resulting need to use a mobility aid, such as a wheelchair, does not change simply because one happens to be a tenant; thirdly, and perhaps most importantly, because it gives me the opportunity to bring to the House’s attention a real-life example which I hope will underline the amendment’s importance.
I should declare an interest. The example I give concerns a person I know—an eminent solicitor with an international law firm who has become severely disabled in adulthood as a result of a condition called Stickler syndrome. For those noble Lords not familiar with this condition—I confess that I was not—common symptoms include vision problems such as near-sightedness and retinal detachment, hearing loss and joint problems such as hypermobility and arthritis. In this individual’s case, it is extremely painful and debilitating and has required extensive surgery, including within the last six months. Remarkably, she is still holding down a demanding job.
However, her suffering is being unnecessarily and even gratuitously compounded by the concerted and blatant disability discrimination she is encountering from HAUS Block Management and the right-to-manage company covering the development in which she lives. This disability discrimination relates directly to her use, as a long-term tenant, of her mobility aids in her rented dwelling, which includes a courtyard garden that she shares with other residents. The amendment refers to a reasonable request from a tenant to install mobility aids in the dwelling. Her request is undoubtedly reasonable, but the irony is that she is not asking for an installation. All she is asking for is the right to use her mobility aids in a courtyard garden, which is part of the dwelling.
There are two aids on which she depends for her mobility to live independently and get to work. Recent deterioration in her condition has necessitated the increased use of a wheelchair and increased visual impairment has required the use of an affectionate, intelligent and furry mobility aid. I refer of course to her adorable, but ageing, canine companion, without which she would immobile and could not function: her guide dog.
The amendment is so important to this individual and other disabled people in her situation—perhaps to an even greater degree than my noble friend appreciated when she tabled it—because despite my friend being a lawyer and having engaged in writing with HAUS and the RTM to explain her legal rights in relation to step-free access to the garden for her guide dog and her wheelchair, all her appeals for kindness, help and basic human empathy have been met with disdain. I know this because I have here in the Chamber a copy of her email correspondence with HAUS and the directors of the RTM. It is a damning indictment of how the rights enshrined in disability discrimination and equality legislation—on which your Lordships’ House has done so much brilliant work over the years to pass—are being traduced by organisations such as HAUS and the RTM. What a sad reflection on society that this could happen in plain sight in 2025, the 30th anniversary of the Disability Discrimination Act. It is heartbreaking—quite literally, in the case of this individual. Her condition is by its very nature isolating. HAUS, her RTM directors and her neighbours know that, and yet they give the impression that they are waiting for her to die, and their callous indifference adds to that sense of isolation.
What is to be done? It would be so easy for the chief executive of HAUS, Gareth Martin, to facilitate the speedy resolution of this situation by ensuring that the RTM directors act in accordance with her rights and with compassion, and that a key was provided, on a permanent and unrestricted basis, to the courtyard garden—which happens to be next to my friend’s apartment—so that she could use her mobility aids in it. As Guide Dogs has explained to in an email to HAUS and the RTM directors, this is vital for the welfare of both her ageing service dog—her mobility aid—and the individual herself.
She is being undeniably persecuted for having the temerity to assert her rights, in a way that would be totally unacceptable were it to be carried out on the grounds of race, for example. Incredibly, as if to add insult to injury, the individual has also been told that a few flowerpots, which contain plants for sensory stimulation and provide her with the very few flashes of colour she can still just about discern, must be removed.
In conclusion, will the Minister meet me so that we can explore how we might persuade HAUS and the RTM to respect this individual’s rights with regard to her mobility aids, in line with the spirit of this amendment? Can directors of companies be struck off, for example, for engaging in what is obviously wilful disability discrimination? If not, how can we ensure that they are? Perhaps their appalling behaviour could be brought to the attention of the relevant regulators—I cannot imagine their clients would be impressed. I look forward to the Minister’s response, and I reiterate my deep gratitude to my noble friend for tabling such an important amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank my noble friend Lady Coffey for tabling this amendment. I also pay my heartfelt thanks to my noble friend Lord Shinkwin; he always brings enormous knowledge and so much personal experience to any debate, as he has done today.
We briefly discussed support for disabled tenants in an earlier group, and we on these Benches firmly support steps to help disabled tenants access the homes and services they need. With the appropriate support, disabled people can live more fulfilled lives and thrive. We have come so far in recent years on support for disabled people to live full and happy lives in their own homes, so I am grateful to my noble friend for moving this important amendment today.
Amendment 275C seeks to prevent landlords and agents declining reasonable requests by tenants who need mobility aids to have them installed. It is a limited amendment that applies only where a tenant can arrange for the payment and installation of the aids themselves. This is an excellent challenge to the Government and we hope that the Minister will seriously consider this proposal and work with my noble friend to deliver the protections we need for disabled tenants. Perhaps this is something that we could revisit on Report.
We also wish to work constructively with my noble friend on how we might consider broader plans to ensure that the removal of mobility adaptions is deliverable, affordable and—crucially—even possible in practice. This is a vital area that demands serious attention from the Government, and the onus is on everyone across the Committee to put forward practical and compassionate solutions that recognise the real-world challenges faced by landlords and tenants alike around adapted homes. We need to look further at who would be responsible for covering the costs of restoring the changes to the original condition of the property. There is some more work to do, but I am sure that we can all do it before Report, and I look forward to working with the other parties to see whether we can find a sensible solution to the issue. We must ensure that any policy in this area supports accessibility, while remaining realistic and fair to all parties concerned.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Coffey, for her Amendment 275C, which seeks to prevent landlords, or any other relevant person in relation to a tenancy, unreasonably refusing a tenant request to install a mobility aid in their home. I also thank the noble Lord, Lord Shinkwin, and the noble Baroness, Lady Scott, for their contributions.
We debated in detail similar amendments on home disability adaptations last week. As I stated then, I absolutely agree that we should take steps to remove barriers that unreasonably prevent disabled renters getting the home adaptations they need—a need so powerfully described by the noble Lord, Lord Shinkwin; I will write to him about the routes to redress in cases such as the one he raised.
However, I do not believe that this amendment is the right way to do this. The Equality Act 2010 already provides protections for disabled tenants, and that applies whether they are in social rented or private rented housing. This includes providing a procedure under which they can request permission in writing from their landlord to make adaptations, including additions to or alterations in the fittings and fixtures of the home, such as mobility aids.
Landlords cannot unreasonably refuse such requests. Creating a new specific obligation in relation to mobility aids in particular would increase the complexity of the system unnecessarily, making it more difficult for tenants to navigate. We also wish to avoid creating a two-tier system in which people with impaired mobility have different rights from people with other disabilities or impairments.
I am very grateful to the noble Baroness, Lady Coffey, for introducing this amendment, because it gives me an opportunity to update noble Lords. There was a lot of discussion about this in the other place during the passage of the Bill. There have been some further commitments, and these were set out in a recent letter from the Minister of State for Housing and Planning to the MPs who tabled amendments in the other place. The letter stated that the Government would take the following actions to address known barriers to disabled tenants accessing the home adaptations they require.
With the leave of the Committee, I will update Members on that now. As highlighted in research carried out by the Equality and Human Rights Commission and the National Residential Landlords Association, a major challenge to the operation of the current system is the lack of knowledge among landlords, tenants and agents. The Renters’ Rights Bill includes the power to require landlords to provide a written statement of terms to new tenants. It is our intention, subject to drafting and scrutiny of the secondary legislation to mandate that this statement sets out the duty on landlords under the Equality Act 2010 to not unreasonably refuse disability adaptation requests from tenants. This will ensure that parties are aware of rights and obligations in relation to adaptations when they enter into a tenancy.
Baroness Coffey (Con)
My Lords, one of the things I am learning about this place is that by tabling amendments to legislation you get to discuss aspects of policy. I was not here for the other debate, but I thought there were some deficiencies in what was being proposed.
I am very pleased to hear about the actions taken by Matthew Pennycook, the Minister. That is welcome news, and I think that will be welcomed right across the country. I would be grateful if the Minister could put the letter in the Library so that everybody can see this. With that, I beg leave to withdraw.
Member’s explanatory statement
This amendment is consequential on the omission of clause 3.
Member’s explanatory statement
This amendment is consequential on the new Part 2 that would be inserted into Schedule 6 by the amendment in my name
“(1) Subject to the exceptions set out in this section, this Act comes into force on the day on which it is passed.(2) Parts 2 and 3 of this Act come into force on such day as the Secretary of State may by regulations made by statutory instrument appoint.” Member's explanatory statement
This amendment and others in the name of Lord Bird would bring the majority of the Act into force on the day that it passes, with the exception of some areas where regulations or consultation are needed.
Lord Bird (CB)
I declare my interests in the register in and around housing and things in that area. I will speak to Amendment 278 and the other amendments in my name—Amendments 282, 286 and 291—as they all work together. My amendments would bring the majority of the Bill and the new tenancy regime into force on the day that it passes, with the exception of some areas where regulations or consultation are needed. The purpose of this is to end Section 21 evictions at the earliest possible moment.
I have some interesting research, which I would like to give. No-fault evictions are currently at an eight-year high. Since the previous Government pledged to end no-fault evictions in 2019, 1 million renters have been served a Section 21 eviction notice. Over 100,000 households have been threatened with homelessness due to one of these evictions. Any delays in ending Section 21 will lead to more renters facing an unwanted move, potentially causing hardship and, in some cases, homelessness. Section 21 has meant that privately renting is considered to provide instability. A quarter of all renters have lived in three or more homes in the last five years. I could go on reading like this, but it is not my style, so I will end there.
It was 2,222 days ago when then Prime Minister May said that we were going to get rid of Section 21. The reason that I have brought forward these amendments is that they would not allow ending Section 21 to be kicked into the long grass, as it has been over the last six years. Michael Gove and everybody in the last Government whom I spoke to said, “Yes, yes—we ought to do something about it”. I am very concerned that what will happen is that we will say that Section 21 needs to go through some more debates and that we need to wait for the legal process, but then even more people will end up being thrown out of their homes.
I raise another question, which I find very frightening. I am the product of a slum house and slum landlords. I was born in 1946; when in 1951 we did not pay the rent, we were thrown out in the streets, and all our goods were put out there. This would really upset people in the Labour Government at the time, but they did not do an awful lot about it. The Conservatives came in, and they did not do an awful lot about it—the fact that a family could be laid out on the streets without the law becoming in any way involved.
When the Conservatives came in, they passed a rent Act—I think it was in 1955—which changed things; when Labour came in, in 1965 it was changed again. You could look at it as the goodies and the baddies: for a Conservative Administration, the goodies are the landlords and the baddies are the tenants; for the Labour Party or a Labour Government, the landlords are the baddies and the tenants are the goodies. I have watched this and been involved in this process for decade after decade. From my experience, I feel that we need to arrive at a situation, but we are not going to unless we really rethink how we deal with tenancies, landlords and tenants. The important thing to me is that we stop this coming and going, this balancing—this seeking of who is in the wrong and who is in the right. Both sides of the argument must get together, and this is where I want the work to be done, where tenants and landlords are advantaged by the stability that comes, and it is not engined by the fact that it depends on which Government are in as to who are the goodies and who are the baddies.
This has been a major problem for me over many years. In 1965, when the Labour Government under Harold Wilson brought in the Rent Act, it meant in fact that you had this peculiar situation where all the support went to the tenant, and for hundreds of thousands of people who were landlords and had property, it was removed, and enormous pressure was put on social housing. So for social housing, the local authorities—it was not housing associations—had to keep raising the bar. My brothers, who were on the council housing list in Hammersmith and Fulham in 1965 and were number 101 and I think 105, were scratched because the pressure on social housing was so enormous. Social housing ended up largely with people who were incredibly troubled, not ordinary working-class people, often single mothers with a number of children, and you had this development of the creation of almost ghettos of people who were living in social housing rather than the social mix of the social housing I moved into at the age of 10.
I use this opportunity to say that I want to get rid of Section 21 because it legalises insecurity. But overall, I also want us to be looking carefully at how we can begin a process of balance and equilibrium between tenant and landlord, because they both need each other. How many tenants are paying for people to buy houses? How many tenants are helping landlords put money aside for their pension? How many tenants are putting the children through university, because it is one of the few places where you can get prosperity? Unless we get to a situation where we get the equilibrium, then over the next 10, 20 or 30 years, as politics change and as Governments change, we are going to be having this kind of arsy-versy sort of world of one being the bully and the other being the hero or victim. I beg to move.
Lord Deben (Con)
There is a point here which I hope the Minister will listen to carefully: the speed with which legislation is put into operation. I make this point only because it has been true over a whole range of issues. It is true on new housebuilding: we change the building regulations, and it is five years before they actually come into operation, because of the way in which we deal with our legislation.
Let us take the disgraceful situation of successive Governments, of both parties, on Dalits. We passed the change so that Dalits could claim compensation for the way they were treated because of their caste. We changed the law in this House. It still has not come into operation—it has been put off and put off because of the way the legislation works.
I hope the Minister will recognise that what has been so ably introduced is two things. First, I entirely agree that we want a proper balance and a way forward. Tenants need landlords and landlords need tenants; that is obviously so. But I hope she will also take on board the fundamental issue of how quickly changes in legislation go through, and how often you are left with continuing delay. It is not just in this Bill—and she is not responsible for other Bills—but I hope she will take back the genuine concern of many of us about the length of time it takes for decisions that we make to affect ordinary people, which is, after all, why we make them.
Lord Jackson of Peterborough (Con)
My Lords, I shall contribute very briefly to the debate on this important amendment. I say at the beginning that I defer to no one in my admiration for the noble Lord, Lord Bird, and his heroic battle over many years to raise the issue of homelessness and those less fortunate people who do not have access to good housing. Sometimes, you come upon an amendment and you have to make a decision between your heart and your head. Your heart is very much taken with the sincerity of the noble Lord’s argument about the need to be fair—principally to tenants, but also to landlords—in the way you put legislation together.
I absolutely and fully take that view, but the noble Lord will understand that one of the reasons I do not support his amendment is that the Government, rightly or wrongly, have brought the Bill to this stage. I believe that Section 21 will have unintended consequences. It will reduce the amount of rental stock, and mean that people who own capital will sell it to other people who own capital—landlords—and they will not put that property back on the market for those in the most desperate need, mainly young working families, but also others in the market. The noble Lord will know—it is a wider issue, I accept—that rent controls very rarely work, whether it is in Barcelona, New York, Scotland or other places in the world. So that is the head part. On the heart part, I absolutely agree with what he is saying.
My point is that the Government have reached this juncture, and we are about to go into Report, the Bill is going to happen and there is a consensus, whether I like it or not. Given that we have some enduring concerns about court capacity and the ability of the court system to deal with any concomitant legislation which might arise from the Bill—which will become an Act in the not-too-distant future—I feel that his amendment, while extremely well-meaning and very sincere, will not help deliver what we want, which is fairness and equity for tenants and landlords. It is only on that basis that I respectfully say that I do not support the amendment, and I suspect that the Government will take a similar view. I applaud the noble Lord for everything that he has done in raising these very important issues over many years.
Lord Hacking (Lab)
My Amendment 281 has not been formally called, but if it is the wish of the House, I will address it. The other amendments, Amendments 279 and 280, have already been debated.
I was rather surprised to be asked again to declare my interests, because I have done so on several occasions already during the passage of the Bill. Oh, I am now being released. Anyway, my interests are disclosed in the register.
I therefore move on to a very responsible role that the noble Lord, Lord Bird, and I have, and that is of moving the last group of amendments in this Committee. It has been a long journey to get to this point, involving a lot of hard work by many Members of the House, but none more so than my noble friend the Minister, who has worked extremely hard throughout all the Committee sittings.
As usual, the noble Lord, Lord Bird, gave a very spirited speech. He spoke with great passion. It is always delightful to hear him, and I welcome him back. He was not here last night but he has given the spirited speech today. I am afraid that I do not agree with his rather simplistic description of the Conservative Party as running their policies based on baddie tenants, or that my party is running policies on baddie landlords. I know from debates in the House and discussions with the Minister that there has been a great effort by my party to produce a Bill which is fair and balanced. I am looking at the noble Baroness, Lady Scott, but she is not quite coming with me on this proposition. However, I believe that my noble friend the Minister largely has achieved that.
We have heard the noble Lord’s reasons for different commencement dates under the Bill. All my amendments go to Clause 145, on commencement. I have tabled Amendments 281, 287, 288 and 289. They all seek to give more time for the commencement of certain parts of the Bill. I draw attention to Amendment 288, which seeks to give more time, and different times for new tenancies, suggesting increasing the times to six months and, for existing tenancies, 12 months.
This is a problem that has been presented to me by estate agents. We all should understand how impactful this Bill is. Clause 1 of the Bill states that it applies to all tenancies—existing tenancies and new tenancies. In so far as it applies to existing tenancies, it applies to a great number of tenancies that are fixed term, many of which are shorthold. My wife and I use a 12-month fixed-term tenancy.
Estate agents have now got a very different role. Concerning new tenancies, that is okay. A new tenancy will be set up as a periodic tenancy with, ab initio, a new tenant. However, the existing tenancies produce different work for the estate agent. Under the present system of shorthold tenancies, the agent contacts the tenant and the landlord about three months before the expiration of the tenancy and checks whether the tenant wants to go for another period of tenancy and whether the landlord is agreeable to that. He also checks the position on the amount of rent. I do not know, and neither do many estate agents, what the new requirements will be. Is it proper for the estate agent to contact the tenant and ask, “How much longer do you want?” It is a periodic tenancy; there is no end date. Would it be proper for the estate agent to then engage the tenancy on the amount of rent? These are difficult decisions that have to be made.
In this modern age, these things have to be set up with software and the like, which is why I am asking my noble friend the Minister to give more time. All that has been asked of me, which I am now asking of noble Lords and, more directly, the Minister, is this: can we have more time, so that all the right procedures are set up and it does not end up being a scrambled egg?
Baroness Grender (LD)
My Lords, I rise briefly on this group, which concerns commencement. I particularly thank the noble Lords, Lord Hacking and Lord Bird, for ensuring that this debate took place, and the noble Lord, Lord Deben, for his wisdom and experience in implementation. I know that my noble friend Lady Thornhill will regret not being here for day 7 of the Committee but, as she explained to the House last night, she had an appointment that she could not change, because this day was unexpected. I add my words of thanks to everyone who has been here all the way through these seven days of Committee. I feel that it has been a quality experience and debate. In particular, I thank the Minister.
There is no doubt that the central aim of this Bill, the long-overdue abolition of Section 21, must be delivered swiftly. This abolition will ensure that renters no longer live under the threat of no-fault evictions. This was a promise that the last Government failed to deliver over a shocking six-year period. Indeed, we have already heard the devastating consequence of that broken promise, with over 120,000 households served with no-fault eviction notices since it was first made in 2019, when the noble Baroness, Lady May of Maidenhead, was Prime Minister.
Lord Hacking (Lab)
My Lords, I am sorry to interrupt the noble Baroness. This should be directed also to the noble Lord, Lord Bird. As I read in Clause 1 of the Bill that all existing tenancies are made periodic tenancies, that must involve the ceasing of the use of Section 21.
Lord Cromwell (CB)
That is what the noble Baroness is saying.
Baroness Grender (LD)
Yes, that is exactly what I am saying: this will bring about the abolition of Section 21.
That failure has rightly eroded trust. It now falls to this Government to deliver what was promised without further delay. Renters should not be asked to wait any longer for the basic security that this legislation is intended to provide. At the same time, we on these Benches recognise that proper implementation matters. Noble Lords would not find that surprising, given that every other member of this Bill team is a former or current councillor, with the exception of me.
The changes this Bill brings are significant and must be supported by clear guidance, well-prepared systems and proper resourcing, not least for the courts and local authorities. Yes, we need preparation time, but that preparation must not become an excuse for indefinite delay. There is a question of balance. Where regulation or consultation is needed, that work must of course be done, but it should be carried out with urgency and to a clear and published timetable. Renters deserve certainty about when these protections will come into force, but so too do landlords. Those operating in good faith need to understand the new framework that they will be working within and to have time to prepare for it, but they should not be left in limbo. The entire sector needs clarity and consistency. Delays would only undermine confidence in this long-awaited reform.
I have only one central question for the Minister. The Government publicly stated that Section 21 would be abolished “immediately” in their 2024 manifesto. However, Clause 145(5)(a) indicates that the abolition will take effect two months after the Bill is passed. The Bill also says that this is a decision for the Secretary of State. Can she please use this opportunity to clarify—my apologies if she has already explained this endlessly, but I am still slightly confused on this question—which timeframe is correct? It would be helpful, for instance, to understand the time lapse between the amendments from the noble Lord, Lord Bird, and the commencement date of the abolition of Section 21.
Finally, many of us were here until 1 am on Tuesday and until midnight last night, and this is now our seventh day. I am certain that there are many Peers who would do that again and again to get to the abolition of Section 21—to get to, at pace, that long-promised, much-needed change in the law. I look forward now to hearing when.
Lord Cromwell (CB)
Perhaps I may offer the briefest of comments. At the risk of being struck by lightning: on the seventh day, the Lord rested. Let us hope we all get some rest soon.
I mention two words: equilibrium and scramble. Equilibrium is what we all seek, but it is a fact of life that one woman’s equilibrium may be different to another woman’s equilibrium. The perpetual life of politics is trying to find an equilibrium between different viewpoints. Regarding scramble, there will be a scramble whenever this comes in, and that is not a reason to put it off.
We touched on the database yesterday. There are bits of the Bill that will come in more slowly, but Section 21, to echo the point from the noble Lord, Lord Bird, will definitely go. If the Bill achieves nothing else, Section 21 will go.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Bird, who, as always, so passionately opened this group. I thank him for all his knowledge and particularly the passion that he brings on anything to do with homes, homelessness and vulnerable people.
The noble Lord’s Amendments 278, 286 and 291, along with others in his name, would bring the majority of the Act into force on the day it receives Royal Assent, save for a few areas requiring further regulation or consultation. We on these Benches have consistently urged the Government to not take this approach. We have called on them to reaffirm their long-standing commitment to prospective lawmaking by providing clear commencement dates and reasonable transition periods for all new obligations. This is essential to protect both tenants and landlords from abrupt and potentially unfair changes.
A phased approach would allow landlords, tenants and letting agents time to understand and adapt to the new legal framework. Commencing the Act immediately upon passage does not provide sufficient time to do this. We simply cannot expect landlords to react and comply with significant new requirements on day 1. Indeed, the evidence bears this this out. In a recent survey conducted by Paragon, 57% of landlords said they had heard of the legislation but did not fully understand its implications, and a further 39% said they knew little about it. Those statistics point clearly to a knowledge gap in the market—one that we must not ignore. Therefore, we believe that a clear transition period is necessary.
Amendments 281, 287, 288 and 289, tabled by the noble Lord, Lord Hacking, present a credible and constructive challenge to the Government’s current position. They propose a model that echoes the approach taken by the predecessor to the Bill—an approach grounded in prospective lawmaking. Phase 1 in that Bill would have applied the new rules only to new tenancies with at least six months’ notice, and phase 2 would extend the rules to existing tenancies no less than 12 months later. This two-phase model provides a reasonable and practical path forward, allowing time for proper education, preparation and implementation. I urge the Government to reflect carefully on these proposals and to recognise the importance of a fair and orderly transition.
We all agree that tenants deserve safe, secure and decent homes at a fair price, but to deliver that we need a functioning rental market with enough good-quality homes to meet growing demand. We need more homes in the right places. This Bill, regrettably, puts that in danger. Rather than boosting supply, it risks driving landlords out of the market, shrinking the number of available homes and pushing rents even higher. If we get this wrong, renters will pay the price. Balance is essential. At present, we believe this Bill does not strike that balance.
Before I sit down, I thank and congratulate the noble Baroness on how she has conducted the first Bill that she is taken through Committee, and all noble Lords who have taken part in excellent, well-informed debates over the past seven days. I look forward to Report.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Bird, and my noble friend Lord Hacking for their amendments relating to the commencement of measures in the Bill. I thank the noble Lords, Lord Deben and Lord Cromwell, and the noble Baronesses, Lady Grender and Lady Scott, for participating in this group.
I turn to Amendments 278, 282, 286, and 291 in the name of the noble Lord, Lord Bird. I add my tribute for all the work he does to tackle homelessness. He is a great hero of mine, and it is a great privilege to work with him. The noble Lord rightly notes the importance of ending Section 21, which is a major contributor to homelessness levels in England and a major cost to councils, which now spend more than £2 billion a year on temporary accommodation. That was the last full year’s figure. I heard that £4 million a day is currently spent on homelessness in London. Much of that is driven by Section 21 evictions. As well as the misery created for individuals and families, these evictions put pressure on the public purse and costs that would be much better spent on other public services.
These amendments seek to bring most of the measures in the Renters’ Rights Bill forward to Royal Assent. The Government agree with the noble Lord that the measures in this Bill are urgently needed, which is why we moved swiftly to introduce it early in our first legislative programme for government. To end the scourge of Section 21 evictions as quickly as possible, we will introduce the new tenancy for the private rented sector in one stage. On that date, the new tenancy system will apply to all private tenancies. Existing tenancies will convert to the new system, and any new tenancies signed on or after that date will be governed by the new rules. There will be no dither or delay, and the abolition of Section 21, fixed-term contracts, and other vital measures in the Bill will happen as quickly as possible.
However, we must do this in a responsible manner, as noble Lords have mentioned. We are therefore also committed to making sure that implementation takes place smoothly. As such, it is essential that wider work around the Bill is allowed to conclude before implementation takes place. That includes the production of guidance, updating court forms and making secondary legislation. For example, the information that landlords are required to give tenants in the written statement of terms will be set out in secondary legislation. Work is already under way on these matters. We need to get it right. We will appoint the date of implementation via secondary legislation, which is typical when commencing complex primary legislation. This will allow us to give the sector certainty about when the system will come into force. Relying on Royal Assent would create significant uncertainty around the specific date, and it is important that we do not do that.
I say to the noble Lord, Lord Bird, that I was lucky enough to benefit from the post-war Labour Government’s drive to build social housing so, although I could have done, I did not grow up in the kind of housing that he described. Our social housing was built in new towns, and that was the last time that social housing was built at any scale in this country. We have promised that again, and have committed £2 billion to social and affordable housing. So the noble Lord has my personal commitment that we will move this forward as quickly as possible.
The noble Lord, Lord Deben, talked about the speed of legislation. I have been a Minister for only a few months but I am already learning the frustration of time lags. I thought that councils move a bit too slowly at times, but we certainly need to move things forward more quickly. Of course, this is not just about legislation; we are trying to move on housing at some speed. We have already provided funding to improve construction skills, funding for planning officers, a new National Planning Policy Framework, over £500 million for homelessness and the social housing funding that I have already mentioned. We understand that this needs to be moved forward quickly. We will work as quickly as we can on that. As such, I ask the noble Lord not to press his amendments.
Lord Jackson of Peterborough (Con)
I concur with the comments across the Chamber about what a professional job the Minister has done in piloting the Bill and engaging with Members. At Second Reading, she made specific reference to working closely with the Ministry of Justice on court digitalisation and extra funding for court costs. Is she in a position to update the Committee on what progress has been made on that? There are still people across the Committee who are concerned about the likely ramifications of the abolition of Section 21, whenever it happens.
Baroness Taylor of Stevenage (Lab)
I understand the noble Lord’s concern. There is ongoing dialogue with the Ministry of Justice, and I hope to be able to update Members before Report on where that has got to as soon as we are able to. I do not think it would be helpful to have a running commentary on it but my honourable friend the Minister for Housing is in dialogue at the moment with the MoJ. I will update noble Lords as soon as we get to the end of those discussions.
I turn to the amendments tabled by my noble friend Lord Hacking. Amendment 281 seeks to delay a number of provisions coming into force. The Bill currently provides that these provisions commence two months after Royal Assent. Two months is a well-established precedent, and I see no reason why commencement of these provisions should be delayed. For example, the provisions include important protections for tenants and provide local authorities with better powers to enforce housing standards.
Amendment 287 would set a time limit of 12 months between Royal Assent and the implementation of the Bill’s tenancy reforms in the private rented sector. Amendment 288 would change the approach to tenancy reform implementation in the Bill. It would require that the measures were applied to new tenancies no earlier than six months after Royal Assent and to existing tenancies no earlier than 12 months after Royal Assent. Amendment 289 would require that the conversion of existing tenancies to assured tenancies under the new tenancy reform system took place no earlier than 12 months after Royal Assent. As I have set out previously, we will end the scourge of Section 21 evictions as quickly as possible, and we will introduce the new tenancy for the private rented sector in one stage.
I assure my noble friend that this Government will ensure that the sector has adequate notice of the system taking effect but, in order to support tenants, landlords and agents to adjust, we will allow time for a smooth transition to the new system while making sure that tenants can benefit from the new system that they have waited so long for as soon as is realistically possible. We are planning a wide-ranging campaign to raise awareness of our reforms, supported by clear, straightforward and easy-to-read guidance to help landlords to prepare for change and to help tenants to be ready for it. On that basis, I ask my noble friend not to press his amendments.
Lord Bird (CB)
Unfortunately, I was not in a position to sit up last night or the night before because I have a full-time job. Yesterday, I was in Cardiff working with people in the Government there. We had a big event around the Big Issue. It was wonderful to be there and to be given the opportunity, I hope, to work with the Welsh Parliament on the idea of social housing, social justice and all that. So I hope noble Lords will forgive me for not being here last night to see all their noble work.
I want to say a few things. I think one of the real problems is that people do not understand the role of a tenant. They know the role of a landlord: the landlord owns a piece of property, and they rent it out to somebody. But the role of the tenant over the last 50 years has been to enrich the landlord. If you look at what has happened to the property market over the last 40 or 50 years, the role of the tenant has been to make sure that the landlord gets richer and richer, because we know the way the property market has been going. It has been going in a direction where people can buy a house in one decade—my ex-wife did so—and sell it later in the decade for maybe two or three times as much. The landlord would often have done not much more than rent the property out and keep it going.
Lord Bird (CB)
I am telling the noble Lord that, from my experience, it is. From my experience, what has happened is that tenants have made a very large section of the population who are small landlords much wealthier.
Member's explanatory statement
This amendment is consequential on the new Part 2 that would be inserted into Schedule 6 by the amendment in my name
3 “(1) This paragraph applies where—(a) before the commencement date—(i) a valid notice under section 21 of the 1988 Act has been given, and(ii) the claimant in possession proceedings has requested the court to issue the claim form for those proceedings, and(b) immediately before the commencement date, possession proceedings have not begun or have not been concluded.(2) The notice under section 21 remains valid until possession proceedings are concluded.(3) The amendments made by Chapter 1 of Part 1 do not apply in relation to the tenancy until the notice under section 21 ceases to be valid by virtue of sub-paragraph (2) (and accordingly the tenancy remains an assured shorthold tenancy until then).(4) In relation to a tenancy to which sub-paragraph (3) applies, section 146(3) (except in its application to this paragraph) has effect as if the following were substituted for the definition of “commencement date”—““commencement date” means the date on which, by virtue of paragraph 3 of Schedule 6, the amendments made by Chapter 1 of Part 1 apply in relation to a tenancy;”.(5) In this paragraph “possession proceedings” means proceedings for an order for possession under section 21 of the 1988 Act in reliance on a valid notice given under that section.Section 2: claim form for section 21 possession proceedings not already requested
3A (1) This paragraph applies where, before the commencement date—(a) a valid notice under section 21 of the 1988 Act has been given, and(b) the claimant in possession proceedings has not requested the court to issue the claim form for those proceedings.(2) Section 21 of the 1988 Act has effect as if the following were substituted for subsections (4D) and (4E)— “(4D) Subject to subsection (4E), proceedings for an order for possession under this section in relation to a dwelling-house in England may not be begun if the claimant in the proceedings requests the court to issue the claim for the proceedings after the end of the applicable period.(4DA) For that purpose the “applicable period” is—(a) the period of six months beginning with the date on which the notice was given under subsection (1) or (4), or(b) the period of three months beginning with the commencement date, if this three month period ends before the six month period mentioned in paragraph (a).(4E) Where—(a) a notice under subsection (4) has been given in relation to a dwelling-house in England, and(b) paragraph (b) of that subsection requires the date specified in the notice to be more than two months after the date the notice was given,proceedings for an order for possession under this section may not be begun if the claimant in the proceedings requests the court to issue the claim for the proceedings after the end of the applicable period.(4EA) For that purpose the “applicable period” is—(a) the period of four months beginning with the date specified in the notice, or(b) the period of three months beginning with the commencement date, if this three month period ends before the four month period mentioned in paragraph (a).(4EB) In subsections (4DA) and (4EA) “commencement date” has the meaning given by section 146 of the Renters’ Rights Act 2025.”(3) The notice under section 21 remains valid—(a) until the end of the applicable period, except where the claimant has requested the court to issue the claim form for possession proceedings before the end of that period;(b) until possession proceedings are concluded, if the claimant has requested the court to issue the claim form for those proceedings before the end of the applicable period.(4) The amendments made by Chapter 1 of Part 1 do not apply in relation to the tenancy until the notice under section 21 ceases to be valid by virtue of sub-paragraph (3) (and accordingly the tenancy remains an assured shorthold tenancy until then).(5) In relation to a tenancy to which sub-paragraph (4) applies, section 146(3) (except in its application to this paragraph) has effect as if the following were substituted for the definition of “commencement date”—““commencement date” means the date on which, by virtue of paragraph 3A of Schedule 6, the amendments made by Chapter 1 of Part 1 apply in relation to a tenancy;”.(6) In this paragraph—“applicable period” , in relation to possession proceedings, has the same meaning that it has in relation to those proceedings in section 21 of the 1988 Act as modified by sub-paragraph (2);“possession proceedings” means proceedings for an order for possession under section 21 of the 1988 Act in reliance on a valid notice given under that section.” Member's explanatory statement
This restructures the provision in paragraph 3 and clarifies that the application of that provision depends on whether the landlord has requested the court to issue the claim form in possession proceedings (instead of depending on whether the court has actually issued the claim form).
15 “(1) This paragraph applies where—(a) before the commencement date—(i) a valid notice under section 8 of the 1988 Act has been given, and(ii) the claimant in possession proceedings has requested the court to issue the claim form for those proceedings, and(b) immediately before the commencement date, possession proceedings have not begun or have not been concluded.(2) The notice under section 8 remains valid until possession proceedings are concluded.(3) The amendments made by Chapter 1 of Part 1 do not apply in relation to the tenancy until the notice under section 8 ceases to be valid by virtue of sub-paragraph (2) (and accordingly the tenancy remains an assured shorthold tenancy until then).(4) In relation to a tenancy to which sub-paragraph (3) applies, section 146(3) (except in its application to this paragraph) has effect as if the following were substituted for the definition of “commencement date”—““commencement date” means the date on which, by virtue of paragraph 15 of Schedule 6, the amendments made by Chapter 1 of Part 1 apply in relation to a tenancy;”.(5) In this paragraph “possession proceedings” means proceedings for an order for possession under section 8 of the 1988 Act in reliance on a valid notice given under that section.Claim form for section 8 possession proceedings not already requested
15A (1) This paragraph applies where, before the commencement date—(a) a valid notice under section 8 of the 1988 Act has been given, and(b) the claimant in possession proceedings has not requested the court to issue the claim form for those proceedings.(2) The notice under section 8 remains valid—(a) until the end of the applicable period, except where the claimant has requested the court to issue the claim form for possession proceedings before the end of that period;(b) until possession proceedings are concluded, if the claimant has requested the court to issue the claim form for those proceedings before the end of the applicable period.(3) The amendments made by Chapter 1 of Part 1 do not apply in relation to the tenancy until the notice under section 8 ceases to be valid by virtue of sub-paragraph (2) (and accordingly the tenancy remains an assured shorthold tenancy until then). (4) In relation to a tenancy to which sub-paragraph (3) applies, section 146(3) (except in its application to this paragraph) has effect as if the following were substituted for the definition of “commencement date”—““commencement date” means the date on which, by virtue of paragraph 15A of Schedule 6, the amendments made by Chapter 1 of Part 1 apply in relation to a tenancy;”.(5) In this paragraph—“applicable period” , in relation to possession proceedings—(a) the period of twelve months included in the notice under section 8 of the 1988 Act in accordance with subsection (3)(c) of that section, or(b) the period of three months beginning with the commencement date, if this three month period ends before the twelve month period mentioned in paragraph (a);“possession proceedings” means proceedings for an order for possession under section 8 of the 1988 Act in reliance on a valid notice given under that section.”Member's explanatory statement
This restructures the provision in paragraph 15 and clarifies that the application of that provision depends on whether the landlord has requested the court to issue the claim form in possession proceedings (instead of depending on whether the court has actually issued the claim form).
“Part 2Existing instruments which permit or require letting etcKey definitions
17 (1) “Residential premises” are premises that consist of or include one or more dwelling-houses in England.(2) A lease of residential premises (whether or not in writing) is a “relevant pre-application instrument” if it was entered into—(a) before the commencement date, or(b) on or after that date under a contract entered into before that date.(3) A mortgage arrangement which relates to residential premises is a “relevant pre-application instrument” if it was entered into—(a) before the commencement date, or(b) on or after that date by the acceptance of an offer made before that date.(4) A contract of insurance which relates to residential premises is a “relevant pre-application instrument” if it was entered into—(a) before the commencement date, or(b) on or after that date by the acceptance of an offer made before that date.(5) A section 106 obligation is a “relevant pre-application instrument” if it was entered into before the commencement date.(6) In relation to a relevant pre-application instrument, “affected dwelling-house” means—(a) if the relevant pre-application instrument is a lease, the dwelling-house, or each dwelling-house, let by the lease;(b) if the relevant pre-application instrument is a mortgage arrangement, the dwelling-house, or each dwelling-house, to which the mortgage arrangement relates; (c) if the relevant pre-application instrument is a contract of insurance, the dwelling-house, or each dwelling-house, to which the contract of insurance relates;(d) if the relevant pre-application instrument is a section 106 obligation, the dwelling-house, or each dwelling-house, to which the section 106 obligation relates.(7) In relation to times before the commencement date, an assured tenancy is a “relevant” assured tenancy if—(a) it is not an assured shorthold tenancy,(b) it is a periodic tenancy, and(c) each period of the tenancy is—(i) a period of 28 days or shorter, or(ii) a monthly period,including where there are different periods at different times, each of which falls within sub-paragraph (i) or (ii).(8) In relation to times on or after the commencement date, an assured tenancy is a “relevant” assured tenancy if—(a) it is a periodic tenancy, and(b) each period of the tenancy is—(i) a period of 28 days or shorter, or(ii) a monthly period,including where there are different periods at different times, each of which falls within sub-paragraph (i) or (ii).Saving for existing powers to vary
18 Nothing in this Part of this Schedule prevents a relevant pre-application instrument from being varied or modified by the parties to it (and accordingly paragraphs 19 to 24 and paragraph 26 are subject to any such variation or modification).Relevant pre-application instruments that permit letting on tenancies that are no longer possible
19 (1) This paragraph applies to a relevant pre-application instrument if either or both of conditions A and B are met in relation to the affected dwelling-house.(2) Condition A: immediately before the commencement date, the relevant pre-application instrument—(a) permitted the affected dwelling-house to be let under an assured shorthold tenancy, but(b) did not permit the affected dwelling-house to be let under a relevant assured tenancy.(3) Condition B: immediately before the commencement date, the relevant pre-application instrument—(a) permitted the affected dwelling-house to be let under an assured tenancy (other than an assured shorthold tenancy), but(b) did not permit the affected dwelling-house to be let under a relevant assured tenancy.(4) The relevant pre-application instrument has effect on and after the commencement date as if it permits the affected dwelling-house to be let under a relevant assured tenancy.(5) That power to let under a relevant assured tenancy is exercisable in the same circumstances, and on the same terms, as the pre-commencement power to let was exercisable immediately before the commencement date, except so far as that would be inconsistent with any provision made by or under this Act.(6) In this paragraph “pre-commencement power to let” means—(a) if only condition A is met, the power to let mentioned in sub-paragraph (2)(a); (b) if only condition B is met, the power to let mentioned in sub-paragraph (3)(a);(c) if conditions A and B are both met, the power to let mentioned in sub-paragraph (3)(a).Relevant pre-application instruments that permit letting on tenancies that continue to be possible
20 (1) This paragraph applies to a relevant pre-application instrument if, immediately before the commencement date, the relevant pre-application instrument permitted the affected dwelling-house to be let under a relevant assured tenancy.(2) That power to let under a relevant assured tenancy continues to be exercisable in the same circumstances, and on the same terms, as it was exercisable immediately before the commencement date, except so far as that would be inconsistent with any provision made by or under this Act.Relevant pre-application instruments that require letting on tenancies that are no longer possible
21 (1) This paragraph applies to a relevant pre-application instrument if either or both of conditions A and B are met.(2) Condition A: immediately before the commencement date—(a) the relevant pre-application instrument required the affected dwelling-house to be let, and(b) that requirement—(i) would have been complied with by letting the affected dwelling-house under an assured shorthold tenancy, but(ii) would not have been complied with by letting the affected dwelling-house under a relevant assured tenancy.(3) Condition B: immediately before the commencement date—(a) the relevant pre-application instrument required the affected dwelling-house to be let, and(b) that requirement—(i) would have been complied with by letting the affected dwelling-house under an assured tenancy (other than an assured shorthold tenancy), but(ii) would not have been complied with by letting the affected dwelling-house under a relevant assured tenancy.(4) The relevant pre-application instrument has effect on and after the commencement date as if it requires the affected dwelling-house to be let under a relevant assured tenancy.(5) That requirement to let under a relevant assured tenancy must be complied with in the same circumstances, and on the same terms, as the pre-commencement requirement had to be complied with immediately before the commencement date, except so far as that would be inconsistent with any provision made by or under this Act.(6) In this paragraph “pre-commencement requirement” means—(a) if only condition A is met, the requirement to let mentioned in sub-paragraph (2)(b)(i);(b) if only condition B is met, the requirement to let mentioned in sub-paragraph (3)(b)(i);(c) if conditions A and B are both met, the requirement to let mentioned in sub-paragraph (3)(b)(i).Relevant pre-application instruments that require letting on tenancies that continue to be possible
22 (1) This paragraph applies to a relevant pre-application instrument if, immediately before the commencement date— (a) the relevant pre-application instrument required the affected dwelling-house to be let, and(b) that requirement would have been complied with by letting the affected dwelling-house under a relevant assured tenancy.(2) That requirement to let under a relevant assured tenancy must still be complied with in the same circumstances, and on the same terms, as it had to be complied with immediately before the commencement date, except so far as that would be inconsistent with any provision made by or under this Act.Pre-commencement s.106 obligations with provision relating to letting on terms that are no longer possible
23 (1) This paragraph applies to a pre-application section 106 obligation if, immediately before the commencement date, it prevented or restricted the taking of particular action unless or until the affected dwelling-house was let under a superseded tenancy.(2) On and after the commencement date, the pre-application section 106 obligation has effect as if it prevents or restricts the taking of the particular action unless or until the affected dwelling-house is let under a relevant assured tenancy.(3) Any such letting under a relevant assured tenancy is to be made in the same circumstances, and on the same terms, as a letting under a superseded tenancy immediately before the commencement date, except so far as that would be inconsistent with any provision made by or under this Act.Pre-commencement s.106 obligations with provision relating to letting on terms that continue to be possible
24 (1) This paragraph applies to a pre-application section 106 obligation if, immediately before the commencement date—(a) provision of the pre-application section 106 obligation prevented or restricted the taking of particular action unless or until the affected dwelling-house was let, and(b) that provision would have ceased to prevent or restrict that action if the affected dwelling-house was let under a relevant assured tenancy.(2) Such a letting under a relevant assured tenancy must still be made in the same circumstances, and on the same terms, as a letting under a relevant assured tenancy immediately before the commencement date, except so far as that would be inconsistent with any provision made by or under this Act.Requirements under the Community Infrastructure Regulations 2010
25 (1) This paragraph applies where—(a) a planning permission is granted before the commencement date on a relevant determination,(b) the planning permission was granted on the basis of a pre-application section 106 obligation, and(c) at the time the planning permission was granted, the pre-application section 106 obligation met the requirements under regulation 122(2) of the Community Infrastructure Regulations 2010.(2) On and after the commencement date any effect of this Part is to be disregarded when considering whether the pre-application section 106 obligation continues to meet those requirements.(3) In this paragraph “relevant determination” has the meaning given by regulation 122(3) of the Community Infrastructure Regulations 2010.Leases which cannot be returned at end of term free of sub-lease
26 (1) This paragraph applies to a lease if— (a) the lease was entered into before the commencement date or under a contract entered into before that date,(b) the lease is—(i) periodic, or(ii) a fixed term lease of a term certain not exceeding 21 years,(c) the lease is modified by paragraph 19 or 21,(d) a dwelling-house is sub-let under the lease on a tenancy (entered into before or after the commencement date) which is (or becomes on or after that date, by virtue of this Act or otherwise) a relevant assured tenancy, and(e) the tenancy was entered into in accordance with the terms of the lease as they stood when the tenancy was entered into (or, if it was not, the breach has been waived by the landlord).(2) The lease has effect as if it provided that a failure by the lessee at the end of the lease to return the premises to the landlord free from the relevant assured tenancy does not constitute a breach of the lease.Application to agreements etc relating to leases, mortgage arrangements or contracts of insurance
27 In this Part of this Schedule references to a lease, mortgage arrangement or contract of insurance, and references to the terms of a lease, mortgage arrangement or contract of insurance, include references to—(a) the terms of any agreement relating to the lease, mortgage arrangement, or contract of insurance, and(b) any document or communication from a party to the lease, mortgage arrangement, or contract of insurance, which gives or refuses consent for letting in relation to a category or description of tenancy.Application to sub-letting
28 (1) In a case where the relevant pre-application instrument is a lease, a reference in this Part of this Schedule to a letting of the affected dwelling-house is a reference to a sub-letting of those premises under that lease or any inferior lease.(2) In the case of any other relevant pre-application instrument, a reference in this Part of this Schedule to a letting of the affected dwelling-house includes a reference to a sub-letting of those premises under any lease or inferior lease of those premises.Application in certain circumstances
29 (1) In a case where a relevant pre-application instrument—(a) gave, or gives, a discretion whether to let an affected dwelling-house, but(b) required, or requires, the affected dwelling-house to be let under a tenancy of a particular description if it is let,the instrument is to be regarded as permitting (and not as requiring) the dwelling-house to be let under that description of tenancy (and this Part of this Schedule applies accordingly).(2) The following provisions of this paragraph apply if there are two or more affected dwelling-houses in relation to the relevant pre-application instrument.(3) This Part of this Schedule applies separately in relation to each of those dwelling-houses.(4) But, if any term of the instrument is such that it gave, or gives, a discretion as to which particular dwelling-house or dwelling-houses the term applies to, this Schedule does not affect that discretion (but the term otherwise has effect subject to this Part of this Schedule).Power to disapply or modify this Part
30 (1) The Secretary of State may by regulations disapply or modify the effect of this Part of this Schedule in relation to relevant pre-application instruments of a specified description.(2) Where the Secretary of State makes regulations under this paragraph disapplying the effect of this Part, the fact that this Schedule has previously applied in relation to a relevant pre-application instrument does not prevent the exercise of the powers in section 148(6)(b) in relation to the relevant pre-application instrument.Meaning of “permitting” letting
31 A relevant pre-application instrument permitted, or permits, the affected dwelling-house to be let under a tenancy of a particular description if letting the affected dwelling-house under a tenancy of that description would not have breached the terms of the relevant pre-application instrument.Interpretation
32 In this Part of this Schedule—“affected dwelling-house” has the meaning given in paragraph 17(6);“assured shorthold tenancy” is to be read in accordance with Part 1 of the 1988 Act as it had effect immediately before the commencement date;“assured tenancy” , in relation to a time before the commencement date, is to be read in accordance with Part 1 of the 1988 Act as it had effect at that time;“the commencement date” has the meaning given by section 146(3);“contract of insurance” has the meaning given by article 3(1) of the Financial Services (Regulated Activities) Order 2001;“dwelling-house” has the same meaning as in Part 1 of the 1988 Act — see section 45 of that Act);“mortgage arrangement which relates to residential premises” or “mortgage arrangement” means an arrangement under which—(a) credit is or continues to be provided to a person, and(b) the obligation of the person to repay is secured by a legal or equitable mortgage or other charge on the residential premises;“pre-application section 106 obligation” means a section 106 obligation that was entered into before the commencement date;“relevant assured tenancy” has the meaning given in paragraph 17(7) and (8);“relevant pre-application instrument” has the meaning given in paragraph 17(2) to (5);“residential premises” has the meaning given in paragraph 17(1);“section 106 obligation” means a planning obligation under section 106 of the Town and Country Planning Act 1990;“superseded tenancy” means—(a) an assured shorthold tenancy, and(b) an assured tenancy (other than an assured shorthold tenancy) that is not a relevant assured tenancy.” Member's explanatory statement
This makes transitional provision about existing “relevant pre-application instruments” whose terms permit letting or sub-letting under leases of kinds which are abolished by the Bill. It replaces clause 3 (about leases) and then also deals with mortgages, insurance contracts and obligations under section 106 of Town and Country Planning Act 1990.
Member's explanatory statement
This ensures that regulations making transitional and saving provision can make provision in substitution for as well as in addition to provision made by the Act.
“(5A) The power to make regulations under subsection (3) includes power to amend or repeal any provision made by Part 2 of Schedule 6 to this Act.”Member's explanatory statement
This enables regulations making transitional or saving provision to make such provision by amending or repealing any provision in Part 2 of Schedule 6 to the Act.
(i) before the commencement date, or(ii) on or after that date either under a contract entered into before that date or by the acceptance of an offer made before that date;”Member's explanatory statement
This brings the wording in clause 148(7)(a) into line with the wording used in the new Part 2 that would be inserted into Schedule 6 by the amendment in my name.
Member's explanatory statement
This amendment is consequential on the new Part 2 that would be inserted into Schedule 6 by the amendment in my name.
(a) fall within subsection (6)(b), or(b) amend or repeal provision made by Part 2 of Schedule 6 to this Act,”Member's explanatory statement
This provides that regulations made under section 148(3) which make transitional or saving provision by amending or repealing provision in Part 2 of Schedule 6 to the Act are subject to the affirmative procedure.
Renters’ Rights Bill
Tuesday 1st July 2025
(1 year, 1 month ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 103-I(b) Amendment for Report (Supplementary to the Marshalled List) - (1 Jul 2025)
17:33 - Division on Amendment 5 - Ayes: 221 / Noes: 196 - Amendment 5 agreed.
18:20 - Division on Amendment 8 - Ayes: 253 / Noes: 150 - Amendment 8 agreed.
18:53 - Division on Amendment 21 - Ayes: 230 / Noes: 137 - Amendment 21 agreed.
19:05 - Division on Amendment 23 - Ayes: 169 / Noes: 176 - Amendment 23 disagreed.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we start the debate on the first group, I want to repeat my reminders to the House in Committee on declaring interests. As we set out previously, noble Lords should declare relevant interests at each stage of proceedings on a Bill. That means that in their first contribution on Report, noble Lords must declare any relevant financial interests in a specific but brief way. Declarations do not need to be repeated in subsequent speeches on Report. As my noble friend the Chief Whip reminded the House last week, it is no longer sufficient to say that interests are set out in the register.
Clause 1: Assured tenancies to be periodic with rent period not exceeding a month
Amendment 1
Lord Hacking
“unless the landlord and the tenant mutually agree to have a fixed term during which period the landlord agrees to suspend the ability to seek possession under Ground 1 (Occupation by landlord and family), Ground 1A (Sale of dwelling house), Ground 1B (New ground for possession after rent-to-buy agreement) or Ground 6 (redevelopment) in Schedule 1.(1A) During a fixed term tenancy agreed under subsection (1), the landlord shall not be entitled to increase the rent.”
Lord Hacking (Lab)
My Lords, I start off with my declaration, which is in the register, that my wife and I own five one-bedroom flats in the next-door house to ours, and we have been renting out those flats for the last 30 years.
As we approach the 126 amendments now tabled for Report, and before I introduce my Amendment 1, I suggest that we take stock of where we are after seven days in Committee. I start by giving praise to my noble friend the Minister. Throughout Committee, she was always very well briefed, and she spoke to every amendment with great politeness, naming and thanking everyone who spoke. She was always available to have meetings and discussions about the Bill. I know, too, from her days as a councillor in Stevenage, about her great concern that landlord and tenant legislation should not make families homeless—she feels that very strongly. I say to her: thank you, Sharon.
However, there has been a big problem. Out of the 300-odd amendments tabled in Committee, the Government did not accept a single one—I think I am right in saying that; if I am wrong, I hope that somebody will correct me. It is true that, in the Minister’s letter of 24 June, the Government, through the Minister, have accepted three amendments. I am very grateful for that, but that is a very small number against the rejection of 300 amendments. By applying normal averages, it cannot be right that the Government were always right in Committee on all these amendments and that the rest of us were always wrong.
Moreover, in Committee, there was considerable expertise in landlord and tenant matters among Members of the House. At least a dozen of us have had that direct experience. At least half a dozen of us were declared landlords of the good and honest variety. When I joined this House 53 years ago, there was good willingness in the House to listen to the expertise of its Members—after all, that is what we are here to provide. It now seems that the Government were not prepared, during the passage of the Bill, to listen to the expertise of the House. To put it bluntly, the rejection of over 300 amendments shows that they are not listening to this House. I do not blame the Minister; I simply do not know who was responsible for the decisions that resulted in those multiple rejections.
The consequence is quite serious. As I will seek to show in relation to Amendments 1 and 41, there have been occasions when the Government have got it plain wrong, because they were not listening. As a Labour Back-Bencher, I want the Government to succeed—and they would do that much better if they were able to listen more. Therefore, on Report, may the Government start listening to us.
The purpose of Amendment 1 is to allow landlords and tenants, if they wish, to agree a fixed-term tenancy. My and my wife’s experience is as follows. We have nearly always let 12-month tenancies to our tenants. Our tenants—currently the whole lot—are couples in their 30s who are planning to own a home of their own. It therefore suits us, as well as our tenants, to agree a 12-month tenancy. After the first 12 months, we meet to discuss whether our tenants want to stay on for another 12 months; they sometimes want to stay on for three or four years or even longer. If any of them want to go early, within the 12-month period, we give full co-operation. We immediately seek new tenants. The outgoing tenants pay their rent as long as they are present in their flat and not thereafter when the new tenant has arrived. Indeed, I do not think that we have ever failed promptly to find new tenants, which is because we let out lovely flats with private use of the garden at the back of the house.
Lord Truscott (Non-Afl)
My Lords, I support Amendment 1 in the names of the noble Lord, Lord Hacking, the noble Baroness, Lady Scott of Bybrook, and the noble Lord, Lord Jamieson. As mentioned previously, I have an interest as a landlord of over two decades, and as a former renter in the private rented sector for some 16 years, I have a combined experience in the PRS of 40 years.
The amendment before your Lordships’ House would allow a tenant and landlord to mutually agree a fixed term, as we have just heard, while restricting the landlord’s ability to regain possession of a tenanted property. It would further mean that the landlord would not be able to increase the rent over the period of the fixed term. Very many tenants would welcome such agreements and the increased security it would give them. Under the proposed periodic tenancies, after 12 months tenants would have no security as the landlord can seek possession on a number of grounds.
Polls have shown that a majority of tenants and landlords want to have fixed terms, and His Majesty’s Government have given no reason why they think they know best. The arguments against mutually agreed agreements on fixed tenancies are, frankly, unconvincing and threadbare. They result in more, not less, security for tenants, and less chance of familial disruption. The Renters’ Rights Bill rightly cracks down on rogue landlords, improves standards in the PRS and seeks to ensure a fair, workable and sustainable rental market.
Noble Lords may recall my Amendment 173 in Committee, which called for tenants to give notice not earlier than four months after agreeing to an assured tenancy, resulting in a minimum tenancy of six rather than two months. Why are the Government insisting that six months would be a disaster, as under today’s assured shorthold tenancies, but two months will be a panacea? The outcome of exclusively two-month periodic tenancies will be less security for tenants and landlords alike, and higher rents.
While I accept the need for flexibility for tenants, I do not see why an additional four months should be regarded as so unacceptable by the Government. Responsible landlords require the certainty of a minimum period to defray the cost of establishing a new tenancy. Many of these costs are one-off and cannot be passed on to the tenant under the Tenant Fees Act 2019. These cover things such as cleaning, inventories, referencing, credit checks, admin and so forth. A higher turnover of tenancies under periodic tenancies, and the financial risks associated with it, will otherwise put up rents. All long-term tenancies could potentially turn into short tenancies and the landlord will have to factor that into the rent. Another concern of landlords will be if a tenant quits in the middle of winter, when much fewer tenants are seeking rental properties. Rentals are often seasonal, and longer void periods will be the outcome. Again, this will be reflected in higher rents.
Ministers argue that it is highly unlikely that tenants will move in and out of rental properties, in effect turning long-lets into short-let properties. But that is exactly what will happen in many cases, especially in coastal resorts and city centres, already plagued by Airbnb and other short-let platforms. Figures produced by Hamptons show that properties being marketed as short-term lets are advertised at prices on average 49% higher than the same types of property for long-term rent. In the London Borough of Camden, short-lets can cost four times higher than long-lets. Deposits for short-let properties are about the same as those for long-term rent. This would make it cheaper for tenants to just rent a long-term property for two months than secure a short let for the same period.
To suggest that people will not game the system is naive. Why would short-term tenants volunteer to pay up to four times the amount of rent when they can save themselves thousands of pounds taking a property advertised for long-term rental for just two months or even less? On day one of the tenancy, they will have the legal right to give two months’ notice. Two-month period tenancies will open the floodgates to legal backdoor short lets which will be impossible to police. This will have other implications, which we are already witnessing. Landlords will gravitate increasingly to short-let platforms such as Airbnb which are more profitable than long lets and virtually unregulated.
With the associated abolition of upfront payments, which will make vulnerable people, the self-employed, pensioners and students—including foreign students—unable to prove their income, why should many landlords continue to take the risk when there is a more profitable alternative? In any event, only 7% of tenants pay anything up front, so I fail to see why this is also an issue for HMG. Banning upfront payments, which your Lordships will discuss later, was very much a last-minute government amendment in the other place, and I suspect it was badly thought through.
All this will result in fewer long-term rentals being available to tenants, less security and a profound shortage of long lets for local people in tourist hotspots. It is already happening, as people in Cornwall, Devon and Wales will know.
Nothing in the Bill will increase the supply of rental property in the PRS which, by some estimates, needs an extra 50,000 rentals per year just to stand still. A six-month minimum tenancy would underpin the viability of the PRS and ensure that more homes, not fewer, are provided for those tenants who need and want a long- term home.
Those should be where people need homes; those landlords entering the market at the moment tend to chase higher yields in the north, ignoring the south, where buy to let is rapidly becoming unprofitable. A six-month minimum fixed tenancy, if mutually agreed, gives all parties plenty of flexibility. As the noble Lord, Lord Hacking, mentioned, many tenants prefer to have even a 12-month fixed tenancy to give them added security.
The amendment would also implement a recommendation by the Levelling Up, Housing and Communities Committee in its report on reform of the PRS in 2023, chaired by the very knowledgeable Labour MP, Clive Betts. The recommendation was
“that tenants be unable to give two months’ notice to leave until they have been in a property for at least four months”.
It noted:
“This will give landlords the legal certainty of at least six months’ rent at the start of the tenancy”.
After this period, the tenancy agreement could continue on a periodic basis as envisaged by this Bill.
I fear that, unless His Majesty’s Government amend the Bill on fixed terms and upfront payments, it will make the PRS unstable, uncertain, increasingly expensive and less viable, which would be bad for both tenants and landlords. Sadly, His Majesty’s Government are showing no sign of introducing the significant amendments necessary. As the noble Lord, Lord Hacking, said, the Government listen but take no notice. As we have seen in the other place, this does not always work out well.
On 28 April, the noble Baroness the Minister, who cannot be accused of not listening, told the Committee:
“We are committed to robustly monitoring and evaluating the impact of our reforms. We retain powers to amend these measures should the evidence arise that they are having a significant impact on a particular group … We maintain the powers to amend, should we need to”.—[Official Report, 28/4/25; col. 1085.]
I hope that His Majesty’s Government bear this very much in mind, before some of the unintended consequences and regrettable flaws in the Bill see the light of day. I was just one of 26 Peers who voted against HS2 in your Lordships’ House, and it gives me very little pleasure to say after the event “I told you so”.
Lord Fuller (Con)
My Lords, I shall speak strongly in favour of Amendment 1. I declare my interests as I rent properties in Norwich and commercial properties in Great Yarmouth through a directorship.
We live in a free-market economy, which is underpinned by the law of contract, a codified agreement between consenting counterparties. Of course, we must have safeguards and regulatory guard-rails to ensure that one party does not hold the other over a barrel, but the freedom of contract so that mutual needs can be codified and agreed is a fundamental part of the way in which we live and is one of the reasons why we have so many learned friends in this place.
I want to give some examples, from my experience as a landlord, of the type of persons who value the ability to customise the standard contract to suit themselves by entering into a fixed term. It is not the majority, but it is a significant proportion that cannot just be wished away. They include: employees on a fixed-term employment contract engaged in a particular project; students, singly or more commonly in groups, who want to secure their ideal house in advance and are able to do so only if the current occupants are sure to vacate in the summer; the busy doctor, who gets passed around the hospitals each August; and the foreign person, who is used to the concept of fixed terms in their own country and cannot understand what business it is of the state to interfere in these private arrangements. Those tenants value contract certainty so that they can focus on their work and generate wealth for our nation.
I like this amendment because it gives an additional benefit to the tenant: not just the fixed tenancy but the fixed rent. That seems a fair compromise, not least because the landlord does not need to price uncertainty into the contract—the uncertainty of a void. As a landlord I value certainty, even at the expense of locking out rent rises, because if I know there will not be a void, I can give a better price and everybody wins. I cannot see what is wrong with that.
The Government boast a commitment to
“transform the experience of private renting”.
They are doing that all right; they are making it harder for a significant minority to meet their reasonable needs. There are so many unintended consequences—the noble Lords, Lord Hacking and Lord Truscott, mentioned some of them. For a moment I thought I was going to be on my own, but I am delighted to see that there is cross-party consensus on the importance of this amendment.
I too was thinking about the abuse in holiday hotspots, where it is common ground that we want to encourage year-round occupation of homes in these coastal areas—although not the second council tax that appears to be emerging alongside. I fear the unintended consequences of this Bill. Let us contemplate a tenancy in Cornwall, taking on in June. The proposed tenant says, “Yes, I’m going to stay for a whole year”, but in the event they leave just after the August bank holiday. The problem is that by giving two months’ notice, it is a clear abuse; and to counter that abuse, landlords will factor in the risk of the vacancy. So they will jack up rents, and the person who genuinely does want to stay for the whole year is disadvantaged. Of course, they may wish to show good faith by paying in advance, but that will be discarded as well. I just cannot see how this helps anyone.
I will talk about students in more detail later, but I am concerned that we are going to seriously disrupt the student market, not just for their convenience. Often in freshers’ week—I saw it in my own experience when I was younger—friendship groups get rammed together and pretty quickly decide they want to go into a house together, and why not? Halls do not suit anybody. The purpose of the fixed tenancy is the discipline that binds them all together. They are not related—at least not when they start; I have been in houses where that does happen—but you get a situation where one person may want to quit half way through, and it reverses the obligation. Rather than that person being forced to find another student to take his or her place, it becomes the obligation of all his former friends to undertake that core activity. The responsibility is flipped, and I do not think that is good either.
There are so many other things I could say, but this is a good amendment. It does not wreck the Bill but enhances it. It works with the grain of the way a significant minority of people, consenting adults, wish to conduct their affairs and come to a sensible contract for those it suits. I agree strongly with what the noble Lord, Lord Hacking, said. There are limits to where the state should interfere; it should allow free citizens to exercise the choices that they should be entitled to make. This amendment deserves our full support.
Baroness Thornhill (LD)
My Lords, I listened almost with shock at what noble Lords were saying because I feel as if I am living in an alternate universe. They live in the cosy one—I smiled when the noble Lord, Lord Hacking, talked about him and his wife as landlords, and I can absolutely believe that his tenants loved him and enjoyed living with him. But sadly, that is not reality—it is not the situation. People say the Government have no right to interfere; if a Government have no right to interfere in making a roof over people’s heads—the basic issue of having a home—part of government business, please tell me what they can interfere in. Defence of the realm, yes, but ensuring that people can have a safe, secure, affordable home certainly has to be the business of government.
This Bill is scarily radical. I am often guilty of saying that the rhetoric does not match up to the reality, but the rhetoric around this Bill—the biggest changes since whenever, radically changing the system—is correct. The system is meant to be changed because it is broken. It is very brave and very bold. His Majesty’s Official Opposition probably think it is very stupid, which they are entitled to think because that is their job. The real issue around this Bill is that we are leaping into the unknown. We do not know what the impact will be. We have been told that Armageddon will happen; we will have to see. We and the Official Opposition do agree that there should be formal reviews in the Bill where its impact can be scrutinised in Parliament in full—because it is that radical.
Baroness Scott of Bybrook (Con)
My Lords, I declare my interest as vice-president of the Local Government Association. As we begin the first day on Report, I would like to start by thanking the Minister for the meetings she has held with me and my noble friend Lord Jamieson on the Bill—we really appreciate those meetings.
I suspect that, since Committee concluded, few days have passed without Members of your Lordships’ House receiving a steady stream of questions, concerns and comments about the Bill, because despite the Government’s amendments, it remains, in our view, a flawed Bill. It is a Bill that uses the powers of government to tell two consenting adults that it knows best; a Bill that fails to acknowledge the realities of the rental market and the consequences it may bring. We are united in the belief that tenants deserve safe, secure and decent homes at a fair price, but to deliver that, we must ensure a functioning rental market with enough good quality homes to meet growing demand. That means building more homes in the right places and encouraging investment in this sector.
Regrettably, this Bill puts that at risk. Rather than increasing supply, it threatens to drive landlords out of the market, reducing the number of available homes and pushing up rents even higher. If we get this wrong, it will be the renters who pay the price. Balance is essential, and we on these Benches do not believe the Bill strikes the right balance. The Government should have brought forward a Bill that targets rogue landlords—those who break the law, put tenants at risk and undermine the proper functioning of the rental market. Instead, we have this Bill, which risks driving out good landlords while allowing the rogue ones to continue operating completely unchecked.
I thank the noble Lord, Lord Hacking, for leading on this group, and all noble Lords who have contributed to the debate. Diversity, choice and a range of tenancy contracts all contribute to a housing sector capable of meeting a wide variety of needs, as we have heard. In that context, it is reasonable to ask the Government why they are pursuing a one-size-fits-all approach through the proposed abolition of all fixed-term tenancies. Having listened to the contributions in Committee, it is clear that there is widespread concern about this element of the Bill. The noble Lord, Lord Hacking, is right to challenge the blanket removal of fixed-term tenancies and to reintroduce much-needed flexibility into what is currently a very rigid clause.
Industry stakeholders share these concerns. Propertymark has warned that abolishing fixed terms could destabilise the position of tenants with lower incomes or poor credit histories. Many of these individuals rely on guarantors, who, in turn, require the legal certainty of a fixed term. Without that structure, these tenants may find themselves excluded from the market entirely, excluded from finding a home, and excluded from getting on with their lives. These tenants include students without parental support, young adults leaving care, and individuals with health conditions or irregular employment. They often rely on guarantors to access housing, but those guarantors understandably require the legal certainty of a fixed-term contract. Without that assurance, the door to the rental home quietly but firmly closes.
The Government’s rebuttal is by now well-rehearsed. They claim there is no cause for concern because tenants will have the ability to give two months’ notice, thereby shaping the tenancy to their preferred timeframe. But this argument is weak and raises serious questions. How can it be right to require landlords to fundamentally alter the contracts they offer? How is it reasonable to expect a landlord to accept a tenant who cannot demonstrate their ability to pay, particularly in the absence of the legal structure and certainty that fixed-term agreements provide. Equally, why should tenants be denied the option of a fixed-term tenancy if they believe it best serves their interests? Removing that choice is not empowering, it is restricting. Tenants, like landlords, have diverse needs and circumstances. Many actively seek fixed-term arrangements because they offer clarity, stability and peace of mind. For tenants in transitional phases of life, that assurance is vital. A fixed-term tenancy can provide security that their home cannot be taken away, even within the grounds of possession remaining. This is particularly important for those on temporary contracts, such as nurses relocating to hospital placements, families seeking to remain within a particular school catchment area or individuals from overseas who require time-limited accommodation.
To remove fixed-term tenancies is to ignore the lived realities of both tenants and landlords and to strip the sector of the very flexibility it needs to function effectively. For landlords, fixed terms provide the certainty required to plan and manage their properties effectively. Removing that certainty could prompt many to exit the sector, and already is, further reducing the already strained supply of rental housing. Ironically, this supposed flexibility could leave both tenants and landlords facing greater instability.
The proposed abolition of fixed-term tenancies may lead some homeowners who currently let their properties on a fixed-term basis to withdraw from the market altogether. Faced with the uncertainty of an open-ended tenancy, some may even choose to leave their properties empty rather than risk loss of control over future use. Why are the Government not listening to landlords, the very people who maintain the foundations of the private rented sector? They are not just participants in the market; they are the backbone of the market. We on these Benches support choice and the freedom to decide a contract that works for both the tenant and the landlord, and I hope the rest of the House agrees. We will support the noble Lord, Lord Hacking, if he tests the opinion of the House.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank my noble friend Lord Hacking for his very kind comments and—with slightly less enthusiasm—for this amendment, which would retain a form of fixed term, during which the landlord could not use a number of “landlord circumstance” grounds, including selling. My noble friend referred to his role as a landlord, and I agree with the noble Baroness, Lady Thornhill: I am sure he is a very good landlord. Good and honest landlords have nothing to fear from the Bill; it is not them we are dealing with here
The issue of fixed terms is one we have debated at some length and on which I know there is great strength of feeling on both sides of the House. For many noble Lords, this is an issue of free will. They believe that the Government should not interfere in a tenant and landlord’s ability to agree terms between them, and that both parties should have the choice between a periodic or fixed-term tenancy. In my view, however, that argument mischaracterises the balance of power between tenant and landlord in any negotiation. Here, I agree very strongly here with the noble Baroness, Lady Thornhill. Landlords have the choice of many tenants, all competing to offer the most favourable terms, while tenants have far less opportunity to choose between properties. Tenants cannot simply walk away if they do not like a landlord’s terms—a choice between homelessness and a fixed term is no choice at all.
To speak to the points raised by the noble Lord, Lord Fuller, it has been symbolic of that imbalance that, until this Bill, landlords have been able to issue a Section 21 eviction notice and remove tenants through no fault of their own. Not only does that cause distress to families; it also places a huge burden on the state as our beleaguered local authorities pick up the cost of over 100,000 families in emergency and temporary accommodation. It is therefore incumbent on the Government to ensure that tenants do not lose out. We must step in to ensure that tenants are not forced into agreeing unfavourable terms that act against their interests and remove fundamental rights to move when needed.
I accept that fixed terms have some benefit for tenants under the current system because they offer some respite from the awful threat of Section 21, which hangs like the sword of Damocles over tenants’ heads. With Section 21 gone, that advantage will be extinguished, so there is even less reason why a tenant would agree voluntarily to a fixed term. Even if freely agreed, there is nothing equal about a fixed term. Under the current system, landlords can rightly seek possession during a fixed term if a tenant breaches the terms of their rental. Possession grounds are available if a tenant misses rent payments, damages the property, commits anti-social behaviour or indeed breaches any term of their tenancy.
Noble Lords would then imagine that, in a fair contract, a tenant could also terminate the tenancy if the landlord failed to fulfil their responsibilities during the term, but in almost all cases tenants do not have this choice. Landlords can allow properties to fall into disrepair, leave properties unsafe to live in, and still tenants must pay rent month after month. This is fundamentally unbalanced. It is critical that we act to reset the scales.
Lord Hacking (Lab)
My Lords, before I reveal my answer to the question just put to me by the Minister, I will make a few observations. The central one I have already made: under English contract law, parties are entitled to agree what they want to agree, and they are entitled to agree to a fixed-term tenancy. I have illustrated —as has the noble Lord, Lord Fuller, with students—the value to the tenant of having a fixed term. It has been so with our many tenants over the last 30 years; it runs to their benefit.
I thank all those who have taken part—the noble Baronesses, Lady Scott and Lady Thornhill, the noble Lord, Lord Truscott, and the noble Lord, Lord Fuller. It would have been a dangerous thing for me to do, with the Chief Whip sitting in front of me, but I was minded to divide the House on this issue. However, I do not have the support of the noble Baroness, Lady Thornhill, and that of the Liberals. I am not quite sure about the Cross Benches; the noble Lord, Lord Cromwell, has not participated, so he has given me no comfort that I will get support from the Cross Benches. Therefore, it is with great regret that I feel I must withdraw the amendment, which I believe was very carefully drafted and provided all the protections necessary on an agreed tenancy. It was, therefore, a good amendment that, alas, is now being lost as I beg leave to withdraw it.
Baroness Scott of Bybrook
“unless the tenant meets the student test when the tenancy is entered into.(1A) For the purposes of this section, a tenant who meets the student test when a tenancy is entered into has the same meaning as in Ground 4A in Schedule 1.”Member’s explanatory statement
This amendment would allow student tenancies to remain as fixed tenancies to provide the certainty that both student tenants and student landlords require.
Baroness Scott of Bybrook (Con)
My Lords, at the heart of the Bill is a duty to protect young people, because it is primarily young people who rely on the private rented sector. Students are no exception: many are leaving home for the first time, stepping into higher education with courage and ambition. For them, the need for clarity, stability and fairness in housing is especially pressing.
Fixed-term tenancies for students, as proposed in Amendment 2, are not a loophole; they are a solution that works. They have brought order and predictability to a cyclical market. The Government recognise this, having already made concessions for purpose-built student accommodation, but that exemption applies only to the most expensive end of the market. What if the student cannot afford a glossy new block with a gym and a neat working space, and instead shares a modest flat in a converted home? We urge the Government to take a consistent approach and extend this provision across the board, because there is a great student migration and a releasing and re-letting of homes at the end of each academic year. It is a finely balanced cycle, and if we tamper with it blindly, we risk breaking it altogether.
That cycle is already under pressure. Student towns and cities are seeing a decline in student-appropriate housing. If we continue down this road, we will put higher education out of reach for many, in particular those from disadvantaged backgrounds who rely on affordable shared housing.
That is why my Amendment 5 is so vital. The current restriction on ground 4A, which limited it to properties with three or more bedrooms, is both arbitrary and unfair. Many students, in particular postgraduates, international students and mature students, live in one-bedroom or two-bedroom properties. In Committee, the Minister said:
“Limiting it to HMOs captures the bulk of typical students”.—[Official Report, 22/4/25; col. 589.]
The Minister is right: it captures the bulk, but not all of them. When housing is scarce, we need all available options. When choices are limited, we must protect every viable home. Let us be clear: ground 4A is not about throwing students out of their homes, it is about ensuring that landlords can confidently re-let for the next academic year and that students can confidently plan their lives.
Amendment 6 rightly asks why six months has been chosen as a cut-off point for ground 4A. This blanket time limit could disrupt rental cycles, discourage landlords from letting to students and ultimately shrink the student housing supply even further.
The Government worry that students may rush into housing decisions too early. That may be true for some, but many students want to secure accommodation early to avoid the stress during exams. Many student tenancies begin in late summer, and students typically start looking well in advance. Limiting searches to up to six months before an August move-in means starting in February. Under the current proposals, properties may not be listed until much later in the year, forcing students to house-hunt during their final exams. That is not necessary, fair or workable. The Government should let students decide when they wish to sign the contract.
Without fixed terms and a workable ground 4A, students will face prolonged uncertainty, and it will be harder for them to plan, budget and study. We must also remember that eviction proceedings are exceptionally rare in this market. The problem is not landlords turfing students out but students facing unnecessary delays and stress when trying to secure accommodation. The current proposals simply do not address this reality.
Finally, Amendment 7 seeks to include apprentices in the definition of students. Like university students, they would benefit from a fixed-term tenancy aligned with their training periods, offering much-needed stability. I hope, having listened to the Government’s arguments in Committee, that they have reflected and that we can agree that it is only fair that apprentices and their landlords have access to the same arrangements as university students.
The Government have already made partial concessions, but now we need a principled and wholehearted attempt to preserve a functioning, fair and inclusive student rental market. Amendments 2, 5, 6 and 7 are constructive and proportionate. They reflect what is already working, they address what is currently broken, and they would help ensure that going to university remains a viable choice for young people across the country. I urge the Minister and the House to support these amendments. We would be minded to test the opinion of the House, for the reasons that I have underlined. I beg to move Amendment 2 in my name.
Lord Fuller (Con)
My Lords, I declare once more my interest as a landlord who rents properties, often to students. Your Lordships will be delighted to know that I will not be jumping up and down on every group today, but I do want to challenge the quite obstinate prevention of fixed tenancies for students—and, importantly, groups of students—many of whom will be moving into their first home outside hall.
I want to outline some of the adverse consequences of this Bill if enacted unamended. It will reduce the supply of rental properties by discriminating against private landlords. The noble Baroness, Lady Thornhill, speaking in the earlier group, seemed to fail to understand the dynamic effect: if landlords leave the market and there is lower supply, costs will rise and students will pay more.
It will reduce the choices of property available to students, because this Bill allows student tenancies only in halls of residence. This will not suit everybody. It reduces the choice of landlord. It favours the monopoly supplier—the institutional provider of halls of residence —rather than the private landlord. In my personal experience, my wife has become “mother”, so to speak, in particular to foreign students who have rented with us on their first time overseas. All that will be swept away, because institutional providers of student accommodation do not have that in their ambit.
It will create an overheated market in September, that is for sure, and—guess what?—that will cost more for students. It will also cause massive inconvenience for second-year and third-year students at university. I agree with my noble friend that this should not be just about universities; those with apprenticeships should also benefit from these amendments. But it means that second-year and third-year students will have to fly back. They may have got a work placement overseas. They will have to fly back early to try to secure a home when they could have sorted it out well before, in February or March.
The consequences of this Bill mean that it will be harder for friendship groups to get the certainty of a house with their friends. I have mentioned issues around clearing. The Bill will prefer established students from good backgrounds, with parents with sharp elbows, who understand and are able to transact draft contracts more quickly. It will aggravate the difficulty of getting guarantors lined up at pace.
It introduces protections for the current students— I heard what the noble Baroness, Lady Thornhill, said in the previous group—but we need to balance that against the disadvantage to students one year behind, who also have rights and who also want to secure a place in their following year.
Students will be forced into these new student blocks. Some of them are really luxurious. There are cinema rooms and pizza places—the whole thing—but it is costing a fortune, and not everybody wants to go to that expense when they can make savings in the private market.
I spoke earlier about the importance of the fixed tenancy, which is a discipline that keeps everybody together and protects everybody’s interests. It is important that we dwell on this, particularly for students. Unlike in the wider private rented sector, where family relationships or other stronger forms of relationship exist, friendship groups at university can be more transient. We have spoken a lot already about the balance of power between tenant and landlord, but we should also consider the balance of power when someone in a friendship group in a house wants to cut and run, leaving his former friends high and dry. That is a real perverse situation that runs against natural justice and good order.
Lord Willetts (Con)
My Lords, I support the excellent amendments proposed by the noble Baroness, Lady Scott, in particular Amendment 5, which strongly resembles an amendment which had cross-party support at an earlier stage of our deliberations on the Bill and I hope will continue to have that support. It seems to me that the proposals that we have before us will lead to a two-tier system, in which advantaged students who can afford the higher rents will go into the purpose-built accommodation, but the lower-cost, more flexible accommodation—often smaller, private lettings—will be much reduced, and that will be very bad news for access to university.
I do not by and large believe conspiracy theories, but on this occasion I think that the interests of the Ministry of Housing, Communities and Local Government are very different from the interests of the Department for Education. If students are no longer travelling to university so much, if some students are deterred from this accommodation, and if other types of tenants move in instead, that is not a problem for the department sponsoring this Bill; in fact, it might almost be a help. It will then be able to say that other people have been able to find private rented accommodation and the adjustment has been borne by a particular group of students. Meanwhile, the Department for Education, with its commitment to social mobility and opportunity, will be facing the consequences of fewer students going to university since they cannot afford the high-rent environment which is now being promoted. So, I am concerned that the department steering this Bill is not taking proper account of the legitimate interests from a different perspective of education and social mobility.
I very much regret that the Minister, despite her courtesy in meeting up with myself and others, which we have appreciated, has not been able to make any concessions, even moving from three rooms to two rooms or one room. I hope at least, however, she will be able to flesh out a statement she made a few minutes ago in the debate on the previous amendments, when she said that the Government would “continue to monitor the market”. Will she assure the House that this monitoring of the market will include monitoring student access to the private rented sector as part of their participation in higher education?
Baroness Wolf of Dulwich (CB)
My Lords, I too offer strong support to Amendment 5. In that context, I declare an interest as an employee of King’s College London.
The profound change, in varying ways, to the rental market that the Bill will introduce is not very well understood outside this Chamber, but some of the people who have become very aware of it, in my experience, are people who currently let to students. I first became aware of this when told by a number of people that they do not see themselves letting to students in future, thank you very much. These are people who have small rental properties. I know that that the noble Lord, Lord Willetts, whose amendment I was happy to support in Committee, is also aware of this. He has highlighted the fact that we now have a bifurcated system.
The Government have rightly acknowledged that student housing is a major issue and have introduced some clear provisions that cover purpose-built student accommodation, and indeed student halls, but fail to cover anything that does not have at least three bedrooms and is being let to students. The problem is that a large proportion of the cheaper student housing outside major cities is of exactly that type. What somewhat astonishes me is that we have a situation in which there is not likely to be any harmful impact on the provision of student housing at the expensive top end of the market but a very major impact on smaller, cheaper rental properties at the lower end, which are of course the ones taken by students from lower-income families and people who are not in the major cities but are in other places. I am somewhat puzzled that the Government have been so determined not to extend ground 4A to, at least, properties with two bedrooms. I really do not understand it and I therefore strongly support the amendment.
I would like to lay something for the future about Amendment 7. I notice that it is a probing amendment and, of course, apprentices are not students—they are employees, many of them rather adult employees—but in future, if and when we revisit the issue of making accommodation easily available to people who are, in effect, students, and that will include apprentices, we should pay this considerable attention.
If we look back 200 or 300 years, especially in London, we see that it was full of apprentices who had come from elsewhere in the country. They served their apprenticeships in London and then went back out, and they could do so because part of being an apprentice was that you lived with your master. We do not have that any more, and the result is, again, enormously reduced opportunities for people who live in less economically advantaged places. If you are a low-income school leaver, you will have far fewer apprenticeship opportunities open to you in your hometown, and we are not doing anything to make accommodation easily available to apprentices who might want to be employed in economically more favoured regions.
Apprentices are not students so it is too late for this Bill to do anything about them, and it probably was not possible anyway, but I flag this conundrum as something that—if we ever come back, review the consequences of the Bill and make some changes—I hope the Government might put something on the table about at the same time.
Lord Shipley (LD)
My Lords, I remind the House that I am a vice-president of the Local Government Association. In Committee I was one of those probing the Government’s intentions on purpose-built student accommodation, houses in multiple occupation—HMOs—and the application of ground 4A to those properties but not to smaller units in the private rented sector that some students might choose to live in.
I listened very carefully to the Minister’s reply in Committee and have thought further. Indeed, I have listened carefully to the debate so far and I am sorry to have to disappoint the noble Lord, Lord Willetts, although I agree with him that it will be very important for the Government to monitor the impact of the student market on the private rented sector. I will explain why I take that view.
I have reached the conclusion that there is a good reason to restrict the application of ground 4A to purpose-built student accommodation—the very large blocks—and houses in multiple occupation. The danger of not doing so is that some unscrupulous landlords renting smaller units of accommodation which do not qualify for the term HMO might decide to call tenants students when they are not students, to get around the provisions of the Bill. I think that would be a serious defect in the Bill. Indeed, as the Minister said in her reply on this issue in Committee:
“The core principle of the Bill is that tenants should have more security in their homes, and we think it is right that these groups should not be exposed to potential eviction using ground 4A”.—[Official Report, 22/4/25; col. 589.]
I have come to the conclusion that the Minister is right on that matter and, for that reason, ground 4A, I submit, should be restricted to purpose-built student accommodation and houses in multiple occupation.
Lord Fuller (Con)
It is quite straightforward that we know who students are. The universities issue certificates and those certificates are handed to the local authority in the case of council tax, so they can get the 100% council tax allowance. It is not difficult to identify who those students are. Does the noble Lord agree? Has he thought whether the existing statutory process for determining who a student is would be sufficient to avoid the jeopardy that he has suggested?
Lord Shipley (LD)
The very point that the noble Lord raises is that I do not think it would be sufficient. Indeed, when I spoke on this issue in Committee, I suggested that the council tax register, because whole-student households do not pay council tax, would potentially be sufficient; I just do not think that is the case. It is not just about university accommodation. it is about students more generally. Indeed, there is an amendment coming up on the Marshalled List to define who is a university student. So I think it is a great deal more complicated than the noble Lord, Lord Fuller, has indicated to us.
I have concluded that those students who are in smaller units of accommodation will be protected anyway, as tenants under the Act. I have concluded that, on this matter, the Government should be given the benefit of the doubt, but I hope very much that the Minister will be able to meet the point made by the noble Lord, Lord Willetts, which is that they have to keep this matter under review.
The Earl of Lytton (CB)
My Lords, as this is the first time I have addressed the House at this stage of the Bill, I will just remind your Lordships that I am a chartered surveyor. I think that is probably the only interest I need to declare, other than being the father of three children. They are now long out of university, but I witnessed the process of them living in halls and subsequently in the private rented sector, two of them within the city of Bristol, and I got to know one or two of the people who let to students as a business model. The properties are not necessarily large—some of them are very small; it depends on what model they are using. I am worried about what seems to be an acceptance of what the Minister said will be a process of review.
Review done by government is an incredibly blunt and ponderous instrument. I predict that if there was a review looking at a particular problem, a lot of serious damage would have occurred by the time it had been completed or the matter actioned and put into regulation, or whatever other form it was going to take.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, for her amendments on students, and all noble Lords who have participated in this debate. As noble Lords will be aware, the proposals on student accommodation have been subject to great consideration and debate both inside and outside this Chamber and in the other place. I thank all those who have written to me, and I am sure to other noble Lords, on this subject.
Amendment 2 seeks to retain fixed-term tenancies for students living in private rented accommodation. I can only repeat that fixed terms serve only to lock tenants in. They oblige them to pay rent even if the condition of the property is poor, or if their circumstances change and they need to move out as a result. In the current system of fixed-term tenancies, we often hear of students who have dropped out of university but are still obliged to pay rent for their accommodation— I could mention some examples, but it is probably not appropriate to do so. This is not the right approach. We want all tenants, including students, from whichever demographic group they come from, to benefit from the increased security and flexibility that the Renters’ Rights Bill provides.
Students pay the same rent—often higher rents—as other tenants and so should have the same rights as everyone else. We have introduced a new possession ground to allow the cyclical nature of the student market to continue and to provide landlords with confidence. I recognise that the noble Baroness is trying to create parity between students in the private rented sector and those in purpose-built student accommodation, as their tenancies will be exempted from the assured system and landlords will be able to offer fixed-term tenancies. However, we have exempted purpose-built student accommodation from the assured tenancy system due to its unique business model. Often, PBSA cannot be let to non-students due to its location or the services it provides alongside accommodation.
We have also exempted this sector from the protections of the assured tenancy system because we are satisfied that the Unipol codes of management practice provide an alternative route to ensuring that tenancies are at a high standard. There is no such code for private student landlords, and it would be wrong to mirror the exemption.
In answer to the noble Lord, Lord Willetts, who asked about monitoring—
Baroness Scott of Bybrook (Con)
I am sorry to interrupt, but does the Minister accept that purpose-built student accommodation is for the more wealthy? Young people who are struggling to go to university will go with the private rented sector and not the expensive specific accommodation. Has she done any work on that, and does she realise that that is what is happening out there?
Baroness Taylor of Stevenage (Lab)
Students who take up accommodation should have the same rights as anybody else who is taking up accommodation. That is why we do not want to exempt from the benefits of the Renters’ Rights Bill students who want to rent in the private rented sector.
To come on to the point from the noble Lord, Lord Willetts, about monitoring, we will monitor this element of the Bill, along with all aspects of it, and I will give noble Lords more detail about that—it comes up under a future set of amendments, but as he has asked the question, it is important to respond to it. We will evaluate the process, impact and value for money of the reforms in line with the department’s published Housing Monitoring and Evaluation Strategy. The evaluation will involve extensive data collection through interviews, surveys and focus groups with a range of stakeholders, as well as trusted data sources. We will talk to tenants, landlords, letting agents, third sector organisations, delivery partners, the court service and government officials. I will say more about the court service later on, because, to some extent, that needs a much more immediate and dynamic monitoring process.
The primary data will be supplemented by monitoring data from existing surveys and new data produced by the reforms. Reports will be produced for publication approximately two and five years after implementation, in line with commitments made in the Bill’s impact assessment to publish findings. Therefore, they will be available for parliamentary scrutiny. It is important to say at this point that we want to make sure there is a process by which we can review the provisions in the Bill.
Lord Willetts (Con)
I am grateful to the Minister for that very full explanation of the monitoring. In her long list of organisations that would be consulted, I do not think she had universities. Will she assure the House that they will be included as well?
Baroness Taylor of Stevenage (Lab)
My apologies to the noble Lord; that was probably my speedy reading rather than an omission on the part of the information I have—so, yes, I agree with him that this is part of the monitoring process.
Amendment 5 seeks to expand ground 4A, which allows students living in HMOs to be evicted in line with the academic year. It seeks to address the concerns of some noble Lords that the scope of the ground needs to be expanded to all student properties. It would remove the HMO restriction and allow students living in self-contained accommodation—one and two-bedroom properties for example—to be evicted each year. We have thought carefully about the design of ground 4A, and I am grateful to the noble Lord, Lord Shipley, for also giving it great thought. We want to ensure the cyclical nature of the typical student market is maintained. We therefore believe limiting it to HMOs achieves this by capturing the bulk of typical students—that is, groups living in a house share. Meanwhile, students who need more security of tenure, such as single parents living with their children, or post-graduate couples living together who have put down roots in the area, will be protected.
The core principle of the Bill is that tenants should have more security in their homes, and it is right that these groups should not be exposed to potential eviction using ground 4A. Self-contained one-bedroom and two-bedroom homes are also easier to let to non-students than student HMOs. I do not agree with the conspiracy theory that the noble Lord, Lord Fuller, spoke about, but if a landlord cannot gain possession in line with the academic year, they are more likely to be able to let the property out to non-student tenants. That gives another way through for landlords.
On Amendment 6, noble Lords may remember that, in the Committee evidence session in the other place, it was highlighted that students are often pressured into signing contracts for the next academic year very early in the term, before they have had a chance to form stable friendships or assess a property’s proper condition and location. To discourage this practice, we amended the Bill to prevent landlords using ground 4A if they had agreed a tenancy more than six months in advance of tenants gaining the right to possession. This amendment seeks to extend this six-month limitation to allow landlords to sign tenancies up to nine months in advance. I am not convinced that this would be the right approach.
As I have highlighted, in many cases students are expected to commit to properties within just months of arriving at university, before having the opportunity to form lasting friendship groups or evaluate whether a property meets their needs in terms of condition or location. The purpose of this measure is to act as a strong disincentive to this practice, while striking the right balance. It avoids pushing students into signing tenancies before Christmas—when students are still settling in—but continues to allow flexibility for students who prefer to secure accommodation in advance of the summer period and does not interfere with typical exam periods. Extending this limit to nine months would undermine that balance and risk reinforcing the practice that this measure is intended to discourage; for example, tenants in a competitive market may be forced to search for tenancies starting in September during their January exam period.
Amendment 7 seeks to expand the student ground for possession, so that it can be used to evict a tenant undertaking an apprenticeship. While I understand the support for apprenticeships and share the noble Baroness’s wish to support people undertaking them, I do not believe that this would be the right approach. Ground 4A was created in recognition of the unique, cyclical nature of accommodation for those in traditional higher education. Those in other types of education, such as apprenticeships, are less likely to live in cyclical accommodation and need the security of tenure that the Bill gives tenants. Those on apprenticeship schemes, for example, earn a wage and tend to hope to stay at their company once the apprenticeship is completed; they live lifestyles much more akin to the working population than to university students. They will therefore benefit from all the increased security of tenure that the Bill will give them. For the reasons I have set out, I ask the noble Baroness, Lady Scott, to withdraw her amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank the Minister for her response and all noble Lords who have spoken; they have considerable interest in and knowledge of the sector. Having listened carefully to the debate, and given that the House has rejected the principle of fixed-term tenancies for all, I intend to withdraw Amendment 2.
On Amendment 6, concerning the timing of student tenancies, and Amendment 7, on expanding the definition of students, I recognise that there is sympathy for the concerns I have raised. However, I do not believe that there is enough support in the House to carry them; I will therefore not move those amendments.
Over the past number of months, we have listened to student organisations and universities across this country about the supply of student housing and the types of housing that students—of many different types—want to be made available in the sector. I have listened on the issue of monitoring, but I am worried that, when we eventually find out that it will have a detrimental effect on the sector, a cohort of young people will have suffered during that period of time. We do not think that is correct.
The other issue is around taking out certain types of accommodation from the sector. What will happen then? The rest of the accommodation will become more expensive for the students who need it. That concerns us as well.
There is an issue of capacity and supply in the market, and that remains very pressing. We believe that the Government’s response could have been better; it is pretty unconvincing. Therefore, we will test the opinion of the House on Amendment 5.
Lord Jamieson
Member’s explanatory statement
This amendment would retain social landlords’ ability to demote tenancies for anti-social behaviour.
Lord Jamieson (Con)
My Lords, I declare my interest as a councillor in Central Bedfordshire. Anti-social behaviour is a scourge on our communities, but it is particularly devastating from a housing perspective. It undermines community spirit, leaving tenants feeling trapped and helpless. It strips away the very essence of what makes a house a home. Too often we overlook the consequences. It is not just the cost of repairs, increased security and time-consuming administration of complaints, placing an unsustainable burden on housing associations and local authorities, but the misery and social breakdown it can cause in communities. As currently drafted, the Bill weakens the powers available to local authorities and social landlords to tackle anti-social behaviour. That is why we have sought to bring back Amendment 3 today to preserve the ability of social landlords to demote tenancies in response to such behaviour.
Demotion is not about punishment for its own sake. It is a vital tool—a proportionate deterrent that enables landlords to uphold community stability. Whether it is loud noise, vandalism or intimidation of tenants, those engaging in persistent anti-social behaviour must know there are consequences. Without the option to demote, how are landlords expected to maintain safety and harmony in their communities? Those with experience in local government will know that when a tenant causes disruption, it is often the landlord who receives the enforcement pressure from the council. If landlords are to be held to account, they must also be empowered to act. Amendment 3 would ensure that social landlords retain this power. It is not a radical departure but a practical necessity to deal with real-world situations where one tenant’s behaviour causes misery to many others.
This is about protecting the quiet minority—the families, the elderly and the vulnerable who rely on their home being a place of safety. It is about ensuring that social landlords are not left powerless in the face of persistent disruption. I urge the Government to reflect on the value of demotion as a tool of last resort and the message it sends that anti-social behaviour has consequences and that community cohesion matters. In conclusion, if we are serious about supporting tenants and local authorities, we must ensure they have the tools to act decisively and fairly. I beg to move.
Baroness Thornhill (LD)
My Lords, we say ditto to every single thing that the noble Lord, Lord Jamieson, said about anti-social behaviour. We all know it blights people’s lives and how difficult it is to stem it. We have arrangements where councils work with their local strategic partnerships to deal with it. Nobody is disputing that.
The reason we have come to the conclusion that demoted tenancies are not needed is really very simple. I contacted the National Housing Federation, whose members are social housing providers. It genuinely does not see a need. It is comfortable enough with the Bill and how it deals with anti-social behaviour. It wants to know that it has effective tools to deal with anti-social behaviour and is concerned about the capacity of the courts to deal with evictions based on anti-social behaviour.
My instinct straightaway was to support the amendment on demoted tenancies, but the National Housing Federation said it did not see the point of it but did want to know that it was going to get the tools to deal with things. Many providers, ones I know personally, feel that they deal effectively with anti-social behaviour, including my own council and I suspect the Minister’s. They were concerned about having those tools and the capacity of the courts to deal with that ground when they choose to use it.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Jamieson, and the noble Baroness, Lady Scott of Bybrook, for this amendment. It seeks to reintroduce social landlords’ ability to apply for a demotion order in response to the anti-social behaviour of a tenant. I can honestly say that one of the most frustrating things I dealt with in 27 years as a councillor was anti-social behaviour. While we all agree with the need for tackling the blight of anti-social behaviour on individuals and communities as a priority, I cannot accept the amendment as a way of dealing with that. It would fundamentally go against one of the core principles of the Renters’ Rights Bill—to improve security of tenure for renters. There is also a technical reason, which I shall come to shortly.
The amendment would seemingly enable landlords to demote social tenants to a less secure form of tenancy. As I said in Committee, as drafted, the amendment would not work: the Renters’ Rights Bill will move tenants to a simpler tenancy structure whereby assured shorthold tenancies and the ability to evict a shorthold tenant via Section 21 are abolished. There will, therefore, no longer be a tenancy with lower security to which one can demote tenants. For the amendment to work, a reversal of measures in the Bill to remove demoted tenancies and assured shorthold tenancies would be required.
Tackling anti-social behaviour is a top priority for our Government and a key part of our safer streets mission. As the noble Baroness, Lady Thornhill, said, many councils and housing associations already do a great job in tackling this in partnership with each other, but I accept that it can still be an issue.
The Bill will shorten the notice period for the existing mandatory eviction ground, with landlords being able to make a claim to the court immediately in cases of anti-social behaviour. The Bill also amends the matters that judges must consider when deciding whether to award possession under that discretionary ground. This will ensure that judges give particular regard to whether tenants have engaged with efforts to resolve their behaviour and the impact on other tenants within HMOs.
For all those reasons, we feel that the amendment is unworkable and unnecessary, and ask the noble Lord to withdraw it.
Lord Jamieson (Con)
My Lords, I thank the Minister for her reply, and the noble Baroness, Lady Thornhill, for her comments, and I am grateful for the wide recognition of anti-social behaviour and the problems it causes. While we will not press the amendment today, I hope the Government have truly heard the problems that this causes. Evicting someone and going to court is very draconian, and this proposal would provide the opportunity of an interim step without the need for eviction. That is a useful tool, but I recognise the Minister’s comments. I hope that the Government will reflect and consider how the Bill can more robustly support those affected by persistent anti-social behaviour. With that, I beg leave to withdraw the amendment.
Lord Jamieson
“(a) the landlord;(b) the spouse, civil partner or co-habitee of the landlord;(c) a person who is—(i) a child,(ii) a grandchild,(iii) a parent,(iv) a grandparent,(v) a sibling,(vi) a niece or nephew,(vii) an aunt or uncle, or(viii) a cousin,of the landlord or of the spouse, civil partner or co-habitee of the landlord;(d) a person who is the spouse, civil partner or co-habitee of a person falling within paragraph (c).For the purposes of this Schedule—(a) one person (C) is the “co-habitee” of another person (P) if P lives with C as if they were married or in a civil partnership;(b) a “niece or nephew” of a person (P) is a child—(i) of a sibling of P, or(ii) of a person who is the spouse, civil partner or co-habitee of a sibling of P;(c) an “aunt or uncle” of a person (P) is a sibling of a parent of P;(d) a “cousin” of a person (P) is a child—(i) of an aunt or uncle of P, or(ii) of a person who is the spouse, civil partner or co-habitee of an aunt or uncle of P;(e) “sibling” includes a sibling of the half-blood and a step-sibling.”Member's explanatory statement
This amendment seeks to apply the same definition of family member which is used in clause 20 of the Act in Schedule 1 to ensure the internal consistency of this Act.
Lord Jamieson (Con)
My Lords, we return to the issue of equalising definitions across the Bill, not just for consistency but for fairness, and ensuring that the definition of “family” is the same when it comes to guarantors and grounds for possession. It is not about expanding the law, but about clarity and equity. We want to place on record and state clearly that we believe the Government are making a mistake in resisting this change.
Amendment 21 is sensible and necessary; possession, for the purpose of housing a carer, is an issue of growing importance. Many families are already making plans for future care needs. With social care under increasing pressure, we believe that this amendment is timely and proportionate. We must allow older or less able people to stay in their own home if that is what they choose. Having a carer close by or even in the annexe next door would enable them to do so. I hope that the Minister understands the value of this ground.
Finally, Amendments 22 and 23, the first in the name of my noble friend Lord Leicester and the second in my own name, speak to the need for a clearer message around redevelopment, not only for commercial purposes but for private regeneration as well. Really good regeneration in urban areas requires a certain scale. When a large site is available, something truly transformational can be achieved, as we have seen with the King’s Cross redevelopment. But large sites like King’s Cross are the exception: they just do not exist. Many forward-thinking investors and developers seek to build up a site of sufficient scale through piecemeal acquisition over many years, continuing to let the housing and commercial properties in the meantime.
We believe that we should support and encourage those seeking to do these high-quality regeneration projects. Are the Government seriously suggesting that the tenancy should be terminated on change of ownership and the home left vacant, potentially for many years, thereby not only reducing the rental housing stock but undermining the viability of such large-scale regeneration projects and blighting the neighbourhood? Would it not be far better to allow property owners to continue to rent their homes until such time as the property is needed for redevelopment? I beg to move.
Lord de Clifford (CB)
My Lords, I will speak on Amendment 21 in my name; I thank the noble Lord, Lord Jamieson, and the noble Baronesses, Lady Bowles of Berkhamsted and Lady Neville-Rolfe, for their support. This amendment makes a very small change to the Bill, but it could make a significant difference to the lives of individuals who need long-term full-time care due to their age or disability.
I also thank the Minister for her time in meeting with us to discuss the amendment. We have listened, but still feel strongly that our amendment is important to those who need care. We do not see that it would create a loophole, which was one of the Government’s concerns, or that it treats tenants unfairly when trying to ensure that they have security of tenure and are not moved on unnecessarily from a home that they enjoy and are settled in.
For a loophole to be abused, there must be opportunities in the wording or function of the clause for this happen. We believe we have addressed this, as the property needs to be in close proximity to the landlord’s residence—for example, an annexe or a flat within the same block, or in the same street or village—so that daily and emergency care can be provided to the person who needs care.
Due to the proximity, the tenant would be aware of where the landlord lives. If there were a caring requirement for the landlord or a member of their family and notice was given on the grounds of the need for a carer, they could investigate, ask neighbours or visit the landlord for confirmation. If they were not satisfied that the requirement was met, they could use the provisions in the Bill to challenge the notice.
One of the principles of the Bill is to provide more security of tenure. This amendment would change the Bill in only a very small way as it would apply only to a small number of properties, but for a very important and valued reason for a family.
We have spoken to several national care organisations, which support our amendment. There are many benefits if a long-term carer lives close by, and these were pointed out to me by the National Care Association.
Continuity of care is so important. Carers have private lives, and this separate property would give the carer the opportunity to live their own life in their own space, thereby improving retention and their own mental and physical health. It would also give private space to the family in their own home, which can only help with all the family’s health needs.
During Covid, a lot of live-in carers suffered from loneliness when living in the same property as the person they were caring for. Allowing them their own housing would be a big advantage. Caring is a professional and skilled job, and therefore, when care is provided, it should be done by the most appropriate skilled person. Surely, this could be a professional carer.
If the individual being cared for has a family member living with them who could be the carer, would it not be more appropriate if that individual went out to work and did an appropriate job with the skills they have, rather than doing the job of the carer, when a professional carer might provide better care? Is not one of the Government’s primary objectives to get people into work? Surely, this must involve doing roles that they are most productive in.
Many people of different ages require full-time care, and this can be for many reasons and can come unexpectedly due to age, significant health reasons or sometimes, sadly, an accident. If there is a need for long-term care then surely, if you have a property in proximity, you should be able to gain possession. Is it not reasonable and fair to extend the grounds to allow a professional carer to live at the property, rather than a reluctant family member providing care services?
In terms of care, surely keeping an individual in their own home rather than in a care home or another institution, would benefit not only them but society in general. This amendment achieves this without adding pressure on the already stretched social care sector. We acknowledge that some tenants will suffer disruption by having to leave their property. This is the same as if the landlord wishes to sell the property or move a family member in, but this is for a very specific reason and most tenants would understand why notice has been given.
The amendment is all about family and landlords gaining possession for the use of a property for the family. That is what ground 8 lists. All we seek is to extend the provision for what is an essential service for a family in a time of need. We hope that the Government consider this amendment and make this small change for the benefit of those in care. If they are reluctant to do so, I may need to test the opinion of the House on this matter.
Baroness Bowles of Berkhamsted (LD)
My Lords, I added my name to this amendment and spoke during previous Bill stages. I declare my interests as a private landlord, in my own right and also as a trustee, and as having a relative who purchased the flat above theirs when a carer was needed, which was going to be the case in due course. That planning is now, of course, in some disarray: they wonder whether they must evict the present tenant and bring forward the employment of a carer, even though that is not yet necessary.
Since the discussion in Committee and since speaking with the Minister, whom I thank for her time, I have spoken to various care organisations, which are all supportive of the amendment. They made some recommendations that lie behind the changes in language since the amendment was tabled in Committee. The care organisations have taught me that there is a very wide way in which carers are used, both in the regulated sector and outside it, on which many people rely for vital tasks, health and personal care. Absent the voluntary sector, a lot more costs would fall on health and social services.
However, it is not always easy to find a family member who can do this. Families are much smaller nowadays—my husband and I were adding up what has happened in our own family and, if we chase it back, 14 at our age level will end up being replaced by far fewer at the grandchild level. With those kinds of circumstances, with many more people working, women not wanting to stay at home and families spreading much further from where they grew up and from where parents or others needing care within the family might be, the care organisations say that the reliance is on what they term “loved ones”. It is a very wide phrase; quite often, it means friends and neighbours whom they have lived close to who have helped one another during their lives. When one of them falls ill or becomes disabled or, in many sad cases, is a survivor of cancer who has been left with life-changing circumstances, they become the carer who helps them. As their condition deteriorates, it may be necessary for the carer to be nearby.
The care organisations that I have spoken to, and which support the amendment, are the Homecare Association, Care England, the National Care Forum, the National Care Association and Carers UK. I thank them for their time and recommendations.
We are quite aware that the Minister does not want to create loopholes—that was the main feature of the discussion that we had. For that purpose, we have provided that regulations can be made to amend the definition of “carer”. In many ways, I would prefer it if we did not have that there, because the Minister could make regulations that took away anything useful, but I am hoping that it would be done only in the light of experience if one found that the term was being somehow abused.
In considering carers, we also need to look at care patterns. Many people who need serious care have several carers, who have to operate in shift systems, whether that be daily, weekly or monthly. Sometimes, the carer may come from overseas and stay for six weeks, and then they go back and somebody else comes in, so there is a rolling pattern. It will be very difficult if they cannot necessarily be conveniently located.
So I ask the Minister to think again. Yes, there may not be a great number of people who would be helped by the amendment in the way that a huge number of renters will be helped by the Bill, but in a civil society being a minority has never been a ground for discrimination. Therefore, I ask the Minister to think about this and to understand that, like her, we do not want cheaters to abuse this; we want people who are in need of this service to be able to avail themselves of properties that, often, they have bought to plan for their care—and, indeed, in order not to be a burden on the state. Should they not be allowed the peace of mind that they will be able to fulfil those plans?
Baroness Neville-Rolfe (Con)
My Lords, I also support Amendment 21 in the name of the noble Lord, Lord de Clifford, and the noble Baroness, Lady Bowles, to which I have added my name. I am particularly grateful for the warm words of my noble friend Lord Jamieson and for the support of the various carers organisations which do such an important job in our society.
The Bill will allow a landlord to take possession of a property for a family reason. Our small extension would allow a nearby property to be taken back in hand if it were needed to house a carer. In the meantime, it would be available, for example, as a dwelling for a struggling local couple or an individual seeking a home.
With ever-growing numbers of the aged and disabled, with the move to smaller homes and smaller families, and with a scarcity of care homes and hospices, the provision for short-term housing of professional carers, often changing at short notice, will become more and more important in coping with our ageing population. This is particularly true in rural areas, which are being so battered by other changes the Government have felt it necessary to make.
I declare an interest, recorded in the register, as the owner of such a cottage bought specifically for a carer and generally let to a local on a shorthold tenancy. Such tenancies have expanded the rental market hugely in this country and will be completely swept away by the Bill. So, we need to do what we can together in this House to moderate its perverse consequences—notably in this case to make things better for carers. Fortunately, neither my husband nor I yet need a carer, but we may need one eventually, and my concern, like that of the noble Lord, Lord de Clifford, is a general one. I can guarantee that I am not alone.
I have no idea how the Government will find the 1 million more rented homes Savills believes we need by 2031 unless they make some sensible technical changes to the Bill, which is being constructively debated by knowledgeable experts here in this House. Our Amendment 21 falls into that category. I hope others will join us in the Lobby and in calling on the Government to think again on this issue.
Lord Cromwell (CB)
My Lords, I did not intend to speak to this amendment but, since I am, I declare that I do not rent out any residential property, but my children are tenants and rent out property in their own right. There are two sources of potential misery here: one is turning out a tenant, the other is being unable to provide care for a family member. I know how I would feel if I was in a situation where I had to deny a family member professional care despite owning a property that could accommodate a carer. I am interested to hear how the Minister feels about this, what she would do in those circumstances, and what other Members of this House would do if the noble Lord, Lord de Clifford, calls a vote on this matter.
The Earl of Leicester (Con)
My Lords, in speaking to my Amendment 22, I also express my support for Amendment 21 in the name of the noble Lord, Lord de Clifford, and Amendment 23 in the name of the noble Lord, Lord Jamieson. I declare an interest as a property owner of both commercial land and residential houses. If one acquires planning permission on a parcel of land that might have, to take a brownfield example, a few workmen’s terraced houses or, in a rural setting, perhaps a farmworkers’ cottage that might be in the middle of a proposed development, my amendment seeks to allow the landowner or developer to gain possession of said property or properties.
When I look out of the window of my flat in King’s Cross, which the noble Lord, Lord Jamieson, alluded to and which was developed by Argent—a brilliant place-maker that has worked in Manchester, created a marvellous area in Tottenham Hale, and produced a high-quality mix of leisure, retail, high-end accommodation, medium-level accommodation and affordable accommodation, but which takes decades to assemble land—I see commercial property that has been bought by developers and converted into flats. Many of these developments have a high proportion of affordable accommodation, which seems to be the largest amount of development happening in Britain at the moment.
However, this should go both ways. We in this country hear we are losing industry and are only a service economy. We should be doing our utmost to produce jobs. The unemployment figures are already rising. If the examples I have mentioned achieve planning permission and the tenant is removed—the reality is that the developer or landowner would do that by negotiation and try to find suitable alternative accommodation for that person—but the tenant then says, “No, I’m not leaving at all”, then the whole opportunity for growth ceases. Were the development to go ahead then, because of the planning permission it has achieved, a great number of jobs would be created in the short-term in its construction, which might take two to four years, and then in the occupation of those commercial buildings. It is a win-win. The Government say they want growth, but if they do not allow my amendment, nor that of the noble Lord, Lord Jamieson, then they are not acting in the best interests of growth.
I support the amendment from the noble Lord, Lord de Clifford, on providing accommodation for a carer, which is very well thought through. We should all support it. It seems that there is a great deal of support around the House for it. The amendment from the noble Lord, Lord Jamieson, is somewhat wider than mine—it is on redevelopment and regeneration—but they are effectively the same thing: they are looking for growth.
I have sat in on much of this debate. It is a shame that the Government are not listening. Good Governments listen to differing views and take note. There are many good amendments being put forward. Government through ideology and a large majority does not lead to good law.
Lord Carrington (CB)
My Lords, I support Amendment 22 from the noble Earl, Lord Leicester. I declare my direct interests in the private rented sector, with lettings of cottages in Buckinghamshire and Lincolnshire, and in direct farming and agricultural lettings in those counties. I said in Committee that a number of Bills, reviews and reports are in motion that cover the whole issue of farm and other diversification in rural areas, which the Government are keen to encourage in the light of falling profitability in farming, as subsidies are withdrawn or concentrated on environmental activities and concerns.
Farmers are therefore looking carefully at their assets to see whether they can be put to a more profitable use. Obviously, this can involve farmstead cottages and buildings, rather than just stand-alone farm buildings. The Planning and Infrastructure Bill is relevant in this context, together with the rural England prosperity fund, which specifically targets facilities and building conversions that help rural businesses to diversify.
This amendment would assist in enabling diversification if the necessary planning permission has been granted or there is a permitted development right. I am thoroughly aware that the Minister is keen to protect all assured tenants from eviction for whatever reason, and keen not to reduce the housing stock. However, in granting that planning permission, the authorities will already have given due consideration to the potential conversion and any loss of residential buildings through change of use. They will have agreed that the merits of the planned development outweigh the retention of the residents. I therefore hope the Minister will include this new ground 8A amendment as a sensible ground for possession, which would assist in the development of the rural economy.
Baroness Thornhill (LD)
I will mainly speak to Amendments 4 and 21. It is fairly obvious that we will support Amendment 21 from the noble Lord, Lord de Clifford.
We have a problem with Amendment 4—or we did to start with, but then I took legal advice. The noble Lord, Lord Jamieson, asserted that we needed clarity and consistency across the Bill. I suspect we have more lawyers than any other profession in this House, and guess what: I got slightly different answers. However, the message was quite consistent: we absolutely do not need to have the same definition of family, in this case, across a whole Bill because we are dealing with very specific, different things.
My understanding is—and I am certain that the Minister will correct me if I have this slightly wrong—that the amendment to ground 1 deals with the diversity of the modern family and the kind of things that can happen, but it is about the repossession ground, so it has been drawn fairly tightly for obvious reasons. However, the definition in Clause 20 is clearly broader because it relates to the removal of the guarantor liability for rent after a family member in a joint tenancy dies. It is a sympathetic amendment and a sympathetic broadening, casting the net a little bit more widely, as it seeks to protect bereaved families, whereas we necessarily want to keep the definition in ground 1 fairly tight to avoid abuse. We have resolved our position on that, so we will not support Amendment 4.
I want to hear what the Minister has to say on Amendments 22 and 23, because I believe there are grounds to do what they would do already in the Bill. I am genuinely interested to hear the Minister’s response to those amendments.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, the noble Lords, Lord de Clifford and Lord Jamieson, and the noble Earl, Lord Leicester, for their amendments, and the noble Baronesses, Lady Bowles, Lady Neville-Rolfe and Lady Thornhill, and the noble Lords, Lord Cromwell and Lord Carrington, for their contributions to the debate.
Amendment 4 seeks to expand the definition of “family member” for the purpose of the moving-in ground, ground 1, to a much wider range of relations. This mandatory possession ground is available if the landlord or their close family member wishes to move into a property. This amendment would allow landlords to evict their tenants in order to house nieces, nephews, aunts, uncles or cousins. It would enable the ground to be used to house the equivalent relatives of their spouse, civil partner or cohabitee. The family members we have chosen who can move in under ground 1 aim to reflect the diversity of modern families, but this is balanced with security of tenure for the existing tenant, as the noble Baroness, Lady Thornhill, indicated.
I appreciate that this draws the line short of where some might hope, but to go too far would open up tenants to evictions for a wide range of people, potentially very significant numbers of cousins, nieces and nephews, where families are large. I know that this depends on families—it would certainly be a large number in my family. This would provide more opportunities for ill-intentioned landlords to abuse the system. It is right that the definition used here is narrower than the definition in Clause 20, which removes guarantor liability for rent after a family member in a joint tenancy dies. That is because this is a possession ground, so it results in people losing their homes; whereas Clause 20 protects bereaved families, where the net should be cast more widely.
Amendment 21 aims to introduce a new ground for possession that would permit the landlord to seek possession of their property for the purpose of housing a carer for them or a member of their family who lives with them. This is qualified by the requirement that the property is within sufficient proximity to the landlord’s residence to facilitate emergency callouts. I thank all noble Lords, particularly the noble Lord, Lord de Clifford, and the noble Baroness, Lady Bowles, for their considered and passionate engagement on this proposed ground in Committee and when I met Peers to discuss the proposal in the run-up to Report. I recognise the difficulties they highlighted that may be faced by landlords who wish to evict their tenant in order to house a carer. We are all aware of the importance of carers and the remarkable work they do in supporting individuals and families in difficult circumstances. These amendments clearly come from a good place, and I am sympathetic to noble Lords’ concerns.
However, there are some practical considerations that weaken the rationale for this intervention. Adding more possession grounds increases opportunities for abuse by those unscrupulous landlords who, sadly, exist in the market. We are committed to giving renters much greater security and stability so that they can stay in their homes for longer. That is why we have developed very specific grounds. We also think that there are very few landlords who would be in the position of both needing a carer and owning a second property close to their home to accommodate that carer. I appreciate the examples that both noble Baronesses gave. Given the potential risk of abuse and the very narrow group of people who might benefit from this ground, we do not think the additional ground is warranted. Our view is that it is not fair that a tenant should lose their home, with all the disruption that entails, in order for another person to be housed in those circumstances.
The noble Lord, Lord de Clifford, talked about supporting people into work, but this amendment might involve another local worker being evicted to house that carer. Indeed, if the evicted tenant were also a carer, it would be likely to deprive one of the very organisations that have been contacting noble Lords of a key member of their staff, so we have to be careful that we do not cause those kinds of circumstances.
Amendment 22 seeks to create a new ground for possession to enable landlords to convert a residential property to non-residential use. I say to the noble Earl, Lord Leicester, that I too visited the King’s Cross development when I was looking at the development of the central part of Stevenage. The work that has been done there is fantastic.
As I stated in Committee, in response to a similar amendment tabled by the noble Lord, Lord Carrington, I do not believe that the proposal in Amendment 22 is the right approach. The Government have thought carefully about where landlords should be able to take possession of their properties, particularly where it would lead to a tenant losing their home through no fault of their own.
Encouraging residential lets to be converted to other uses, at a time of such chronic pressure on housing supply, would not be right. It is for the same reason that the Bill abolishes ground 3, which enables landlords to evict long-term tenants in order to turn the dwelling into a holiday let. Where landlords wish to convert their property to non-residential use, it is right that they should do this as tenants move out, rather than by evicting a tenant who has done nothing wrong.
It is also worth noting—as I think the noble Baroness, Lady Thornhill, referred to—that the existing redevelopment ground, ground 6, could potentially be used in some circumstances. This is the right approach, not the approach put forward in the amendment from the noble Earl, Lord Leicester.
I turn to Amendment 23. This well-intentioned amendment would create a new mandatory possession ground to allow landlords to evict tenants in order to redevelop their property, if they have received planning permission for the works and these works cannot be carried out with the tenant in situ. I am pleased to be able to reassure the noble Lord, Lord Jamieson, that landlords will already be able to evict in these circumstances. They can do this by using the existing, broader mandatory redevelopment ground, ground 6. This also does not require the landlord to prove that they have planning permission, which may not be necessary in all circumstances. In effect, this proposed new ground would merely duplicate ground 6, but with additional constraints. For the reasons I have set out, I ask the noble Lord to withdraw his amendment.
Lord Jamieson (Con)
Before the Minister sits down, can she be categorical that anybody seeking to redevelop their property would be able to terminate a tenancy to do so?
Baroness Taylor of Stevenage (Lab)
You can use the existing, broader mandatory redevelopment ground, ground 6, when you are redeveloping property.
Lord Cromwell (CB)
In respect of Amendment 21, does the Minister accept that denying someone the ability to move in a carer to look after their family in the way that was outlined will be an enormous temptation for abuse? The best outcome in that context is likely to be that people will simply hold the property empty for very many years in case they might need it. That will not create much help for the rental sector.
Baroness Taylor of Stevenage (Lab)
I will reiterate my comments. When evicting one tenant to put another tenant in, you may well be evicting somebody else’s carer to put your carer in. Of course, we do not want to see properties sitting empty but, if people have a property, that is their choice. The idea that you might evict one carer to put another carer in, for example, is just not acceptable.
Lord Cromwell (CB)
I hear what the Minister is saying about pushing a tenant out to put a carer in, but she is touching on a very specific case, where you are putting out a tenant who happens to be a carer so as to put another carer in. I would submit to her that that is a very tiny example.
The sheer emotional impact of not being able to care for somebody by putting a carer in will simply invite people to abuse the system: to find ways to get around it, or simply to hold the property empty. I wonder how Members of this House would react if they were in the situation of not being able to provide care to a loved one because, despite owning a property, they were unable to put a carer into it.
Baroness Taylor of Stevenage (Lab)
I simply add that it does not have to be another carer; it could be any of the key workers who we talk about so often who are in need of housing. There are other options for people. If landlords are receiving rent for that property, while I appreciate that there may be further shortages making it difficult to find somewhere near enough to the property, but there is the option of using the rent secured on one property to rent alternative accommodation for a carer.
Baroness Bowles of Berkhamsted (LD)
Those of us who deal with economic matters will have to point out that there would be tax paid on the rent, so there would not be a great deal left to be able to rent the next home. That is not an economically viable solution, even if there were another adjacent property to rent with what was left of the rent after deductions.
Baroness Taylor of Stevenage (Lab)
I am sorry; I can only come back to my point. It does not seem equitable to evict one family to house another family. I ask the noble Lord to withdraw his amendment.
Lord Jamieson (Con)
My Lords, I thank all noble Lords for their thoughtful contributions. Turning to my first amendment, I recognise that the Minister has given some serious consideration to the definition of family and is satisfied with the Government’s position. We respectfully disagree, but I will not press Amendment 4 and will therefore withdraw it.
We have had an excellent debate on Amendment 21. I thank the noble Lord, Lord de Clifford, for introducing it and the many noble Lords who raised issues on it. They have spoken with clarity and conviction. We believe that allowing a property to be used to house a carer in a time of need not only is reasonable but can be vital to the well-being and living standards of the property owner, and on these Benches we are pleased to support this amendment.
Finally, turning to the issue of redevelopment and regeneration, I thank the noble Earl, Lord Leicester, for his amendment and the noble Lord, Lord Carrington, for his contribution. Revitalising areas is key to improving living standards and supporting the long-term well-being and development of communities, delivering the growth that this Government have said is their number one priority. It is also crucial to delivering the homes that are so vital, as the noble Baroness, Lady Thornhill, and the Minister said earlier in the debate. I appreciate the Minister’s comment that this may already be covered, but we are not satisfied that it is. The Minister’s comments were not conclusive when I sought clarification. I will therefore test the opinion of the House on Amendment 23.
Baroness Scott of Bybrook
Member’s explanatory statement
This amendment would remove the restriction of Ground 4A to accommodation of three or more bedrooms only.
Baroness Scott of Bybrook (Con)
My Lords, on behalf of the young people looking for student accommodation in the future at a reasonable rent, I wish to test the opinion of the House.
Lord Carrington
Member’s explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house to house their agricultural worker, who will be working at least 35 hours per week for the landlord, regardless of the worker’s employment status (i.e. employee, worker or self-employed person).
Lord Carrington (CB)
My Lords, I shall speak also on Amendments 9, 11, 13, 14, 15, 16 and 17. I apologise that there are so many; I actually tabled only one but the Table Office divided it.
The amendments cover grounds for possession as they relate to self-employed agricultural workers. It is clearly understood that the key aim of government is to provide more security for tenants in the private rented sector—hence the abolition of Section 21 no-fault evictions. I thoroughly support this policy, but reforms must be implemented carefully when it comes to the rural economy to take into account the particular circumstances of the agricultural sector in order to avoid negative impacts, such as the necessary housing of farm workers who are crucial to the nation’s food security, as well as to a thriving rural economy.
Accordingly, special protections specific to agriculture are required. That is already partly recognised in the Bill in ground 5A, but limited to direct employees. Agriculture is unique in terms of tenanted housing, as often agricultural workers are provided with accommodation to enable them to be close to their place of work. A worker can often be required to work long hours during certain seasons, such as lambing or harvest, or unsocial hours, such as early mornings and late evenings, in the case of dairy farming. There are also animal welfare considerations that require workers to be close at hand at all times.
Following Committee in the Lords, I withdrew the original amendments to address the Minister’s concerns. She said then that there were other arrangements that a landlord could use to help their contractors with accommodation when they are working away from their home, such as paying expenses, using licences to occupy or paying for them to be housed in an Airbnb. She is absolutely correct, as contractors can be somewhat different from employed or self-employed farm workers. I have therefore removed contractors from this amendment.
The Minister’s suggestion that the same could be achieved by allowing self-employed workers to occupy a property under licence would not be appropriate for longer-term workers, which this amendment seeks to address. I also point out that licence agreements are generally unsuitable for long-term occupation, and in some instances can actually be considered as a tenancy, especially when the occupant of a dwelling has exclusive occupation of all or part of the dwelling.
I know the Minister was worried that these amendments could open up an exemption for a wider group of workers, and I hope I have reassured her that this specifically covers only genuine full-time agricultural workers. The revised amendments, which add only self-employed agricultural workers to this category, also deem that the nature of the self-employment should be genuine and meaningfully full-time. Hence, reference is made to working a minimum 35-hour week. Furthermore, the revised amendments confirm that there is no intention to alter the security of tenure afforded to assured agricultural occupants. That is because the Bill states that grounds 5A and 5C do not apply to this type of worker.
We believe that the ground for possession should be available where there is a need to house self-employed agricultural workers—for example, a self-employed party to a share-farming arrangement on a farm or a self-employed shepherd. It is increasingly common in the agricultural industry for workers to be self-employed but, given the nature of their work, especially if it is with livestock, they need to live on site. Some examples of workers who might fall into this category are dairymen, sheep shearers, relief milkers or tractor drivers. Currently, ground 5A provides a means of getting possession where the dwelling is required to house someone who will be employed as an agricultural worker. However, it does not cover the situation where that worker is self-employed.
On the same theme of self-employed workers, ground 5C does not adequately provide for possession where a self-employed worker has been provided with a dwelling but the work contract has ended; it applies only where the tenant has been employed by the landlord. In summary, we would like to see extensions to both ground 5A and ground 5C to reflect modern farming employment practices and cover situations where the worker is self-employed as well as employed. I very much hope that the Minister will be able to accept this amendment, which purely reflects current employment practices in farming, is non-political and is not designed to cover non-agricultural workers.
My two other amendments in this group, Amendments 10 and 12, cover the status of service and key workers. Much of the debate, within this Chamber and beyond, is rightly focused on the Bill’s impact on the private rented sector in urban rather than rural areas. These amendments seek to address two critical concerns: first, how we ensure that rural businesses can continue to function effectively and house employees; and, secondly, how to support the housing needs of key workers, in both urban and rural areas.
In many rural communities, landlords have typically also been a major employer in the area, and the convention is that they house employees of their businesses. Traditionally, the most common form of employment was in agriculture, and this is reflected in the specific legislation for agricultural worker tenancies. But, as successive Governments have encouraged rural diversification, we have seen a growing number of businesses beyond farming employing and housing workers. This has become more frequent as affordability challenges have meant that accommodation often needs to be offered as part of an employment package to attract and retain staff. Alongside this, more properties have been let to non-employees under assured shorthold tenancies, which have maintained flexibility. This system has allowed landowners to regain possession at the end of a fixed term, enabling them to house new employees as business needs evolve. Without a clear right to repossess in such cases, we risk seeing vital rental properties in rural areas either being sold or left empty. This is not hypothetical: we have already seen the consequences in Scotland following the ending of its equivalent of Section 21.
These amendments aim to ensure that rural businesses can continue to house the workers they need, while also supporting the broader functioning of rural and urban communities. In Committee, the Minister raised two objections to a similar amendment: first, that ground 5A already covers this issue; and, secondly, that we must protect tenants in critical local jobs. However, ground 5A, while welcome, does not go far enough. As the Minister acknowledged, the agricultural sector has unique needs, hence the inclusion of ground 5A, but 85% of rural businesses do not relate to farming or forestry. Many of these businesses still require staff to live on or near the site to perform their duties effectively. If the logic behind ground 5A works for agriculture, it should also work for these other rural enterprises. These amendments would extend repossession rights to cover incoming service occupancy workers—those who are required to live in a property for the better performance of their duties.
A good example is a rural business that diversified into hosting weddings to remain viable under changing agricultural policies and profitability. It now needs to hire a full-time wedding planner, someone who must be on site at short notice, work irregular hours and take on responsibilities for security and caretaking. However, the business cannot recruit because there is no housing available nearby. One of this rural business’s cottages is currently let to a non-employee. If the business were to seek repossession of this property to house this wedding planner, ground 5A would not apply and it would be unable to obtain possession. Amendments 10 and 12 would allow repossession of this property to protect the viability of the business.
I appreciate that the ambition of the Bill is to protect the security of tenure of more households. However, if we do not strike the right balance and make it more difficult for businesses to employ and house staff, they will simply hold properties vacant for potential future employees or sell them. This will further restrict the availability of private rented housing in rural areas.
I turn to the second point, which is the protection of tenants in vital local roles. The amendment is needed to address the efficient functioning of the rural economy, which includes housing those in vital local roles. The principle has been accepted for housing incoming agricultural workers; this is simply an extension of that. The Government are concerned about housing vital key workers in rural areas, so I have strengthened the amendment to include a provision allowing repossession where the property will be used to house an incoming key worker. Such workers are broadly defined as certain NHS employees; carers, who we have already talked about; teachers; and police and security staff, et cetera. In many rural areas, key workers face long commutes due to a lack of suitable housing. This undermines recruitment and retention and ultimately harms local services. These amendments would allow rural landlords to offer housing to key workers, ensuring the viability of rural areas.
While my focus is primarily rural, the benefits extend to urban landlords, such as NHS trusts or housing providers, and to key workers such as firefighters, on-call carers and others whose proximity to work is essential. In short, these amendments would make the private rented sector more responsive to the needs of both rural businesses and urban communities. They strike a balance between tenant protection and operational necessity and I urge the Minister to support them. I beg to move.
Baroness Grender (LD)
My Lords, I thank the noble Lord, Lord Carrington, for bringing what is a quite small technical issue, even if there are many amendments related to it, particularly regarding farmers and their tenants. We understand that, technically, Amendments 8, 9, 11 and 13 to 17 relate to one very small, specific, technical issue, which is that if a dairy farmer, say, is on a contract, or is a freelancer but needs to be moved in to the site, then that repossession should be able to happen. So it is about viable businesses and about ensuring that somebody who is highly relevant can live next door to where they are working.
We understand, or we thought we understood, that licence to occupy would cover this. We also worry about the hours relating to this, although we note that one of the amendments specifies a 35-hour week. Therefore, I want to know from the noble Lord, Lord Carrington— I am happy to sit down and make way for him to answer—whether it would be possible to apply a loophole so that someone could work for just one hour and then get through a loophole that has been applied by these amendments.
Lord Carrington (CB)
The answer is “No”. The whole reason for putting 35 hours a week in there is to make sure there is no loophole, and it is drafted as such.
Baroness Grender (LD)
I thank the noble Lord.
On Amendments 10 and 12, we on these Benches are concerned that they technically widen the scope beyond where we are comfortable. However, regarding Amendments 8, 9, 11, 13, 14, 15 and 16, we hope that the Minister has heard the technical detail that is required for a very specific profession and will look favourably on taking this away and having another look.
Baroness Scott of Bybrook (Con)
My Lords, the agricultural sector of this country and its workers are without doubt the lifeline of the nation. I therefore thank the noble Lord, Lord Carrington, for his proposed amendments that make provision for agricultural landlords and workers, bringing the welfare of the agricultural sector into overdue consideration.
Today, the British agricultural industry contributes £14 billion to our economy and puts food on our plates three times a day. Agricultural landlords lie at the heart of this. They provide the means for this essential lifeline by providing on-site housing for workers who are required to be at hand to fulfil their duties 24 hours a day. From milking cows daily at three o’clock in the morning to delivering lambs throughout the night in the spring, on-site and proximity housing ultimately facilitates workers’ ability to produce the food on which we all depend. It is therefore crucial that we consider the effects of the Renters’ Rights Bill on these agricultural workers and, in the case of the Bill’s failure to protect their livelihoods, consider proposed amendments so that the Bill does not obstruct one of Britain’s lifelines.
As drafted, the Bill clumsily allows for occupants to remain in a dwelling house even if they no longer work for the landlord, which is usually the requirement for the occupancy of such housing. Similarly, as my noble friend Lord Roborough stated on 12 May, the wording of this Bill also does not allow for the possession of a house dwelling as long as the occupant remains in agricultural employment, with no indication as to the specific type of agricultural work that the occupant carries out, or whether proximity to certain facilities or animals is necessary.
This ultimately risks the deprivation of housing for current full-time workers, who may depend on the occupied dwelling house to be able to fulfil their duties, not to mention simultaneously risking the inability of the agricultural sector to function effectively, due to an inefficient proximity to work that this lack of provision may cause.
Amendments 8, 9 and 11 to 16 therefore ensure that such damage may be averted by allowing an agricultural landlord to possess their property for the use of their own full-time agricultural workers, and thus retain the efficacy that fuels this industry. Amendment 11 is particularly important, because our country’s modern agricultural industry is changing. One of those changes is that many of the employees are self-employed, particularly in jobs in the dairy industry and the sheep industry, where milkers and shepherds are often self-employed. So we will support the noble Lord, Lord Carrington, if he moves his Amendment 11.
As previously emphasised, it goes without saying that the agricultural sector serves to provide for every one of us, and it is in the same vein that proposed Amendments 10 and 12 also serve. In the Bill’s current form, the absence of provision for service occupants overlooks the reality that many agricultural workers’ contracts express: the worker must live in a particular residence where they can better perform their duties. This is of particular relevance to the contracts of agricultural workers who, out of both duty and British custom, are often housed by their employer, who is also the landlord.
By allowing possession to be made for service occupants and key workers, in Amendments 10 and 12 the noble Lord, Lord Carrington, rightly seeks to uphold the implements and customs that facilitate effective and key agricultural operations, and the welfare of agricultural employees. However, with the more comprehensive inclusivity entailed by service occupants and key workers, the amendments also make provision for workers in other vital sectors where similar contracts exist. These include, but are not limited to, the NHS, healthcare, education professionals and emergency service workers. With Amendments 10 and 12 in place, whether one of those key workers needs to rise in the early hours in the lambing season to check the ewes, or provide immediate care for an elderly person, or is putting out a fire, their crucial duties can be carried out only with the due expediency granted by their proximity and not if they are hindered by the limitations put in place by the Bill.
Lord Cameron of Dillington (CB)
My Lords, I support Amendments 8 and 9, et cetera, proposed by the noble Lord, Lord Carrington, about treating self-employed agricultural staff as full-time staff members on a farm for the purposes of the Bill. As this is the first time I have spoken on the Bill—probably the only time I am going to speak on the Bill—I declare my interest as a farmer and someone who has a dairy, because it is about dairies that I want to speak.
Cows have to be milked twice a day. It is not only from the point of view of the welfare of the farmer, and perhaps his or her bottom line, but from the point of view of the welfare of the cows. The cows have to be milked twice a day or they really suffer. Cows can actually die from not being milked, so it is really important that they are milked twice a day. Most dairy farmers now employ their dairymen or dairywomen— I am pleased to say there is a considerably greater number of women who are dairy farmers these days than in the past—through an agency, because it is the duty of the agency, if the dairyman suffers a heart attack or gets run over, or something terrible happens, to produce a dairyman literally the next day so the cows can continue to be milked. It really is very important for the welfare of the cows and the farm.
These staff, who are self-employed through an agency, are treated on the farm as part of the farm team. Although technically they are self-employed, they must be treated as being employed members of the farm for the purposes of the Bill. They usually occupy a vital house, probably close to the dairy. There is not only milking twice a day; a good dairy person has to spend two or three hours a day, in addition to the milking, watching their cows, seeing that their welfare is okay and they are in full health, and that their feet do not need treatment, and whether they are on heat. It is a really important role.
Although I am only speaking about dairy people, I am sure the same applies to herdsmen in a beef herd, or shepherds looking after a flock. The point is that these people are employed through an agency, therefore they are self-employed. It would really not be at all right—and I am talking about the welfare of the cows, apart from anything else—if these people were excluded from being treated as ordinary members of staff for the purposes of the Bill.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Carrington, for these considered amendments, which reflect the debate we had around his similar suggestions in Committee, and the noble Baronesses, Lady Grender and Lady Scott, and the noble Lord, Lord Cameron, for speaking in our discussion.
As noble Lords will be aware, we have responded to the needs of the agricultural community and incorporated ground 5A in the Bill. We appreciate that the agricultural sector has distinct requirements, and it is often vital for workers to live on-site to carry out their duties. However, this must be balanced with the needs of the wider rural community. We believe this ground balances both: it allows agricultural employees to be housed while protecting other tenants who may work in critical local jobs.
Widening the ground to include, for example, self-employed workers could open the ground to abuse and decrease rural security of tenure. For example, a landlord could engage someone on a self-employed basis to do a nominal amount of agricultural work and on that basis use the expanded ground to evict a tenant in respect of whom no other grounds are available. Amendment 8 would expand ground 5A, which, as drafted, will allow landlords to evict assured tenants to house an agricultural employee. The amendment would mean that landlords could evict their tenants to house self-employed workers and other types of workers engaged in agriculture.
As we have made clear, a key aim of the Bill is to increase tenants’ security, and the grounds for possession have been designed narrowly to reflect situations in which we think it is right that a tenant could lose their home, often through no fault of their own. Expanding the types of workers a tenant can be evicted in order to house goes against this principle and would reduce the security of tenure in rural areas.
Amendment 9 works with Amendment 8 to ensure that tenants could be evicted only to house workers who would be working for the landlord for at least 35 hours a week. I understand the intent behind this: it aims to address the concerns I expressed in Committee that the similar expansion of the ground that the noble Lord, Lord Carrington, proposed then would open up the ground to abuse. However, I am still not convinced that any expansion of the ground is the right approach. Amendment 11 is purely consequential on Amendment 8, removing a reference to “seasonal or permanent employee” which Amendment 8 has moved so that it appears earlier in the text of the ground.
I ask the noble Lord not to push these amendments to a Division for the reasons I have set out. In short, we do not wish to degrade the security of rural tenants to house wider categories of workers. The narrow drafting of the ground proposed by the Government is proportionate, and by focusing on agricultural employees it achieves a fair balance for all.
Amendment 10 seeks to expand the agricultural worker possession ground, 5A. This would permit a landlord to seek eviction of a tenant to house key workers and service occupants as well as agricultural employees which the ground as drafted allows. Ground 5A is designed to allow landlords to house employees working for them in agriculture. This ensures workers who genuinely need to live on-site can be accommodated and recognises that employees may need to live on-site only for a limited period. We have balanced this with the needs of all tenants for security and stability in their homes.
Expanding this ground to other types of workers from different sectors would not be right. It would allow tenants to be evicted through no fault of their own to house a wide range of employees; for example, a teacher or a healthcare worker who is an employee of the landlord. For this wider group of employees, we do not believe that landlords directly provide accommodation on a large scale or that in most cases such individuals need to live on-site. In fact, this might see one key worker being evicted to house another, a point I made under a previous amendment.
Amendment 12 works with Amendment 10 to clarify the definitions for both key workers and service occupants. It also seeks to give power to the Secretary of State to amend the key worker definition by regulations. This would allow a future Government to potentially expand the definition to include many other types of worker without suitable scrutiny, which could significantly degrade tenant security. Employment ground 5C may be available to landlords who need to provide accommodation to tenants as a consequence of their employment. In our view, if a landlord needs to accommodate someone on-site, it is right that housing is kept for this purpose and that other tenants do not see their lives disrupted after a short period in a property.
Amendment 13 works together with the other amendments in this group to expand ground 5C to allow landlords to evict a wider range of workers rather than just tenants who are employees. The amendment would change the condition within the ground that the dwelling was let to a tenant as a result of their employment by expanding it to include “work” as well as “employment”.
I am clear in my view that expanding the ground for possession is not the correct approach. Ground 5C is narrowly drafted to allow employer landlords to evict tenants when the accommodation is no longer required for their employment. Expanding this ground further would reduce security of tenure for a much wider group. I am not persuaded that opening the ground more widely is justified for more informal working arrangements. If a tenant is an employee, it indicates a long-term relationship which could require accommodation, whereas this is much less likely to be the case for other types of worker.
Amendment 14 works together with the others in this group to expand ground 5C, as I have described. The amendment would expand the condition that the tenant has ceased to be employed by the landlord to include circumstances in which they have ceased to work for the landlord—a much broader definition. For the reasons I have explained, I am not convinced and have not been persuaded that any expansion of the ground is the right approach.
Amendment 15 also works with other amendments in the group to expand ground 5C. In parallel to Amendment 14, it would expand the condition that the tenancy was granted for an early period of the employment—for example, to help with relocation—to include circumstances where the tenancy was granted for an earlier period of the tenant’s work, a much broader definition.
Expanding the employment ground to allow landlords to house and evict non-employee workers is not the right approach, as I have explained. Workers who are not employees are also much less likely to require the long-term accommodation a tenancy entails. Other arrangements, such as licence to occupy or service occupation, may be more suitable for shorter-term contractors or self-employed workers.
Baroness Scott of Bybrook (Con)
Before the Minister sits down, on self-employed workers in the agricultural industry, has MHCLG discussed this issue with Defra? Defra would know how the industry has changed over the past years and how critical it is to have self-employed workers on specific jobs in agriculture. It is going to be very difficult for farmers, particularly livestock farmers, to manage in certain circumstances on the farm, as we have heard from the noble Lord opposite.
Baroness Taylor of Stevenage (Lab)
I have not personally discussed the issue with Defra, but I am sure that officials in MHCLG will have done so, and—
Lord Rooker (Lab)
If my noble friend the Minister does discuss it with Defra, she will find that Defra has nothing like the numbers of people with experience of farming that it had 10 years ago. It has been completely denuded and she would not find the answer to the question asked by the noble Baroness opposite.
Baroness Taylor of Stevenage (Lab)
I was about to say, before the noble Lord, Lord Rooker, intervened, that I am always happy to discuss these important issues further with noble Lords and to refer back to colleagues in Defra and elsewhere. Nevertheless, I ask the noble Lord, Lord Carrington, to withdraw his amendment.
Lord Carrington (CB)
I thank the Minister very much. I appreciate her response, but I am afraid that I am somewhat disappointed by it. It demonstrates a lack of understanding of the farming industry and the rural economy.
I greatly appreciate the words of the noble Baronesses, Lady Grender and Lady Scott, as well as of the noble Lord, Lord Cameron of Dillington, who brings very practical experience as a dairy farmer, whereas I am only a sheep and arable farmer.
To pick up on what the Minister said about this being a loophole, the whole point of my amendment saying that the person has to be a genuine worker, working 35 hours a week, is surely sufficient to deny that claim. Reluctantly, I would like to test the opinion of the House.
The Deputy Speaker (Lord Faulkner of Worcester) (Lab)
My Lords, I understand that it has been agreed that a number of amendments are regarded as consequential on Amendment 8.
Amendment 9
Lord Carrington
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house to house their agricultural worker, who will be working at least 35 hours per week for the landlord, regardless of the worker’s employment status (i.e. employee, worker or self-employed person).
Lord Carrington
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house to house their agricultural worker, who will be working at least 35 hours per week for the landlord, regardless of the worker’s employment status (i.e. employee, worker or self-employed person).
Lord Carrington
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house when the tenant stops working for the landlord, regardless of the tenant’s employment status (i.e. employee, worker or self-employed person).
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house when the tenant stops working for the landlord, regardless of the tenant’s employment status (i.e. employee, worker or self-employed person).
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house when the tenant stops working for the landlord, regardless of the tenant’s employment status (i.e. employee, worker or self-employed person).
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house when the tenant stops working for the landlord, regardless of the tenant’s employment status (i.e. employee, worker or self-employed person).
Member's explanatory statement
This amendment and others in the name of Lord Carrington would enable the landlord to gain possession of the dwelling-house when the tenant stops working for the landlord, regardless of the tenant’s employment status (i.e. employee, worker or self-employed person).
Baroness Scott of Bybrook
Member's explanatory statement
This amendment retains the status quo, allowing landlords to begin recovering rent arrears after eight weeks—rather than thirteen—where rent is payable weekly or fortnightly, helping to reduce the build-up of rental and mortgage arrears.
Baroness Scott of Bybrook (Con)
My Lords, I will speak to group 6 and to Amendments 18 and 19 standing in my name. These amendments concern the point at which rent arrears become a valid ground for possession, an issue of considerable importance to landlords and tenants alike. The most recent English Private Landlord Survey shows that 45% of landlords own a single rental property and a further 38% own between two and four. That means over four-fifths of landlords operate on a very small scale, far from the image of institutional landlords with deep financial reserves. These are individuals and couples, often retirees, who rely on rental income for their own stability. They form the backbone of our rental sector.
With that image in mind, I turn to the amendments in this group. Under the proposals in the Bill, landlords will be prevented from initiating possession proceedings for 13 weeks of arrears in the case of weekly or fortnightly rent, or three months where the rent is paid monthly. That is a significant extension from the current thresholds of eight weeks and two months, respectively. Amendments 18 and 19 in my name are not about undermining tenant protections—far from it; they are about retaining the status quo, which has for many years struck a workable balance between supporting tenants through temporary difficulty and allowing landlords to respond promptly when rent is not being paid. When landlords are prevented from acting until arrears have been built up to such a degree, the financial consequences can be severe, not only for landlords themselves but for tenants too, who may find the ultimate possession proceedings more inevitable and more traumatic as a result. Early intervention can help avoid escalation.
Amendment 20 in the name of the noble Lord, Lord Carter, is fundamentally right in principle. Landlords who provide a private service in an open market in exchange for a fee should not be penalised for government failure. If the Government fail to make payments, that is not the fault of the landlord, and they should not be made to suffer as a result. Therefore, if the noble Lord was to test the opinion of the House on this issue, we would support it.
These amendments speak to a broader principle that must underpin this Bill—balance. Yes, we must protect renters from unjust eviction, but we must also enable landlords to operate viably, to maintain confidence in the sector and to continue providing the homes that so many people depend on.
Lord Carter of Haslemere (CB)
My Lords, I have Amendment 20 in this group and declare an interest as a former landlord. Amendment 20 was tabled in Committee, but I have retabled it because I do not feel I have had an adequate answer from the Government. The amendment would continue to permit rent arrears which arise from non-payment of universal credit to be taken into account as a ground for possession. Not to do so is unworkable and unfair.
Taking unworkable first, since this is the point which must surely concern the Minister, I suggest that it is unworkable because, unlike in the social sector, private landlords are not allowed to know, under data protection rules, whether a tenant is in receipt of universal credit. The Department for Work and Pensions is not allowed to tell them. As such, the landlord will have no idea whether rent arrears are due to a non-payment of universal credit and, unbeknownst to them, will be legally prevented from taking enforcement action. A landlord might discover that rent arrears were due to a delayed universal credit payment and therefore unenforceable only once the case reaches court, thereby piling yet further quite unnecessary pressure on the justice system. This creates significant uncertainty and risk for responsible landlords, particularly smaller landlords. Disregarding non-payment of universal credit is therefore completely unworkable. It will lead to unnecessary enforcement action, which is surely the last thing this new system needs.
Turning to why it is unfair, I ask why the landlord should be penalised if the non-payment of universal credit is the fault of the universal credit system breaking down in some way. This is especially problematic for landlords renting out just one or two properties who rely on timely payments to meet their own financial obligations. If the Government are serious about sustaining tenancies, then addressing the root causes of delayed benefit payments would be more effective. In other words, protecting tenants from administrative delays should be the job of the welfare system, not landlords. Otherwise, the upshot could well be that landlords will be much more cautious about taking on tenants on universal credit. Is that what Ministers really want?
In response to this amendment in Committee, the Minister told your Lordships on 24 April:
“It is important that tenancies that are otherwise financially sustainable should continue, with tenants protected from one-off financial shocks. For example, it is feasible that a tenant who lost their job and had to apply for universal credit could breach the arrears threshold while waiting for their first payment. Evicting that tenant and potentially making them homeless would not help the situation, whereas giving them chances to resolve the arrears would ensure that the tenancy could continue, benefiting both them and the landlord and ensuring that the landlord was able to claim the arrears once the payments were made”.—[Official Report, 24/4/25; col. 842.]
With great respect to the Minister, I cannot help feeling that this is slightly naive. Is it really of benefit to a landlord to ensure that the tenancy continues when a tenant has accrued three months’ worth of arrears and, in the process, may have seriously damaged the landlord’s financial position—for example, in being unable to support their family or unable to pay the mortgage and forced to take enforcement action? Why should landlords be penalised for the state’s failure to pay universal credit promptly?
Paragraph 24(d) of Schedule 1 should therefore be omitted. It is unworkable and unfair. If, however, the Minister continues to think that paragraph 24(d) is fair on landlords, can she at least give some assurance that they will have a way—notwithstanding the data protection rules—of finding out whether rent arrears are due to delays in payment of universal credit, so as to avoid clogging up the tribunal system with unenforceable claims?
I can help the noble Baroness here, because Section 16 of the Data Protection Act—a Henry VIII power, in fact—enables the Act to be amended so that the list of exemptions in Schedule 2 to that Act is expanded. It could be amended in that way by regulations to enable the landlord to know whether rent arrears are due to delays in universal credit. This would not deal with the fairness points I have made but would deal with the unworkability points. If the Minister were able to give the assurance that the tribunal system will not be clogged up with unenforceable claims, I would not press my amendment.
Baroness Thornhill (LD)
My Lords, much of what we have been debating is about balance. We have heard that word a lot today, and I guess it is fairly obvious to noble Lords by now that when it comes to a balance, we come down in favour of the tenant. We believe the balance has been tilted very much the other way from time immemorial due to the complete lack of supply, the lack of social housing and the beauty parade whereby landlords can choose whom they want to let their properties to.
We feel that the Bill intentionally aims to give tenants more time to address their financial difficulties and therefore avoid eviction. We believe that is the right and the moral thing to do because of the additional cost to society of more homeless and evicted people and more costs to local authorities; it is a nasty, invidious vicious circle. But we do not totally have rose-coloured specs on: we seek reassurances from the Minister that landlords have robust grounds for possession, when necessary, when it comes to arrears. We all know that arrears are painful for landlords, especially if they still have a mortgage, but the good news is that most of them do not. In the situation that the noble Baroness outlined of a couple having one or two houses to rent for their pension—generally properties that were inherited from their parents that they decided to rent out—almost half of landlords do not have a mortgage, and a further 20-something per cent have only small mortgages. More than 70% of landlords are not in a dire financial situation and, as someone rather flamboyantly said, needing to feed their families. I see no evidence of that.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, and the noble Lord, Lord Carter, for their amendments, and the noble Baroness, Lady Thornhill, for her comments.
Amendments 18 and 19 seek to decrease the threshold for mandatory eviction under rent arrears, ground 8, from three months to two, or 13 weeks to eight where rent is paid weekly. I do not believe that this is the right approach. We have taken the decision to restore the threshold for mandatory evictions to the levels originally set by the party opposite in the Housing Act 1988 before they were reduced in the 1990s.
Three months, we believe, is the right balance. It gives landlords facing significant arrears certainty of possession, but allows tenants facing one-off financial shocks enough time to get their financial affairs in order and not lose their home if their tenancy is otherwise sustainable. I assure the noble Baroness, Lady Thornhill, that ground 8 is a mandatory ground, but it is worth noting that mandatory eviction is not the landlord’s only route to possession. Landlords facing frequent arrears and late payment of rent that indicate an unsustainable tenancy can also pursue eviction via the discretionary grounds 10 and 11. For these reasons, I ask the noble Baroness, Lady Scott, to withdraw the amendment.
Amendment 20 seeks to remove a key protection for vulnerable tenants from the Bill. It would allow tenants to face mandatory eviction when they have breached the three-month rent arrears threshold due to not receiving a universal credit payment to which they are entitled. This would not be right. We want to protect those vulnerable tenants who have suffered a change of circumstances, such as redundancy or an accident, by helping them remain in their home. It would not be right for them to face another destabilising event by allowing landlords to evict them, potentially making them homeless because they are waiting to receive universal credit that is due to them. Not being able to pay their rent on time because they have not received universal credit they are entitled to does not mean that they are a bad tenant. It is right that these tenants are given time to resolve their arrears; it is also important that tenancies that are otherwise financially sustainable should continue. That will benefit both the tenant and the landlord.
We have heard concerns that landlords might face uncertainty in pursuing possession claims if they do not realise that arrears are caused by an outstanding benefit payment. That is subsequently used as a defence in possession proceedings. Of course, we would strongly encourage tenants and landlords to communicate; it is clearly in the tenants’ interest to explain their situation before the case reaches court. I note too that there is an element of uncertainty in any possession case, and this requirement is not unusual in that regard.
I have heard the point that the noble Lord, Lord Carter, made about data access and I will take that back to the department. I hope he agrees that we are justified in our approach and that he will not move his amendment.
Baroness Scott of Bybrook (Con)
My Lords, the amendments before us, in particular Amendments 18 and 19, seek to preserve a workable and fair framework that supports both tenants and landlords. The current thresholds, allowing landlords to begin recovery proceedings after eight weeks or two months of arrears, have stood the test of time because they offer a sensible compromise.
Moreover, early intervention is often in the best interests of tenants themselves. Addressing arrears sooner rather than later can prevent problems escalating to the point where eviction becomes unavoidable—a consequence that benefits no one. Our goal must be to craft legislation that is fair and balanced, which ultimately safeguards the rights of renters while ensuring stability for landlords.
Although it is imperative to safeguard tenants from unfair evictions, we must ensure that the protections do not inadvertently place landlords in an untenable position, thereby threatening the very housing supply we all seek. We will not put these amendments to a vote, but we think that Amendment 20, in the name of the noble Lord, Lord Carter of Haslemere, represents a very sensible improvement to this part of the Bill, and we will support him if he chooses to divide the House.
Lord Carter of Haslemere
Member’s explanatory statement
This amendment would continue to permit rent arrears arising from non-payment of universal credit to be used as a ground for possession.
Lord Carter of Haslemere (CB)
I am very grateful for all the support that my Amendment 20 has received. This amendment was genuinely meant. I was concerned about fairness, but above all about workability. The tribunal system, which we will come on to in more detail in later amendments, needs to have before it only the cases that absolutely have to be resolved. The last thing I or anybody wants to happen is for the tribunal system to be clogged up with unnecessary cases, which was my principal concern.
However, I listened to what the Minister said, and I am grateful that she will look more carefully at the data protection point, which, frankly, is a better way of dealing with this than relying on tenants and landlords to speak to each other. On that basis, and if she would be so kind as to write to me once she has had those discussions with the department so that the position is on the record, I will not press my amendment.
Baroness Taylor of Stevenage (Lab)
I just confirm to the noble Lord, Lord Carter, that I will respond to him in writing.
Lord de Clifford
“New ground for possession for property which is required for a carer for the landlord or landlord’s family
24A After Ground 8 insert—“Ground 8A
The landlord seeking possession requires the dwelling-house for the purpose of housing a person who is a carer for—(a) the landlord,(b) the landlord’s spouse, or(c) a member of the landlord’s family who is living with the landlord,where the dwelling-house is in sufficiently close proximity to the person requiring care to facilitate emergency callout.For the purposes of this Schedule, “carer” means an adult providing personal care or nursing care to another person, who may be under the age of 18, under a voluntary or contracted arrangement.The Secretary of State may by regulations amend the definition of carer above.””Member’s explanatory statement
This new ground for possession would allow the landlord to seek possession of a dwelling house where it is needed to house a carer for the landlord, or a member of the landlord’s family, and the dwelling-house is in close proximity to the person requiring care.
Lord de Clifford (CB)
My Lords, I thank the many Peers who passionately supported this amendment. I listened to the Minister and feel that a concession with regard to possession of a house for carers is not forthcoming. Therefore, I would like to test the opinion of the House.
Lord Jamieson
“Possession for redevelopment and regeneration of private rented homes
24A After Ground 8 insert—“Ground 8A
The following conditions are met—(a) the private landlord intends to redevelop the dwelling-house for the purpose of regeneration, and the proposed works cannot reasonably be carried out while the property is occupied; (b) the private landlord has complied with all relevant tenancy obligations up to the date of possession;(c) the private landlord has given six months’ notice; (d) a planning application has been made.In this Ground—“Redevelopment” means—(a) demolition or reconstruction of all or a substantial part of the dwelling-house, or(b) substantial works to the dwelling-house or any building of which it forms part;“Regeneration” means the process of improving an area through coordinated measures that either—(a) secure the redevelopment, refurbishment, or enhancement of land, buildings, or infrastructure,(b) promote economic growth, including through the creation of employment opportunities and support for local enterprise, or(c) advance social wellbeing by improving housing, public services, community facilities, and the overall quality of life for residents;“Private landlord” means a landlord who is not a registered provider of social housing.””Member's explanatory statement
This amendment creates a new group for possession where a landlord has made a planning application, and the proposed works cannot reasonably be carried out while the property is occupied.
Lord Jamieson (Con)
My Lords, we should be supporting regeneration, enabling more housing and employment, and the renting of property in the meantime. While I appreciate the comment from the Minister, I am not reassured. Therefore, I would like to test the opinion of the House.
Renters’ Rights Bill
Tuesday 1st July 2025
(1 year, 1 month ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 103-I(b) Amendment for Report (Supplementary to the Marshalled List) - (1 Jul 2025)
21:42 - Division on Amendment 34 - Ayes: 45 / Noes: 126 - Amendment 34 disagreed.
22:50 - Division on Amendment 43 - Ayes: 23 / Noes: 103 - Amendment 43 disagreed.
Lord Jamieson
Member’s explanatory statement
This amendment prevents the Secretary of State from expanding the definition of “relevant low-cost tenancy” by regulations.
Lord Jamieson (Con)
My Lords, I thank the Minister for taking the time to meet my noble friend Lady Scott and me to discuss the contents of the government amendments in this group. We are grateful that she has returned to the House with what has been referred to as a “break glass” provision, finally acknowledging that the Government’s policy may indeed lead to a significant backlog in the tribunal system.
However, on these Benches we struggle to understand why the Government, having recognised the problem, have not sought to take proactive steps to prevent such a backlog in the first place. Waiting until the system is overwhelmed before acting is not good policy. It also cannot be right that rent determinations made by tribunals can result only in the rent being revised downward. This creates a clear and perverse incentive. There is no risk to bringing a case if the rent cannot go up and can only go down. Why not try your luck? You may as well. It encourages unnecessary and speculative tribunal claims.
That is why I thank the noble Lord, Lord Carrington, and my noble friend Lord Howard of Rising for their consistent work on this issue and for the thoughtful amendments they have tabled. Both noble Lords have highlighted the problem with clarity. The current system gives tenants an incentive to challenge rent, knowing that they have nothing to lose. We would therefore support Amendment 31 should my noble friend decide to press it to a vote. It would correct the imbalance by allowing for rent to be revised upwards as well as downwards, restoring fairness to the process.
Amendment 42, which stands in my name, would require the Secretary of State to conduct a formal review of the tribunal system responsible for rent determinations. We on these Benches recognise the potential for tribunal backlogs that the “break glass” amendment is supposed to address, but we do not believe that will be the case. Hence, we believe that a comprehensive review is necessary to help us understand the true pressure being placed on the system and how best to mitigate it.
I am grateful to the noble Baroness, Lady Wolf of Dulwich, for recognising the overburdening of the tribunal system with Amendment 29, but it would add an additional filtering step rather than seek to reduce the incentive to go in the first place, especially when there is no downside to doing so, which we think would be the more appropriate way of addressing the issue.
Finally, I will say a word on Amendment 24, which concerns preventing the Secretary of State expanding the definition of a relevant low-cost tenancy by regulation. This is important because such a power, if exercised without scrutiny, could significantly broaden the Bill’s scope in unintended ways. It is vital that any change to this definition comes before Parliament not simply through ministerial discretion. From these Benches we look forward to hearing from noble Lords across the House on these issues. I beg to move.
Baroness Wolf of Dulwich (CB)
My Lords, I shall speak to Amendment 29 in my name and in that of the noble Baroness, Lady Thornhill, but before doing so I will thank the Minister, as so many other noble Lords have done, for the courteous way in which she has discussed this issue with me. My amendment seeks to provide for a pre-appeal assessment process to filter out appeals that have no prospect of success and thus avoid overburdening the tribunals. Its specific and highly practical suggestion is that the Government should take advantage of the technical expertise available to them through the Valuation Office Agency. Rent appeals should progress to the courts only if the Valuation Office Agency considers that they have a chance of success.
It seems appropriate to be making this suggestion on the 100th anniversary of the Rating and Valuation Act 1925, which ensured consistency of property ratings across the country by the use of professional valuation officers. I commend this Act to noble Lords. Reading it is quite possible because it is a relatively brief piece of legislation written in language that a normal person can understand. But the main reason I am commending it is that it set up a decentralised but uniform system which gave people across the country consistent decisions on a regular and predictable timescale, with clarity on who was making those decisions and how they could be contacted. This sort of clarity and consistency is surely what we would like for all tenants and all landlords, but the current drafting of the Bill, which loads more work on to a tribunal system that we know is overloaded, is not in a position to deliver this.
As I explained in Committee, my proposal was prompted by current Scottish practice. It does not in any way reduce the right of tenants to appeal against a rent increase, and I am not sure that it even reduces the incentive to appeal on the off-chance, but it does reduce the likelihood that the courts will be overwhelmed very soon by appeals, in particular by appeals which do not succeed and which swamp the courts, to the detriment of important and merit-worthy cases.
Under the Government’s current proposals, tenants will enjoy a number of new and important rights. Rents cannot be increased as often as at present, for example. Most importantly in the context of this group of amendments, tenants who wish to challenge what they see as an excessive rent increase have access to an independent tribunal. The tribunal cannot propose an increase that is any higher than the one initially proposed by the landlord, as the noble Lord, Lord Jamieson, has already pointed out. It can endorse the landlord’s proposal or rule that a lower rent should be charged. Obviously, these charges are of great assistance when landlords are proposing major increases that are out of line with inflation or the market, but, equally obviously, they will encourage a very large number of appeals which are lodged on the off-chance, and I do not think there is any doubt that this would be disastrous. In the other place during the Public Bill Committee, Minister Pennycook observed:
“There is no dispute on the Government side of the Committee as to the fact that the court system is on its knees”.—[Official Report, Commons, Renters’ Rights Bill Committee, 22/10/24; col. 9.]
He added “after the past 14 years” but the relevant point here is that the court system is on its knees.
As first introduced, the Bill provided that the tenant who appealed against a rent increase where the tribunal found this was allowable would pay the increase only from the date of the tribunal decision, which could be many months on. This clearly hugely increased the incentive to appeal, and I think it would also have been seen as massively unfair by any tenant who accepted an increase without appealing and then saw a fellow tenant getting months at a lower rate. So, I was very pleased that the Government recognised this risk and I look forward to the Minister explaining how the government amendments will work in practice.
However, I do not think this is enough to head off tribunal overload, which is why I have retabled my amendment. There will still, for many people, be a sense that they have nothing to lose by appealing. If I were an officer in a student union, for example, and I was asked my opinion, I would have to say that appealing remains something of a no-brainer. I would have to say the same if I was on a radio programme or an online forum. Why would you not? I therefore remain convinced that, in the absence of some sort of prior screening of the type that I have suggested, the courts will be overwhelmed.
In Scotland, the first stage in any appeal goes to Rent Service Scotland. Apparently, on average, it takes just five days to respond and most things stop there; very few cases go further. Obviously, the Scottish situation is very different from ours, but it is also obvious that, when it comes to providing tenants and landlords with quick feedback rather than months in limbo, it is very effective. It is also obvious, given the volumes that Rent Service Scotland deals with, that without this prior system there would be a very large number of cases which were effectively a waste of time.
It would be very easy for us to introduce a similar first-stage process in England. There is a large amount of expertise on rents outside the tribunals and the courts. The Valuation Office Agency already gives the Government valuations and property advice that they need to support taxation and benefits. Rents in social housing are tightly regulated. Registered providers must comply with the Regulator of Social Housing’s rent standard or rent settlement, which is effectively set by the Government, and its annual increases would be an obvious and simple yardstick to use when evaluating whether appeals should go on. Rent officers also still set rents for the remaining group of protected tenancies, so the basic infrastructure is there.
To see what we are facing, I think, as I thought in Committee, that a bit of back-of-an-envelope arithmetic is in order. The Government do not think there will be a huge growth in open appeals. If appeals from private sector tenants tracked the levels going to Rent Service Scotland and they all proceeded to the tribunal, we would end up with another 40,000 cases a year. That compares with 909 cases heard by the tribunals under current legislation in England, so that would be a fortyfold increase. But suppose that it was only a quarter of that level; that would still be a tenfold increase, with 10,000 extra cases a year hitting First-tier Tribunals that are under enormous strain. We hear a lot in the press about pressures and backlogs in criminal courts, but the statistics for the tribunals are at least as grim. In the year 2024-25, the open case load total—excluding immigration and asylum—rose to 745,000, which is an increase of 14% in the course of a single year.
The Minister was kind enough to discuss my amendment with me following Committee and to recognise that a provision for initial screening could be helpful if tribunals were indeed overwhelmed. In the absence of any government amendment to that effect, I look forward to hearing from her about the Government’s current thinking. I also highlight the enormous importance of reviewing the impact on the judicial system, which we will return to later on Report.
Baroness Jones of Moulsecoomb (GP)
My Lords, I shall speak to Amendment 30 in my name. I take the point made by the noble Baroness, Lady Wolf of Dulwich, that it is good to have something easy to read. I would say that this amendment is very easy to read: it would amend the Housing Act 1988 so that, when determining rents, tribunals must disregard any improvements funded by government grants for a two-year period.
The amendment, which I feel strongly about, is designed to help renters and the Government. It aims to improve upon a good policy that creates warmer homes and cheaper bills. The climate benefits from the warmer home grant, as do landlords, so why not guarantee that tenants get cheaper bills without a rent rise for a couple of years?
I met the Minister last week. She is very generous with her time, and I was grateful for her comments, but I still do not see the problem with passing the amendment. There are complexities, and the tribunals would have to sort out any details if the property owner added some of their own money along with the taxpayer money, but tribunals make far more difficult calculations every week. I have also heard privately from several people just how difficult it is with tribunals, but that is the sort of thing that must be fixed. They really cannot be allowed to wallow and not be the tribunals that they need to be.
The important thing for me in this amendment is that taxpayer-funded improvements are not used as an excuse to raise rents, and we need the force of law backing that up. Although the guidance is slightly more explicit, it will get ignored and that will discredit a good policy. Generation Rent recently did a poll of renters, asking them about their support for the Government’s policies in this area. There was a net support increase from plus 14% to plus 55% when renters were presented with a scenario where the Government would protect them from rent increases. I do not want to suggest that the Government should be run by opinion polls, but it is wonderful when you can do something that is right, does not cost any extra money and leads to a 41% jump in the popularity of that policy—and also, hopefully, the popularity of the Government.
I had hoped the Government would put this forward as their own idea in some form or another. I have been told privately that it is not nuanced enough, and that is possibly a fault of my nature, but I think it is a good amendment and hope that the Government will give it due attention.
Lord Howard of Rising (Con)
My Lords, I shall speak to Amendments 31 to 33 in my name. I declare an interest as a landlord of rented properties.
When I pointed out in Committee that the Bill as drafted would create a conservative 1 million applicants to the rent tribunals, the Minister commented that that was
“unlikely, to say the least”.—[Official Report, 28/4/25; col. 1045.]
In a recent letter from her, recognition was given that there is an inherent uncertainty about the volume of rent challenges. The proposed new delegated power to backdate rent increases acknowledges the potential difficulties. Welcome as that proposal is, it does not start to address the fundamental problem. At best, it will provide some temporary window dressing. The Government might recognise that the system may be overwhelmed, as the noble Baroness, Lady Wolf, pointed out very cogently, but promoting appeals to the rent tribunal in the first place is the crux of the problem when the Bill still provides that the tribunal can only confirm or reduce the rent, not raise it. That creates a no-lose situation for tenants.
Amendment 31 addresses the most fundamental of the structural flaws. It would remove this restriction that the tribunal may only reduce or uphold a proposed rent, not increase it. If a tribunal can only confirm or lower a rent and never raise it, that is a one-way ratchet. As my noble friend Lord Jamieson pointed out, if things can only get better, what possible reason is there not to try it on? There will be no loss, and until and if the Secretary of State regulates to backdate rent increases—and how speedy that will be with two Government departments having to consult over it is noble Lords’ own guess—there will be a decent delay in any increase being implemented. It becomes a virtual necessity for a tenant to challenge.
Amendment 32 would ensure that in the event the tribunal determines that the rent initially agreed was too high, landlords are not retrospectively liable for backdated repayments to tenants of an agreed rent. This is simply a matter of fairness and legal certainty: if a tenant has freely agreed a rent at the outset of a tenancy, it should not be open to the tribunal to rewrite an agreement and impose retrospective liability on the landlord. It would set a worrying precedent.
Lord Carrington (CB)
My Lords, I shall speak to Amendment 34 and the associated Amendments 35, 36 and 40 in my name and kindly supported by the noble Lord, Lord Hacking. First, I thank the Minister, the noble Baroness, Lady Taylor, for her ongoing engagement with me and other noble Lords and Baronesses throughout the steps that this important Bill has taken thus far. My amendments concern a vital part of the Bill: the right of renters to challenge annual rent increases.
There remains strong consensus across this House and in the other place that stands with the Government in ensuring that unreasonable and exploitative rent increases are avoided. Such increases should not be used in this way across the private rented sector as a means of eviction through the back door. However, despite the Government’s own recent amendments, which I will turn to in due course, I remain strongly of the opinion that the Government’s current drafting of Clause 7 will not work, even with the new failsafe mechanism that has been added in the name of the noble Baroness, Lady Taylor.
It remains the case that under the current wording of the Bill, renters will have a universal right to challenge any and every rent increase they receive, in all circumstances and without qualification. Moreover, increases that the First-tier Tribunal agrees will come into effect only once the tribunal has given its ruling. This wording continues to have the very real and dangerous potential to undermine the supply of new rental homes in England and, at the same time, overwhelm the courts.
The Government believe that renters will apply to the tribunal only if they believe that a rent increase is above market rents. Like others, I am afraid that will not be the result of this legislation. The legal text of the Bill still sets out that a rent increase could not come into force until after the tribunal rules. The result of this drafting is to create an artificial incentive for all renters—all 4.5 million of them—to submit a challenge to a proposed increase in rent from their landlord, however legitimate. This would prevent the increase coming into force until the tribunal decides. There is no risk to the renter in this, as it provides a guaranteed delay. Once this is widely understood, as was pointed out by the noble Baroness, Lady Wolf, renters will exercise their right as a matter of course. Indeed, I expect a celebrity such as Martin Lewis would immediately note the opportunity to delay rent increases as a money-saving tactic for renters.
This incentive also risks the efficacy of the First-tier Tribunal by burdening an already struggling court with thousands of cases. This would result in those in real need waiting potentially months longer for access to justice from exploitative landlords. The Government rightly want renters in genuine need of redress to have access to the court, but the queue for justice will be too long for this to prove realistic.
My amendments seek to ensure that if a rent increase is challenged, but the increase is upheld by the tribunal, the rent increase becomes effective from the original date of the Section 13 notice. This important detail removes the incentive for spurious challenges that are being used only as a delaying tactic by renters who are challenging their rent increase because they simply want to delay payment of it. By removing this incentive, only those renters with real cause and who are being exploited, and are therefore likely to get the support of the tribunal’s decision, will challenge rent increases. These are the very people who should be at the front of the queue when it comes to these sorts of challenges.
I turn to the amounts of money we are looking at when it comes to rent increases. I want to explain how my amendments, while deterring spurious challenges, also support renters who challenge their rent but with whom the tribunal is not in agreement. The Office for National Statistics notes that the average rent per month in the United Kingdom, in the 12 months to April 2025, was £1,339. The average rent increase across the UK in the same 12-month period was 7%. Therefore, if we were to take 7% as a marker for the rent increase in the next 12 months, we would be looking at the average rent across the UK increasing by around £93 per month.
Now, £93 can be a good deal of money to many across the country, particularly as the cost of living crisis continues. This pressure on household finances has not been overlooked in my amendments, which cover the concerns of the Minister and others that renters may be put under undue financial pressure if they are unsuccessful in their rent challenges and are required to pay back large lump sums of backdated rent at once.
Under the Bill, every renter from the time it is implemented would have the ability to challenge and delay the £93 per month annual increase without needing to provide a reason, be it financial or otherwise, as to why they are challenging that increase. However, if the tribunal, when it eventually gets to each and every challenge, judges in the landlord’s favour, my amendments would ensure that instead of that renter needing to pay their landlord a backdated amount of rent immediately, a 12-month payment plan would be put in place. This means that if it took six months for the challenge to be reviewed by the courts and a decision made, the renter would not need to find the extra rent immediately but would need only to find the extra £46.50 each month over the next 12 months to pay their landlord in backdated rent. This seems entirely reasonable, and I hope the inclusion of this amendment has been carefully considered by the Minister.
I now turn to the Government’s assessment that renters will apply to the tribunal only if they believe a rent increase is above market rents. The Government are placing a great faith in this opinion and have commissioned a new burdens assessment and justice impact test, which is referred to many times throughout the Bill’s impact assessment, from November last year. However, we have not been able to review or scrutinise these two important documents, as they have not been published. Were we able to see and scrutinise them in this place, many of us may be reassured by the Government’s current opinion on levels of renters who will challenge their rent, but while the Government restrict access to these documents, we must rely on what the Bill says and our understanding of renters and the PRS as it stands in a time when household finances are tight and there is every incentive to delay a rent increase.
The Government have tabled a fail-safe amendment to Clause 7, but again there is a lack of detail here too. In Amendment 37 in the name of the Minister, the noble Baroness, Lady Taylor, we are not given clarity around when such a power would be used and what the trigger for this would be. What level of caseload would the tribunal need to face before the Government were to step in and introduce backdating? Therefore, while I applaud the Government for considering Clause 7 and tabling this amendment, I fear it will do nothing to reassure the sector. It is also interesting to note that in the event of the introduction of the fail-safe mechanism, rents will be charged from the date of the Section 13 notice—quite a reversal of policy from the tribunal decision date. If we had the detail around when such a statutory instrument would be enacted, we might be able to agree with the Government on the amendment, but as it stands, sadly I cannot.
To sum up, taken together, I believe that Amendments 34, 35, 36 and 40 in my name would deliver a fair result. They are technical changes that keep the vital rights of renters to challenge from being exploited, while reducing the artificial, jeopardy-free incentive to take any and all landlords to court for reasonable increases in line with the market. The amendment giving protection to renters who lose their challenge with the 12-month payment plan should also be strongly considered by Government.
Lord Hacking (Lab)
My Lords, I put my name to Amendments 34 and 35 from the noble Lord, Lord Carrington. The noble Lord has given such a precise and detailed reasoning for all those amendments that there is nothing I can really add to what he said, but I would just like to remind the House—particularly my noble friend the Minister—of the point I made earlier when I was speaking about Amendment 1 of all the amendments before us on Report; that is, the value to the House of having the expertise that the noble Lord, Lord Carrington, presents in supporting his argument. Indeed, I ask for particular attention from my noble friend the Minister to the points he raised relating to her amendments, which are also before us in this group. If she does nothing else, I hope my noble friend will take careful note of the improvements that the noble Lord, Lord Carrington, suggests should be made to her own amendments.
Lord Carter of Haslemere (CB)
My Lords, I strongly support the amendments tabled by the noble Lord, Lord Carrington, which have been supported by the noble Lord, Lord—
Lord Carter of Haslemere (CB)
Not at all.
It is not just obviously fair that the tribunal should be required to backdate the rent; it would also remove the incentive for tenants to challenge every rent increase, come what may. Landlords who increase rent to market value should not be penalised by being unable to backdate that rent to the date of increase where there is an unsuccessful challenge. Otherwise, it makes a mockery of the tribunal process, which is there to determine the legal right of the landlord to increase the rent to the amount proposed. If that right is upheld by the tribunal, like other legal rights that are litigated successfully in our civil courts, it should be upheld from when it arose, with a remedy backdated accordingly. That is how our civil justice system works. For example, if I successfully make a claim against a defendant for negligence, nuisance or breach of contract, damages will generally be assessed from the date the claim arose. That is how justice is meant to work. It should be no different here. The correct market rent, upheld by the tribunal, should be backdated to the date of the original increase.
Baroness Eaton (Con)
My Lords, I declare my interests as a vice-president of the Local Government Association and as the part-owner of a small number of rented properties in West Yorkshire.
I will speak in support of Amendments 29, 34, 35 and 36, which are in the names of the noble Baroness, Lady Wolf, and the noble Lord, Lord Carrington. Your Lordships may recall from my contribution at Second Reading that I am deeply concerned about the impact of this Bill on rented housing supply. I remain concerned about this issue. However, these amendments provide me with the reassurance that I know the rental market is also looking for. The amendments are technical, but sensible and clearly thought through.
If the Government are to get anywhere near reaching their ambitious 1.5 million new homes target, we need to support and give clarity to the responsible institutional build-to-rent landlord sector, which is building thousands of new, high-quality rented homes each year. I know that this part of the rental market supports the Government’s aim to raise standards across the private rented sector. However, with the uncertainty it faces around how much rent it may reasonably receive and how many rent increase challenges it may receive, I worry that its development pipelines will slow or, at worst, completely halt, while it assesses this new landscape where any renter can challenge any increase without any jeopardy.
Amendments 29, 34, 35 and 36 would allow for those providing new, net additional high-quality rental homes to the market to continue to do so without undue impact from Section 13 rent increase challenges. They would allow the institutional landlord sector to continue delivering the net additional rented homes we need without uncertainty. Crucially, the amendments would deter spurious rent increase challenges and allow vulnerable renters the access to justice that they rightly deserve.
I acknowledge the Government’s amendments on Section 13 notices, but they also leave me concerned that, in this place and indeed in the rental market, we and the sector are being asked to place a significant amount of faith in the Government, and the data they have but will not publish, on how many renters might challenge their rent increases. If a renter can save themselves months of rent increase for free and without any jeopardy, why would they not?
I am therefore strongly of the opinion that the amendments in names of the noble Baroness, Lady Wolf, and the noble Lord, Lord Carrington, provide the requisite amount of clarity to the sector, while ensuring renters’ rights are improved. I urge the Government to take them on board to give everyone clarity while improving renters’ rights and access to justice for vulnerable renters.
Lord Young of Cookham (Con)
My Lords, I will be very brief. I strongly support Amendment 29 so ably moved by the noble Baroness, Lady Wolf. I recall that, when we debated this in Committee, the noble Baroness got a favourable response from the Front Bench, and it may be that on this amendment the ice is beginning to melt.
I am also struck by the contrast between the certainty that we get with Amendment 36 from the noble Lord, Lord Carrington, and the absence of any clarity and certainty from government Amendments 37 onwards. As the noble Lord, Lord Carter, said, it is normal procedure in law if a rent increase is valid to backdate it from the date that it was due, so the Government are introducing a wholly new concept in law in their Amendment 67, which does not actually take the trick because, as I understand it, they are going to wait until the system is gummed up before they activate the process.
This is simply no way to govern. The Government ought to accept Amendment 36 with its clarity and certainty, rather than this doubtful procedure whereby there remains every incentive to appeal and only when the system becomes even more clogged will the Government intervene. That cannot be good government, and I urge the Minister to think again about Amendment 36 or the other amendment that achieves the same objective in the name of my noble friend Lord Howard of Rising. I just do not think that this takes the trick.
Baroness Thornhill (LD)
My Lords, I do not know which amendment to start with really, but I will start with the least contentious. We agree with Amendment 42 that a review is imperative and should definitely happen.
On Amendment 30 from the noble Baroness, Lady Jones, it seems absolutely right to us that, when the taxpayer funds lovely, significant improvements that will raise the value of the landlord’s asset, the tenant in the house should be protected from a rent rise at least during that tenancy. That seems only right and fair.
Amendment 29 from the noble Baroness, Lady Wolf, which I supported in Committee and co-signed, is a sensible amendment that several noble Lords have said they would support. I think she has explained it at length and with clarity, so I need say no more. But anything that acts as a triage system in this process should be looked at seriously.
On the controversial bits, the rent tribunal is clearly causing concern. I say to the Minister that I think there was an invitation in the last speech to look at this again—there will be Third Reading. It seems to me that a lot of work has gone into these amendments that would justify perhaps a little more time and effort than we have now. The Minister has a lot to justify in order to gain support from the House. We are minded to support the Government, but clearly we need answers on the very detailed and sensible proposals put forward today.
What worries us about Amendment 31 is that it risks allowing a tribunal to determine the level of rent increase, which could actually be unaffordable. The idea that a rent tribunal could decide that the rent should be such-and-such would fuel a market in which rents are rising exponentially, more than they have at any other time—the amendment would seem to fuel that further. We certainly do not agree with rent controls, but we believe that some brakes could be put on this; that would seem eminently sensible.
Perhaps I am looking at this through the wrong lens, but I would have thought that a tenant might expect an annual rent rise: “I am in my rented apartment and I am expecting the landlord to put up the rent in a year because I know what’s going on in the area, so I can kind of suss out how much it might be”. But, looking at it from the other way, if we assume all the things that noble Lords have said about everyone applying to the tribunal—Martin Lewis will be saying they should apply and the student unions will be on it—why would a landlord, knowing all that, impose a stupid rent rise if he knows that his tenant can then appeal against it? That should put an instinctive brake on unjustified, unrealistic rises. The system should work with those natural tensions.
We are not happy with it, but we have had conversations and thoughts about the proposal. We would ask the Government to look again at some of the detail. Perhaps with some assurances from the Dispatch Box, we could avoid a load of votes now and at Third Reading because I think that we would want the Minister to look in more detail than I personally, I admit, have done, if that is fair to say.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Baronesses, Lady Scott, Lady Wolf and Lady Jones, and the noble Lords, Lord Carrington and Lord Howard, for their amendments on rent increases and the tribunals, as well as the noble Lords, Lord Hacking and Lord Carter, and the noble Baronesses, Lady Eaton and Lady Thornhill, for their contributions to the debate.
Government Amendment 37 will enable the Secretary of State to make regulations to change the date from which tenants are required to pay a new rent in instances where the First-tier Tribunal has set one following a challenge to a proposed rent increase. Government Amendments 38 and 39 are consequential to that.
Our Government were elected on the clear manifesto promise to empower tenants to challenge unreasonable rent increases. It is essential that we deliver on this commitment, not only to protect tenants from undue financial pressure but to prevent rent hikes being used as a form of backdoor eviction once Section 21 notices have been abolished.
During the Bill’s passage, the House has debated at length the capacity of the justice system to enable the smooth implementation of reforms in the Bill. This is particularly the case on the subject of rent increase challenges, in relation to which noble Lords have expressed very serious concerns that strengthening tenants’ rights might lead to the First-tier Tribunal being overwhelmed by a sharp increase in challenges.
Set against that concern, we have heard powerful testimony from many tenant groups that private renters, many of whom are struggling to juggle family life, multiple jobs and financial challenges, are unlikely to spend what little time they have navigating the justice system unless they have a compelling reason to do so. Given the cost and effort that challenging a rent increase at tribunal would require, as well as the risk it poses to a tenant/landlord relationship, there is good reason to doubt that a significant number of tenants will bring rent increase challenges that have little prospect of success—who knows what will happen if Martin Lewis gets involved, but we will wait and see.
We also know that the majority of landlords act responsibly, and we do not expect that many will seek to serve unreasonable rent increases given that this will increase the likelihood of a tenant challenging them at tribunal, as the noble Baroness, Lady Thornhill, said. If landlords do not impose egregious rent increases, they will not get taken to tribunal. We recognise, however, that there is inherent uncertainty as to the volume of rent increase challenges that will be brought when the new tenancy system comes into force.
The noble Baroness, Lady Wolf, mentioned the system in Scotland; as she will know, the changes made there are very different from the ones that we are proposing.
As the House will know, we are already working very closely with the Ministry of Justice to make sure that the justice system is well prepared for our reforms. In the Property Chamber, work is progressing to increase capacity, as well as reviewing resource and working practices in readiness for any increase in demand.
Baroness Wolf of Dulwich (CB)
Since I cannot withdraw my amendment, I thank the Minister very much for this constructive engagement, and I will not move it.
Baroness Taylor of Stevenage (Lab)
I am grateful to the noble Baroness.
Regarding Amendment 24, at present private registered providers of social housing can grant secure or assured tenancies. The majority of these are let at social rents. Social rents are regulated by the social housing regulator. The definition of “relevant low-cost tenancy” in the Bill reflects these arrangements. If the Government or the social housing sector were to change how rent is determined or regulated, this power would enable the Secretary of State to make technical amendments to reflect this or other changing circumstances. As the power relates only to the definition of relevant low-cost tenancies, I assure your Lordships that the Secretary of State will not be able to use this power to change the legislation to affect market-rate tenancies. Based on this, I ask the noble Baroness, Lady Scott, to withdraw this amendment.
Turning to Amendment 30, I thank the noble Baroness, Lady Jones, for her engagement on this issue. The Government fully support efforts to improve the energy efficiency of homes in the private rented sector, particularly where tenants are proactive in accessing support through government-backed schemes. The amendment as drafted would mean that any increase in value arising from these improvements would be disregarded, even if it was funded partly by public money. Therefore, if landlords have made sizeable investments themselves in improving the energy efficiency of their properties without government grants, under this amendment they would not be able to increase rent to reflect those improvements.
The tribunal has experts, such as surveyors, who will assess what the landlord could expect to receive if re-letting the property on the open market. Both landlords and tenants will have the opportunity to submit evidence on whether or not they think that the rent increase is justified. The tribunal already ignores any improvements to the property made by the tenant, to avoid inflating the rent. However, it is likely to be more challenging in practice for the tribunal to differentiate rent levels based on whether energy-efficiency upgrades were funded through specific grant schemes—particularly where the tenant was not directly responsible for the work. This may complicate the tribunal process.
We recognise that it is very important that means-tested energy-efficiency grant schemes are used to benefit tenants. That is why, for the warm homes local grant, which was launched in April, the Department for Energy Security and Net Zero has set a clear expectation that landlords should declare that they do not intend to raise rents as a direct result of the upgrades being made. In Committee, the noble Baroness, Lady Jones, rightly highlighted the importance of ensuring that landlords do not profit unduly from government-funded improvements and that the value of these schemes should flow primarily to tenants, given the impact on many people living in poverty, and the threat of eviction. We have carefully considered these points and believe that the measures already being introduced strike the right balance.
In conclusion, the landlord declaration, introduced and overseen by DESNZ through the warm homes local grant, will include a commitment from landlords not to increase rents as a result of improvements made using the grant funding. I hope that this offers the noble Baroness, Lady Jones, reassurance that the Government are taking this issue seriously. For those reasons, I respectfully ask her not to move her amendment.
The noble Lord, Lord Howard, has proposed two amendments to the process for challenging rents at the tribunal within the first six months of the tenancy. On Amendment 31, the ability to challenge rent in the first six months of the tenancy is a vital safety valve, ensuring that tenants cannot continue to be ripped off if they have been pressured into an unfair rent. Landlords who have agreed a fair market price have nothing to fear from this mechanism. This amendment would exacerbate the worry that tenants already face about going to a tribunal to enforce their rights. Tenants will not challenge rents if they risk being worse off following a tribunal ruling. The Bill encourages tenants to engage the tribunal when they have legitimate concerns. By reinforcing the rights of tenants to do so, we are disincentivising the minority of landlords from pressurising tenants into unfair rents at the beginning of a tenancy. The way for landlords to avoid this is to make sure that their rents are fair at the start of the tenancy.
On Amendment 32, the Government are clear that tenants should submit an application to the tribunal during the first six months of their tenancy only where they believe that their rent is above market rates or that they have been pressured into an unjustified initial rent. In the first instance, we strongly encourage landlords and tenants to communicate about what adjustments to rent might be reasonable. The noble Lord asked how a tribunal determines a fair rent. To determine the market rate, the First-tier Tribunal considers a wide range of evidence, such as the price of similar properties being advertised online and evidence submitted from both parties justifying or arguing against the rent increase.
The First-tier Tribunal has experts who are experienced in understanding the different factors that result in the market rate and determining whether the rent is reflective of this. The First-tier Tribunal is best placed to do this in the new tenancy system. It is also worth noting that tribunals have had the power to adjudicate rent levels in line with the market rent since the Housing Act 1988, and since then the market rate has continued to increase. However, if the rent is challenged and the tribunal determines that a rent exceeds the open market rate, it is right that the tribunal can backdate the lower rent to the date of the tenant’s challenge and that the landlord repay the difference to the tenant. I therefore ask the noble Lord, Lord Howard, not to press his amendments.
I turn now to Amendments 33 to 36 and 40. The Government recognise that some tenants may avoid challenging unreasonable rent increases out of fear that they will be saddled with significant amounts of backdating, which they will be unable to afford. By removing the ability of the tribunals to backdate a rent increase, tenants, particularly vulnerable tenants, will be empowered to challenge what they believe to be an above market rate rent increase. This reduces the risk of an unreasonable rent increase causing a tenant financial hardship, or even being used to force someone out of their home. This is a really important measure to encourage people to challenge unreasonable rent increases.
Amendments 34 to 36 and 40 in particular may only heighten the risk of vulnerable tenants feeling unable to challenge an above market rent increase. We know that tenants and landlords are usually eager to maintain a positive relationship and will not bring the other to court or tribunal without good reason. As such, I ask the noble Lords, Lord Carrington and Lord Howard, not to press these amendments.
I turn finally to Amendment 42. The tribunal has over 30 years’ experience in making determinations of unfair rent increases, having carried out this function since the Housing Act 1988. We have full confidence in the tribunal’s ability to carry out this function in a fair way. I appreciate the need for the justice system to be ready for our reforms and for landlords and tenants to access justice in a timely way. We are working in partnership with the Ministry of Justice to assess the impact of our reforms on the tribunal and to lessen these wherever possible. This close collaboration has been ongoing for a number of years and in a great amount of detail.
The amendment we have tabled to our rent increase measures shows that we are listening to the concerns of the sector and this House about tribunal workloads. It puts in place a safeguard in case it is needed. We will already be collecting extensive data to assess the impact of these reforms. As set out in the impact assessment for the Bill, and in debate, we have committed to monitor and evaluate our reform programme. We will use a range of sources to support this. Existing datasets will be used, and new data will be collected. We are committed to publishing the evaluation findings at the two and five-year points after the Bill’s implementation.
I will respond to the request from the noble Lord, Lord Carrington, about the justice impact test. The justice impact test we are undertaking with the Ministry of Justice will identify additional burdens on the justice system, but they are internal government documents and are not published. The test is ongoing and regularly reviewed to ensure that it reflects any changes to legislation as the Bill continues its journey through Parliament. We are fully focused on making sure the justice system is prepared for changes to court case load and procedures that will be required for our reforms. We are working with the Ministry of Justice and HM Courts & Tribunals Service to that effect, including investing additional court and tribunal capacity to handle any extra hearings generated.
In this context and in the context of the review that I have already outlined, both in the course of discussing these amendments and earlier today, I do not think it is necessary to commit to undertake any further review. On that basis, I hope that the noble Baroness will agree to withdraw her amendment.
Lord Jamieson (Con)
My Lords, I thank the Minister for her reply and for setting out the Government’s amendments. However, we remain disappointed that the so-called “break glass” power is reactive in nature and fails to address the underlying incentives that drive unnecessary cases. Noble Lords across the House have raised the risk of the tribunal system being overwhelmed. Although I listened carefully to the Minister’s comments on mechanisms, there are no firm proposals. Therefore, on that basis, we will support my noble friend Lord Howard of Rising on Amendment 31 if he is minded to push it to the vote.
As the noble Lord, Lord Carrington, has raised, and we requested in Committee, the Government have failed to publish the justice impact test. I heard the Minister’s comments, but I asked her to publish it before Report given its importance and the concern across the House about the impact of the Bill on the justice system.
Amendment 42 seeks a review of the impact on the tribunal system. As we have another amendment later, reviewing the impact on the justice system in its entirety, we will not press this amendment now.
Serious concerns remain about the Secretary of State’s discretion to expand the definition of low-cost tenancies. I urge the Government to reflect carefully on the breadth of the powers they are granting. That said, I will withdraw this amendment.
Lord Best
“(4F) It shall be an implied term of every assured tenancy to which this section applies that for a period of four years from the commencement of the tenancy the percentage increase between the existing rent and any new rent specified in a notice given under subsection (2) must not exceed whichever is the lesser of—(a) the percentage of the rate of inflation calculated by reference to the consumer price index since the date on which the existing rent took effect, or (b) the percentage increase in median national earnings calculated over a three-year period by the UK Statistics Authority, ending on the date on which the notice was served.”Member’s explanatory statement
This amendment provides for in-tenancy rent increases to be index-linked on the basis of CPI or increases in national annual earnings. This seeks to avoid the uncertainties for a period of up to four years of rents being determined at unknown – and potentially unaffordable – market levels.
Lord Best (CB)
My Lords, in moving Amendment 25 in my name and those of the noble Lord, Lord Young of Cookham, and the noble Baroness, Lady Grender, I will also speak to my related Amendments 26 to 28. I declare my interests as a vice-president of the Local Government Association, the Chartered Trading Standards Institute and the Town and Country Planning Association, and a past chair of the Affordable Housing Commission. My wife owns rented property in Dorset.
I fear the Bill still contains a fundamental flaw in its provisions for rent increases. Quite properly, the Bill seeks to ensure that tenants are not subject to huge rent rises, which can have the effect, as the Renters’ Reform Coalition and Shelter have made so clear, of evicting them from the property. But the Bill’s way of solving this problem creates considerable hazards for tenants and landlords alike.
To prevent exorbitant rent increases, the Bill relies on the renter taking their case to the First-tier Tribunal, which will determine a market rent that cannot be exceeded. That arrangement is fraught with difficulty. The first problem with a system dependent on a tribunal’s judgment is that deciding on a market rent is not a science. The outcome of tribunal hearings can be unpredictable and sometimes appear arbitrary. The second drawback is that renters must take on a daunting task. They are likely to fall out with their landlord, on whom they depend for continuing service, and to appear in person they may need to give up a day’s work, incur travel expenses and experience a troublesome and intimidating process. Thirdly, the tribunal’s decision on what is the market rent may still involve a big rent hike, well ahead of rises in incomes, and can thereby present an impossible affordability obstacle for the tenant, which is the very problem the process was intended to avoid.
From the perspective of the landlord, many of your Lordships have been concerned that the tribunal will get clogged up with thousands of time-consuming appeals. I was pleased to hear that the Minister is looking at an amendment to make use of the Valuation Office Agency to weed out appeals that are likely to fail. She is also introducing an amendment that reduces incentives for renters to appeal by enabling the Secretary of State to allow at a later date a backdating of the rent increase that is determined by the tribunal. By making the appeal process more risky, this new measure could deter renters who have a good case for pursuing an appeal. In any case, it is a fallback, a long-stop that might not be introduced for some time, if at all.
More helpfully, Amendments 25 to 27 would provide clarity and security for the renter and the landlord and give confidence to responsible investors. The amendments would mean rent increases being capped on an indexed basis using either CPI or the rise in earnings averaged over the previous three years. The indexation would be limited to three annual increases, after which the landlord could charge a market rent, if necessary determined by using the process of appeal to the First-tier Tribunal. This model surely represents a fair solution to the need for moderation of rent increases without reliance on appeals to the FTT and all the problems that brings.
In returning to this matter on Report, I have added the new Amendment 28, which addresses a criticism of the indexation approach. This amendment tackles the valid objection that there may be exceptional circumstances in which an indexed increase would not be fair to the landlord; for example, the landlord may have spent substantial funds to improve the property which could justify a rent increase that contributes towards the cost. The new amendment enables the landlord—not the tenant—to ask the tribunal to approve the setting of a rent in excess of the otherwise automatic indexation.
The amendments cut out the need for renters to take matters to the tribunal and therefore to enter into a battle with their landlord. Most tenancies do not last more than four years, so for most tenants, the arrangement would mean the certainty of indexation of rent increases, whereas the fickle market might have meant much greater rent increases. I believe this is a far better way of limiting increases than currently in the Bill. It cannot be described as rent control. It is time limited—and not comparable with failed rent control measures in other countries. It is fair to landlords and entirely preferable to the hassle and uncertainties of them being taken to the tribunal. It avoids the clogging-up problem that may mean that the tribunal system is going to be overwhelmed. Here is a package that has real benefit for landlord and tenant alike. With thanks to my co-sponsors, I beg to move.
Lord Young of Cookham (Con)
My Lords, I have added my name to the amendment of the noble Lord, Lord Best. I will add a brief footnote to what he has just said. As we heard in the last debate, there has been considerable concern about the capacity of the courts to handle the volume of appeals that will go to the tribunals when the Bill becomes an Act. The backlog has been going up: in the first quarter of 2025, the average time between a landlord submitting a claim and getting possession was over seven months—32.5 weeks, up from 29.8 weeks a year ago.
The Minister uses a different figure—eight weeks—but that covers only getting a possession order, not actually getting the property back. In an earlier debate, the Minister implied that it was actually quite difficult for a tenant to challenge an increase in rent. I respectfully disagree with that. There is a whole range of organisations that will give tenants advice on how to challenge an increase from the landlord.
This Government have made it clear that, unlike the previous Administration, they are not prepared to wait until the necessary reforms to the court processes are in place before they activate the Bill. That is a decision they are perfectly entitled to take, and it will be welcomed by tenants. However, a necessary corollary of that decision should be a process to minimise the chance of the courts being overwhelmed, which would be in the interest of neither tenant nor landlord. That is what Amendment 25 does.
The likelihood of the rent—a market rent when it was fixed—diverging significantly from CPI or RPI over four years is quite small. The certainty that goes with that guarantee will be welcomed, I think, by both tenant and landlord. If, after four years, there is a divergence, as the noble Lord, Lord Best, has explained, the rent can then catch up. As someone who voted for the Housing Act 1988, which abolished rent control, I see no problem with this measure to simply smooth increases over a four-year period. Again, speaking personally, if at the end of the four or five years the courts have shown themselves to be up to speed, with no backlog, I would be happy to see this provision lapse, but in the meantime, I hope the Government will smile on it.
Lord Cromwell (CB)
If I may add one note to what the noble Lord has just said, it is very common in commercial contracts to have CPI over a series of periods followed by a reset to market level, in part because CPI may take it up too high and it comes back down to market level. I think that needs to be part of this amendment.
Baroness Grender (LD)
My Lords, we support the amendments in this group concerning rent affordability, a matter that strikes at the heart of the lived reality of millions of tenants. We welcome the long-overdue commitment to abolishing Section 21 no-fault evictions but, as Shelter rightly said in a release only this week:
“For every day the government doesn’t pass this bill, another 70 households will be threatened with homelessness because no fault evictions are being kept on life support for no good reason”.
I hope that we will soon get some reassurances about when this key measure will begin, to overcome some of the rumours in the media of late about it being delayed.
We also welcome all the work to fix the issue of the supply of decent homes across all tenures, but private rent inflation is persistently outpacing both wage growth and general inflation. According to the latest data—we heard some of it from the noble Lord, Lord Carrington, earlier—average rents in England rose by 7.1% in the 12 months to May 2025. Meanwhile, wages continue to grow more slowly than rents, with the most recent data showing annual growth of 5.2%. Rents have outstripped wages every month for nearly two years; that is, since September 2023. Over the past three years, the average annual rent has increased by £2,650, rising from £12,800 to £15,450, a 21% increase, compared with—for all the owner-occupiers here—just a 4% growth in house prices over the same period. This relentless rise is not just a statistical anomaly. It is a driver of poverty, hardship and, in some—way too many—cases, homelessness.
Amendment 25, tabled by the noble Lord, Lord Best, and supported by me and the noble Lord, Lord Young of Cookham, proposes a mechanism to smooth in-tenancy rent increases by limiting them to the lower of wage growth or inflation. The Bill currently restricts rent increases to once per year and allows tenants to challenge above-market rents at the First-tier Tribunal, as we heard in the previous group. However, “market rent” is often calculated based on arbitrary information, such as advertised rents for new tenancies, figures that will inevitably and typically be inflated and do not reflect the actual rents paid by sitting tenants. This methodology leaves tenants exposed to rent hike evictions—Section 21 in all but name—undermining the very security that the Bill purports to deliver.
Tenants on lower incomes will be particularly exposed. For the many renters who have no alternative but to rent, the cheapest places they can find at market rent are already, by definition, unaffordable. The tribunal process will help, but not fix, this problem, and certainly not soon. Generation Rent’s analysis found that while 73% of tenants who challenge a rent increase through the tribunal succeed in reducing the proposed rent, the average increase awarded is still 14%, and only a small minority of cases result in annualised increases below wage or rent inflation. The process is also onerous and complex, deterring many tenants from pursuing it at all.
Smoothing in-tenancy rent increases is therefore not just a technical fix but a vital safeguard during this period of transition. It will provide tenants with the predictability and stability needed to budget and to remain in their homes, free from the constant threat of unaffordable rent hikes. For landlords, it offers an indexed yield without the administrative burden and uncertainty of tribunal proceedings.
I ask in particular that the Opposition Front Bench and the Government Front Bench resist the temptation and lure to comment on these proposals as rent controls. That would suggest that the years of knowledge and experience of the noble Lords, Lord Young and Lord Best, have rendered them somehow incapable of being able to understand the difference between rent control and something else. This proposal is fundamentally different. It is time limited. It applies only to in-tenancy increases. It does not set market-wide caps. It is designed to stabilise rents for existing tenants, not to distort the market or stifle investment.
Beyond these immediate protections, we must look to the medium term while we wait for the much-needed and long-awaited additional supply of homes. That is why I have tabled Amendment 114, requiring the Secretary of State to conduct a comprehensive review of rent affordability with the express aim of establishing a national rental affordability commission. I thank the noble Baroness, Lady Lister, for her support and the Renters’ Reform Coalition for their work on this issue. The coalition has found that nearly one-third of private renters—an estimated 3.8 million people—always or often struggle to afford essentials such as groceries due to the amount that they spend on rent, and nearly one in 10 have sold or pawned personal items to be able to afford to rent.
Baroness Lister of Burtersett (Lab)
My Lords, in my Second Reading speech, I drew attention to the role played by high housing costs in driving poverty. I was thus pleased to add my name to Amendment 114, tabled by the noble Baroness, Lady Grender, although I am supportive also of the other amendments in this group and hope that what I have to say will add to the case for them too.
Evidence from the Joseph Rowntree Foundation illustrates the extent to which high rents in the private sector are associated with poverty. Shockingly, it points out that around
“half of private renters were only in poverty after their housing costs were factored in”.
Two more reports specifically on child poverty, published this year, reinforce the point. The first, by IPPR, argues that:
“Housing costs are core to understanding child poverty”.
It notes that the number of children counted as in poverty is about a third higher when housing costs are factored into the measure, and that the private rented sector has become increasingly significant in the lives of children.
The second report was co-published by IPPR together with CPAG—of which I am honorary president—and Changing Realities, which involves people with lived experience of poverty. The report observed that rent increases are
“stressful for families to manage, and … the Renters’ Rights Bill as currently drafted will continue to enable large increases in rent … providing they are deemed to reflect ‘market rents’”—
a point made by the noble Lord, Lord Best. It suggests that this
“risks exposing tenants to sudden and unaffordable hikes in housing costs, undermining the Bill’s stated aim of providing greater security and fairness for renters”.
The report quotes one tenant:
“I’m getting really worried about my rent going up this year. It keeps rising every year yet the local housing allowance is frozen for this year! … It’s frightening”.
Both reports underline how the situation is aggravated by freezes in the local housing allowance and by the operation of the benefit cap, which hits larger families and/ or those paying higher rents in particular. As the amendment states, any review of rent affordability must include in its remit the effectiveness of policy interventions to improve affordability relative to incomes. I would argue that this would need to include policies on the incomes side, which are making it impossible for some families to meet their rent commitments alongside other essentials.
This seems to me a very modest amendment that would complement the Government’s welcome commitment to an ambitious child poverty strategy. I know that the Child Poverty Taskforce is aware of the importance of housing to the strategy, but it is unrealistic to expect it to carry out the thorough review of rent affordability proposed in the amendment.
I hope, therefore, that my noble friend will be able to give a more positive response than the one she gave in Committee, which I found rather disappointing. What is needed is something more robust and holistic than the regular monitoring to which she referred, important though that might be. A review of this kind would be in the spirit of the Bill and would help to ensure that its impact is not blunted by the continued damage created by excessively high rents in the private sector.
Lord Fuller (Con)
My Lords, I rise briefly to try to understand what the definition of rent is if we are going to control rents or somehow curtail them or attenuate the increases.
One can see the base rate just by googling property websites. It is a good idea to get a feel for the cost of a basic, low-cost, unfurnished property in the worst part of town, but that is not necessarily the market price, which is determined by a number of factors: the property may be furnished; it may be serviced accommodation; there may be porterage; there may be other benefits— I am not going to go as far as swimming pools and gyms, but I know they are available in some circumstances. Parking would be another one. All these different elements have different cost pressures and inflationary increases, which may be determined by factors outside the landlord’s control. A property that has inclusive parking may become significantly more valuable, one could anticipate, if the local council applies permits on the streets around it.
I am tempted to support Amendment 25, but I am reluctant to do so because at the moment all these extras are rolled into the single price. The logical conclusion of where this debate is going is that we will get menu pricing, rather as we see on low-cost airlines. There may be an attractive flight—£5.99 to fly to Spain or whatever—but by the time you add in the baggage, the booking fee and everything else, it rolls up to a significantly higher value. My noble friend Lord Young of Cookham made the point that the risk of the price going up over the four-year period may be somewhat attenuated, but those extras amounting to what I would call the landed price, or total cost of ownership, could vary accordingly.
Another significant point that we need to take into account is that there may be Section 20 repairs or improvements, particularly in the case of furnished accommodation where the landlord is prepared to improve and upgrade the fixed furnishings, such as tables and chairs and possibly soft furnishings as well. All of this complicates what is a rolled-up figure at the moment. The logical conclusion is that all those extras are going to be disaggregated and obfuscated, so it is going be harder to compare for the potential tenant. But it is going to be essential for the landlord to obfuscate in this way in the circumstance of a First-tier Tribunal appeal, which is really concerned with the underlying rent—that £5.99 figure. It is very difficult.
I have a huge amount of sympathy with the amendment of the noble Lord, Lord Best, but I cannot support it because I think the logical conclusion of it will be that we will get a fragmentation of the landed rent so that the tail wags the dog. The landlord will be so focused on restricting the base rate that those other things will get lost.
Lord Jamieson (Con)
My Lords, we have concerns about a number of amendments in this group on the basis that they are unduly prescriptive and risk the introduction of what could be regarded as, in effect, a form of rent control.
The amendments in the name of the noble Lord, Lord Best, seek to protect the tribunal from being overloaded due to the Bill. While we agree that there is significant risk of overload, we have concerns about how the arrangements would function. In particular, we do not feel able to support a system that ties rental increases to CPI. CPI is a generalised index that reflects the prices of bread, fuel, clothing and so forth, but not rental market dynamics. What happens in areas where market rents are falling but inflation is high, or where incomes are stagnant while CPI rises? This approach uses a national economic measure to benchmark against a highly localised rental market, and the result would almost certainly be a distorted rental market. That said, we share the concerns of the noble Lord, Lord Best, about the impact of the Bill on tribunals’ backlogs, which we discussed at length in Committee.
Amendment 114 in the name of the noble Baroness, Lady Grender, raises some important points. There is no doubt that rent affordability is a serious issue, and the amendment rightly draws attention to a range of important factors: the regional disparities in rental costs, the strain of high rents placed on household finances and the need to understand how effectively the First-tier Tribunal is working in practice. However, I must also sound a note of realism. We do not need another report for its own sake. We need actual change that improves the lives of renters and restores fairness to a housing system that too often feels stacked against ordinary people. If this review is to go ahead, it must not become just another document left to gather dust on the shelves of the department—it must lead to action. I urge the Minister to use this opportunity to outline how the Government will respond to the concerns raised by the noble Baroness in her amendment, which we agree are all points which matter in this debate.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Best, and the noble Baroness, Lady Grender, for their amendments relating to rent affordability and rent controls, and the noble Lords, Lord Young, Lord Fuller and Lord Jamieson, and the noble Baroness, Lady Lister, for speaking in this discussion. I have the deepest respect for the noble Lords, Lord Best and Lord Young, and their experience, and for the noble Baroness, Lady Grender, who has vast experience in this area too. I am grateful for their contributions.
I do not intend to revisit the detailed discussions we had in Committee. They were detailed and informed deliberations, and I know how strongly some noble Lords and tenant groups feel about helping those who struggle to pay high rents. I absolutely understand the pressure that rents put on the budgets of individuals and families. To come back to the points that we made earlier in the debate, obviously the solution to this is to create a lot more social and affordable housing, but I realise that is not going to happen overnight.
However, I must reiterate the Government’s concern that rent controls, as proposed, would risk reducing housing supply, discouraging investment and ultimately lowering property standards. In the case of Amendment 25, the most relevant international comparator is Ontario, an example that I also cited in Committee. I am afraid that the Ontario model, whereby rent increases are capped according to a measure of inflation, has not led to desirable outcomes. In fact, analysis suggests that the result has been higher rents for new tenants.
In respect of the experience in Scotland, a recent Nationwide Foundation report by the Indigo House Group found that rent control measures had not protected the majority of private rented sector tenants against excessive rent increases or against high advertised market rents, considering average advertised rents in the system as a whole. The measures in Scotland do not appear to have impacted rental price growth, because Scotland has consistently been one of the regions in the UK with the highest growth in asking rents. For example, according to Zoopla, in the year to January 2024, when the rent freeze was in place, Scotland was the only UK region with a double-digit annual rent growth, at 11.6%.
Lord Best (CB)
My Lords, I am very grateful to noble Lords for their support for my set of amendments, including the noble Lord, Lord Young of Cookham, who made the point that the First-tier Tribunal already faces a backlog and there is the danger that it will get a lot worse in the future. I am grateful to the noble Lord, Lord Cromwell, for his inside knowledge that, in the business world, indexation is relatively common as a way of stabilising increases over time. Of course, the market rate may go down when it resumes, in comparison with what has happened on an index basis, so rents could go down at the end of a four-year period.
I am grateful to the noble Baroness, Lady Grender, who made the point that renters will still be exposed, after this Bill is passed, to much greater insecurity and uncertainty from potential rent increases. We are seeing increases at the moment of 14%, which is miles above inflation. This is very unsettling for tenants and the stability of an index system would be infinitely preferable. I support the noble Baroness’s own Amendment 114, which proposes a government commission on affordable housing. This would match the voluntary sector-supported commission, which I had the honour of chairing a couple of years ago, ready for review. That was supported by the noble Baroness, Lady Lister, who pointed out how housing costs increase almost exponentially the number of children and families in poverty—it is housing costs “wot done it” very often, by creating poverty.
The noble Lord, Lord Fuller, is yet to be convinced of the merits of my case. It is true that there could be complications, but any other system is more complicated and difficult than the one that we propose. I am sad to say that the noble Lord, Lord Jamieson, compared this to rent control—“Oh, not again!” We thought we were at pains to point out that something that hits the market level on a regular basis cannot be called rent control—it is not control of the marketplace—but I thank him for his contribution.
I am afraid I have not convinced the Minister, despite her great generosity in having meetings outside the Chamber. I am grateful to her for listening attentively to the case I make. It has not been sufficient to win her over. I can only say that there is now, on the record, an alternative to the Bill’s formula, and if that proves as unsatisfactory as I suspect it will be, maybe this amendment’s time will come. In the meantime, I beg leave to withdraw the amendment.
“(4A) In subsection (2)(b) at end insert— “(iii) any increase in the quality of the dwelling attributable to improvements made to upgrade the minimum energy efficiency that were not funded by the landlord but government or ECO grants, either in part or in sum, made within the previous two years.””Member’s explanatory statement
This amendment would amend the Housing Act 1988 so that when determining rents tribunals must disregard any improvements funded by government grants, for a two year period.
Baroness Jones of Moulsecoomb (GP)
My Lords, I note what the Minister says about the Government taking it seriously and I accept that there is a move, for example in the warm home local grants, to put in a clear expectation, but that is not compulsory. Guidance is not compulsory. Landlords do not need to do it; they can completely ignore it. It is not okay that tenants have to suffer the noise, dirt and disruption of improvements and then do not actually benefit at all financially and have rent rises immediately. I am not precious about how it is done: it could be in the grant conditions. I imagine there are all sorts of ways of actually making this happen, so that tenants can have some benefit without increased costs.
I thank the Liberal Democrats for being prepared to support this amendment, but—although I bitterly resent saying it—I will not move the amendment.
Lord Carrington
Lord Carrington (CB)
My Lords, I very much thank the Minister for her answers to my various questions. However, I also point out that her agreement to work on the amendment from the noble Baroness, Lady Wolf, is an extremely positive step and I look forward to the results of that.
However, with considerable sadness, I am very disappointed by the lack of clarity on Amendment 37. The drafting of that amendment is so vague, with the judgments being called only when absolutely necessary and when significant, et cetera, and there being no data to back this whole thing up, that I want to pursue my amendment, because my Amendment 34, together with associated Amendments 35, 36 and 40, all provide great clarity to this particular issue. They are, in a sense, technical amendments: they are not in any other way political.
In Amendment 36, I propose this 12-month delayed payment for any rent increases that the tribunal comes up with, so I recognise these financial pressures, and we have done something to try and ameliorate them. On that basis, I would like to test the opinion of the House.
“(5A) The Secretary of State may by regulations make provision so as to substitute, in relation to relevant tenancies, a different date as the effective date.(5B) The effective date may not be earlier than the beginning of the new period specified in the notice served on the tenant under section 13(2) or 13A(2).(5C) Regulations under subsection (5A)—(a) may amend this section;(b) may make different provision for different purposes;(c) may make supplemental, consequential, incidental, transitional, transitory or saving provision;(d) are to be made by statutory instrument.(5D) A statutory instrument containing regulations under subsection (5A) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”Member’s explanatory statement
This amendment enables the Secretary of State to amend the Housing Act 1988 so as to substitute a different date from which new rent is payable. The substituted date must not be earlier than the date specified in the notice of the new rent given by the landlord. The new date will only apply to applications to challenge the rent made on or after the date on which the regulations come into force.
““the effective date” means a date for the time being specified in subsection (3)(b) as the date from which the rent payable takes effect;”Member’s explanatory statement
This amendment is consequential on the amendment tabled in my name inserting a new regulation-making power into the Housing Act 1988 in relation to the effective date for proposed new rent.
““relevant tenancies” means tenancies in relation to which an application under section 14(A3) is made on or after the date on which the regulations under subsection (5A) come into force.”Member’s explanatory statement
This amendment is consequential on the amendment tabled in my name inserting a new regulation-making power into the Housing Act 1988 in relation to the effective date for proposed new rent.
Lord Hacking
“Restrictions on rent increaseWhen a landlord has obtained possession of a property pursuant to Schedule 2 of the Housing Act 1988 (as amended by Schedule 1 of this Act) on either—(a) Ground 1 (occupation by landlord or family), or(b) Ground 1A (sale of dwelling house),and the landlord is unable to place a family member in the property or sell the property and is putting the property again into the letting market, the landlord is prohibited from raising the rent of the property for a period of 12 months from the date of the notice to quit as served on the original tenant.”
Lord Hacking (Lab)
My Lords, I will explain how this amendment came about and be more definitive. It relates to the proposal in the Bill—I think it is in Clause 7—that when a landlord has obtained possession principally on the grounds of a proposed sale of the dwelling and then withdraws from the sale and wants to put the property straight on to the market, he is prevented from doing so for a period of 12 months. The noble Lord, Lord Cromwell, supported by the noble Lord, Lord Pannick, moved an amendment in Committee to reduce that period from 12 months to six months. I will leave it to the noble Lord, Lord Cromwell, to develop the argument again because he has tabled Amendment 58 in this group. Basically, the noble Lords argued that 12 months was oppressive and far too long, and that there would be a sufficient deterrence against the rogue landlord seeking to put the property on the market for the purpose of raising the rent.
I did not move an amendment in Committee on this subject, but I thought about it and I decided to write a letter to the Minister, which I did on 19 May. My proposal was much simpler: that there should be a prohibition on all landlords raising the rent when, following putting the property on for sale that did not go forward, seeking to let it out again. I really thought that that was a very sensible amendment; I had hoped that my noble friend would congratulate me and say what a good solution I had provided.
The immediate advantages of my proposal were that, first, it dealt directly with the problem of the rogue landlord raising the rent. That, as my amendment proposes, will be forbidden. It would also have the advantage that the landlord would not be penalised for a long period; he could immediately put the property on the letting market and then collect rent. The other great advantage was that the property would be on the market and there would not be an absence of a property on the market, which is always regrettable. It would therefore help to house people who needed rented property.
Unfortunately, my noble friend did not congratulate me on this proposal as set out in my letter. She expressed caution regarding other tenant/landlord situations, such as a landlord getting fed up with a tenant constantly asking for repairs to the property. Another example she gave, which was rather simpler, was that the landlord had got to the point where he did not like the tenant. We must remember that, in either of those situations, the landlord has to enter into a ruse, either pretending that he wants to sell the property or possibly finding a phantom member of his family who does not exist so that he could get possession under the alternative of placing a member of his family in that house.
I am asking the House to measure up the difference between the advantage of imposing a ban on any rent increase and the advantages that I have just outlined of having the property immediately on the market, with the landlord being able to collect his rent as soon as the property is rented. We have to balance that because the measure in the Bill will affect every landlord—the good and the bad. We should have a balance between that and the extraordinary. After all, a landlord cannot successfully evict a tenant just because he dislikes him. Equally, when he is fed up with a tenant who constantly asks for repairs, he cannot bring an action for eviction just because the tenant is pestering him. In both those situations, he has to enter into a ruse.
I am suggesting that the proper balance is to look at the market as a whole—everybody in the market is affected by these measures. Therefore, to release everybody else in the market from the measure proposed serves it. So it is a balance, and I suggest that that balance goes to the market and not to the particular circumstances of a landlord disliking his tenant or getting fed up with a number of requests for repairs. I beg to move.
Lord Cromwell (CB)
My Lords, Amendment 58 is in my name. I express my gratitude to the noble Lord, Lord Pannick, who apologises that he is unable to be with us today but who has added his name to the amendment, and of course to the noble Lord, Lord Hacking —and indeed to the Minister and her officials for the time they have taken to discuss the background to this with me.
This amendment is at heart a simple and technical one. The Bill says that if you ask a tenant to leave on the grounds that you are selling the property but then the property fails to sell, as happens in about a third of cases, you are not allowed to rent the property out for a period of 12 months. It simply has to stand empty and impossible to rent out for a year. That means that numerous properties would, for the crime of not selling, be punished by standing empty and unrentable. My amendment does not seek to change the principle or any other element or clause of the Bill. It simply introduces a rational and balanced obligation to stand empty in this way for six months rather than 12. That is all that it does. I will now set out the reasons why.
On financial logic, when I and others suggested that 12 months was too long, the answer given was that 12 months’ lost rent would prevent evil landlords from claiming they were selling simply as a means to eject a tenant and then re-letting the property at a higher rent. The theory was that after the tenant had left, the landlord would jack up the rent to a high level, both to recoup their interim losses and make profits. Let us look at that proposition rationally.
First, if the landlord has a valid claim to increase the rent, the Bill already provides for that. A landlord would simply seek a normal rent increase rather than going to the dramatic and expensive process and risk of requiring a tenant to leave and then hoping to re-let at a much higher rent.
Secondly, in Committee I set out the mathematical calculation behind a six-month void period; noble Lords will be relieved to know that I do not propose to repeat the numerical details here tonight, or those that I provided subsequently in a meeting with the Minister and her officials. However, the numbers demonstrated clearly that the supposedly avaricious landlord, even if having the property empty for only six months, as I propose, rather than 12, would have to put the rent up by a very substantial amount—in excess of 200% or even 300%—to recoup their rental losses. I say nothing of the other costs, including the council tax surcharge bills and the risks of leaving a building empty. Such a huge rent hike would be impossible. The rent asked would be completely uncompetitive against other properties not carrying such an inflated rent level. In short, being obliged to leave a property empty for six months is more than enough of a financial burden and barrier so as to make the strategy so feared by the Minister simply untenable.
Thirdly, it was suggested that those nasty landlords might lie about selling a property or put it on the market at an absurdly high price, presumably in collusion with a disreputable estate agent—there are some, I believe. I therefore draw noble Lords’ attention to the second part of the amendment. This requires the landlord to provide, if necessary, to the local authority or the court hard evidence of marketing, pricing and offers, et cetera. A landlord flouting these requirements would be breaking the law and punishable accordingly. I understand that an agent colluding with them would also be acting contrary to the law. I remind noble Lords that any landlord taking this approach would face not only the legal risk of a false sales process but ending up with the property back on the rental market at an absurd and uncompetitive level of rent and, on top of that, losing six months’ rent.
Turning to other reasons, having made the argument on the rental conspiracy theory advanced in defence of the 12 months of standing empty, I heard that the landlord might have “other reasons” for wanting to get rid of the tenant, such as those that the noble Lord, Lord Hacking, touched upon. Let us examine this argument. Whatever these other reasons might be, the Minister has confirmed that the Bill makes it perfectly clear that the landlord has only four grounds for requiring a tenant to leave: sale, anti-social behaviour, moving in a relative or persistent failure to pay rent. If the landlord cannot demonstrate that one or more of these cases applies—for example, through not providing conclusive evidence of a genuine sales process—that landlord will be in breach of the law as well as having the financial penalty of the months of lost rent. It is a fundamental of the Bill to block any attempts to get around Section 21 by other means. I entirely agree with that. However, as I hope that I have demonstrated, this amendment is no such thing. The “no renting out” mechanism to prevent abuse remains, but the amendment makes it proportionate rather than excessive and heavy-handed.
Standing back from the detail, we are frequently assured that most landlords are good landlords. Perhaps some in this House have friends who are landlords. Perhaps some Members of this House let out property. This provision to leave a property unlet will not apply just to a subset of bad landlords. It will apply to anyone who rents out a property and genuinely wants or needs to sell their property but does not manage to do so. It also, for the same 12 months, deprives the market of rental properties—a market already bedevilled by a lack of available property to rent. That does not help tenants. This is not only unnecessary but manifestly unfair and will actively harm the supply of rental property. The Minister has accepted in a letter to the noble Lord, Lord Hacking, that landlords will lose out, but says that it will be in a small number of circumstances. Where is the evidence for that—or that the six-month penalty is not enough?
I underline that I am no lobbyist for landlords. I have spoken repeatedly in this House about the need to protect the poorest and the most vulnerable tenants who are abused and evicted by genuinely unscrupulous landlords. I have a later amendment seeking to prevent illegal evictions which is specifically on that theme. However, as the Minister has stressed, a successful rental sector is about a balance of rights. The amendment that I am speaking to does not do away with the relevant part of the Bill. It simply reduces the punishment —and it is a punishment—for not managing to sell a property from 12 months to six months. Those six months of costs and no income are, as I have demonstrated previously, more than sufficient punishment to make unworkable the avoidance strategies that so vexed the Minister and to meet the objectives of the Bill.
To be frank, a prohibition on renting out for 12 months is an impractical and disproportionate sledgehammer level of overkill that does not belong in a Bill that creates a set of checks and balances to produce a new, fairer environment for property rental. It also works against its own objective by artificially restricting the availability of property that is available to rent. That is why I feel strongly that this amendment is proportionate and needed. I will listen carefully to what any others and the Minister have to say, but I may need to test the opinion of the House in due course.
Lord Young of Cookham (Con)
My Lords, I speak to my Amendment 59. I am grateful to the Minister for the time that she spent with me and a representative of the Shared Owners’ Network after Committee, when we discussed in further detail the problems facing shared ownership leaseholders in blocks that have been blighted by the cladding disaster. This amendment is needed to protect shared owners, who are accidental landlords, from the financial problems that they will face if they are unable to finalise a sale after issuing a ground 1A notice.
Many shared owners, of course, continue to live in the property which they half-bought from the registered social landlord. Many shared owners have simply had to move to get on with their life; they have been unable to sell the property in the meantime, so they have sublet. Shared owners are allowed to sublet—they have to get permission from their RSL to do this—but the rent that they receive from the subletting may not actually be enough to cover their costs, with the mortgage, the rent, the service charge and the insurance charges on a block affected by the cladding disaster. Those costs may well exceed the local market rent.
Many shared owners who have been subletting for a number of years have seen their financial situation considerably weakened, with many effectively losing hundreds of pounds every month as a result of subletting. These are people who employed all the professional people that they should have employed when they bought the property owned by a registered social landlord. They took every precaution available to them and bear no responsibility at all for the problem that has engulfed them.
When we met, although she expressed sympathy for this group, the Minister could not offer any mitigation for the unsustainable costs which a 12-month ban on re-letting would create for these shared owners. This is not a satisfactory outcome for a cohort who qualified for an affordable home because their income was not high enough to buy on the open market; this was their first step on the ladder. The Minister argued that the proposed ban protects tenants, but it fails to protect shared owners who are actually also tenants.
Shared owners face a much riskier sales process with the Bill. They have to give four months’ notice to their tenants, and that means they have no certainty at all that the offer to buy the flat will actually result in an exchange, or indeed a completion. Shared owners have to give the first option to buy their flat back to the registered social landlord so they can find another shared ownership owner, and there are strict qualifications, so they are fishing in a relatively small pool. Prospective buyers need to meet the criteria for shared ownership, and that means that the risk of a failed sale, even at a late stage, is actually much higher for a shared owner, and particularly high if you are selling a flat in a block with unsafe cladding.
Should a sale fall through, as is frequent, particularly for these types of properties, shared owners, like other landlords under the Bill, face the prospect of a 12-month void when they will be banned from re-letting their empty property and forced to cover its costs without any rental income.
These people never planned to become landlords. It was not part of their vision at all. They will have had no ability to plan for this outcome or make provision for extended void periods. This will become completely unaffordable for the vast majority of shared owners who, as I have said, are not as financially resilient as other leaseholders, otherwise they would have bought a property on the open market. They will have to pay for the property they now live in, as well as the property they have been unable to sell.
Of course, they will continue to market their property for sale after the first sale has fallen through, but facing the mounting unmet costs of an empty property will actually put their homes at risk of repossession if they fall into arrears, as is very likely. Also—and this is worse—it puts incredible pressure on them to accept any offer from a buyer as soon as possible, even if the offer is below the RICS pre-sale valuation. If they do that, due to the rules of the scheme, they will have to compensate the registered social landlord for the loss of value on their share, as well as losing out on their own share. So, the unintended consequence of the 12-month ban on re-letting is that it puts shared owners selling a property on the back foot, unable to wait for a suitable offer at a fair market value.
It is just not acceptable to punish shared owners who have had to become accidental landlords, including as a result of the building safety crisis, and have already suffered considerable financial harm. In her correspondence, the Minister explained that shared owners would have the option to ask their provider whether a buyback would be possible rather than leaving the property empty.
This could provide a solution, but it will need the Minister to make some changes, As the Minister knows, buybacks are currently very much at the discretion of the registered provider. At the moment they have only limited access to funding to do this, using either their own funds or recycled capital grant funding.
If the Minister is unable to accept my amendment, will the Government ring-fence some of the dedicated funding to registered providers in its affordable homes programme so that they can swiftly buy back properties from those shared owners who fail to sell after issuing a ground 1A notice? This would enable housing associations to add to the stock of affordable property to rent at well below the cost of a new build and avoid leaving a property empty. If the Minister can neither accept the amendment nor give that guarantee, I am minded to test the opinion of the House at the appropriate time—probably next Monday.
Baroness Thornhill (LD)
My Lords, the three amendments here are interesting. The noble Baroness is well aware that we share the same concerns as the noble Lord, Lord Young of Cookham, regarding shared owners. I was allowed to gatecrash their meeting. I admit that it was eye-opening for me. I was aware of the issues around shared ownership, but I was shocked at the costs incurred and the amounts of money lost, which the noble Lord has amplified superbly. I hope the noble Baroness can give us some way forward on this and other issues that seriously affect shared owners—accidental landlords who are trapped in the situations the noble Lord has accurately described and see no way out. The “What can I do?” was quite revealing. It is no surprise that we will support Amendment 59.
We know that the not-able-to-sell situation applies to thousands of shared owners—far greater numbers than, I suspect, Amendment 58 from the noble Lord, Lord Cromwell, applies to. This is yet another area in the Bill where we do not know the numbers. We do not know how many homes will be affected. I have to pay credit to the noble Lord because Amendment 58 has been patiently worked on and lobbied for by the noble Lord, Lord Cromwell. I completely understand where he is coming from but perhaps do not agree that the detriment to the relatively few landlords who find they cannot sell their property is worth the abuses that might occur if prohibition on re-letting is reduced to six months rather than 12 as in the Bill. Perhaps this is an area for some compromise.
I have a simple question, and I am sure somebody will tell me I am wrong. If I genuinely wanted to sell my property and realise my capital for whatever reason, given the amount of time to evict, I would probably not serve notice to my tenant until I had sold my property. I can serve the notice; the process of selling, conveyancing and everything else carries on; the tenant leaves at the appropriate time; the buyers exchange contracts and we say, “You can’t move in until that time”. I do not see how that would be unachievable. I am sure somebody will tell me why that would not be the case. I certainly would not evict them before I put it on the market or had some sense of the market or of how things were. As I said in Committee, a letting agent said to me, “All houses will sell, Dorothy. It just depends on the price”.
Amendment 41, moved by the noble Lord, Lord Hacking, is clearly designed to act as a disincentive to landlords trying to abuse this ground, but maybe if the landlord is genuine, it is just a little too draconian. We broadly agree that the Bill has got this right, as far as we can tell.
Lord Jamieson (Con)
My Lords, I rise to speak to this group of amendments and to offer my full support to my noble friend Lord Young of Cookham. Amendment 59 addresses a significant gap in the Bill by providing a vital exemption for shared ownership leaseholders from certain provisions within Clause 14. Shared ownership is an important tenure model that enables many people to take their first step on to the housing ladder, yet it is not without its challenges, particularly when sales fall through, as my noble friend has highlighted. Amendment 59 is a sensible and necessary provision that recognises the realities faced by shared ownership landlords. Protecting this group helps to maintain confidence in shared ownership and prevents unintended consequences that could undermine the Bill’s original intent. If my noble friend Lord Young of Cookham is minded to test the opinion of the House, the Opposition will support him without hesitation.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank my noble friend Lord Hacking and the noble Lords, Lord Cromwell and Lord Young, for their amendments and their engagement on these issues. I also thank the noble Baroness, Lady Thornhill, and the noble Lord, Lord Jamieson.
On Amendment 58, we want to strengthen tenant security and prevent abuse of ground 1A. A 12-month no re-let period will act as a deterrent to unscrupulous landlords who want to evict tenants so that they can let to a new tenant for more rent or because the tenants are asking for repairs that the landlord does not want to do. We understand this is a strict measure, and it is meant to be. It is intended to ensure that only landlords who genuinely wish to sell their property will wish to use that ground and to deter from using it landlords looking to evict a tenant in order to re-let at a higher rent or to a different tenant. Not only will landlords have to forgo rental income for 12 months after using ground 1A but should they be found to be misusing the ground, they could be fined up to £40,000. It is right that we have these strong tenant protections in place.
This amendment would also bring significant complexity to the system, and I struggle to see how it would work in practice. It would allow the courts to require evidence that the dwelling had been on the open market for six months and that no suitable offers had been received, but it is unclear how the courts would become involved. Additionally, it could place undue burdens on courts which may have to follow up on any ground 1A evictions to check whether the landlord had tried to sell for six months and whether they had received any suitable offers. The court would also have to determine what a suitable offer was, which would be another undue burden. The no re-let rule is a clear and simple rule that would not benefit from further complexity. I believe this amendment would open the no re-let period to abuse, reducing tenant security and contradicting the aims of this Bill.
As the noble Baroness, Lady Thornhill, indicated, if a landlord is genuinely planning to sell a property, they can market it to gauge interest before upending the tenant’s life by evicting them. This would be more effective for all parties than evicting as soon as they decide to sell and only then putting it on the market and waiting for suitable offers. For all these reasons, I ask the noble Lord, Lord Cromwell, not to press this amendment.
On Amendment 41, I understand from our helpful discussions that my noble friend Lord Hacking’s intent here is to remove the period during which a landlord cannot re-let the property after using grounds 1 and 1A and instead prevent the rent being increased in the new tenancy. While this amendment addresses one of the goals of the no re-let period by making it unprofitable for landlords to abuse the moving and selling grounds, it does not address the other key reason to prevent abuse. Even if an unscrupulous landlord could not profit from abusing the grounds, they could still, under my noble friend’s proposals, use these grounds with no intention of moving in or selling to pursue retaliatory evictions. This means abusing the grounds to get rid of a tenant who had done nothing wrong but whom, for example, the landlord simply did not like or who they considered raised too many issues with the property.
These abuses of the system are exactly what the 12-month no re-let period aims to prevent. In the current system, under Section 21, we hear all too often of tenants afraid to ask for repairs because the landlord has made it clear that they will evict them if they do. Under my noble friend’s proposal, this could still happen. The opening up of the grounds to abuse must be resisted. The 12-month no re-let period is a strong disincentive for landlords to abuse the grounds, and I believe that it strikes the right balance. As such, I ask my noble friend not to push his amendment to a Division.
I turn now to Amendment 59. I am grateful to the noble Lord, Lord Young, for his engagement on this issue and for introducing me to the Shared Owners’ Network. These clauses implement critical protections for tenants. If a landlord has used the selling or moving-in ground, they will not be able to re-let or market a property for 12 months. That period starts from the date of possession proceedings, as specified in their Section 8 notice to the tenant. These clauses also include other important prohibited landlord behaviours.
The Government are aware that some shared owners with building safety issues are facing very difficult circumstances through no fault of their own. The Shared Owners’ Network has provided invaluable insight into this issue. We are continuing to engage with it to determine how best to support these shared owners. We will have a dialogue with the registered providers as well. I am grateful to the noble Lord for his suggestion in that regard. To respond to another of his comments, I will clarify the licence points to him in writing.
However, I do not agree that, by helping in one area, other blameless tenants should have reduced security of tenure or be exposed to the risk of wrongful eviction just because of who their landlord is. We have to get the balance right somehow, to support those who find themselves in this awful position but not at the expense of other tenants. We will continue to work on that. All assured tenants must benefit from the new system.
I therefore ask the noble Lord, Lord Young, not to press this amendment.
Lord Hacking (Lab)
My Lords, my Amendment 41 was the first in line in this group. I still think that it was a good amendment and would have produced all of the right results without creating sorrow for the market of the full 12-month waiting period.
It is now very late in the evening. I am not going to press for a Division. I nevertheless argue that my amendment was the best of the three.
Baroness Scott of Bybrook
Member's explanatory statement
This amendment would allow a person to mutually agree a tenancy with a landlord which requires them to pay up to six months of rent in advance.
Baroness Scott of Bybrook (Con)
My Lords, the payment of rent in advance can provide significant benefits to tenants that go beyond simply avoiding late fees or demonstrating financial security. Many tenants choose to pay rent in advance for financial planning, to ease the stress of monthly payments or to manage upcoming financial burdens. Amendment 43 in this group recognises and affirms this choice, firmly rooted in mutual agreement between tenant and landlord.
We did consider introducing a 12-month period proposal at Committee stage. However, in a spirit of compromise, and having listened carefully to the views expressed in Committee, we have instead brought forward a six-month proposal. We hope that the Government will recognise this as a reasonable and constructive step, and we hope that noble Lords can support this.
If a tenant does not wish to pay rent in advance, they would be under no obligation to do so. However, there are particular groups who would benefit from this flexibility, including overseas students and those with poor or limited credit histories. Many tenants with lower credit ratings face barriers to securing housing that are often no fault of their own. By paying rent in advance, these individuals could demonstrate responsibility and financial reliability, improving their chances of obtaining a tenancy.
Similarly, overseas students often lack a UK credit history and therefore require UK-based guarantors, which is not always possible. For those students, paying rent up front for a term or even an entire academic year is a practicality and a common solution. I ask the Minister to clarify what impact these amendments might have on overseas students’ ability to secure accommodation and whether the landlord will maintain incentives to rent to those tenants despite their limited credit history.
Lord Fuller (Con)
My Lords, it feels as if we are going back to Amendment 1 at the start of this debate and the theme of that essential freedom to contract between consenting parties, which had support on both sides of the House from the noble Lords, Lord Hacking and Lord Truscott, and others. Amendment 43 is a practical solution and an optional one. It provides a route for an otherwise unrentable tenant to find a tenancy and it is a practical expression of good faith. We have had some examples of where the freedom—it is a freedom and not an obligation—to offer up to six months’ rent in advance can be helpful.
My noble friend Lady Scott mentioned the case of students, especially foreign students. Foreign students often want to secure accommodation before they get on the plane to come to this country. At that point, they may not even have a UK bank account. They certainly will not have references or a track record. The only practicable way they can secure a tenancy with that impaired record is to pay in advance.
Earlier today, we spoke about the potential abuses in holiday hotspots, where somebody may say, “I am going to stay for a whole year”, as they contract in June, whereas in fact they immediately give notice to quit after the August bank holiday. The noble Lord, Lord Truscott, who is not in his place, told the House that the differential between the Airbnb rate and the year-round rate is something like 49%. This is a way for somebody who was sincere about entering into a long-term arrangement for, say, six months—but it would not have to be exactly six months—with a potential landlord to demonstrate that they were not just the carpetbagging, holiday-hotspot people. They could pay in advance and that would be helpful.
My noble friend mentioned those with an impaired record. It would be possible to have a guarantor who stumped up for those people with a weak covenant strength. For those who have cash—I appreciate that not everybody does—coming to an accommodation with the landlord for paying up front sometimes results in considerably less rent, and in those cases both landlord and tenant benefit considerably.
Amendment 43 would help both the landlord and tenant to come to an arrangement to their mutual advantage. I know it is not for everybody, but without this provision the unrentables will remain unrented. The Bill’s objective, as we have heard from the Minister, is to get people into safe, secure, good accommodation, and for a small number of people the amendment would provide the otherwise unprovidable. I support it entirely.
Lord Hacking (Lab)
My Lords, I very much support Amendments 43 and 45, tabled by the noble Baroness, Lady Scott, and supported by the noble Lord, Lord Jamieson. I can give a practical example of this. A very nice couple from Chile wanted to rent one of our flats. They had no credit record at all here in England so there was no way to check that. There was no efficient way to check the previous landlord, which is the other step that a landlord normally takes to ascertain whether these are suitable tenants to go into the property. They had the money. Both of them were coming to work in London for a year for an academic purpose. Enabling them to pay some money in advance—I have forgotten whether it was six months or more—was therefore a sensible compromise. They turned out to be delightful tenants and highly reliable, and we were delighted to have them in our house.
I also want to speak to Amendment 46. It is to protect landlords when a tenant has signed up to take the property on a certain date but has failed to pay either the first month’s rent in advance or the deposit. I suggest that it would be entirely wrong, because the tenancy agreement had been signed and so forth, if the landlord were then obliged to take that tenant into the property. Remember that a landlord cannot chase unpaid rent for three months, and then there is the delay in getting a hearing in the county court, so that would be onerous for the landlord to deal with. Moreover, if the tenant has not paid either the first month’s rent or the deposit in advance, he probably does not have the money available, and the high probability is that the landlord will have to suffer that tenant in his property for three or four months without any payment at all.
I therefore thought it would be sensible to make it quite plain—my amendment starts:
“For the avoidance of doubt”—
that the landlord does not have to give the tenant keys to the property or allow them to get into it when the tenant has not paid. I added a further bit to the amendment to enable the landlord, if the tenant fails to pay the first month’s rent or the deposit for a further 28 days, to take the next step of having the lease annulled. That is to make it plain in the Bill what the position of the landlord is after having entered into an agreement with a tenant who then does not pay either the first month’s rent or the deposit.
Lord Carrington (CB)
I support the indefatigable and noble Lord, Lord Hacking, in his Amendment 46. I find it plainly obvious that rent needs to be paid before occupation. I can find preciously few examples of anyone paying for goods and services after they are contracted or consumed. An obvious example is a railway ticket or an air ticket. No one goes to the cinema and pays after the performance or takes a litre of milk at Tesco and then pays after drinking it: it is just not acceptable.
Participating in the private rented sector, as either landlord or tenant, is a serious business. The landlord has made a major investment and may have a mortgage to service, among other costs. A tenant is looking for a safe and secure tenancy which incorporates decent home standards: he is well aware of the financial obligation. Without this amendment, the landlord would be laid open to the possibility of four months with no rent and a longer eviction process under Section 8, possibly taking seven months or so. The position of a landlord is a commercial business, not a public service. I urge the Minister to accept this rather obvious amendment.
Baroness Thornhill (LD)
My Lords, in view of the time, I will speak briefly to Amendment 43. I could simply say the first sentence: “We are strongly opposed to rent in advance because it is discriminatory”.
This amendment is being framed as a cosy option where tenants and landlords can reach a mutual agreement as to whether or not they will do this. No, I do not believe that. If allowed, it will become, as now, a requirement. In effect, it will become a bidding war by any other name, and landlords have their pick of tenants: Zoopla has just reported that there are between 20 and 25 punters for each property and at least 20 requests to view each property. Landlords can pick, it is a beauty parade, so they can choose the tenants who have the money to give them six months’ rent up front against those who just do not have those advantages. But those same people can still afford to pay the rent and would still make good tenants.
We are opposed to anything that prices out poor renters in hot rental market areas. We refute the argument being discussed by landlord groups that this is an option for niche circumstances that allows people to access housing; for example, as was said, where people might struggle with credit checks. If you are struggling with credit checks, it is highly unlikely that you will be able to pay six months’ rent in advance. In a very modest property in Watford, six months in advance is between £6,000 and £8,000. That is a lot of money.
We know that landlords and letting agents often use it as a barrier to reject tenants relying on universal credit or housing benefit, preventing them accepting a tenancy, which means that only those with savings or family support to draw on will comply, which those on low incomes are less likely to have. Shelter tells us that six in 10 renters have been asked for it and over 800,000 people in one of its surveys say they were not able to secure a property because of the demand for rent in advance. The Bill aims to prevent discrimination against renters on benefits. This amendment would allow it by the back door.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott, and my noble friend Lord Hacking for their amendments on rent in advance, and the noble Lord, Lord Carrington, and the noble Baroness, Lady Thornhill, for speaking.
The Government have been very clear in their view that the charging of rent in advance is unfair. I have not heard anything this evening that has changed my mind on that. Therefore, we cannot accept Amendment 43, tabled by the noble Baroness, Lady Scott. Six months’ rent is a significant amount of money. For some renters, this will be their entire savings, which were perhaps carefully built up with the ambition of being put towards a deposit on a first home. For many others, it will be an amount of savings which is simply unreachable.
I recognise that it is the noble Baroness’s intention for it to be possible to request large amounts of rent in advance only where this has been previously agreed by the tenant and landlord. However, we must consider what this means in practice. It would allow a landlord, at the pre-letting stage, to insist on a tenancy agreement which would permit them to require up to six months’ rent in advance. In hot rental markets, we could expect such clauses to become simply a fact of renting. This could leave tenants with the “choice” of stretching their finances to the limit or facing homelessness.
Baroness Scott of Bybrook (Con)
My Lords, allowing tenants, where mutually agreed, to pay rent in advance of up to six months provides an important option for many, particularly those who may face barriers such as a poor credit history, overseas students without a UK credit record or those who simply wish to manage their finances proactively. This choice should be respected and preserved, not restricted by over-prescriptive regulations.
Housing is a personal and often complex matter, and we acknowledge the complexity of balancing landlord protections with tenants’ rights, particularly regarding initial payments such as deposits and the first month’s rent. However, it demands legislation that is flexible enough to accommodate different circumstances without sacrificing fairness and stability.
I know the hour is late but we believe that this is an important amendment for the freedom and flexibilities that tenants require in this sector. I would therefore like to test the opinion of the House on my Amendment 43.
“(za) to a tenancy entered into before the commencement date (which has the same meaning as in section 146(3) of the Renters’ Rights Act 2025),”Member’s explanatory statement
In line with the original policy intention, this amendment ensures that existing leases (those entered into before the commencement of Chapter 1 of Part 1) will fall outside the scope of the new section 4B.
Renters’ Rights Bill
Monday 7th July 2025
(1 year, 1 month ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 103-II Second marshalled list for Report - (3 Jul 2025)
16:34 - Division on Amendment 53A - Ayes: 206 / Noes: 198 - Amendment 53A agreed.
17:07 - Division on Amendment 58 - Ayes: 213 / Noes: 209 - Amendment 58 agreed.
17:18 - Division on Amendment 59 - Ayes: 274 / Noes: 154 - Amendment 59 agreed.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we start the debate on the first group of amendments, I repeat the reminders from last week on declaring interests. As we set out previously, noble Lords should declare relevant interests at each stage of proceedings on a Bill. That means that, in their first contribution on Report, noble Lords must declare any relevant financial interests in a specific but brief way. Declarations do not need to be repeated in subsequent speeches on Report, so if noble Lords made a declaration last week, they do not need to do it again. As my noble friend the Chief Whip reminded the House last week, it is no longer sufficient to say that one’s interests are as set out in the register.
Clause 11: Right to request permission to keep a pet
Amendment 47
“(5A) The circumstances in which it is unreasonable for a superior landlord to refuse consent through the landlord include, but are not limited to, the following—(a) a superior landlord’s personal opinion of a tenant;(b) a superior landlord’s personal opinion of pets or specific species;(c) a generalised fear of damage to the property;(d) a pre-emptive fear of complaints from neighbours relating to noise, fouling or anti-social behaviour caused by the animal;(e) a superior landlord’s experience with a previous tenant about pets;(f) generalised or unsubstantiated animal welfare concerns.”Member’s explanatory statement
This amendment sets out examples of when it is unreasonable for a superior landlord to refuse consent, providing clearer guidance and limiting arbitrary or prejudiced refusals.
Baroness Miller of Chilthorne Domer (LD)
My Lords, I start by declaring an interest: I own a dog that is subject to approval by a superior landlord of the flat in which we live. It has that approval.
In Committee, the Minister laid out the Government’s commitment to enabling many more tenants to have pets in rented properties, which is, of course, very welcome. However, in her reply to my Committee stage amendment, which was similar to this amendment, she made the point that the Government did not want to include superior landlords among landlords who could unreasonably refuse the right to keep a pet. The superior landlord owns the head lease under which another landlord may come. She gave two main reasons: first, that there are practical challenges involved in engaging with superior landlords, and secondly, that in many cases the superior landlord is not based in the UK or is a complex ownership structure and requiring the superior landlord to give reasons for refusal for a pet might involve the tenant and/or the landlord in lengthy and costly processes that might make the obligation difficult to realise in practice.
The fact is that most superior landlords are very quick to contact tenants when there is something they do not want to happen or there is an issue about money, so I do not accept how difficult it is to engage with them. The Minister may give me some examples. The fact that they are based overseas or have a complex ownership structure is simply not a good reason. The Minister kindly said she would come back to me after she had looked at the quantum involved, and I wonder whether she has found that out now as I have not heard anything.
The Minister went on to say that my amendment was “not proportionate or necessary”. In fact, it is necessary, given that there are about 24,000 property management companies and the average size of portfolio is about 193 units. That would equal about 4.5 million units altogether, and the bigger superior landlords often manage about 144,000 properties. That is an awful lot of tenants to whom this very good clause of the Bill would not apply. On whether it is proportionate given the size of the tenant base who, without my amendment, will not benefit from Clause 12, I believe it is necessary and desirable that, when we legislate, we are as fair and equitable as possible.
Since Committee, I have noticed warnings going out from people who represent superior landlords. I shall quote a couple. Nockolds writes:
“One proposal introduced by the Bill is that Landlords must not unreasonably refuse pets at a rental property. In assessing what is ‘reasonable’ in these circumstances, it is likely to be justified for the Landlord to refuse a pet if the superior lease does not allow pets. If you do not want pets to be kept in your buildings, this may be a sensible clause to introduce”.
That is what is going to happen. Superior landlords will all just introduce clauses, even if they do not have them now, to preclude pets, so there could be an unintended consequence without my amendment. John D Wood & Co goes into the matter:
“Under What Grounds Can a Landlord Reject a Pet?...acceptable reasons may include … Superior Landlord Refusal”.
There is a real issue here that, without including superior landlords in the Bill, the Minister will find that Clause 12 was a nice idea that does not work in practice.
In Committee, the Minister rightly said that the Government want tenants to have the right to own a pet. We do not give superior landlords a free pass to discriminate in any other way, and we should not do so in this case. I hope the Minister will agree. I beg to move.
The Earl of Kinnoull (CB)
My Lords, I will speak to Amendment 48, which stands in my name. I declare my interests both as a landlord for my own part, to a small extent—all for properties in Scotland—and as trustee, in particular for the Blair Charitable Trust, all properties of which are also in Scotland.
At the earlier stages of the Bill, it was reflected by a number of noble Lords that pets promoted well-being among tenants; that is something with which I very much agree. I am looking at the noble Baroness, Lady Fookes, who made a very good speech on this point at an earlier stage.
The thrust of this Bill is that there is a presumption that pets should be allowed in rented property. There are two protections for landlords. First, they can say no if it is reasonable to do so; we have just been hearing about some things that might not be so reasonable. Secondly, there is a protection for landlords, at least currently in the Bill, of deposits and insurance. However, social housing is not included in the Bill; indeed, it is specifically excluded. That seems to me very unfair.
I am grateful to the Minister and her Bill team, some members of which I can see sitting in the Box. They have been very generous with their time; we have been over this topic a number of times in the Minister’s meeting room upstairs. It seems to me that people in social housing are in many ways the people who most need the sense of well-being that a pet brings. I would be very keen that we make that change.
In the meeting—I do not want to steal any of the Minister’s thunder—a number of points were made to me about this area, and I must say that I have been brought along with those. I would be very grateful if the Minister could tell the House everything that she told me. I think that would be helpful to everyone on this amendment.
Lord Trees (CB)
I rise to support Amendment 48 in the name of my noble friends Lord Kinnoull and Lord de Clifford. It is a short amendment but, hopefully, could have a long impact. It would allow tenants in social housing some of the benefits with regard to keeping a pet that this Bill will provide for tenants in private properties. Tenants seeking social housing may not be in a position to buy their own property; if they did, they would have no problem with keeping a pet and they would have all the positives to which my noble friend Lord Kinnoull alluded in relation to well-being and health benefits. Instead, the Bill denies them those rights, which are enjoyed by tenants in the private rental market. I am curious to understand the Government’s explanation for this.
Baroness Fookes (Con)
My Lords, I too am anxious to have a better explanation. To me, the Bill seems very unfair, as it introduces two classes of people, one of whom will be disadvantaged at the same time as others are advantaged. It is one step forward and another one or two steps back. I hope that the Minister will be able to give sufficiently strong reasons why this should not happen to make me content, but I am not holding my breath.
Lord Pannick (CB)
My Lords, I declare an interest. My wife is the landlord of a number of rented properties. My reason for rising is to invite the noble Baroness, Lady Miller, when she comes to reply, to clarify something that puzzles me about her Amendment 47. It says:
“The circumstances in which it is unreasonable for a superior landlord to refuse consent through the landlord include … a superior landlord’s personal opinion of … specific species”.
I ask her whether this means that the superior landlord would be prohibited from saying that he or she does not think it is reasonable or appropriate for the tenant to keep as pets rats, skunks or tigers.
Lord de Clifford (CB)
My Lords, I speak today in support of Amendment 48 in the name of the noble Earl, Lord Kinnoull, and supported by the noble Lord, Lord Trees. I declare my interest with regards to pets, as I own a share of a veterinary practice that cares for pets and I have my own dog. We welcome the Government’s support of a tenant’s right to request to keep pets. Although social housing is not the main focus of this Bill, surely it is fair and reasonable for all tenants to have the same rights to request to keep a pet, regardless of the type of landlord that they rent from, whether it is a private company or a social landlord. As I have said previously on this amendment, it also makes it fair to all landlords. Surely private landlords should not be the only landlords to have to accept pets in their property. I hope that the Minister can find a positive solution today to this issue and that all tenants have the opportunity to keep pets in their homes.
Lord Fuller (Con)
My Lords, I shall speak on Amendment 47 in the name of the noble Baroness, Baroness Miller. I speak as a landlord of rental properties in Norwich, as declared in the register. Naturally, we should consider the rights of people who own companion animals, but that must go hand in hand with the rights of a landlord who may be concerned about damage to his property and the rights of neighbouring residents who may have to deal with the consequence of noise, mess, smell, and so forth. Once again, there is a balance to be struck, but this amendment strikes the wrong balance.
It is obvious that keeping a pet elevates the risk of damage, especially in the case of furnished accommodation. This Bill contemplates that all tenancies are the same, but there are different sorts of properties and in furnished accommodation the consequences of damage are greater. It fails to recognise the reality of different types of accommodation, whether they be period or listed or of some historic or archaeological merit making the building incompatible with pets. There are often circumstances, particularly in blocks of flats, where there are communal amenities—for example, common courtyards or gardens, often where children play. All these are different to the detached rented home in the countryside where there is much more space. This Bill contemplates a one-size-fits-all approach, regardless of all the different types of properties one may wish to tenant, whether they be furnished, unfurnished, in the countryside, or flats.
It is reasonable for a landlord to refuse to allow a large dog in a small flat where there is no outside space. Confined animals do not just chew, although they do. They bark and upset the neighbours, and the needs of neighbours must be considered. This Bill is all about the tenant, and I can understand that that is important, but it is to the exclusion of any other stakeholder, and that cannot be right. The landlord must make the judgment and take into account whether the applicant, perhaps a night-shift worker with a large dog, is suitable for his property. I will concede that there is a world of difference between the different types of pets: goldfish, spiders, dogs, cats and ferrets—may I be the first to introduce a Second Reading having just heard the First Reading of that particular Bill? Let us make those distinctions with the chewing variety. By just calling them pets, we are denying the obvious distinction between two legs, four legs, 100 legs, no legs, fishy ones with scales and so forth. There are different types of animal contained within this catch-all. That cannot make sense.
The one point where I agree with Amendment 47 is in proposed new paragraph (a), where it says that the landlord should not form predisposed opinions of the tenant. I agree with that, but not in the way you might think. I once had the chief executive of a county council as a tenant. Her cat ate my sofa. The white polyester fluff was everywhere. I did not know where the cat ended and the sofa began. These things happen, but my point is: however well-heeled or fragrant that tenant might have been, she had no control over the pet whatever. It is important that we consider that it is the pet which potentially does the damage, and not the tenant, because that lady worked long hours and travelled widely. She was not there. The chewing cat was incompatible with her lifestyle, and my furnished apartment took the consequences.
Let us move on. The Bill contemplates that the tenant with a pet has that pet at the outset, but neither the Bill nor the amendment adequately takes into account the possibility of a tenant who may acquire a pet during the tenancy or somehow mendaciously mislead as to the nature of an existing pet or even hide it away altogether. When we are considering pets—this is probably a bit too late because that is in Clause 4, which was done last week—we have to contemplate that wilful misdescription amounts to a breach of contract.
I have no intent to be overbearing or heavy-handed, but these are examples where the rights of the tenant must coexist with their neighbours. At the moment I have a case of a tenant who repeatedly allows his small dog to urinate against the wall in the communal courtyard. That is damaging the brickwork, which is for my account, and is really unpleasant for the kids because it is the only place for them to securely play away from the traffic that passes outside, and that is really not fair on everybody.
I have mentioned the distinction between the goldfish and the Staffordshire terrier and between the spider and the snake. While I am not scared of spiders or snakes, some are. One of the clauses in the Bill is about predispositions towards certain sorts of animals. Scaredness is a different sort of cat completely, the scaredy-cat. It is right and proper that people with a predisposition against those sorts of animals are protected.
I regret to say that the noble Baroness’s amendment is well meaning but does not live in the real world between the differences of location, different properties, different furnishings, different types of animal—fur or feather—and the neighbours. These examples are not grounded in prejudice; they are grounded in the balanced welfare of all residents, and the landlord has a role to arbitrate to everyone’s benefit. I am afraid I cannot support Amendment 47. I make no comment on Amendment 48.
Lord Sentamu (CB)
My Lords, I support Amendment 48 from the noble Earl, Lord Kinnoull, not because he is the Convenor of the Cross Benches, although that could be a bonus point, but for three reasons. First, my family have never kept a pet, but why should I be part of a legislature that would deny somebody seeking consent to keep a pet simply because they live in social housing? To me, that is clear discrimination. It cannot be right that you would say, “Because you’re in social housing, you cannot request the consent of the landlord”. It is their right to ask for consent. That is not to say that it would give an automatic right to the social housing person to keep a pet.
Secondly, we are constantly told that this wonderful nation and the other three are nations of pet lovers. Do we want to say that somebody in social housing cannot be a pet lover? Who would want to say that?
The third reason is our beloved Majesty, the late Queen Elizabeth II. Do your Lordships remember when there was somebody who was going through a lot of trauma and she invited that gentleman to come and spend time with one of her corgis? Noble Lords will remember that the person said, “This has put my trauma in perspective”.
Those who want to keep pets because they live in social housing, and because they are animal lovers, should be given the same right as others to request consent.
Baroness Scott of Bybrook (Con)
My Lords, I thank all noble Lords who have contributed to this debate, in particular the noble Earl, Lord Kinnoull, for his thoughtful and balanced Amendment 48. This Bill must work for renters, but it must also work for landlords. We have discussed pets at length throughout the stages of the Bill and there is no denying that pets provide vital companionship, comfort and emotional support for many. It is therefore no surprise that this issue has attracted considerable interest across the House.
However, we recognise that this is not a Bill about social housing; it is focused rightly on the private rented sector. The frameworks, obligations and operational realities governing social housing are distinct, and we believe they are better addressed through the appropriate legislative and regulatory channels. That said, we fully support the principle behind the noble Earl’s amendment and hope the Minister will take this issue forward. There is a clear opportunity to work with housing associations and local authorities to ensure that fair, proportionate and compassionate policies can be delivered in this space.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble Baroness, Lady Miller of Chilthorne Domer, and the noble Earl, Lord Kinnoull, for their amendments on pets and for their continued engagement on these issues, which has been incredibly helpful. I thank all noble Lords who have taken part in the debate: the noble Lords, Lord Trees, Lord Pannick, Lord de Clifford and Lord Fuller, and the noble Baroness, Lady Fookes. I have heard the passion of noble Lords on the issue of keeping pets. I hope there is overall support for the aim of the Bill to make it easier for tenants to keep pets but to get the balance right between tenants and landlords.
Amendment 47 seeks to set out a list of circumstances in which it would be considered unreasonable for a superior landlord to refuse consent for a tenant to keep a pet. These include personal opinions, general fears of damage or complaints and previous negative experiences with other tenants. While I completely understand the intention of the noble Baroness, Lady Miller, to provide clarity and guard against unfair refusals, I must respectfully say that I do not believe the amendment is needed. Our letter in response to the noble Baroness’s questions in Committee was sent on 15 May. I am really sorry if she has not had that letter, but I will make sure it gets sent out to her again today.
We do not believe it is appropriate or practical to draw superior landlords into the day-to-day running of the tenancy. Requiring them to engage directly in case-by-case decisions about pets risks creating serious administrative burdens. We believe it could also lead to complex and costly delays in decision-making, particularly where superior landlords are difficult to identify and contact or are located overseas. The noble Baroness cited experiences where they have responded quickly, but I know from personal experience of having tenants trying to contact superior landlords that it can be a very complex business.
That said, we intend to publish guidance alongside the Bill to assist landlords in understanding what might constitute a reasonable refusal by an individual’s immediate landlord. This will help ensure clarity, without locking specific examples into primary legislation. For these reasons, I hope the noble Baroness, Lady Miller, will consider withdrawing the amendment and not pressing for a Division.
My Lords, I thank the noble Earl, Lord Kinnoull, for tabling Amendment 48 and discussing this important issue further following Committee. Like the noble Earl, this issue is very close to my heart, and I absolutely would not want to see a two-tier approach. It is right that requests from tenants across all sectors to keep pets be considered fairly, especially given the valuable role pets play in people’s lives. Whether they be corgis, or the veritable zoo quoted by the noble Lord, Lord Fuller, pets can provide a great deal of comfort and company to those who wish to keep them.
Following Committee, my officials have explored the issue further. I can confirm that many social landlords already set out and publish their policies on pets in their tenancy agreements, allowing tenants to keep pets where appropriate. We have not been able to find any significant evidence that social tenants requesting a pet are not having their requests considered fairly. Although tenants in social housing do not generally experience the same barriers to keeping a pet as those in the private rented sector, I recognise that it is important to have clarity and consistency across sectors. Therefore, I intend to write to social landlords to ensure that they are fairly considering tenants’ rights to request a pet, and to share existing best practice in this area.
However, for the reasons I have set out, I do not I believe it is proportionate or necessary to add further provisions to the Bill regarding a social housing tenant’s right to request a pet. As the noble Baroness, Lady Scott, pointed out, even if legislation were required, this Bill is not the right vehicle for it as it would create inconsistent rules within the social rented sector. That is because the provisions in the Bill would apply only to tenants of registered providers who grant assured tenancies and not to the majority of local authority tenants, who are granted secure tenancies. Given the current approaches taken by landlords in the social rented sector, the lack of evidence of issues warranting further regulation, the additional engagement by my officials and my undertaking to continue to monitor this—and if there does seem to be a need, we will look at that if we bring forward future legislation—I hope the noble Earl, Lord Kinnoull, will consider withdrawing his amendment.
The Earl of Kinnoull (CB)
I am very grateful for what the Minister has said all round. Before she sits down, I wonder if I could push her just a little more. I think she is saying that there will inevitably be a suitable Bill on social housing at some point, and that it will be the Government’s policy to bring forward at that stage an amendment similar to this, so that there will be a legal necessity for social housing to offer availability of pets on the same basis as this Bill.
Baroness Taylor of Stevenage (Lab)
We need to continue to look at the evidence, and to look at the response to the letter that I will write to social landlords. We will then take further action, as necessary and if it is needed, in future legislation.
Baroness Miller of Chilthorne Domer (LD)
My Lords, I thank everybody who has contributed to this debate and thank the Minister for her reply. I found very helpful her response to the amendment from the noble Earl, Lord Kinnoull—which we do support—saying that she will write to ensure clarity and consistency.
I had a slight dread when the noble Lord, Lord Pannick, got to his feet, because I thought it would be something really tricky, which of course it was. On the circumstances in which superior landlords can have an opinion on specific pets, I am trying to include superior landlords in the same way as the Bill already includes landlords. I understand the issues the noble Lord, Lord Fuller, raised, but they are for direct landlords, not superior landlords, and we debated those very fully in Committee. It is people with portfolios of hundreds of flats having a blanket refusal—or not—I am concerned about. The noble Lord talked about a simple detached home in the countryside.
Lord Fuller (Con)
We can bandy around the distinction regarding the superior landlord with the offshore pension fund and hundreds of thousands of dwellings, but what about the small charity that owns a listed building held in trust for possibly hundreds of years? It surely must be entitled to its head leaseholder laying down certain provisions. It is not just about a common or garden large house in the countryside versus a flat; there have to be guardrails. Does the noble Baroness not understand that, as well-meaning as her amendment is, she has failed, I regret to say, to consider some of those narrow points and therefore it is incomplete? I find myself having huge sympathy for the Minister on this one; the amendment is incomplete.
Baroness Miller of Chilthorne Domer (LD)
I am still struggling to understand why the noble Lord is referring to something that is much more about direct landlords. It is not bandying terms around; there is a specific legal definition of a superior landlord, and that is the only group my amendment is talking about. It is not talking about individual landlords.
I thank the noble Baroness, Lady Scott of Bybrook, for her comments, which were indeed more welcoming. I hope the Minister will consider some guidance to superior landlords too to address this situation. In the meantime, I beg leave to withdraw the amendment.
Member’s explanatory statement
This removes provision inserted into the Housing Act 1988 making it an implied term of an assured tenancy (other than a tenancy of social housing) that a tenant will comply with conditions relating to pet insurance where the landlord has consented to the tenant keeping a pet and given written notice of the condition.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank noble Lords for their rigorous, detailed and good-natured engagement on the matter of pet damage insurance. In particular, the extensive knowledge of the insurance industry of the noble Earl, Lord Kinnoull, has been of great assistance in ensuring that we get this policy right.
Following much debate in Committee and further discussions with sector stakeholders, including the Association of British Insurers and the British Insurance Brokers’ Association, we have reflected on our position and I will now speak to government Amendments 49, 54, 55, 57 and 73. I have listened carefully and recognised that, while the insurance market adapts to public policy, there is a risk that relevant insurance will not come on to the market sufficiently following implementation of the Bill. To avoid a situation in which landlords could essentially veto a tenant’s reasonable request to keep a pet, we are withdrawing the pet insurance provisions from the Bill. Tenants will still be able to request to have a pet in their home, but landlords will no longer be able to require insurance to cover property damage caused by a pet. Although our view was that a new market will develop for insurance products, following further engagement with the sector we now accept that this may not happen at the scale necessary. We are committed to supporting responsible pet ownership in the private rented sector and we do not want to leave tenants in a position where they are unable to comply with impractical conditions that a landlord may place on the tenant as part of their pet consent.
Noble Lords will rightly want to know what this means for landlords with concerns about potential property damage. I reassure the House that we are also now satisfied that landlords will be suitably protected from damage caused by pets, particularly after noble Lords shared evidence in Committee—for example, the University of Huddersfield report showing that three-quarters of pet-owning tenancies result in no claim against the deposit. As such, I am content that the existing five-week deposit for typical tenancies will cover any increased damages caused by pet ownership. We will, however, continue to monitor this closely after the implementation of the Bill. If tenants with pets are regularly causing more damage than deposits can cover, we have existing delegated powers to allow higher deposits for tenancies with pets under the Tenant Fees Act 2019. I hope the House recognises that we have listened and responded to the debate with pragmatism. Private renters should be treated fairly if they have reasonable requests for pets, and our legislative framework should support that. I am grateful to all colleagues who have helped us to get to the best position possible, and I beg to move government Amendment 49.
The Deputy Speaker (Lord Geddes) (Con)
My Lords, before putting Amendment 49, I must advise the House that, if it is agreed to, I will not be able to call Amendments 50 to 53 due to pre-emption.
Lord de Clifford (CB)
My Lords, I first wish to thank the noble Baroness, Lady Taylor of Stevenage, and the Government for adding Amendment 49 to this Bill with regard to pet insurance. I know that the Minister and the Bill team, as well as the noble Earl, Lord Kinnoull, have spent a lot of time on this matter, and the Minister listened and considered the noble Earl’s expert views and spoke to the insurance market before bringing this welcome change to the Bill.
I have submitted Amendment 53A. I originally supported Amendment 51 in the noble Earl’s name, with regards to the pet damage deposit, but it no longer worked within the Bill. As mentioned previously, I welcome the changes in this Bill regarding pets. The Government have acknowledged that pets can potentially cause damage or wear and tear to the property, so there was a need for a pet insurance product to cover potential costs, but that is now not part of the Bill.
The amendment seeks to provide an alternative protection to landlords and tenants from the possible additional costs that may be incurred by keeping a pet, to maintain the condition of a property. The additional three weeks’ rent as a deposit would provide an amount towards those costs. Some would say that the first five weeks would cover all forms of wear and tear; that amount is set aside for human wear and tear and damage.
The Earl of Kinnoull (CB)
My Lords, I shall speak also to Amendment 53A. Getting the balance right between landlords and tenants is something that was stressed by a number of speakers on the previous group of amendments, including the Minister. The Bill really amounts to a presumption that tenants can keep pets, on the one hand, and protection for landlords, on the other hand, in the shape of a deposit and insurance. Insurance is going to fall away because it was not available and would have entailed a high cost. Even if such insurance had been available, the loss ratio would not have represented good value for tenants. Good tenants would have lost all their money, whereas, as the noble Lord, Lord de Clifford, has pointed out, you can get your deposit back with interest at the end. I feel that a deposit is a very good way to go, and that is why I tabled Amendment 51. I was disappointed that the appearance of Amendment 49 was going to kill Amendment 51 by way of pre-emption. That is why Amendment 53A is a very good idea.
Pets damage buildings. We heard a lot about this in Committee, and the noble Lord, Lord Trees, may say something to remind us of all the unseen things that pets bring into the home. I am afraid that I feel that the survey by the academics at the University of Huddersfield is a rogue thing; it does not accord with my experience at all—and the Blair Charitable Trust is a reasonably sized landlord all round. Pets do damage things, but a deposit is a very fair way of adjusting the balance between the two people.
In Scotland, that deposit is set at two months. Here, if the correct level of deposit is five weeks and we add the risk of a pet on top of that, which was going to be taken out by the insurance as originally proposed in the Bill, it seems to me not to be a good balance that there should be no increase in the level of deposit protection. In the original Amendment 51, I had set the additional protection at three weeks because I considered eight weeks very similar to two months and I felt that having some symmetry between Scotland and England on this point was a good idea. I also felt, through experience, that Scotland, with two months of deposit, was okay, and that the balance between tenants and landlords was okay where pets were concerned. I feel that Amendment 53A has a tremendous amount of merit.
One of the points made to me is that Amendment 53A would add a lot of expense to tenants in the amount of deposit they would have to put up. I was just totting up how much our own two dogs cost to look after in a year, and it is a lot. Even though they probably eat better than some dogs, the dog food, inevitable visits to the vets—we do not buy insurance but it would amount to roughly the same as insurance is a pooling scheme—and all the various other things one has to do, such as finding someone to look after them if you go away on holiday, cost many hundreds of pounds a year. There is also the initial cost. I am talking about dogs, but it would be same for other pets. The website Pets4Homes has 1,625 dogs on it today, which cost between £400 and £3,000. Many people who have pets are engaging in something that is reasonably costly anyway, so asking them to provide another three weeks of security is perfectly fair and proportionate—especially if, having looked after the property well, they get back not only the interest on it but the money itself at the end. I am very pro Amendment 53A.
Lord Trees (CB)
My Lords, I too will speak to Amendment 53A, but first I thank the Minister and her team for their Amendment 49 and the consequential amendments, which will improve this Bill substantially. I thank her for the helpful letter about assistance dogs, which is a matter I raised in Committee and at Second Reading.
I support Amendment 53A. As many have said, it is extremely important that landlords are willing to accept tenants with pets—an objective with which all noble Lords would concur. This amendment would further that objective, and I think it is quite significant.
The costs incurred occasionally—it is only very occasionally but it happens—can be substantial. It goes way beyond a gnawed chair leg or a bit of wallpaper off the wall. As has been alluded to, if one has deposition of potential allergens in a property or a flea infestation, a real deep clean can cost hundreds if not almost thousands of pounds. Those costs inevitably fall on the landlord at the minute and are a considerable potential disincentive.
We have heard the figures from Huddersfield. Another figure is that 75% of landlords did not have a problem with pets. That means that 25% of landlords accepting pets have had some degree of problem. I note that 40% of landlords do not accept pets at all.
The deposit suggested in the amendment is proportionate and extremely important to assure landlords that, if there were to be negative results from a pet, they would get acceptable recompense. As the noble Earl, Lord Kinnoull, has pointed out, the deposit costs nothing if there has been no problem. It is returned fully, with interest, to the tenant. As he also pointed out, keeping a pet, particularly a dog—we are probably mainly concerned with what dogs can do—is a major financial responsibility and should not be undertaken by people who could not afford to put up a deposit of the size suggested. I support this amendment.
Lord Howard of Rising (Con)
My Lords, I support Amendment 53A in the name of the noble Lord, Lord de Clifford, spoken to so ably by the noble Earl, Lord Kinnoull.
While there is considerable improvement in the present five-week deposit limit, there will still be a good number of cases where the damage by pets is more than the cost of the remedial work that needs to be done. For the first time ever, I have just refused a tenancy on the ground that the pets would be inappropriate. The proposed tenants wanted to have three Newfoundland dogs in a two-bedroom property. In Committee, the Minister said that the Bill already permits landlords to refuse their consent on reasonable grounds which are best judged on a case-by-case basis. Would my refusal to have three Newfoundland dogs in a small two-bedroom cottage be reasonable? I doubt that even an eight-week deposit would cover the potential damage, and the present five-week deposit would be nowhere near adequate.
Baroness Miller of Chilthorne Domer (LD)
My Lords, I am glad that the noble Lord, Lord de Clifford, brought forward Amendment 53A, because it is enabling us to have this very interesting debate. We are talking about the cost of pets, but actually you could transpose the words “children” or “elderly incontinent”, because those two groups equally have very difficult problems. They can damage carpets—if anyone has had children in a house, they will know that they can inflict an awful lot more damage than pets. Unfortunately, the elderly and the disabled can often be equally as damaging.
The noble Lord, Lord Trees, mentioned that pets have fleas, which is very true. However, if you let your property to people who travel a lot, there is the risk that they might bring bedbugs back, which are much harder and more costly to get rid of than fleas.
Although I understand the reason for the noble Lord’s amendment, we do not support it. We think the Government have struck the right balance with their Amendment 49, which we will support.
Lord Pannick (CB)
My Lords, I support Amendment 53A. However, I ask the noble Lord, Lord de Clifford, to deal with one point when he replies. There appears to be no requirement in the amendment that the landlord must be acting reasonably in demanding a deposit. It is easy to understand and entirely reasonable that the landlord may require a deposit if the tenant wishes to keep dogs, but it would not be reasonable to demand a deposit if the tenant wishes to keep a goldfish. It is easy to understand the idea that there is no harm done because the deposit will be returned at the end of the tenancy, but the requirement of the deposit may well inhibit the tenant from being able to have the goldfish and the companionship that it gives.
Lord Fuller (Con)
My Lords, once again I declare my interest, in that I am a landlord.
I support Amendment 53A most strongly, but I wonder if I might dwell on the point made by the noble Baroness, Lady Miller. Looking around this Chamber, I see that most of us travel a lot as part of our duties in this House if we live outside of London. I am sure my wife would be the first to complain if I brought bedbugs back to our family home.
Drawing on my experience as both a landlord and a managing agent, I know the cost of the Bill will be that the additional costs of damage, wear and tear, fluff, cleanliness, pest control and all those other little things—as enumerated most ably by the noble Lord, Lord de Clifford—will, particularly in blocks of flats, be borne by those tenants who do not keep pets. I do not think that is right. Quite simply, keeping a pet is an add-on to a tenancy and the additional cost should be borne by those who bring the pets with them.
There are lots of examples of where things can go wrong and I will give an example, from my own lived experience, of a tenant who declared that he did not own any pets at all. In due course, he brought his two large dogs to the property, where he left them while he went to work. By and by, it became clear that my house was being used as a kennel. Not only were the neighbours disturbed by the barking all day and all night but, by the time the tenant had stopped paying rent and I had taken proceedings, £15,000-worth of damage had been caused. When he finally left, I discovered the most foul-smelling and revolting scene: one bedroom had been used as a doggy lavatory for weeks. It would have been even worse had the proposals to stop repossession action been extended from eight to 13 weeks.
This was a gross case, in every respect, although I was lucky to get an insurance claim because the sum of money was so large. But that is not what we are talking about generally in this Bill. We are not concerned about granny who may be infirm, as the noble Baroness, Lady Miller, implied, chewing the table leg or eating the carpet. We are thinking of the middling bit, where it is above and beyond the three weeks. I agree with my noble friend Lord Howard that the additional three weeks is not enough, but I accept that we have to fight the battles we can win. If that is as good as we can get, it is a proportionate compromise that I am prepared to accept.
Several noble Lords mentioned—and I agree—that if the pet does not cause any damage, the tenant gets the deposit back in full, with interest. I place on the record that in the statutory deposit protection schemes, interest is not normally paid. The deposit goes in and the costs of interest are retained by the deposit scheme, presumably to defray their costs of operating the system and its administration. I would not want those watching this outside the Chamber to think that we are now going to introduce the requirement to pay interest if the landlord does not accept that.
I listened carefully to what the Minister said about the Government’s ability to increase the deposit through the Tenant Fees Act 2019, but I think we should accept here and now—and Amendment 53 implies this—that there are additional costs and risks to keeping pets, and it is obvious that we should not necessarily wait. Let us have those provisions within the Tenant Fees Act 2019 introduced immediately, but proportionately, so the goldfish is not charged at the same rate as the Newfie—that would not be sensible—particularly in cases where there is furnished accommodation. Then we can have a good compromise that everybody can live with.
Finally, I do not want to repeat this at length, but I believe that if we can come to that arrangement, having that deposit benefits the tenant because at least they get it back, whereas in the case of buying an insurance policy—not that these policies exist, as the noble Earl, Lord Kinnoull, said—that would be an absolute cost because they would pay whether there was damage or not. I strongly support Amendment 53 and if the noble Earl is minded to test the opinion of the House, I will follow him through the Lobby.
Baroness Scott of Bybrook (Con)
My Lords, the issue of pet-related damage is understandably a source of concern for landlords. This group of amendments raises important questions about how we balance—that word balance again—the increased rights granted to tenants to keep pets with the responsibilities and protections that landlords need.
It is simply not reasonable to argue that the existing tenancy deposit, which is designed to cover damage under current arrangements, is also sufficient to cover the additional risks introduced by granting tenants a new right to keep pets.
The Government have already accepted that pets pose a greater risk by including pet insurance measures in the Bill. That was a clear recognition that pets are likely to cause additional damage. However, as we consider these provisions, it is crucial to reflect on the experience already gained in Scotland, where tenants’ rights legislation has evolved to allow pets in rented properties, while seeking to balance landlord protections. In Scotland, the introduction of pet-friendly tenancy provisions and related insurance requirements has offered valuable lessons. While these measures have expanded tenant freedoms and encouraged pet ownership, they have also revealed challenges, particularly in ensuring that landlords are adequately protected against damage and in making sure that any additional costs or deposits are fair and transparent.
Either pets cause additional damage or they do not. If the Government now claim that they do not, they must provide clear and compelling evidence to justify overturning their original assessment. Without such evidence, it logically and fairly follows that the landlord should be permitted to take a separate pet damage deposit.
We believe it is inevitable that some damage will result from pets. That is why we support Amendment 53A, which would introduce the option of a dedicated pet damage deposit. This would provide landlords with an essential route to recoup costs, while also protecting tenants from unfair charges by clearly defining that this is a separate and transparent element of a tenancy agreement and that, as we have already heard, if no damage is done, they get this charge back.
We recognise that some landlords may choose to welcome pets without requiring additional deposits—or, in the future, insurance—and they should be free to do so. But where landlords require further protections, there must be a fair and transparent mechanism for tenants to provide it at the outset of the tenancy.
Finally, the experience in Scotland reminds us that implementing pet-friendly rental policies is a delicate balance that must be tailored to the practical realities that landlords and tenants face. As the Bill moves forward, it is essential that it draws on such lessons to achieve frameworks that work fairly across the whole United Kingdom.
If the noble Lord, Lord de Clifford, is minded to test the opinion of the House on Amendment 53A, we will support him.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank all noble Lords for their contributions to this debate. I know it is a hugely emotive and important issue for so many people, and we have had a good debate on it today. I thank the noble Lord, Lord de Clifford, for introducing his amendment, and the noble Earl, Lord Kinnoull, the noble Lords, Lord Trees, Lord Howard, Lord Pannick and Lord Fuller, and the noble Baronesses, Lady Miller and Lady Scott.
I turn now to the amendments in the names of the noble Earl, Lord Kinnoull, and the noble Lord, Lord de Clifford. As we have discussed, Amendment 50 is not required as our government amendments remove the insurance requirements altogether. I understand fully the intention of Amendments 51 and 53A, with the aim to ensure that landlords are protected from potential damages caused by pets. However, we are content that existing deposits, which are capped at five weeks’ rent for typical tenancies where the annual rent is less than £50,000, or six weeks’ rent for tenancies over £50,000 per annum, are enough to cover typical pet damages.
The noble Lord, Lord Pannick, illustrated very clearly some of the complexities of this issue. Allowing a further three weeks’ deposit would cost the average tenant in England over £900. This is unaffordable for many tenants, who will have worked very hard to save for their deposit for their property, and greatly exceeds the average deposit deduction for pet damage of £300 reported in the study we have already spoken about. That study found that 76% of landlords reported that they did not encounter any damage caused by dogs or cats in their rental properties. Where there was damage, it was an average of £300 per property, compared with £775 for non-pet-related damage.
The report also shows that renters with pets tend to stay longer in their properties than those without pets, indicating financial and social advantages for landlords in fostering those longer and more stable tenancies. In the very rare cases where the insurance and deposit do not cover the cost of damage caused by a pet, a landlord can of course take the tenant to the small claims court by bringing a money claim to recoup any outstanding funds.
In relation to the issues mentioned about Scotland, housing is of course a devolved matter in Scotland, and it is for the Scottish Government to set deposit limits for private rented properties. I note that the right to request a pet does not yet exist in Scotland. In England, we believe that the five weeks’ deposit will be sufficient to cover damages. We also have concerns that in some cases it will be impossible to distinguish between damage caused by pets and that caused by tenants themselves. This could leave pet owners with more exposure to large, unreasonable deposit deductions compared with other renters. As I said, we have an existing power under the Tenant Fees Act, which we could use to allow landlords to require a larger deposit where they have consented to the tenant having a pet. We want to closely monitor how the pet provisions work in practice following implementation, and will consider using the power in the Tenant Fees Act if we see that the cost of pet damage is frequently exceeding the value of deposits.
Lord Deben (Con)
My Lords, the Minister just said that the situation has changed. I have listened very carefully to the debate. The Government thought it was necessary to have insurance; they now say it is not necessary. Therefore, the Government have already admitted that there needs to be something additional to protect the landlord in the case of somebody having a pet. Frankly, the argument does not stand up to say that that is not so. I hope that the Minister will accept that she really has to go back and say that if there is no insurance, there has to be a greater degree of protection for the landlord.
Baroness Taylor of Stevenage (Lab)
I hear what the noble Lord says, and I have listened to other noble Lords, but the evidence in the study that I cited is that three-quarters of landlords of those tenants who have pets do not report any damage. Where there is damage, the cost is around £300, which is perfectly within the scope of the normal deposit. We are content that landlords would be suitably protected against the cost of pet damage through existing tenancy deposits.
Finally, I turn to Amendment 53. As I stated in Committee, “premium” is already commonly understood to include any insurance premium tax, so this amendment is not strictly required, in our view. However, following the Government’s amendments, which remove the ability of landlords to require tenants to obtain insurance to cover the risk of property damage caused by a pet, the noble Lord will, I am sure, recognise that this amendment is no longer required. I therefore request that these amendments not be pressed.
The Deputy Speaker (Lord Geddes) (Con)
My Lords, as previously advised, Amendment 49 having been agreed to, I cannot call Amendments 50 to 53 due to pre-emption.
Amendment 53A
Lord de Clifford
“16D Pet damage deposit(1) It is an implied term of every assured tenancy to which section 16A applies that if, at the time of consenting to the tenant keeping a pet, the landlord informs the tenant in writing that the payment of an additional pet damage deposit by the tenant is a condition of the consent, then the tenant must comply with that condition.(2) The additional pet damage deposit under subsection (1)—(a) can be used to make good pet damage,(b) must be of equivalent value to three weeks of rent,(c) cannot be subject to the limits for deposits in tenancy agreements, and(d) is subject to the rules governing deposits in tenancy agreements, for purposes of monies handled.”Member’s explanatory statement
This amendment seeks to introduce a new option of a landlord pet damage deposit.
Lord de Clifford (CB)
I thank your Lordships very much for their contributions on my amendment. I will answer just a few of the questions posed. I agree with the noble Baroness, Lady Miller of Chilthorne Domer, that children and, potentially, elderly people can cause extra damage, but pets have their own minds and are uncontrollable. The noble Lord, Lord Pannick, has pointed out a possible slight fault in the amendment, but landlords do not have to make that a condition. If it was just goldfish, I think there could be some negotiation with the tenant.
I have listened to the Minister and her suggestion of a way of reviewing this in time, but that will take time. It could be many years before we see a change. Therefore, I think landlords need a little more protection when it comes to pets—they do cause additional damage—so I would like to test the opinion of the House.
Member’s explanatory statement
This is consequential on the amendment in my name which would remove the provision to be inserted into the Housing Act 1988 relating to indemnity and insurance for pets.
Member’s explanatory statement
The amendment removes the provisions to be inserted into the Tenant Fees Act 2019 to allow tenants to make payments relating to pet insurance in consequence of the amendment in my name which would remove the provision to be inserted into the Housing Act 1988 relating to indemnity and insurance for pets.
Baroness Grender
“Permission for home adaptations(1) The Housing Act 1988 is amended as follows.(2) After section 16 insert—“16A Home adaptations(1) It is an implied term of every assured tenancy that a landlord must give permission for adaptations where a local council has carried out a Home Assessment and recommends adaptations which constitute reasonable adjustments under the Equality Act 2010.(2) A tenant may appeal a landlord’s refusal to give permission for such adaptations.””Member’s explanatory statement
This new clause would ensure that landlords of private and social tenancies provide permission for home adaptations for people who have disabilities where a Home Assessment has been carried out.
Baroness Grender (LD)
My Lords, I rise to move Amendment 56 on behalf of my noble friend Lord Tope, who, regrettably, is unable to be with us today. This amendment would require landlords to grant permission for home adaptations that qualify as reasonable adjustments, provided that a local authority assessment has been completed. The challenges faced by disabled tenants are many and their needs are often complex. Without clear provisions allowing disabled tenants to make the necessary adaptations following a proper assessment, they risk being unable to remain in their homes long term. Far too often, disabled tenants are forced to move frequently, encountering unpredictable and inadequate modifications that undermine their ability to live independently.
This is not a marginal issue. The 2023-24 English Housing Survey found that 37% of households included someone with a long-term illness or disability, with that figure rising to a striking 59% in the socially rented sector. According to a 2024 report by the Housing, Communities and Local Government Select Committee, one in three people living with disability in the private rented sector lives in unsuitable accommodation—the highest rate of any tenure type. Meanwhile, a survey by Generation Rent found that more than eight in 10—86%—of disabled private renters reported that their disability or mental health condition had been negatively impacted by renting privately.
Following the Committee debate, I am grateful to the Minister for highlighting the additional funding for the disabled facilities grant and for her comments on the review of the allocation formula, which is a welcome step. I also appreciate the Minister’s remarks regarding the ongoing review of the upper limit for the disabled facilities grant. However, I highlight that this upper limit has not been revised since 2008, meaning that it has not kept pace with rising costs and the increasing complexity of adaptations needed. While I agree that any review must be thorough, to ensure fairness and sustainability, it is equally important that it is carried out with a sense of urgency. Delays in updating the upper limit risk leaving many disabled people without the full support they need to make their home safe and accessible. A timely review and adjustment are essential to reflect the current realities and provide adequate assistance for those who rely on this vital funding. I also gently urge the Government to prioritise timely and efficient local authority home assessments. For many disabled people, delays in these assessments mean living for months or even longer in unsuitable or unsafe conditions.
The challenges facing disabled people in the housing sector were highlighted in deeply concerning evidence from, again, the local government Select Committee. Some individuals waited 22 weeks to complete just the first stage of their disabled facilities grant application, leaving them without access to an adapted kitchen or bathroom during that time. While I understand the concerns about creating a two-tier system, the central aim of this amendment is to ensure that, once a professional assessment has confirmed a need, there is a clear pathway to delivering those adaptations. I hope that Ministers will continue to engage with the spirit of this proposal and explore practical ways to reduce unnecessary barriers to independent living.
I also express my support for Amendments 72 and 86, tabled by the noble Baroness, Lady Jones of Moulsecoomb. Amendment 72 proposes a new clause to establish a right to minor home adaptations for accommodating a disability. This is an important and practical step that would enable disabled tenants to live more independently, without unnecessary delays or obstacles. Amendment 86 seeks to prevent discrimination against prospective tenants who may require adaptations for accessibility. This is a vital protection to ensure that disabled people are not unfairly excluded from the rental market because of their needs. Both amendments reflect a fair and proportionate approach to improving accessibility and inclusion in the private rented sector. I hope the Government will give them serious consideration.
While I do not intend to divide the House at present, I hope that the Government will listen carefully and reflect on the proposals contained in these amendments. The aim is not to impose undue burdens but to support disabled people in living independently and with dignity in homes that meet their needs. I urge the Government to continue engaging constructively on this issue and to consider how we can work together to improve the system so that it is more responsive, more equitable and more attuned to the realities faced by disabled tenants across the country. I beg to move.
Baroness Jones of Moulsecoomb (GP)
My Lords, I will speak to my Amendments 72 and 86. I thank the noble Baroness, Lady Grender, for giving such a good explanation of them. I wish I had lobbied the Minister more, as all three amendments in this group are very good and very sensible.
Turning first to Amendment 72, I was talking last night to a friend who has very severe disabilities. He said he had noticed that, while landlords are very slow at making improvements or adaptations and allowing their tenants to do so, business, retail business in particular, is moving ahead. He talked about a new retail development in Yeovil where everything is accessible. It is roll-in, roll-out, and people with disabilities in wheelchairs, for example, have full access.
It seems that businesses are taking this seriously, so why are the Government and landlords not doing so? Renters of all ages face challenges—it is not only the older ones among us—but older renters are particularly vulnerable, for several reasons. They are more likely to have health issues or disabilities, which means they are more at risk of becoming ill because of poor housing. They are also more likely to live in poor quality homes. In view of our ageing population, this is not just a good thing to do but entirely necessary.
I welcome the support of the LGA for Amendment 86, as promoting equitable housing access and preventing discrimination is fundamental to our society. It is essential that tenants are protected from unfair discrimination when seeking housing. I do hope that Labour listens. We have seen with its welfare reforms what happens when Labour does not listen to the needs of disabled people. These are simple changes, but they are important. They would change the lives of our ageing population for the better, now and in the future—and that is what a progressive Government should do.
Lord Jamieson (Con)
My Lords, I thank both noble Baronesses for speaking in this debate. It is a sensitive issue. It concerns adaptations for some of the most vulnerable in our society and touches on those who require the greatest compassion and care. We do need to support people to live independently in their own home. As a council leader, I was proud that we built a number of fully accessible, affordable homes for the disabled.
However, I must express some concerns about Amendment 56, tabled by the noble Lord, Lord Tope, and moved by the noble Baroness, Lady Grender. This Bill is focused on the private rented sector, yet the amendment introduces provisions relating to social tenancies. As my noble friend Lady Scott alluded to earlier today, social housing providers have not been widely consulted in the lead-up to this Bill. Imposing new requirements on them without proper consultation and discussion would be inappropriate. Any such change rightly belongs in a dedicated social housing Bill. The noble Baroness, Lady Taylor, said earlier that she would seek to write to social landlords and perhaps this is another opportunity for her to do so.
Furthermore, the amendment is riddled with gaps. It lacks clarity on important matters such as what happens when a tenant leaves, who is responsible for reinstatement, its cost and the loss of rent while work is carried out. There is also the issue of ensuring work is carried out to a high standard and that structural integrity is maintained. These issues are vital to maintaining the value and usability of the property, and the amendment fails to address them adequately.
Turning to Amendment 72, tabled by the noble Baroness, Lady Jones of Moulsecoomb, I note that it defines “minor changes” as including structural alterations. Structural alterations hardly seem minor. While I fully appreciate the noble Baroness’s intentions and her compassionate approach, which we all share, this is a complex issue. I strongly believe that we must strike a careful balance between compassion, cost and deliverability, and we must do so in a thorough and considered manner. I hope that your Lordships’ House agrees.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Tope, for his amendment, the noble Baroness, Lady Grender, for moving it so ably, and the noble Baroness, Lady Jones of Moulsecoomb, for her amendment. I also thank the noble Lord, Lord Jamieson. He may remember that I visited some of the housing that he developed when he was a council leader to pinch some ideas for my own local authority. It was indeed very accessible.
Amendment 56, from the noble Lord, Lord Tope, would require landlords to allow disability adaptations when a local authority has carried out a home assessment and recommended changes to be made. While the Equality Act 2010 already provides protections for disabled renters, I completely accept that they are not always as well understood as they should be. It is right that we consider how to address barriers preventing disabled renters getting the home adaptations they need. However, as I stated in Committee, I do not consider that this amendment is the right way to do this. A new requirement linked to local authority home assessments would create a confusing two-tier system. As a consequence, even these well-intentioned measures might make it harder for people who are not eligible for disabled facilities grants to access adaptations.
As I previously set out, the Government have committed to take steps to clarify matters further to support disabled renters. We all recognise what a vital issue this is and the difference it can make to someone’s life to have adequate access to their property. We will look to ensure that the written statement of terms that landlords will have to provide to new tenants includes the duty on landlords not to unreasonably refuse tenant requests for disability adaptations.
We also intend to work closely with the sector to deliver a communications and engagement programme to raise awareness of disability-related rights and obligations among tenants and landlords, and we will explore enhancing guidance to help landlords and tenants better understand the current system. This is in addition to existing provisions in the Bill that empower disabled tenants to request the home adaptations they need. For example, by abolishing Section 21 evictions, we will remove the threat of retaliatory eviction, and the creation of the new ombudsman will give tenants a new route of redress when their adaptations are refused.
The Government have also increased funding for the disabled facilities grant, as the noble Baroness, Lady Grender, mentioned. We have increased the grant by £86 million, bringing the total amount to £711 million. On the role of local authorities, they must provide a decision on the disabled facilities grant application within six months of receipt and the works must usually be completed within 12 months of the approval date. I appreciate that that can feel like a long time when you are waiting for an adaptation, but the Government have published guidance for local authorities in England to help to support the efficient local delivery of the disabled facilities grant, including speed of delivery. I appreciate that in some areas the availability of occupational therapists to do the assessments has proved an issue. Many local authorities are looking carefully at this issue, and I know we will be taking steps to address it.
Baroness Grender (LD)
My Lords, I thank all noble Lords for participating in this short but sweet debate on a very important issue.
I particularly welcome the reiteration of the application of the Equality Act, particularly for people with disabilities who simply wish to have reasonable adjustments to live their lives with independence and dignity. That is the most important point that we are trying to achieve with this amendment.
I am sure that my noble friend Lord Tope would wish me to say that he would love to continue to work with the Minister on this issue to try to ensure that we can achieve some of the changes that are required. That said, I beg leave to withdraw the amendment.
Member's explanatory statement
This is consequential on the amendment in my name which would remove the provision to be inserted into the Housing Act 1988 relating to indemnity and insurance for pets.
Lord Pannick
(iii) the dwelling house has been demonstrably available for purchase on the open market at a fair price for not less than six months and the landlord has not had any suitable offers to purchase the dwelling house.(1A) For the purposes of subsection (1)(b)(iii), the previous tenant or local authority retain the right for the courts to require evidence and to decide whether genuine attempts have been made to market and sell the property at a reasonable price and no offers at or above that price have been refused.”Member's explanatory statement
This amendment proposes a 6, rather than a 12, month prohibition on renting out an unsold property to make it impossible for a landlord to benefit financially by falsely claiming to be selling a property in order to require a tenant to vacate. The amendment includes evidential safeguards to ensure sale attempts are genuine and to support greater availability of property for rent.
Lord Pannick (CB)
My Lords, my noble friend Lord Cromwell has asked me to apologise to the House on his behalf, as he is unable to be here today. Amendment 58, tabled in his name, was debated last Tuesday.
I remind the House that the Bill says that, if a landlord asks a tenant to leave on the grounds that the landlord is selling the property but the property then fails to sell, which happens in about one-third of cases, the landlord will then, in all such cases, be prohibited from renting out the property for another 12 months. Amendment 58 seeks to reduce that period to six months, which would mitigate what is an unjustifiably penal provision of the Bill, which damages both landlords and prospective tenants. With the agreement of my noble friend Lord Cromwell, I wish to test the opinion of the House.
Lord Young of Cookham
“16GA Exemption for shared ownership leaseholders(1) Sections 16E and 16F do not apply to any relevant person who gives notice under Ground 1A in Schedule 2 if on the date such notice is given that person is a tenant under a shared ownership lease.(2) For the purposes of this section “shared ownership lease” has the same meaning as in section 13 of the Landlord and Tenant Act 1985 and “tenant” shall be construed accordingly.”Member’s explanatory statement
This amendment seeks to protect shared leaseholders whose sales fall through, as is common. The current drafting of clause 14 would leave the shared ownership leaseholder with an empty property if notice is given and the sale falls through.
Lord Young of Cookham (Con)
My Lords, when I spoke to this amendment last Tuesday, I said I was minded to test the opinion of the House if the Government could neither accept the amendment nor give an assurance that shared owners letting flats in blocks affected by the cladding scandal could sell the flats back to the housing association they bought it from when a sale falls through to save them from the financial problems that will confront them with the proposed 12-month ban on re-letting. Although I was grateful to the Minister for the meeting she held with me, and for her sympathetic remarks at the end of that debate, and read with interest the letter that she sent me this morning, I am afraid that it falls well short of the assurances I was looking for, so I beg leave to test the opinion of the House.
Baroness Scott of Bybrook
“Report on financial assistance to local housing authorities(1) Within 12 months of the day on which section 16 (landlords etc: financial penalties and offences) comes into force, and annually thereafter, the Secretary of State must make a statement of all financial assistance provided to local housing authorities under section 16L of the Housing Act 1988 (financial penalties: supplementary and interpretation).(2) The statement made under subsection (1) must be laid before Parliament.”Member's explanatory statement
This would require the Secretary of State to produce an annual report on financial assistance provided to local housing authorities.
Baroness Scott of Bybrook (Con)
My Lords, the Bill brings forward significant changes to the way our housing market functions and to the Government’s role within the private rented sector. It introduces new controls, grants new powers to the Secretary of State, imposes new fines and restricts what landlords and tenants can do. These are not minor or technical adjustments; they are fundamental shifts in how the private rented sector will operate.
A Bill of this scale and consequence will require a clear, well-planned implementation strategy. It cannot promise change at some undefined point in the future, with no clear road map for how landlords and tenants will be taken along that journey. Effective communication and timely guidance will be essential to ensure that the sector is not left in a state of uncertainty.
Beyond implementation, the Bill will alter the underlying dynamics of the market. The Government’s active involvement will inevitably shift the balance of supply and demand, change price signals, affect future capacity, influence rational expectations and alter incentives for both landlords and tenants. These are not unintended side-effects; they are the direct consequences of the choices made in this legislation. That is why we have to be so passionate about the need for proper accountability and monitoring. It is why we tabled Amendment 118, which would require an impact report on the effects of this Bill as a whole, covering the housing market, rent levels, house prices and availability.
It is clear to us that the Bill will not enhance the availability of homes; indeed, it risks diminishing it. It will not ease the pressure of unaffordable rents, but may exacerbate it. Nor will it drive improvements in the quality of rented accommodation; quite the reverse, it threatens to hasten its deterioration. The Government should therefore be required to return to both Houses with a report on the impact of this legislation, not merely a review. A review can be vague, take time and be inconclusive, lacking in accountability and expensive. A report, by contrast, must provide evidence, analysis and a clear assessment of outcomes against the stated aims of the Bill. If we are to legislate with such ambition, we must also commit to transparency about the consequences of this Government’s Bills.
Finally, I wish to draw the House’s attention to Amendment 60, which would require the Secretary of State to provide an annual report on financial assistance to local housing authorities. This is about transparency and accountability. When public finances are under strain and the fiscal outlook is bleak, taxpayers deserve to know where their hard-earned money is going. I hope the Minister will consider how we can strengthen oversight when significant sums of financial assistance are involved.
On the broader principle of scrutinising the Bill’s intentions and implications, I am pleased that we have found common ground with the noble Baroness, Lady Thornhill. The Minister and the Government may find this group frustrating, but the onus is on us to ensure that predictions are tested and instincts are aligned with reality. I beg to move.
Baroness Grender (LD)
My Lords, I will speak to Amendments 90 and 93 in the name of my noble friend Lady Thornhill, who, unfortunately, cannot be here. These are thoughtful and constructive proposals that seek to strengthen the effectiveness and accountability of the Bill.
Amendment 90 would require a review of the impact of Part 1 within three years, specifically addressing its effect on renter security and stability. Given the significance of the reforms introduced by the Bill, it is entirely reasonable to build in a mechanism to evaluate whether these changes are achieving their intended outcomes and put it before Parliament. I am aware that the department conducts its own review processes for legislation of this kind, but I would welcome assurances from the Minister that these reviews will be thorough and fully account for the various impacts of the Act across the private rented sector.
Amendment 93, also tabled by my noble friend Lady Thornhill, proposes a review of how well tenants understand their rights and obligations under the Bill and where they are most likely to seek that information. This speaks to a critical issue. The Bill makes a number of positive reforms, particularly in strengthening the rights of renters to challenge unfair practices such as unlawful rent increases, poor property standards or breaches of their tenancy agreements through accessible routes such as the First-tier Tribunal. However, as we have discussed again and again in Committee and at Second Reading, far too many tenants either are unaware of these rights or lack the practical information and support needed to exercise them. Without clear and accessible communication, even the most well-intentioned reforms risk falling short. This amendment would ensure that the Government are proactive in identifying how renters seek advice and whether current methods of communication are effective at reaching them. It is only through this kind of follow-up that the Bill’s protections can be meaningfully realised in practice.
Amendment 60, tabled by the noble Baroness, Lady Scott, would require the Secretary of State to produce an annual report on financial assistance provided to local housing authorities. As drafted, in our view, the amendment does not clarify the contents of the review and the information it suggests is already available. We are much more supportive of Amendment 118, which would require a broader review of the impact of the Bill on the housing market. We attempted to introduce this on day 1 of Report; we argued then that, given the scale of the reforms to the private rented sector, a review of this kind would provide a useful opportunity to assess the Bill’s wider consequences.
We hope the Minister will take these considerations into account. These amendments do not seek to undermine the Bill but rather to ensure that its implementation is informed, effective and fair. A commitment to review the impact on renters’ stability and to assess how well tenants understand and can access their rights would demonstrate that the Government are serious about delivering lasting change in the private rented sector. It would also offer a valuable opportunity to identify where further support or clarification may be needed, helping ensure that the reforms achieve, as we all hope, their full potential.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baronesses, Lady Scott and Lady Thornhill, for their amendments, and the noble Baroness, Lady Grender, for again ably speaking to them.
Amendment 60 would require the Secretary of State to publish a statement of the financial assistance provided to local authorities in connection with their powers to impose civil penalties for breaches and offences relating to assured tenancies. The statement would need to be laid before Parliament within 12 months of Clause 16 coming into force, and then annually for an indefinite period. It is clearly important that local authorities are prepared to fulfil the duties placed on them by the Bill. However, requiring the Government to produce an annual statement of the nature outlined in this amendment would create a significant administrative burden for little benefit.
We know that the enforcement duties created by the Bill will present an additional net cost for local authorities. That is why we will ensure that the additional burdens created by the new system are funded in line with the new burdens doctrine. We will continue to work closely with local authority stakeholders as the Bill is implemented to ensure a smooth transition to the new system. For these reasons, I ask the noble Baroness, Lady Scott, to withdraw her amendment.
Amendment 90 from the noble Baroness, Lady Thornhill, seeks to prescribe the groups with which the department would be required to consult as part of this process. I know there is a large amount of interest in this House on the impact of this legislation, and I have previously set out to the House the approach we will be taking to monitoring and evaluating the impact of the Bill.
The use of a broad range of data is at the heart of our approach. As well as existing data, we will use data from stakeholders such as local authorities, and data generated from the reforms themselves. I agree that it is important that our evaluation makes use of interviews, surveys and focus groups, and we have committed to conduct these with a range of stakeholders. This amendment would require the Government to speak to renters, landlords and local authorities as part of our evaluation. We have already committed to speaking to these groups. In fact, we plan to go further and draw on the experience of letting agents, third-sector organisations, delivery partners, the courts and tribunals service and government officials. The information we collect from speaking to these stakeholders will be used as a key part of our evaluation of the programme.
I also recognise that this amendment places a particular focus on the impact of the Bill on levels of homelessness and the use of temporary accommodation. We already collect robust data through the Homelessness Case Level Collection. Local authorities provide quarterly data returns on their actions under the homelessness legislation. This allows us to effectively monitor homelessness, including temporary accommodation breakdowns.
No approach to tackling homelessness can rely on a single action. Instead, we are determined to address the homelessness crisis we inherited and deliver long-term solutions. That is why we have already made a £1 billion investment in homelessness and rough sleeping services this year—2025/26—a £233 million increase on the previous year. In addition, we are developing a cross-government strategy to get us back on track to ending homelessness. We are committed to moving away from a system focused on crisis response, taking a holistic approach to preventing homelessness in the first place and driving better-value-for-money interventions.
Amendment 93—also from the noble Baroness, Lady Thornhill—would introduce a legal requirement for the Secretary of State to conduct a review of the extent to which tenants in the private rented sector understand their rights and obligations. I know the House will share my view that the successful implementation of the Renters’ Rights Bill is firmly rooted in how widely its provisions are known and understood, and I completely agree with the noble Baroness, Lady Grender, in that respect. I therefore want to reassure the House that the Government are committed to raising awareness of the full range of Renters’ Rights Bill reforms across the private rented sector. This will be done through robust and extensive stakeholder engagement, providing the sector with a full suite of guidance on the reforms and an overarching communications campaign, along with partnership marketing. This extensive and targeted work will ensure each part of the sector fully understands its new rights and obligations.
The Government have already committed to a comprehensive monitoring and evaluation programme of the reforms, drawing on a wide range of data sources and stakeholder input. Including a requirement for a review of tenants’ understanding of the rights and responsibilities in the Bill therefore represents an unnecessary step. On the basis of these arguments and our clear commitments, I ask the noble Baroness, Lady Thornhill, not to press her amendments.
Finally, I turn to Amendment 118 in the name of the noble Baroness, Lady Scott. I appreciate the concern that underpins Amendment 118, namely the potential impact of the Renters’ Rights Bill on the housing market in England and whether it might discourage landlords from remaining in the sector. As we consider this issue today, it is important to reflect on the evidence already available. The 2023-24 English Housing Survey shows that the size of the private rented sector has remained broadly stable since 2013-14. This suggests that, despite ongoing discussions about reform since 2019, landlords have not exited the market in significant numbers. The Government remain confident that the measures in the Bill will not destabilise the rental market. On the contrary, our proposals make sure that landlords have the confidence and support they need to continue to invest and operate in the sector.
I will not repeat the details I set out in Committee of this Government’s commitment to thoroughly monitoring and evaluating the private rented sector reform programme using a wide range of data sources and stakeholder input. However, for the benefit of the House, I will briefly set out our plans for publishing the findings from this evaluation, which I believe is what the noble Baroness, Lady Scott, was asking me.
In accordance with the policy set out in our evaluation strategy, the department will publish its assessments of the Renters’ Rights Bill on GOV.UK at two key intervals: two years and five years after implementation. To ensure the reports are publicly accessible, copies will be formally lodged in the Libraries of both Houses of Parliament at the time of publication.
I reassure the noble Baroness that we are committed to carrying out a robust evaluation of the Renters’ Rights Bill. We will disseminate its findings widely so that parliamentarians, tenants, landlords, local authorities and wider stakeholders will be able to see and scrutinise the impact of the reforms in a timely way. For these reasons, I ask the noble Baroness not to press her amendment.
Baroness Scott of Bybrook (Con)
My Lords, I thank noble Lords for their contributions to this group, which have allowed us further to explore the real impacts of the Bill and what it entails. It is clear from today’s discussions in the lead up to the report that there is probably not sufficient support in the House for Amendment 60, so I will not be pressing it today.
However, it has been clear from the outset that this, to us, is a poor Bill. We believe it will have serious consequences for both landlords and tenants. A reduction in rental supply is not good for tenants; it pushes up costs for those already just about managing and, in many cases, removes the entirely reasonable option of renting a home altogether. We therefore wish to test the opinion of the House on Amendment 118 when the opportunity to do so arises, on the next day of Report.
If the Government are confident in this Bill, we believe they should have nothing to hide. I beg leave to withdraw the amendment.
“Restriction on landlord’s ability to require tenant to provide guarantor(1) A relevant person must not, in any of the circumstances set out in subsection (3), require a person, as a condition of the grant of a relevant tenancy, to provide a guarantor in relation to the observance or performance of the tenant’s obligations under the tenancy.(2) For the purposes of this section, requiring a person to provide a guarantor includes accepting an offer by that person to provide a guarantor.(3) The circumstances are—(a) that the person has paid a tenancy deposit or has been assisted under a deposit scheme,(b) that the person is required to pay rent in advance of one month’s rent or more,(c) that on a reasonable assessment of their means the person’s income (including state benefits received and any other lawful source of income) is sufficient to enable them to pay the full rent due under the tenancy,(d) that arrangements will be made for housing benefit or the housing element of universal credit to be paid directly in respect of rent to a relevant person,(e) that the relevant person has entered into a contract of insurance under which they are insured against non-payment of rent, or(f) such other circumstances as may be prescribed by the Secretary of State.(4) In any other case where a relevant person lawfully requires a person, as a condition of the grant of a relevant tenancy, to provide a guarantor, the sum for which the guarantor may become liable under the relevant guarantee may not exceed a sum equal to six months’ rent.(5) In any case where a relevant person lawfully requires a person, as a condition of the grant of a relevant joint tenancy, to provide a guarantor, the sum claimed under the guarantee may not exceed such proportion of the loss as is attributable to the act or default of the individual tenant on whose behalf the guarantee was given; and if such proportion cannot be proved, may not exceed the sum obtained by dividing the total loss by the number of tenants.(6) In this section—“guarantor” is a person who enters into a guarantee in relation to a relevant tenancy; a “guarantee” is a contractual promise to be responsible for the performance of an obligation owed by the tenant to a relevant person under the tenancy if the tenant fails to perform the obligation;“deposit scheme” includes a scheme whereby a sum payable by way of deposit or a bond or guarantee is provided by a local authority, registered charity or voluntary organisation for the purpose of providing security to a landlord for the performance of a tenant’s obligations under a tenancy;“tenancy deposit” has the same meaning as in section 212(8) of the Housing Act 2004;“relevant person” has the meaning given by section 16M(1) of the 1988 Act.”Member's explanatory statement
This new clause would restrict the circumstances in which a landlord can request a guarantor.
Baroness Kennedy of Cradley (Lab)
My Lords, I declare my interest as a trustee of the Nationwide Foundation. Amendment 61 seeks to address a growing and deeply concerning issue in the private rented sector: the overuse, and often misuse, of guarantor requests. This amendment was expertly moved by my noble friend Lady Lister of Burtersett in Committee, and I thank her for her support today along with that of the noble Baroness, Lady Grender, and the right reverend Prelate the Bishop of Manchester—all of whom have given continued support to addressing the issue of the overuse of guarantors.
I am sure that noble Lords across the House will accept that landlords should retain ways to manage financial risk. However, the increasing use of guarantor requests is creating a new form of exclusion, particularly for vulnerable renters. This is what Amendment 61 is about: it is not about banning guarantors altogether but restoring proportionality and fairness in their use.
Guarantors have become a significant barrier to housing for many. Recent data from Generation Rent shows that almost 30% of renters who moved in 2023-24 were asked to provide a guarantor. A further survey by Shelter and YouGov showed that over 100,000 private renters per year are blocked from renting a home in the private rented sector due to a guarantor request they cannot fulfil.
Meanwhile, only 2.9% of landlords attempted to claim unpaid rent from a guarantor in the last two years, despite an estimated 1.85 million tenants being asked to provide one. Guarantors are therefore becoming commonplace, yet they are rarely needed in practice and often never pursued when payment issues arise. Noble Lords may be asking why. A YouGov survey by Shelter asked the same question. When questioned, 25% of private rental landlords said that they asked for a guarantor because “My letting agent advised me to”. Another 16% said, “I thought it was standard practice”, while 12% said, “I’d heard from other landlords it was a good idea”. Simply put, guarantors are over-requested, largely unused and, worst of all, increasingly serve as a proxy for discrimination.
When a tenant can show that they can afford the rent through a standard affordability assessment, the additional requirement of a guarantor becomes both unnecessary and unfair. It many cases, it adds to an already substantial financial burden, alongside the five-week deposit and the first month’s rent in advance. The evidence shows that this practice disproportionately affects people on lower incomes, those without access to financial support networks and groups already at greater risk of housing discrimination: women, single parents, renters with disabilities and black and Bangladeshi households are all significantly more likely to be asked for a guarantor. A renter with a disability is 20 % more likely to face such a request, and a black renter is 66% more likely. These figures cannot be anomalies; they are a pattern. In Committee, we heard from my noble friend Lady Lister of Burtersett about older renters securing their pensions, being asked intrusive questions and then being required to provide a guarantor. From the noble Baroness, Lady Grender, we heard of a self-employed single mother being asked for a guarantor even though she was earning £45,000 a year—well above the UK median income. Too many renters simply do not have someone in their network who can act as a guarantor. Unless this issue is addressed, we risk entrenching a two-tier system in the rental market: one for those with access to wealth and another for those without.
The justification for these requirements often rests on an overstated fear of rent arrears, yet government figures show that only 2% of private renters were in arrears in 2023-24, and the English Housing Survey puts it at 5%. Of course, that is not negligible, but it does not warrant such widespread and disproportionate use of guarantors. There is an eviction ground for rent arrears, which is the primary backstop for when tenants fail to pay their rent.
Moreover, Amendment 61 aligns with the National Residential Landlords Association’s own guidance that guarantors should be requested only when a tenant cannot fully demonstrate that they can afford the rent. This amendment strikes a balance, allowing landlords to use guarantors when genuinely necessary, while protecting tenants from unjust exclusion. It is supported by a wide range of voices: Shelter, Independent Age, UNISON, Renters’ Reform Coalition, the Mayor of London and others. It is also worth noting that this amendment not only calls for legislative clarity but invites the Government to go a little further by introducing national guidance on fair and proportionate tenant referencing. Such a move would help standardise best practice and prevent local variation from undermining equality in the rental market.
In summary, this amendment is proportionate and reasonable and would not remove a landlord’s right to safeguard their interest, but it would ensure the right is exercised in a way that is just, consistent and in keeping with the spirit of the Bill. I hope that my noble friend Lady Taylor of Stevenage is minded to accept this amendment, but if that is not the case, I ask my noble friend four final critical questions. With guarantor requests increasingly becoming standard process, rather than when they are needed, will the Government issue guidance to landlords on when to request a guarantor? Will the Government look at what support they can provide for people who are at risk of homelessness because they cannot find a guarantor? Will the issue of guarantors be examined in detail as part of the post-Bill implementation work? Will my noble friend commit to working on these issues with Shelter, the Renters’ Reform Coalition, noble Lords in this House and many others on these issues, to find other ways to support the growing number of renters being locked out of the PRS because of the overuse of guarantors?
Without this amendment or government action to address the issue of guarantors, the Bill’s measures to tackle discrimination risk being undermined by the very practices it seeks to reform. I beg to move.
Lord Fuller (Con)
My Lords, I will speak briefly against Amendment 61. It is well-meaning, but I am afraid it is a blunt instrument full of unintended consequences. I do not deny that to require a guarantor for most tenancies is disproportionate and unnecessary, and the Bill makes welcome provisions to regularise what has become standard practice for the most part. However, I want to alert your Lordships’ House to some perverse consequences for three particular types of potential tenant who are among the quietest voices: the foreign student; the groups of students; and those with impaired reputation or difficult personal circumstances. Guarantees make the unrentable into rentable, in some cases. It makes opportunities exist when refusal would otherwise be the only other choice.
Let us dwell for a moment on the case of the foreign student. The foreign students come from far away; they have no reputation, there is no covenant strength and they may not even have arrived in the United Kingdom. They certainly do not have a UK bank account at this point and they probably do not have a UK mobile phone either. In many cases, the only way in which they can secure a property to live in before they arrive is to have the support of a guarantor; a guarantor allows them to have a roof over their head.
Then we have the groups of students. I refer to the case of my daughter, when she went off to Newcastle. There were seven students who were friends, although none of them really knew each other that well; they certainly were not related to each other, and there were no family bonds to tie them, whereas the Bill contemplates that the tenant is a single tenant. It is quite reasonable for a landlord renting to students, if they cannot have payment in advance—I will not talk about that because we discussed that on day one of Committee—to require some sort of guarantor so that the downside risks can be compensated. Not all students want to live in expensive halls of residence; they are disadvantaged at an early part of their lives.
Let us think also about those with an impaired reputation—people who may have left prison or are suffering from domestic abuse or family breakdown. I have been a guarantor for hundreds of families in these sorts of situations, but the Government seek to make my well-meaning interventions unlawful. Let me explain. Sitting in your Lordships’ House, I see the Minister and my noble friend Lord Jamieson who, like me, have been leaders of councils. We know that councils, in certain circumstances, have to step in to avoid homelessness. We know there are not enough registered social landlords and that the private sector landlords are our friends—they are part of the solution, not the problem. However, we cannot expect the private sector landlord to be the only one who takes a chance to get that person, who may have become homeless, a roof over their head.
In common with many other councils, my council—and I am proud that we pushed this hard—went for guarantees. We stood as guarantor for somebody in difficult circumstances so that the private sector landlord, who was prepared to take a chance with us, could provide a home. This is an essential part of managing a housing market. It is all about supporting the most vulnerable. It works; it is a success. If you have been a council leader—I am sorry that I failed to identify the noble Baroness, Lady Scott, who has also been a council leader in these circumstances—this is about helping families get back on their feet.
In considering Amendment 61, I ask noble Lords: in what universe can this misdirected, misguided and counterproductive amendment help those with the quietest voices get a roof over their heads? Providing a guarantor is the way in which the unrentable can rent, and there is nothing fair about keeping people in bed and breakfasts if they could, via a guarantor, be housed. I cannot support this amendment.
Baroness Lister of Burtersett (Lab)
My Lords, I am pleased to support my noble friend Lady Kennedy of Cradley, and I am grateful to her for taking over the amendment. She is much better placed than I am to speak to it, and has done so very persuasively. The noble Lord, Lord Fuller, called it a blunt instrument and was hyperbolic in his description of the amendment. According to Shelter, the Bill and this amendment would restrict the scenarios in which a landlord can legitimately request a guarantor to those in which a prospective tenant cannot prove that the rent is affordable to them.
So it does not seem to me that the amendment excludes the groups that the noble Lord described. If it does so, then perhaps we can have a refined version of it, but the fact is that there are problems without an amendment of this kind. My central argument in Committee—
Lord Fuller (Con)
The noble Baroness talks about the burden of proof. In the three examples I gave, proof is not available. I can understand the intent and the well-meaning behind Amendment 61, but if it is to form part of the Bill, noble Lords need to ask themselves how those people in difficult circumstances are going to demonstrate the proof. They cannot, so a guarantor is the only way forward.
Baroness Lister of Burtersett (Lab)
This amendment does not preclude the use of guarantors; it just limits their use. I will leave it at that. As I said in Committee, if there is a better way of doing it, then fine—perhaps the Government could bring forward an amendment that ruled out any unintended consequences. I am not convinced that there are any—but anyway.
Baroness Grender (LD)
My Lords, I have added my name to this amendment in the name of the noble Baroness, Lady Kennedy of Cradley, and am absolutely delighted to support it. We spoke about this in Committee, but I still feel that there is an opportunity here. This is not about banning all guarantors—if that needs clarifying—and that is made very clear in the wording of the amendment. This is about trying to stop the blanket use of guarantors, which, I am afraid, is occurring and is highly discriminatory.
The noble Lord, Lord Fuller, referenced student groups. But I am a little bit confused, because my understanding is that the student groups that have been in touch with me over the last few days about this amendment are in support of it—unless the noble Lord has any examples of student groups that have been in touch with him that are against this amendment, then I am happy to sit down to allow him to tell me.
Lord Fuller (Con)
I have not canvassed student groups, but I know the example of my own family—my daughters went to Oxford and Newcastle—and the strictures that were placed on them. So I am talking from my personal experience rather than that of the representatives of other organisations.
Baroness Grender (LD)
It is my understanding that student groups are happy with this amendment and against the blanket use of guarantors. The current use of guarantors is, I am afraid, a proxy for discrimination against vulnerable groups. There is evidence that black renters are 66% more likely to be asked for a guarantor—I know that has already been said, but it is so profoundly shocking that it bears repetition. If you are on benefits, you are 60% more likely to be asked; if you have a disability, it is 20%. The great Equality Act 2010 is being driven over with the use of guarantors and I am delighted to support this amendment.
I read with a lot of care the Front-Bench speeches in Committee. The noble Lord, Lord Jamieson, suggested that guarantors can be a lifeline for those with poor credit or no rental history, but on these Benches we genuinely believe that nothing could be further from the truth. The harsh and stark reality is that 550,000 private renters were unable to secure a desired home in the last five years because they lacked a guarantor.
There is not a single organisation that I am aware of that campaigns and advocates on behalf of people who could be described as those who need that kind of lifeline, who are on no or a low income, which opposes this amendment. That includes working-class, international, estranged and care-experienced students who struggle to find suitable guarantors because they do not know anyone in those highest quartiles, which are the only guarantors that many landlords will accept. They just do not have those contacts or connections.
The noble Lord further suggested that tenants have market discretion or choice if a landlord is imposing a blanket guarantor policy. That defies the logic of the current marketplace, where the low-income tenant is never in the luxury position of shopping around. Again, that choice rests only with those whose income is in the higher quartiles.
On the Minister’s point in the same discussion about guarantors providing confidence, we must ask: at what cost to fairness? Landlords already have really robust tools: a five-week deposit, the first month’s rent up front, and affordability checks. As the noble Baroness, Lady Kennedy, said, guarantors are rarely invoked in practice. Like the noble Lord, I am currently a guarantor for my son, who is a student, so I completely understand that this is what we currently do. But in the past two years less than 3% of landlords have ever attempted to claim lost rent from a guarantor. When they did, it was 16 times more likely to be difficult than easy. Landlords have other, much more appropriate business risk management tools, such as rent guarantee insurance, rather than relying on a tenant’s family member, and so many of these tenants do not have a family member who is earning way above the median income, which is what is demanded.
Even before this legislation has come into effect, there is a worrying rise. A 2024 Generation Rent survey of its supporters found that 30% of private renters who had moved in 2023-24 had been asked for a guarantor—up from 22% of people who had moved in 2019. Always in this context, I fear that the debate is held on a presumption that renters lack responsibility somehow, unlike other tenures. However, as the noble Baroness, Lady Kennedy, said, only 2% of tenants were reported as in arrears in 2023-24. The vast majority of tenants are responsible individuals, who, by the way, often forgo other things, such as heating and eating, in order to pay rent, because they understand the severe consequences of not doing so and because the market is so limited for them.
This amendment is not a radical proposal. As Generation Rent and Shelter argue, it simply ensures that guarantors are used sparingly, appropriately and only when absolutely necessary, when a prospective tenant genuinely cannot demonstrate that they can afford the rent. This entirely aligns with the National Residential Landlords Association’s own current guidance.
When the Minister responds, if the Government are unable to stop this loophole for discriminatory practice, will she at least make it clear, either today or perhaps in a letter to follow, that guarantors should be used only as a last resort, that the Equality Act should be used if there is further evidence of discrimination, and that landlords already have the means to ensure that tenants pay through other mechanisms? I hope that her words today will ensure that the widespread use of guarantors is not the next version of no-fault evictions.
Lord Jamieson (Con)
My Lords, I thank the many who have spoken in this debate, particularly the three noble Baronesses who have spoken very passionately to say that we need to support some of the most vulnerable in our society. I agree that we need to support them.
As my noble friend Lord Fuller pointed out, many councils use the fact that they can act as a guarantor to enable many of the most vulnerable to access a home which they would, in other circumstances, not be able to. There is clearly an appropriate role for the guarantee. As the noble Baroness, Lady Grender, just mentioned, there is a shortage of rental accommodation—I think the figure is something like 12 people chasing every available rented home. We need to think about this when we are discussing this Bill. How do we encourage more people to rent their home so that we have a more dynamic market, with more availability there?
It is widely recognised that we need more rental homes, as is the importance of small landlords, particularly in rural areas. We also need to recognise that many of these small landlords have only one or two homes. For many of them, it is a substitute pension, and many of them have mortgages on these homes. If that is the case, they need security that they will get the rental income; otherwise, it is just too high a risk. Some noble Lords have said that the risk is small, but if it is your only asset and you have got a mortgage on it, you may not feel able to take that risk. As we have discussed before, without this, many would have no choice but to exit the market, meaning fewer rental homes and fewer people able to access a home—more people on the street. That is a particular issue in rural areas with small landlords.
Guarantors play a crucial role in the rental market. They provide an essential layer of security, offering landlords the reassurance that the rent will be paid, even if the tenant experiences financial difficulties. As we have mentioned earlier, for tenants, particularly students and young people or those without a strong credit history, a guarantor can be key to securing a home which might otherwise be out of reach. This is partly why we are so passionate about enabling rent in advance. That provision is especially helpful for individuals facing barriers, such as overseas students without UK credit records, or those who simply have no one to act as a guarantor.
With that context, I understand why the noble Baroness, Lady Kennedy of Cradley, has brought forward this amendment. However, I regret to say that, on this side of the House, we cannot support it. First, it is overly prescriptive and would constrain landlords from making what is, in many cases, a reasonable response to financial risk. Secondly, preventing landlords requiring a guarantor in such circumstances could have the unintended consequence of discouraging them from renting to high-risk tenants altogether. Thirdly, it would undermine a market-led approach to risk mitigation. Finally, the amendment would afford a broad and, we believe, inappropriate delegation of power. Combined, this would, as I said earlier, reduce the supply of available homes, increase the cost to a tenant and mean fewer people are able to get their own home. For these reasons, we cannot support this amendment.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank my noble friend Lady Kennedy of Cradley for her Amendment 61 and for bringing her expertise and experience to both today’s debate and discussions we have had previously on this issue—as did my noble friend Lady Lister when she moved a similar amendment in Committee. I also thank the noble Lords, Lord Fuller and Lord Jamieson, and the noble Baroness, Lady Grender, for speaking.
The use of guarantors within the private rented sector is an issue which I know is of great interest to the House. Let me start by saying that the Government recognise that obtaining a guarantor can be a difficult task for some prospective tenants, and I understand concerns that it can be used as a further barrier to tenancy in some cases. As the noble Baroness, Lady Grender, indicated, where it is being used to discriminate, equalities law may apply. I will consider, for our information-sharing exercise on the Bill, whether there is more we can do to inform people in this regard.
Baroness Kennedy of Cradley (Lab)
My Lords, I thank every noble Lord who has spoken on this group. I reassure my noble friend Lady Taylor of Stevenage and the noble Lords, Lord Fuller and Lord Jamieson, that the intention behind this amendment is clear: it is not about banning guarantors. On this side of the House—and, I am sure, on all sides of the House—we appreciate that landlords need to manage their financial risk. They have a number of ways to do this. The amendment would not ban guarantors; it simply seeks a way to end discrimination and ensure that guarantors are not overused and commonplace, and that they are used when they are genuinely needed. It is about restoring proportionality and fairness to the use of guarantors.
I thank my noble friend Lady Taylor of Stevenage for her reply, and her engagement and understanding on this issue, and for continually meeting me and other stakeholders. Of course, we are disappointed that the Government will not accept the amendment, and I am particularly disappointed about the guidance not being issued. However, I appreciate the issues around the guidance, about discrimination and the discriminatory nature of the overuse of guarantors, and her commitment that guarantors will be included in the evaluation of the impact of the Bill. Of course, I am always very happy that she will meet me and other stakeholders.
I am firmly of the belief, as I am sure other noble Lords are, including my noble friend Lady Lister of Burtersett and my friend, the noble Baroness, Lady Grender, that the overuse of guarantors seriously undermines the anti-discrimination intentions of the Bill. We welcome the guidance from my noble friend the Minister. Having said that, I will not be pressing it to a vote, and I beg leave to withdraw my amendment.
Lord Shipley
Member’s explanatory statement
This amendment and others in the name of Lord Shipley aim to ensure that the provisions contained in section 21 apply to joint tenancies as well.
Lord Shipley (LD)
My Lords, in moving Amendment 62, I will speak also to Amendments 63, 65 and 66. In Committee, I raised some problems with the way the Bill was drafted for joint tenants in respect of notices to quit under assured tenancies defined in Clauses 21 and 22. It was anticipated in Committee that the issues raised would be examined further, and I thank for the Minister for having done this.
The problem was that where joint tenants had a breakdown in their relationship, there could be unforeseen consequences for one joint tenant, who might be unaware, for example, that a notice to quit had been served by the other joint tenant. I am grateful for the assistance provided by Citizens Advice, whose front-line staff identified this problem and proposed solutions, and for the work done by the Minister and her department in drafting Amendments 64 and 67, which I welcome.
I look forward to the Minister’s explanations of Amendments 64 and 67 in the expectation that I will then seek to withdraw this amendment. I beg to move.
Lord Jamieson (Con)
My Lords, this group of amendments relates to joint tenancies and the procedural requirements for serving and responding to notices to quit. These amendments, tabled by the noble Lord, Lord Shipley, seek to ensure that the provisions in Clauses 21 and 22 apply expressly and fairly to all assured tenancies. The spirit of these amendments is to promote transparency and fairness, ensuring that no tenant is left unaware of or disadvantaged by unilateral actions.
As we have discussed in this debate and in Committee, joint tenancies are an important and increasingly common form of tenancy arrangement, particularly among families, couples and shared households. Given that multiple tenants hold equal rights and responsibilities, it is only right and fair that the Bill reflects this reality by requiring all parties to be kept informed of significant developments affecting their tenancy.
These amendments propose sensible procedural safeguards. The requirement that any notice to quit served by one joint tenant be communicated in writing to all other joint tenants is fair. Similarly, where a landlord serves notice, all joint tenants should be notified promptly. It is also noteworthy that some amendments specify that certain agreements, such as those shortening notice periods or withdrawing notices to quit, must involve the consent of all joint tenants rather than just one. This is a balanced recognition of the collective nature of joint tenancies and the importance of mutual consent in such decisions.
As the Bill continues to evolve, it is our shared goal to ensure a rental market that is fair and workable for all parties involved. Although we fully understand and respect the intentions behind these amendments and welcome the constructive debate they have sparked, it is important to consider the practical implications. Requiring unanimous consent or detailed notice procedures could, in some circumstances, add complexity or delay, especially in situations where tenants’ circumstances change rapidly. Therefore, although we support the principle of ensuring fairness and transparency in joint tenancies, we urge careful consideration of the balance between protecting tenants’ rights and maintaining workable, efficient processes for landlords and tenants alike.
Baroness Taylor of Stevenage (Lab)
My Lords, I would like to thank the noble Lord, Lord Shipley, for his amendments on joint tenancies; Citizens Advice, which has provided the benefit of its significant expertise in this area throughout the Bill’s passage; and the noble Lord, Lord Jamieson, for his contribution.
Turning first to Amendments 62 and 66, the Government’s intention is not that tenants on a joint tenancy can unilaterally end that tenancy sooner than expected, nor should a tenant be able to trap another in a tenancy indefinitely by withdrawing a notice to quit. As such, I am pleased to confirm that the Government have tabled Amendments 64 and 67, which achieve the same effect as those laid by the noble Lord, Lord Shipley.
Government Amendment 64 will apply where a tenant who wants to serve a notice to quit in a joint tenancy seeks to agree a shorter notice period with the landlord. All other joint tenants will need to agree the shorter notice period as well for the notice to quit to be valid. This will ensure that tenants will not be able to agree short notice periods for a notice to quit without their other joint tenants being aware, preventing tenants finding out at potentially very short notice that their tenancy is ending. This was not the Government’s intention, and I am pleased to be able to clarify this issue beyond doubt in the Bill.
Government Amendment 67 will clarify that all joint tenants must agree, alongside the landlord, for a notice to quit to be withdrawn. This will ensure that it is clear that tenants must all agree to sustain a tenancy and make absolutely clear that one tenant cannot trap another in a tenancy indefinitely. These changes will ensure that joint tenancies can continue to operate effectively in the future tenancy regime and ensure maximum clarity for all parties. As such, I hope the noble Lord will not press his amendments and will instead support the government amendments.
Turning now to the noble Lord’s other amendments, Amendment 63 would require a tenant to inform all other joint tenants of their serving a notice to quit, and the landlord to do the same. I have great sympathy with the noble Lord’s intent. We all agree that tenants and landlords should communicate transparently with one another and take action to ensure that all parties are aware that a tenancy is coming to an end. With regret, however, I am unable to support codifying a requirement for this in law. The Government are concerned that, in certain circumstances, this may place individuals at risk. This is particularly true for victims of domestic abuse, who may not be able to safely inform a perpetrator that a notice to quit has been served. Indeed, some victims may choose not to serve a notice to quit at all. I also have practical concerns about the amendment. It might give rise to frustrating and counterproductive disputes between tenants. It might also cause tenants to question whether a tenancy has been validly ended if the requirement is not complied with.
Amendment 65 would allow a tenant to serve one month’s notice to end a tenancy if a landlord has served a possession notice on grounds 1 and 1A. That would be a reduction from the usual two months’ notice required by the Bill. Although I appreciate that the intent is to offer tenants greater flexibility to find a new property, we think the Bill strikes the right balance. Landlords must now give four months’ notice when using these grounds, and we think it is reasonable that the property be occupied for at least two months of this period, unless there is specific agreement to a shorter period.
I note that allowing a shorter notice period automatically might place other joint tenants in a difficult situation—for example, if they have not been able to find alternative accommodation as quickly as their housemates. This is recognised in the noble Lord’s other amendments. In many cases, the landlord will be supportive of a tenant moving out sooner than would otherwise be permitted. In those cases, there is nothing to stop all joint tenants and landlords agreeing a shorter notice period.
I hope that the noble Lord recognises that we have given very careful consideration to these amendments and have accepted those where we think the Bill could be strengthened, although I fully appreciate the intent behind his other amendments. I therefore ask him not to press those amendments for the reasons I have set out.
Lord Shipley (LD)
I thank the Minister for her clarifications and for the Government’s amendments, which strike an appropriate balance, given the explanations from the Minister. As a consequence, I beg leave to withdraw my amendment.
“(1ZB) In the case of a joint assured tenancy, an agreement under subsection (1ZA)(a)(i) is not valid unless it is made between the landlord and all of the tenants.(1ZC) That does not affect the validity of any notice to quit premises let under a joint assured tenancy that is given by only one or some of the tenants.(1ZD) In this section “joint assured tenancy” means an assured tenancy where two or more persons are tenants under the tenancy.”Member’s explanatory statement
The new subsection (1ZA)(a)(ii) inserted into section 5 of the Protection from Eviction Act 1977 enables the landlord and tenant to agree that notice to quit of less than two months can be given. This amendment would ensure that, where there are joint tenants, all of them must make such an agreement with the landlord.
“(4) In the case of a joint assured tenancy, an agreement under subsection (3) is not valid unless it is made between the landlord and all of the tenants.(5) That does not affect the validity of any notice to quit premises let under a joint assured tenancy that is given by only one or some of the tenants.(6) In this section “joint assured tenancy” means an assured tenancy where two or more persons are tenants under the tenancy.”Member's explanatory statement
The new section 5A(3) inserted into the Protection from Eviction Act 1977 enables the landlord and tenant to agree that notice to quit can be withdrawn. This amendment would ensure that, where there are joint tenants, all of them must make such an agreement with the landlord.
Lord Shipley
Member’s explanatory statement
This amendment and others in the name of Lord Shipley seek to prevent a landlord from serving a notice (under section 8 of the Housing Act 1988) to seek possession of a property where a tenancy deposit has not been properly protected or the relevant statutory requirements in relation to the deposit have not been complied with.
Lord Shipley (LD)
My Lords, in moving Amendment 68 I will speak to Amendments 69 to 71. This issue was not raised in Committee but it is sufficiently important—again I thank Citizens Advice for raising it—to be discussed on Report. I assure the Minister that I do not wish to press these amendments to a vote, but I hope the Minister might be willing to take away the questions raised in this group to assess whether further amendments are needed at Third Reading.
The amendments in this group
“seek to prevent a landlord from serving a notice (under section 8 of the Housing Act 1988) to seek possession of a property where a tenancy deposit has not been properly protected or the relevant statutory requirements in relation to the deposit have not been complied with”.
Citizens Advice has advised me that the tenancy deposit protection scheme will be significantly weakened if it remains the case in the Bill that landlords will not need to protect tenants’ deposits prior to serving notice, and that this would be a departure from the current position. Reverting to the requirement that a landlord must be compliant at the point that notice is served would give far greater certainty and avoid wasted court time in cases where a tenant may not have known up until the last minute whether a valid defence existed. The tenant may believe that they have a defence, because the deposit has been taken and not protected, but then find that the landlord protects or returns the deposit to them at the very last minute, potentially on the morning of the court hearing. That makes it very difficult for tenants to make informed decisions about defending a claim.
The Bill says:
“Where a tenancy deposit has been paid in connection with an assured tenancy, the court may make an order for possession of the dwelling-house let on the assured tenancy only if the tenancy deposit is being held in accordance with an authorised scheme”.
My Amendment 68 would amend this to say that where a deposit has been paid in connection with an assured tenancy,
“no notice of proceedings for possession under section 8 of the Housing Act 1988 (notice of proceedings for possession) may be given at a time when the deposit is not”
being held.
Over 600 clients every month ask Citizens Advice for help with tenancy deposit return issues of various kinds, and things will only worsen if the protections are weakened. I hope the Minister will be able to reassure the House that deposit protection will be strengthened during the passage of the Bill and that no notice of proceedings for possession may be given at a time when the deposit is not being held in accordance with an authorised scheme.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Shipley, for bringing this group of amendments to the attention of the House. However, we do not believe that these amendments are necessary. Tenants already have clear rights and remedies when it comes to deposit protection. A tenant can easily check online whether their deposit has been lodged in a government-approved protection scheme. If it has not been properly protected and the issue remains unresolved, the tenant has the right to take the landlord to court.
In such cases, the court may order the landlord to return or protect the deposit, and may even award the tenant three times the value of that deposit as compensation. These are significant penalties and they serve as a strong incentive for landlords to comply with the law. Given that eviction proceedings are already subject to considerable safeguards and restrictions, we are not convinced that removing Section 8 grounds in these circumstances is either proportionate or necessary.
In particular, we must ensure that where a genuine error has been made and later rectified, especially where there is no actual harm or financial loss to the tenant, landlords are not barred from recovering possession of their property. To do so would seem unjust. A more flexible and proportionate approach would promote better compliance while avoiding unnecessary hardship or deterrence to good-faith landlords.
Although we fully understand the intentions behind these amendments, having heard the reasoning of the noble Lord, Lord Shipley, we believe that existing protections for tenants are robust and that further restrictions of this kind risk being disproportionate.
Baroness Taylor of Stevenage (Lab)
My Lords, I am once again grateful to the noble Lord, Lord Shipley, for raising these points, as well as to Citizens Advice for discussing them directly with our department, and to the noble Baroness, Lady Scott, for her comments. Although I have great sympathy with the intention of Amendments 68 to 71, Clause 27 already ensures that deposits will be protected at the time of the possession hearing, which we think is a more proportionate approach.
Landlords have until the court hearing to comply with deposit protection rules. This ensures that landlords can still gain possession when it is reasonable, while ensuring that the tenant’s deposit is protected before the tenancy ends. I also note that this approach is far stronger than current restrictions, which prevent only the use of Section 21, and not Section 8, if the deposit is not protected.
However, I believe the noble Lord’s approach goes too far. Most notably, if a landlord had failed to protect a deposit within 30 days of receiving it, they would be permanently prevented from serving notice for possession on any ground except anti-social behaviour. Let me be clear: such a landlord should have complied with the law—of course they should—but there are other, more proportionate, mechanisms available to enforce that compliance, including an ability for a court to award tenants up to three times the amount of the deposit if it was not protected properly.
In conclusion, the Bill balances tenant protection with the need for legitimate possession cases to proceed. I therefore ask the noble Lord to withdraw his amendment.
Lord Shipley (LD)
My Lords, I am grateful for the Minister’s reply but it has extended the doubts that I have had about this, because it is still not clear to me why the Bill is weakening the current safeguards.
It is not clear why a valid defence cannot be assured for a tenant who has to go to court when the court case may not be necessary—in other words, they do not know whether the landlord has managed a tenancy deposit scheme correctly on their behalf. Citizens Advice has produced a strong case here, and it is not clear why the current safeguards are not being continued. I am advised that the tenancy deposit protection scheme will be significantly weakened if it remains the case in the Bill that landlords will not need to protect tenants’ deposits prior to serving notice. That is a departure from the current position. If that is required to happen in future, it will simply encourage wasted court time.
I shall withdraw the amendment and not move the other three, but I hope that the Minister and the Government will look very carefully at this issue because otherwise, I fear that tenants will not be properly protected by the tenancy deposit scheme. I beg leave to withdraw the amendment.
Member’s explanatory statement
This is consequential on the amendment in my name which would remove the provision to be inserted into the Housing Act 1988 relating to indemnity and insurance for pets.
Lord Best
“Regulatory Enforcement and Sanctions Act 2008
69A In Schedule 3 to the Regulatory Enforcement and Sanctions Act 2008 (enactments specified for the purposes of Part 1), in the appropriate place, insert—“Tenant Fees Act 2019 (c.4)””Member’s explanatory statement
This amendment integrates the Tenant Fees Act 2019 into Schedule 3 to the Regulatory Enforcement and Sanctions Act 2008. It enables a Primary Authority to support local authorities to give assured advice to lettings agents on achieving compliance under the Tenant Fees Act 2019. It is intended that providing this advice will support lettings businesses and reduce pressure on local authorities' enforcement teams.
Lord Best (CB)
My Lords, I rise to speak to Amendment 74, to which the noble Baroness, Lady Thornhill, and, to my delight, the Minister, have added their names. I declare my interests as a vice-president of the Local Government Association and of the Chartered Trading Standards Institute. Trading standards officers are going to be important in the enforcement of key provisions in this Bill, and Amendment 74 is intended to support their work.
I brought forward this amendment in Committee, and it is intended to extend the matters covered by the special primary authority scheme. This scheme enables certain local authorities to provide assured advice that property agents can rely on in seeking to fulfil their obligations. With this amendment, letting agents and those that advise them, such as Propertymark and the Property Ombudsman, would be able to obtain clear guidance on their responsibilities in meeting regulatory requirements under the Tenant Fees Act 2019, an important piece of legislation that has been left out of this advisory scheme to date. This amendment will help trading standards officers ensure compliance and is beneficial to all property agents wanting to do the right thing.
The amendment was promoted by the senior manager of the National Trading Standards estate agency team, James Munro, to whom I offer many thanks. I also thank noble Lords on the Opposition Benches for supporting this amendment in Committee. I am very pleased that the Government have also decided to back it, and I am grateful to the Minister for adding her name to it. It may not be the most exciting measure before us, but it represents a most welcome addition to the Bill and will reduce pressure on overburdened local authority enforcement teams. I beg to move.
Baroness Grender (LD)
My Lords, I rise to support Amendment 74 in the name of the noble Lord, Lord Best, noting that it is signed by my noble friend Lady Thornhill. This is a characteristic amendment from the noble Lord, Lord Best, who has become the technical amendment expert when it comes to housing, capable of spotting small but significant changes that can genuinely make a difference. We are delighted that the Minister has also signed the amendment.
We have long supported efforts to raise standards and professionalism among managing and property agents. We fully agree with the findings and recommendations of the 2019 report, Regulation of Property Agents, chaired by the noble Lord, Lord Best. Is it really six years since its publication on the 18th of this month? How many of its recommendations have been implemented? Perhaps the Minister can tell us or the noble Lord in his summating. The noble Lord’s amendment goes some way to helping local authority trading standards officers work more effectively with good agents who want to raise standards for all and weed out the bad guys, knowing that the assured advice they receive will be clear and comprehensive in ensuring compliance in meeting their obligations under the Tenant Fees Act. I look forward to hearing from the Minister.
Lord Jamieson (Con)
My Lords, on this amendment, I think we are unanimous. I, too, thank the noble Lord, Lord Best, for this amendment. I approve of his technical knowledge on this and can agree with the noble Baroness, Lady Grender—just occasionally.
Baroness Taylor of Stevenage (Lab)
I hope that the next day of Report will go just like that. It will be wonderful.
I thank the noble Lord, Lord Best, for Amendment 74. As he noted, I have added my name to it, and I am delighted to do so. The Government are very pleased to support the amendment, technical as it is. As the noble Baroness, Lady Grender, said, it will make a positive difference. I am grateful to the noble Lord, Lord Best, for bringing this forward. The amendment is a positive step towards creating a fair and transparent rental market with a more streamlined regulatory process. We want to ensure that letting agent businesses are able to receive reliable and tailored advice on complying with regulations under the Tenant Fees Act 2019.
The amendment will allow a primary authority scheme to be set up for the Tenant Fees Act 2019. The reliable and tailored assured advice issued by the primary authority is recognised by other local authorities. This helps businesses avoid costs and difficulties caused by different local authorities interpreting and enforcing the same rules inconsistently. The primary authority scheme also promotes great co-operation between businesses and regulators, fostering a collaborative environment that ultimately increases compliance rates while lowering enforcement costs and reducing administrative burdens. The Government strongly support the amendment, recognising its potential significantly to improve the rental market. I hope the whole House will support it.
Lord Best (CB)
I am delighted to receive support from all around the House and am deeply grateful. The commonhold and leasehold reform Bill is on its way shortly. That will provide further opportunities to strengthen the regulatory framework around managing agents and the work they do.
“(a) for sub-paragraph (1) substitute—“(1) A tenancy which is granted to a person who is pursuing, or intends to pursue, a course of study provided by a specified educational institution if—(a) the tenancy is granted— (i) by that institution,(ii) by another specified educational institution, or(iii) by a specified body of persons, or(b) either of the following is a member of a specified housing management code of practice—(i) a person appointed to act on the landlord’s behalf in respect of the tenancy;(ii) a person appointed to discharge management functions in respect of the building which comprises the dwelling-house or in which the dwelling-house is situated.(1A) Subsection (1)”.”Member’s explanatory statement
The new paragraph (b) of subsection (1) provides that a tenancy of student accommodation is not an assured tenancy if the person appointed to act on behalf of the landlord or to discharge management functions in respect of the building concerned is a member of a “housing management code of practice” (which is a code approved under section 233 of the Housing Act 2004).
Baroness Taylor of Stevenage (Lab)
My Lords, I shall speak also to Amendments 76 to 85 and Amendments 123 to 125, to Clause 33 and Schedule 6 respectively. These relate to the mechanism by which private purpose-built student accommodation, or PBSA, will be exempted from the assured tenancy system. They are highly technical in nature and can be broadly divided into two main groups. First, there are technical amendments to the power in the Housing Act 1988. We will use this power to make secondary legislation exempting providers from the assured tenancy framework by reference to their membership of the Unipol code of management practice. This amendment to the power will allow building managers, not just traditional landlords who own the building, to be exempted in the event those managers are members of the housing management code. The amendments are designed to reflect the diversity of commercial arrangements in the PBSA sector.
Secondly, there are amendments that aim to smooth over the transition for the sector by providing access to a modified ground 4A for landlords of existing PBSA tenancies after the transition date. I am grateful to stakeholders from the sector for working with the Government to ensure that these clauses work in the way intended.
I will now go briefly through the amendments one by one. Amendment 123 is a consequential amendment that updates the numbering in paragraph 13 of Schedule 6. Amendment 124 is not related to PBSA but rather corrects a pre-existing cross-reference error contained in paragraph 13 of Schedule 6.
Turning to the first of the substantive amendments, the Government’s intention is to exempt private PBSA from the new assured tenancy system, in recognition of its unique operating model and the need for alignment with the academic calendar. We will do this using a delegated power in paragraph 8 of Schedule 1 to the Housing Act 1988, which we are also amending. However, the power in the Housing Act will allow for new tenancies to be exempt only if they fall within scope. As a result, tenancies entered into prior to the commencement of the Bill will fall outside the scope of the exemption and, therefore, will be subject to the full provisions of the new assured tenancy system.
To apply the exemption retrospectively would carry significant risk, as it would turn one of these existing PBSA tenancies into what is known as a “common law” tenancy: that is, a tenancy almost entirely regulated by what is in the tenancy agreement. This could cause unintended consequences, such as those PBSA tenancies containing significantly fewer rights for tenants than the assured shorthold tenancies they will have signed. It could also cause problems for the landlords of those tenancies in the event that the tenancy agreement does not give them adequate forfeiture rights. We do not consider it to be the right approach, therefore, to simply exempt pre-existing PBSA tenancies from assured tenancy status.
That said, it is important that PBSA landlords under these existing PBSA tenancies can still access the possession grounds, in particular ground 4A. To ensure that the exemption operates as intended, Amendment 125 modifies ground 4A when applied to pre-existing “qualifying student tenancies”. These are PBSA tenancies, in other words.
The amendment ensures that the ground can be used despite those tenancies not usually being HMOs, nor does it require the landlord to serve the Section 8 notice between 1 June and 30 September, reflecting the fact that this restriction does not apply to PBSA tenancies in the old system; nor will it apply to fully exempted tenancies. This will ensure that existing PBSA landlords retain the ability to regain possession at the end of the academic year and therefore end the tenancy. This is consistent with the treatment of new PBSA tenancies established after commencement, where they will not be subject to the assured tenancy framework.
I turn now to Amendments 75, 76, 77 and 78. We are seeking to make the existing exemption from assured tenancy status for student tenancies more comprehensive. This exemption is currently set out in paragraph 8 of Schedule 1 to the Housing Act 1988. Amendment 75 therefore amends the exemption to ensure that it applies where a landlord has appointed a person to manage the tenancy on their behalf or to manage the building, and that person is a member of a recognised student housing management code of practice.
Amendment 77 therefore inserts a new sub-paragraph, (2CA), into paragraph 8. This will allow for regulations to make more tailored provision for particular circumstances by reference to a specified building when combined with the specified person acting on behalf of the landlord. Amendments 76 and 78 are consequential on Amendment 77. They ensure that new sub-paragraph (2CA) is cross-referred to where appropriate in the rest of paragraph 8.
I turn to Amendments 80, 81, 82, 83 and 85. There is often a delay between a student tenancy being entered into and the student tenant actually taking possession. In light of this, the exemption in paragraph 8 contains provision to say that a tenancy that meets the exemption at the point at which the tenancy is granted will be exempted permanently, save for particular situations.
These situations will include where at the time of grant the tenancy was exempt because the landlord or person acting on their behalf was a member of a housing management code of practice but at the point where the tenant takes possession neither the landlord nor the person managing is a member of a code. It will also include where at the time of grant there were regulations in place under paragraph 8 that did not prevent the tenancy from falling within the exemption, but at the point at which the tenant is entitled to possession, these regulations do prevent the tenancy from being caught by the exemption. This is achieved by Amendments 80, 81, 82, 83 and 85. These amendments are designed not only to ensure that the exemption is granted solely to those PBSA providers who adhere to robust standards but also to guard against any potential for the exemption to be misapplied or exploited.
Amendment 79 is consequential on Amendment 75. It ensures that regulations made elsewhere in paragraph 8 can specify classes of buildings that are subject to a housing management code of practice specified for this purpose under new paragraph 8(1)(b).
Amendment 84 is consequential on Amendment 125, which provides that a tenancy will be exempt if the person discharging “management functions” in relation to the building is a member of a specified housing management code. Amendment 84 defines “management functions”. It defines these functions to include services, repairs, maintenance, improvements, and insurance of the building. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I begin by thanking the Minister for so clearly setting out the Government’s amendments relating to purpose-built student accommodation—PBSAs. I am also grateful to her for taking the time to meet with me and my noble friend Lord Jamieson ahead of Report to discuss this matter in detail.
As the Minister is aware, student accommodation is a matter of considerable importance to many of us; indeed, it is an area of particular concern in this Bill. Ensuring that we have sufficient student accommodation, of the right type, available in the right places, and operating in line with the academic calendar, is vital. This is a matter not simply of logistics but of availability and affordability. An adequate supply of accommodation helps to keep rents manageable, which is especially important for students from less advantaged backgrounds.
This is why we raised concerns around ground 4A, particularly with regard to the importance of preserving the cyclical nature of student tenancies. The cyclical model is central to the viability of purpose-built student accommodation and, indeed, to maintaining affordability for students. We therefore welcome the Government’s amendments in this area, which rightly acknowledge the unique nature and operation of the PBSAs. In particular, I am very grateful for the clarification offered in sub-paragraph (2C), which states that the tenancy of student accommodation will not be considered an assured tenancy if the person acting on behalf of the landlord is a member of a housing management code of practice.
However, I would be grateful for further clarification. Can the Minister confirm whether this provision refers specifically to recognised codes such as the ANUK or the Unipol code, or whether it includes other housing management codes of practice as well? It would be helpful if the Government could set out explicitly which codes are deemed applicable under this provision. Furthermore, in the case of newly established accommodation, how will providers be expected to demonstrate adherence to an accepted code specifically for the purpose of continuing to provide fixed-term tenancies?
I am sure the Minister agrees that providers must have, and maintain, an up-to-date understanding of their obligations. With that in mind, when does the Minister intend to update the relevant guidance, particularly regarding the practical steps that PBSAs will need to take to ensure they can continue offering fixed-term tenancies?
The relevant codes of practice are, of course, designed around the specific characteristics of student accommodation, covering matters such as health and safety, maintenance and the management of relationships between providers and their tenants. In light of the changes introduced by the Bill, does the Minister have any plans to review or amend the codes? If so, how will such changes be communicated to those operating in the sector?
Finally, does the Minister agree that one of the key benefits of code membership is the ability to provide student accommodation outside the assured tenancy framework—a flexibility that underpins the viability of the sector?
I hope the Minister will continue to keep under review the impact of this Bill on students and to consider carefully any future changes that could make it harder for students to secure suitable accommodation. Students must be at the forefront of our considerations, not only in policies but also in practice.
Baroness Taylor of Stevenage (Lab)
I thank the noble Baroness, Lady Scott, for those comments. I will attempt to answer her questions; I may have to come back in writing on the point about amending the codes.
Pre-existing PBSA tenancies will continue to benefit from the protections provided by the Bill. For newly signed PBSA tenancies after commencement, protections will be provided through the housing management codes of practice, approved under Section 233 of the Housing Act 2004. These codes set out clear and robust standards, and compliance with the codes is a condition for exemption.
In respect of the approved codes, the ANUK and Unipol codes have clear oversight mechanisms in place, including regular audits, complaint processes and suspension or exclusion for non-compliance. That is why they are the important codes that we have focused on. Landlords must maintain membership and demonstrate adherence to the code standards. If they fail to do so, they will lose their exemption, so that is very important. If they lose their code membership mid-tenancy, they will no longer be entitled to rely on the exemption for any new tenancies. However, existing tenancies will continue under the terms; otherwise, that would not be fair to the students concerned. I hope that answers the noble Baroness’s questions.
I thank everyone for their contributions to this debate. We debated other student accommodation issues extensively on the previous day of Report. I hope the whole House will agree that these amendments will ensure that this PBSA exemption works effectively and as intended, and I hope the whole House will support them.
Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (2CA).
“(2CA) The Secretary of State may by regulations made by statutory instrument—(a) specify a person appointed to act on the landlord’s behalf in respect of the tenancy or to discharge management functions in respect of the building or a class of such persons,(b) specify a class of building in relation to the specified person or specified class of persons, and(c) provide that a tenancy—(i) does not fall within this paragraph if the dwelling-house is in the specified class of building and there is a person appointed to act on the landlord’s behalf in respect of the tenancy or to discharge management functions in respect of the building who is specified or is in the specified class of such persons, or(ii) falls within this paragraph only if the dwelling-house is in the specified class of building and there is a person appointed to act on the landlord’s behalf in respect of the tenancy or to discharge management functions in respect of the building who is specified or is in the specified class of such persons.”Member's explanatory statement
This makes provision which corresponds to the new sub-paragraph (2C) but which operates in relation to the case where a tenancy of student accommodation is not an assured tenancy because the person appointed to act on behalf of the landlord or to discharge management functions in respect of the building concerned is a member of a “housing management code of practice”.
Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (2CA).
Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (1)(b).
Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (1)(b).
Member's explanatory statement
This is consequential on paragraph (b) in the amendment in my name which inserts the new sub-paragraph (1).
Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (2CA).
Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (2CA).
“(za) “management functions” in respect of a building includes functions relating to—(i) the provision of services, or(ii) the repair, maintenance, improvement or insurance of the building;”Member's explanatory statement
This is consequential on paragraph (b) in the amendment in my name which inserts the new sub-paragraph (1).
“(da) a tenancy is “exempt solely by reference to a code of practice” if—(i) the tenancy was granted by a body of persons who were, at the time of the grant, a specified landlord solely by reference to a code of practice, or(ii) at the time of the grant, sub-paragraph (1)(b) applied to the tenancy but sub-paragraph (1)(a) did not apply to the tenancy;(db) a reference to the landlord’s interest under the lease not attracting the exemption under this paragraph is a reference to—(i) a case where the landlord is not a student landlord and there is no person appointed to act on the landlord’s behalf in respect of the tenancy or to discharge management functions in respect of the relevant building; or(ii) a case where the landlord is not a student landlord and there is a person appointed to act on the landlord’s behalf in respect of the tenancy or to discharge management functions in respect of the relevant building, but that person is not a member of a specified housing management code of practice;and for that purpose the “relevant building” is the building which the dwelling-house comprises or in which the dwelling-house is situated;”Member's explanatory statement
This is consequential on the amendment in my name inserting the new sub-paragraph (1)(b).
Renters’ Rights Bill
Tuesday 15th July 2025
(1 year ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 103-III Third marshalled list for Report - (11 Jul 2025)
16:12 - Division on Amendment 87 - Ayes: 237 / Noes: 223 - Amendment 87 agreed.
17:16 - Division on Amendment 98 - Ayes: 215 / Noes: 240 - Amendment 98 disagreed.
18:08 - Division on Amendment 106 - Ayes: 282 / Noes: 158 - Amendment 106 agreed.
18:37 - Division on Amendment 110 - Ayes: 98 / Noes: 148 - Amendment 110 disagreed.
18:59 - Division on Amendment 111 - Ayes: 214 / Noes: 153 - Amendment 111 agreed.
19:43 - Division on Amendment 118 - Ayes: 106 / Noes: 148 - Amendment 118 disagreed.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we start the debate on the first group, I want to repeat earlier reminders on declaring interests for, I hope, the final time. As we set out previously, noble Lords should declare relevant interests at each stage of proceedings on a Bill. That means that in their first contribution on Report, noble Lords must declare any relevant financial interests in a specific but brief way. Declarations do not need to be repeated in subsequent speeches, so if a declaration has been made on Report, it does not need to be made again.
While I have the attention of the House, I remind noble Lords that when pressing or withdrawing an amendment, speeches should be short. As set out in paragraph 8.79B of the Companion:
“Members … pressing or withdrawing an amendment should … be brief and need not respond to all the points made during the debate, nor revisit points made when moving the amendment”.
The Deputy Speaker (Baroness Garden of Frognal) (LD)
My Lords, due to an error, Amendment 86, which has already been debated, does not appear on the Marshalled List and has not been disposed of. I therefore begin by calling Amendment 86.
Lord Keen of Elie
Member’s explanatory statement
This amendment, in conjunction with another amendment in the name of Lord Keen of Elie to clause 58, imposes a uniform standard of proof – beyond reasonable doubt – where the local housing authority imposes a financial penalty.
Lord Keen of Elie (Con)
My Lords, I begin by referring to my interests as recorded in the register. I add that I am the proprietor of properties in London that are the subject of tenancy agreements and are managed by an agent.
In this group we have Amendments 87 and 88 in similar terms. Amendment 87 deals with an issue in Clause 41. It concerns the right of a local authority association to impose financial penalties and the burden of proof on that authority in respect of those penalties. I seek your Lordships’ leave to put this into context. Clause 41, on page 58 of the Bill, provides that:
“A local housing authority may impose a financial penalty under this subsection on a person if satisfied on the balance of probabilities that the person has breached a requirement imposed by … regulations made under section 40”.
Clause 58, on page 90, refers to a local housing authority being able to
“impose a financial penalty under this subsection on a person if satisfied on the balance of probabilities that the person has breached the prohibition imposed by section 57”.
But in Clause 67, which can be found on page 109, we have the provision that:
“A local housing authority may impose a financial penalty on a person if satisfied beyond reasonable doubt that the person has … breached regulations”.
It is again a regulatory offence, but with a significantly different burden of proof placed on the same local housing authority.
Clause 92, on page 126, provides that:
“A local housing authority may impose a financial penalty on a person if satisfied beyond reasonable doubt that the person has … breached a requirement imposed by section 83(1), (2) or (3)”.
That, in turn, refers to certain regulatory requirements that may be imposed on landlords.
So where do we find ourselves? We find ourselves in a situation in which a local authority is to be empowered to impose financial sanctions on landlords for breaches of regulations and yet, depending on which regulation is referred to, the burden of proof shifts between “balance of probabilities” and “beyond reasonable doubt”. The first point I make is that there is clearly a need for some kind of uniform standard in this legislation. What on earth will a local authority do when faced with the prospect that there may be multiple breaches of regulations, but different standards of proof applied in respect of whether they can find a breach? It produces a nonsense result.
Indeed, in circumstances where a local housing authority is entitled to impose very serious financial penalties running into thousands of pounds for breaches of regulations, I suggest that it is only appropriate that the relevant standard of proof should be that in any criminal proceedings—namely, “beyond reasonable doubt”. Otherwise, there is not only the risk of confusion, because of the different standards applied between different regulations in the legislation, but the very real risk of wrongful penalties being imposed in circumstances where a local housing authority thinks, “There may have been a breach of regulations—it’s in the balance, but we think there probably is—so we’ll fine them £7,000”. On the next alleged breach of regulation, they would say, “It’s in the balance, so we can’t possibly impose any kind of financial penalty”. It really is a nonsense.
It also, I respectfully suggest, raises a question of fairness and proportionality. Is it truly fair that we should have one set of regulations that can be met by way of a breach “on balance” and another that requires a proper standard of proof—namely, “beyond reasonable doubt”? It will also place pressure on local housing associations and their resources. Are they really equipped to distinguish between those two standards of proof for different sets of regulations?
Amendment 87 would amend the reference in Clause 41 to a housing association proceeding on the “balance of probabilities” and substitute the requirement for the standard to be “beyond reasonable doubt”. In Amendment 88 I seek to make the same amendment in order that Clauses 41 and 58, about the powers of a housing association and breaches of regulation, are simply brought into line with the provisions of Clauses 67 and 92 of the same Bill. I beg to move.
Baroness Kennedy of Cradley (Lab)
My Lords, I will speak to Amendment 104 in my name in this group and, in doing so, I declare my interest as a trustee of the Nationwide Foundation. First, I thank my noble friend Lady Taylor of Stevenage for the excellent meeting we had, together with the noble Lord, Lord Cromwell, and renter groups Safer Renting, ACORN and the Renters’ Reform Coalition. I also thank my noble friend for the subsequent letter she sent, responding to the points raised at the meeting and for the additional conversations that I understand have taken place between Safer Renting and her officials.
Amendment 104 seeks to change the standard of proof required for rent repayment orders, based on offences under the Protection from Eviction Act. Currently, tenants must prove their case to a criminal standard, beyond reasonable doubt, even though these are civil proceedings in a civil tribunal. This change would make rent repayment orders a realistic option for renters who are victims of illegal eviction and harassment—serious offences that cause immense harm. As we know, most illegal evictions and harassment occur behind closed doors, without witnesses, and I appreciate that my noble friend Lady Taylor of Stevenage recognises that these offences are harder to prove than other rent repayment order offences. The available evidence rarely meets the criminal standard, but may clearly satisfy the civil standard of balance of probabilities.
Civil claims for illegal eviction and harassment already use the civil standard and can carry far higher penalties. The definition of the civil wrongs of illegal eviction and harassment in the Housing Act 1988 uses the same definition as in the Protection from Eviction Act. For all intents and purposes, there is no distinction between the conduct targeted by both laws. Aligning the standard in rent repayment cases would bring consistency, fairness and a real access to redress.
The problem is clear. Research shows that at least 16,000 illegal evictions occurred in 2021-22, yet there were only 31 successful rent repayment orders made for those offences. This shows that the current system deters valid claims and does not provide a realistic route to redress for renters. It is vital that tenants can enforce their rights against criminal landlords. Yes, it is a small minority of landlords, but they are criminal landlords whose impact on renters’ lives, health and well-being is immense. As we heard in Committee, because the rent repayment mechanism is ineffective, these criminals gamble on breaking the law, knowing how hard it is for tenants to prove their case. Amendment 104 would make justice more attainable for renters and allow them to take a leading role in holding landlords to account.
I note from my noble friend Lady Taylor of Stevenage’s letter on this issue—copied to me and the noble Lord, Lord Cromwell—that the Government are minded not to change their view on the standard of proof at this point. Of course, this is disappointing. However, I very much appreciate my noble friend’s acknowledgement that rent repayment orders are not currently working as well as they should for illegal eviction and harassment offences. As well as my noble friend’s commitment to monitor the impact of changes to rent repayment orders, this is very welcome. Collecting the right data will be required to assess whether rent repayment orders are working as intended in cases of illegal eviction and harassment after this Bill becomes law.
Moreover, I very much welcome my noble friend’s commitment to continue to work with noble Lords and stakeholders to assess whether rent repayment orders are working for illegal eviction and harassment offences, with a view for potential changes down the line. I ask my noble friend: can we now start gathering the evidence needed to assess the scale and impact of the problem? In addition to the report as set out by the noble Lords, Lord Cromwell and Lord Best—I very much support Amendment 113—will my noble friend Lady Taylor of Stevenage consider publishing PRS enforcement data, provided by local authorities, to include a record of the number of reports of suspected illegal eviction or harassment received by the authority, so we can get a better understanding of the scale of the problem? Will she consider mandating local authorities to provide the department with PRS enforcement data, instead of data reporting being voluntary, so again we can get a more complete dataset? Will she work with the Ministry of Justice to collect and publish regular data on rent repayment orders to facilitate monitoring of the system in respect of the volume and success of applications alleging illegal eviction and harassment?
Finally, as well as the issues renters face accessing redress through rent repayment orders, since 2012 there has been an 80% reduction in legal aid applications for bringing cases of illegal eviction and harassment in the civil courts. Therefore, if at all possible, could my noble friend Lady Taylor of Stevenage assist me, Safer Renting and other noble Lords in getting a meeting with a Minister or an official at the MoJ to discuss the availability of legal aid for civil cases involving illegal eviction and harassment?
Lord Cromwell (CB)
My Lords, it is a great pleasure to follow the noble Baroness, Lady Kennedy. I have also enjoyed my encounters with the Minister, with her, to discuss these issues. I rise to speak to Amendment 110 in my name. I am very grateful for the support of the noble Lords, Lord Hogan-Howe and Lord Best, who have added their names. Between them, they bring unsurpassed knowledge of both policing and housing matters, which are both very relevant to this amendment. I am also grateful to the organisations Safer Renting and ACORN for their assistance in highlighting the need for this amendment, and of course to the Bill Office for its clear and effective drafting.
This amendment is distinct from others in this group, as it does not deal with standards of proof. Rather, as I outlined at Second Reading and in Committee, it addresses the difficulties faced by those at the bottom end of the rental market and most at risk from abusive landlords. It is these people, the economically and socially vulnerable, who are the most likely to face illegal and sometimes forcible evictions. They are often also the least equipped to resist such behaviours.
A core problem that emerged in discussions with tenant organisations at the sharp end is insufficient clarity of understanding about what the Protection from Eviction Act 1977 requires of the police. There is a widespread and incorrect belief among police officers that illegal evictions are civil matters. This has resulted in a tiny number of prosecutions for illegal evictions. Indeed, statistics show that the police have not acted in 91% of cases.
I do not want to stretch the House’s patience with detailed case studies, but three quick examples will give colour to the types of incidents we are concerned about. A tenant returned to their flat to find that the landlord had changed the locks. When the police were contacted, they threatened to arrest the tenant for obstruction of the landlord and assisted in the removal of the tenant’s belongings. In other cases, landlords used tactics such as intimidation and turning off the water supply, as well as threatening and actually using force. When tenants called the police, they were told that it was a civil matter and to call back when an actual crime was being committed. In other cases, tenants went to the police station, but were turned away repeatedly on the basis that such evictions are a civil matter.
In Committee, I put down an amendment to clear up this misunderstanding of the law and improve co-ordination between the police and local authorities. It did not gain government support, which I find very disappointing, not least given the Bill’s avowed focus on those most in need of help. The Government’s response did address the co-ordination point, citing extra work for the authorities and police, and the instance of Liverpool, where the Minister has personal experience of such co-ordination working well.
Tenant bodies involved in the issues reflected in my amendment met with the Minister, and afterwards I received a copy of a letter from the Minister to them. I am, of course, very grateful for the Minister’s considerable engagement, but that letter does not address the role of the police in preventing or stopping illegal evictions before or as they happen. Where it does refer to the substance of today’s amendment, it says that the abolition of Section 21 will
“strengthen the tenants’ ability to argue that they were unlawfully forced out of their homes”.
With the greatest respect, that is very wide of the issue. It is a point for legal argument that may come up if the evicted tenant ever manages, or indeed dares, or can afford, to bring a legal claim against the landlord who put them out on the street. I remind noble Lords that we are dealing here with landlords who care little for the niceties of the law—people whom the Minister’s letter refers to as a
“small minority of unscrupulous landlords”.
But we have repeatedly been told that the purpose of the Bill is exactly to tackle these unscrupulous landlords.
This amendment has dropped reference to local authorities and focuses fully on the core legal issue. It requires a report to establish the level of understanding among tenants, landlords and the police of the criminal nature of illegal evictions and clarification of the correct legal situation, and the incorporation of that legal position and how it should be dealt with in the training of the police.
This is a modest amendment, but it is critical for those facing or experiencing illegal evictions or who feel powerless in the face of the violent actions of their landlords and find that the police seem to be against them when they should be protecting them. Not least, it is critical for police officers themselves, who are trying to follow and apply the law and do the right thing.
In Committee, I asked the Government to bring forward their own amendment to address this issue. They have chosen not to do so, instead writing to say that they are
“working towards updating the department’s guidance”.
That is simply not sufficient when we have one of the few opportunities in the Bill to address a real and terrible day-to-day experience of vulnerable renters. On this modest amendment, I believe we should stand firm. Its requirements are clear, deliverable and highly impactful on those most in need of our help through the Bill. I will, of course, listen to what the Minister says in response, but I anticipate seeking the view of the House on this amendment.
The Earl of Kinnoull (CB)
My Lords, I will speak to Amendments 87, 88 and 103, which I have signed. I add my thanks to the Minister, who has engaged with me on these amendments, among others in the Bill. She has always been courteous and has had good points of view.
These amendments were originally drafted by the late noble and learned Lord, Lord Etherton. To double-shot Lord Etherton’s efforts in this area, I signed them in Committee. The amendments have been taken over and very ably introduced by the noble and learned Lord, Lord Keen of Elie.
Lord Etherton viewed this selection of amendments as being his effort to try to manage a quasi-judicial process. He was looking at it, of course, with a very practised eye, having been the Master of the Rolls. He was fully knowledgeable on the various large civil penalties that are in the Housing and Planning Act 2016, for which the Ministry of Housing, Communities and Local Government issued a 20-page memorandum to help local authorities through this particular maze of quasi-judicial process.
The problem, as Lord Etherton saw it, was that this was not a level playing field for local authorities. The best local authorities would have plenty of highly trained resources to look into a quasi-judicial matter with great fairness, and promptly—promptness being important for both sides of any argument. However, the local authorities whose resources were most stretched or at the bottom end of the quality scale would produce problems. Lord Etherton felt that it was important to set the law in this area so that it would be not for the best or the average local authority but at a reasonably modest rate, so that every local authority could execute, with fairness, whatever quasi-judicial issues they were dealing with. Therefore, with Amendments 87 and 88, he was keen that the standard of proof should move from the balance of probabilities to beyond reasonable doubt. He felt that was more in keeping with how the Housing and Planning Act 2016 had turned out.
Moving on to Amendment 103, Lord Etherton noted that there were some large penalties in that Act, the highest penalty being £30,000. The £40,000 penalties we see in this Bill are, I suppose, simply £30,000 grossed up for inflation. He was not worried necessarily about £40,000 as an amount—it was consistent with the £30,000, as he saw it—but he was worried that, under the Housing and Planning Act 2016, the £30,000 penalties were available only where the mental element was intention and not for offences where the mental element was recklessness.
Of course, there is a great difficulty in the law for deciding what the difference is between negligence, recklessness and intention. It is very much something on which, in the judicial process, a great deal of training is given to try to allow courts and judges to be utterly consistent up and down the land so that one has clarity for negligence, recklessness and intention. Lord Etherton’s feeling was that recklessness is very difficult. The 20-page memo for the Housing and Planning Act 2016 will be considerably longer if one is going to try to educate local authorities on what “recklessness” truly means. So he was very keen to remove recklessness from Clause 93. I would be very grateful if I could hear where the Minister feels Lord Etherton was wrong in his analysis on that point.
Lord Hogan-Howe (CB)
My Lords, I support the amendment from the noble Lord, Lord Cromwell, to which I added my name. Sadly, he is right: the police do not have sufficient knowledge about the law changes, which are now quite old. I suspect the reason is that the complaints tend to be infrequent, but of course it can be a Catch-22 because, if people do not think that their complaints will be listened to, they do not tend to make them. But, in the process, that means that the police have probably not kept pace with the law as it has changed, and with the needs of complainants.
Traditionally, the police did get involved, even in civil disputes, usually to prevent a breach of the peace, because people were worried there would be violence. Sometimes, a tenant might have access to a firearm, so there would be pre-work to make sure that that was removed from the scene so things could not get more serious.
This seems a reasonable step. I could not necessarily give the amendment that level of support in Committee because I thought there was a danger that it was directing the police to do certain things. All this tries to do is establish the level of the problem and what can be done about it so that the police perform their duty. The risk is that, at the moment, they are not.
Obviously, the amendment may or may not be accepted, but there are some fairly straightforward ways in which it could be helped. The Chief Inspector of Constabulary goes around and inspects every force every year and, if it were put on the list of things to look at, that would certainly make the police think about it. Tenants having a single point of contact within a force would mean that at least one person—or two or three people, or a department—could provide this knowledge and expertise for the officers on the street. That would be helpful. Carrying on as we are is not fair on the tenants, and it is not proper if Parliament has decided that this is a criminal act and the police have a role to play. So I support this amendment; it is a reasonable step. If the Government do not accept it, they might want to make it clear how they will address the gap.
Lord Best (CB)
My Lords, I will briefly support Amendment 110 in the names of the noble Lords, Lord Cromwell and Lord Hogan-Howe. I am grateful to Safer Renting, ACORN and the Renters’ Reform Coalition for bringing this matter to our attention. My noble friends have noted that this is a milder and more focused version of the amendment from the noble Lord, Lord Cromwell, debated in Committee, calling only for a review of the legislation that covers the duties of the police in respect of illegal evictions.
Although the amendment places a very modest obligation on the Government—namely, simply to publish a report on the position—this would be a good first step toward addressing a highly unsatisfactory state of affairs. It is clear that the laws against illegal and sometimes violent evictions are not being enforced. I see from the statistics that there were over 16,000 illegal evictions in 2022-23, and the police did not act in over 90% of cases. The underlying problem is surely not because of any malice on the part of the police officers but because of ignorance of what should be done and of the priority this should receive. The report that this amendment would elicit would clarify matters and make the recommendations that are needed to end wrongful and criminal practices by the very worst landlords. I am delighted to support the amendment.
Baroness Thornhill (LD)
My Lords, Amendments 87, 88 and 104, as we have heard, seek to raise the burden of proof to that of the criminal standard, “beyond reasonable doubt”, from the civil standard, “on the balance of probabilities”, consistently across the Bill. All the amendments in the next group, on financial penalties, seek to lower the amount of money an enforcing council can fine a landlord. This group and the next are, to me, heads and tails of the same coin. Seen together, both sets of amendments seek to considerably help landlords by raising the standard of proof for an offence and lowering the fine if they are in breach of it. We believe that it is a naked attempt to tilt the balance massively in favour of landlords in a dispute, when the power balance is already heavily in their favour, and to deter tenants from complaining and taking action.
We do not agree with anything that undermines two of the core principles of the Bill. The first is to act as a deterrent to bad landlords. We on these Benches keep saying, as does the Minister, that good landlords have nothing to fear from the Bill, and certainly not from this aspect, but the fines have to be tough enough and the burden of proof appropriate to a civil offence. The second is to increase penalties to bring them in line with similar penalties that can be issued already by enforcement authorities against landlords who breach legislation.
I want to look specifically at the amendments. I think that the noble Earl, Lord Kinnoull, and the noble and learned Lord, Lord Keen, with their forensic legal eyes, are looking at them in a particular way. I look at the unintended consequences for tenants. Amendment 87, on raising the burden of proof, relates to families claiming benefits. Refusing to rent to someone due to their claiming benefits is unlawful. However, with high demand, this form of discrimination is really hard to prove. It is often based on verbal rather than written evidence. This amendment would therefore make it significantly more difficult for recipients of benefits to hold their landlord to account for this discriminatory practice.
Similarly, Amendment 88 relates to bidding wars. It is absolutely right that the Bill will ban bidding wars. Too often, renters are pitted against each other for a home, driving up the cost of renting in the process. It is already very hard to prove, without making it even harder by raising the burden of proof. Raising that standard of proof would make it significantly more difficult for a local authority to enforce the ban on bidding wars, especially due to the nature of the evidence in such cases.
Amendment 103 relates to the database that the Bill will set up. Noble Lords will know from Committee that I am a database believer. However, without the right data and information, such a database risks losing its utility for all tenants, prospective tenants and local authorities. This amendment would provide landlords with a lovely loophole that they could potentially exploit. It would be very difficult to prove that the landlord had knowledge of the breach they committed, and the amendment would therefore allow landlords to contravene the new regulations without fear of enforcement. I acknowledge the complexity of this amendment and look forward to the Minister’s response. To us, all these amendments seek to undermine the protections for tenants, thus we are very much against them.
Let us now be positive, by turning to Amendment 104, in the name of the noble Baroness, Lady Kennedy. She has explained the situation very clearly and we support her fully. This is a really positive move. Amendment 104 would reduce the burden of proof for a rent repayment order where an illegal eviction has taken place on the balance of probabilities—hence the connection to the amendment of the noble Lord, Lord Cromwell. This is important, as “beyond reasonable doubt” is the criminal standard. It is just too hard at the moment for tenants to successfully get justice. Cases involving illegal evictions and harassment are typically really hard to prove to this standard; in far too many cases, where evidence is based on the word of the applicant, it is practically impossible.
A rent repayment order is not a criminal prosecution. Cases are settled in the First-tier Tribunal; there is no jury and it does not follow criminal procedural rules. There is no criminal sentence or criminal record for the respondent. There is no legal aid available for rent repayment order claims and thus applicants are often self-represented, with little help and no legal expertise. This is again why the higher criminal burden of proof is so inappropriate for this kind of action. It is virtually a non-action, as evidenced by the low numbers of rent repayment orders that are brought.
We need to consider the very serious possibility that, with the abolition of Section 21, there will be more illegal evictions. It is therefore important that a bigger deterrent is in place. This needs to be changed to “on the balance of probabilities”. It is really important not to confuse criminal and civil offences and their parallel burdens of proof.
This takes us neatly to Amendment 110, in the names of the noble Lords, Lord Cromwell, Lord Hogan-Howe and Lord Best—a formidable trio. I can tell the Minister that it will take a lot of political will to withstand their arguments. Amendment 110 clearly gets our support, should the noble Lords wish to test the opinion of the House.
We know from all the arguments in Committee that less than 1% of illegal evictions are successfully prosecuted and that a major part of the problem is exactly as has been enunciated: the police view these things as a civil matter or, even worse, assist the landlord, even though it is a criminal matter under the Protection from Eviction Act, or they refuse to get involved at all. I cannot think of anything worse than being illegally evicted from what I believe to be my home, with my goods and my family. There has to be a greater awareness and more training, which is the aim of the amendment. As this view seems to be shared by many important bodies, it has real credibility.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I thank the noble and learned Lord, Lord Keen of Elie, the noble Lord, Lord Cromwell, and my noble friend Lady Kennedy of Cradley for their amendments. I thank the noble Earl, Lord Kinnoull, for his comments. We all miss the late Lord Etherton very much and I am very grateful to him for all the work he did on this. I thank the noble Lord, Lord Hogan-Howe, and the noble Baroness, Lady Thornhill, and all the tenant groups that have taken time to speak to me about the amendments in this group.
Amendments 87 and 88 would require local authorities to meet the criminal rather than civil standard of proof when imposing civil penalties for rental discrimination and rental bidding breaches. The standard of proof we have chosen for these breaches is lower than that which applies to the imposition of financial penalties for breaches of other measures brought in by the Bill. This is because, unlike those other breaches, rental discrimination and rental bidding breaches cannot lead to a criminal offence if the conduct persists. Breaches of the rental bidding and rental discrimination requirements cannot result in the landlord being prosecuted or given a civil penalty of up to £40,000, and are subject only to the lower £7,000 maximum penalty. This means the jeopardy for landlords in relation to those breaches is significantly lower than for others in the Bill.
I point out—I hope the noble Lord finds this reassuring—that local authorities already impose civil penalties based on the civil standard of proof in other legislation; for example, in their enforcement of agent redress requirements. My view since Committee has therefore not changed. I consider it appropriate that local authorities need to prove these breaches to the civil standard, “on the balance of probabilities”, rather than the criminal standard, “beyond reasonable doubt”.
On Amendment 103, the PRS database depends on landlords providing accurate information to raise standards, protect tenants and support local authority enforcement. Retaining the reference to recklessness in the current wording of Clause 93 is essential to achieve this, by preventing dishonest landlords submitting false or misleading information. I reiterate the point made by the noble Baroness, Lady Thornhill, that good landlords have nothing to fear from this legislation.
Recklessness is not a simple mistake; it involves taking an unjustified risk, and this wording is consistent with other, similar offences, including offences under the Housing Act 2004, under which local authorities already make prosecutions.
Lord Keen of Elie (Con)
I am obliged to noble Lords for their contributions to this debate. I make a number of observations. First, I sympathise with the observations made by the noble Baroness, Lady Kennedy, about the conduct of those she identifies as criminal landlords. But before someone should be stigmatised and identified as a criminal, they should be guilty of an offence that leads to them being stigmatised as a criminal. That should not be done on a balance of probabilities.
The relevant standard of proof in regard to criminality is “beyond reasonable doubt”. Indeed, where there is uncertainty about whether conduct is civil or criminal—a point brought up by the noble Lord, Lord Cromwell—it is important to ensure either that you can make that clear distinction, or that you understand that the relevant standard of proof must be that which is fair to both parties.
I have to disagree with the noble Baroness, Lady Thornhill, when she suggests that, where it is difficult to prove a case, you should reduce the burden of proof. The consequences of that, if developed, are very wide-ranging indeed. We know that there are many areas of criminal prosecution where it is extremely difficult to secure a conviction, but no one would suggest that it is appropriate in these circumstances simply to reduce the burden of proof.
Baroness Thornhill (LD)
Given that we are not talking about criminal offences—we are talking about civil offences—and given the power imbalance between a landlord and a tenant, will the noble and learned Lord at least accept that by lowering the burden of proof we would allow the tenant to feel that they might have a voice and could possibly bring something? Otherwise, his amendment is, in effect, saying, “Well, just don’t bother. The burden of proof is too high, so please carry on with your poor behaviour”. This is civil conduct and behaviour.
Lord Keen of Elie (Con)
I do not accept the proposition advanced by the noble Baroness at all. In circumstances where you are going to stigmatise somebody’s conduct as criminal, as the noble Baroness, Lady Kennedy, pointed out, it is appropriate that there should be a relevant standard of proof. You are not taking away anyone’s voice in that context.
I come on briefly to deal with the helpful contributions from the Minister and in particular welcome her observation that inconsistency in legislation undermines a regime’s credibility. That is very much in point here, because I cannot accept as accurate her suggestion that you can distinguish the provisions in Clauses 41 and 58 from later provisions of the Bill on the basis that the latter lead to greater jeopardy and, as she put it, could result in a criminal offence. I merely remind noble Lords of what Clauses 67 and 92 actually say. Clause 67 says:
“A local housing authority may impose a financial penalty on a person if satisfied beyond reasonable doubt that the person has … breached regulations under section 65(1)”—
that is not a criminal offence; it is a breach of civil regulations. Clause 92 says:
“A local housing authority may impose a financial penalty on a person if satisfied beyond reasonable doubt that the person has … breached a requirement imposed by section 83(1), (2) or (3)”.
That is not a criminal offence. Again, what is being underlined here is the very point that the Minister wanted to avoid: the inconsistency in the legislation which is liable to undermine the regime’s credibility. It appears to me that there is a need, if nothing else, for consistency with regard to the obligations imposed by this series of provisions and regulations. I would therefore move to test the opinion of the House on Amendment 87.
Lord Keen of Elie
Member’s explanatory statement
This amendment, in conjunction with another amendment in the name of Lord Keen of Elie name to clause 41, imposes a uniform standard of proof – beyond reasonable doubt – where the local housing authority imposes a financial penalty.
Lord Keen of Elie
Member’s explanatory statement
This limits the local housing authority’s power to impose a financial penalty to £7,000.
Lord Keen of Elie (Con)
My Lords, Amendment 89 is to Clause 59 and addresses the question of the penalty proposed in that provision, which is £40,000. Under the amendment, that would revert to the same level of penalty for other provisions in the Bill of £7,000, on the basis that £40,000 is simply excessive.
If we are to have enforcement regarding the various provisions in the Bill, consistency and uniformity are to be welcomed. In the context of a regulatory obligation as contained in Clause 59, it is appropriate that the level of penalty should be £7,000. I beg to move.
Lord Hacking (Lab)
My Lords, this group of amendments on the financial penalties raises the very important point of how local authorities are informed of the landlord’s breaches and hence are in a position to impose financial penalties. Without that, there can be no imposition of financial penalties. This issue was raised in our last debate by the noble Baroness, Lady Thornhill, and the noble Lord, Lord Cromwell, relating to police failures.
A major thrust throughout this Bill is to curb—or, rather optimistically, to stop—rogue landlords acting illegally. Therefore, we need to realistically identify the rogue landlords. It may sound trite, but they are rogues who have every intention to exploit the law to their benefit or ignore it altogether. It is no good legislating for financial penalties unless the rogue landlord’s breaches are identified and brought to the notice of local authorities so that financial penalties can be applied.
Under this Bill, commendable new schemes are being set up. First, there is the private rental sector ombudsman scheme. Secondly, there is the private rental sector database scheme. Thirdly, there are the private sector rent payment orders, otherwise known as RPOs. However, each of these schemes relies on the landlord’s breaches being reported. Moreover, if these breaches are reported to the ombudsman, it is doubtful that the ombudsman, in this entirely civil procedure, has any right to report on the landlord’s breaches to the local authorities. The major potential reporter is the wronged tenant, but history shows that wronged tenants are very reluctant, for obvious reasons, to report their landlords. The answer must therefore be to legislate sensibly and to go for measures that will be most effective against rogue landlords but do not penalise ordinary, lawful and honest landlords.
I have to say, politely and respectfully, that this is where this Bill fails. Take the example of the 12-month ban on putting properties back on the market after a failed sale or failed family occupation following evictions on grounds 1 or 1A. The rogue landlord will simply exploit this procedure, fudging dates and taking other steps. This will not provide any effective deterrent to the rogue landlord. Focusing on the wrong that is to be put right—namely, landlords raising the rent after failure of sales or failure of family occupation—my noble friend will remember that I suggested that the much better, more sensible and more directed focus is to ban all rent increases across the market after abortive sales or abortive family occupation.
Since that is a simple, across-the-board provision, rogue landlords would find it much more difficult to act in breach. Noble Lords may remember my example of a landlord having sought and obtained eviction of a tenant in order to put his parents into the property and then one of his parents has a stroke and is unable to enter it. That landlord is then left with the penal result of being unable to put the property on the market for 12 months and to collect much-needed rent. Also, it would mean property unnecessarily being unavailable on the rental market, also for a period of 12 months.
Baroness Scott of Bybrook (Con)
My Lords, fines must be proportionate, yet, as the Bill stands, the threshold for imposing fines on landlords is worryingly low, and the scale of those fines is notably high. This combination is troubling. Setting fines at such significant levels, in some cases representing a substantial portion of a landlord’s rental income, or even exceeding it, risks driving honest, well-meaning landlords out of the market, not because of any wilful negligence but out of fear.
I thank my noble and learned friend Lord Keen of Elie for leading this group from the Back Benches today and bringing two considered amendments to the attention of the House. The group continues the discussions we had in Committee, as we remain unclear on how the scale of the fines has been determined. Frankly, they appear to be arbitrary, with no transparent methodology or rationale behind them, and we would welcome clarification from the Minister on how these amounts were determined and why those particular values were chosen. Without a clear explanation, it is difficult to support their inclusion in the Bill.
Amendments 98 and 99 seek to clarify that fines should be issued only for persistent breaches. Including this in the Bill would provide much-needed reassurance. It would make it clear that significant penalties will not be levied for the first offence. That is especially important when many landlords may not be immediately aware of their new obligations, either those set out in the legislation or those introduced later through regulations. Imagine a landlord renting out a cottage for many years in their village in rural Wales. They are entirely unaware of this Bill and the proceedings of this House. They do not register on any new database, not out of malice but because they simply do not know what is required. Is it right that they should face a steep fine for this? Surely not. That is why “persistently” must be in the Bill—to protect landlords like them and ensure that the legislation is proportionate, fair and enforceable.
Ministers may say that, in practice, individuals such as in the example I have given will not be fined, and that discretion will be used and enforcement will be reasonable, but warm assurances are not enough. We need to ensure that this protection is guaranteed in law, not simply assumed in guidance or left to future interpretation. We need this clarity in the Bill, and without it, the risk remains that well-intentioned landlords—those who may simply be unaware of new requirements—could still find themselves facing disproportionate penalties.
If the Minister cannot accept the premise that we must embed this protection clearly within the legislation, I regret to say that we will be minded to test the opinion of the House.
Baroness Thornhill (LD)
My Lords, the noble Baroness was so quick to leap up—
Baroness Thornhill (LD)
No, I was listening to the debate and trying to get my thoughts in order. I will be very brief because, as I said on the previous group, it is clear that we will oppose anything that lowers the fines.
I am a little bit concerned about some of the attitudes towards local government that are coming out, particularly from the noble Baroness, Lady Scott, from her own experiences. Local authorities have experience and expertise; they employ lawyers and solicitors, and they make sure they apply fair and proportionate responses to enforcement across a range of things and do it with consistency and uniformity. There is almost an infantilisation of local authorities, as if they want to grab lots of money from lovely, well-meaning landlords with one cottage in a little village. I say to the noble Baroness that I do not see that happening.
I see that approach to enforcement across a range of things. Even if we are changing parking rules, for example, we put a little notice on windscreens, saying, “Next week, you will get fined if you park here”. Local authorities have guidance and standards that they like to adhere to. I guess there is the odd rogue local authority, like there is the odd rogue landlord, but I do not like the way we want to have things absolutely pinned down so that local authorities can have no discretion about what they do.
The Bill is bold and radical and has new things in it that have to succeed—the database, for example, has to succeed. If the fine is not enough to deter landlords, it will be ineffective, and one of the tools that makes this transformative will have been taken away from local authorities. We have to trust local authorities. I doubt that many £40,000 fines will happen, and I guess that is why we are also calling for reviews—such things will be part of looking at that.
We certainly need to give local authorities higher financial penalties. I am quietly confident that they will not take them out on the uninformed landlord. There is also something faintly patronising about the idea of uninformed landlords. There is so much information out there and so many landlord lobbying groups that it would be surprising if they were not aware that there had been some changes. If they are astute enough to be a landlord, and a good landlord, they will be astute enough to notice that this big Renters’ Rights Bill might just have some impact on them. We will not vote for any amendment that reduces the ability of councils to impose higher fines.
Lord Carrington (CB)
My Lords, I support the amendment, but I want to concentrate on a slightly different aspect, which came up in the intervention by the noble Lord, Lord Hacking, and remarks made by the noble Baroness, Lady Scott. The noble Lord referred to the fact that rogue landlords will ignore whatever we put in the Bill, and that may well be the case, although I hope he is not accurate on that. The noble Baroness mentioned that there are people in Wales who will never have heard of the Bill but are expected to conform to the provisions in it. My question for the Minister covers both aspects. Can she at some point, whether now or later, tell us about the implementation of the Bill, so that everybody understands how it works and avoids going to court and all the other matters?
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble and learned Lord, Lord Keen of Elie, the noble Lord, Lord Cromwell, and the noble Baroness, Lady Scott of Bybrook, for their amendments. Amendments 89, 92 and 101 would reduce the maximum civil penalties for offences in relation to illegal evictions—
Lord Cromwell (CB)
I thank the Minister for thanking me, but I have not spoken to this amendment.
Baroness Taylor of Stevenage (Lab)
I think somebody must have assumed that the noble Lord, Lord Cromwell, was going to speak. I apologise for that.
For these reforms to be effective, they must be enforced robustly and fairly. Our approach to civil penalties is fundamental to this. Landlords who commit first-time and minor non-compliance will be subject to civil penalties of up to £7,000. However, for serious and repeat non-compliance, landlords will be subject to civil penalties of up to £40,000. The principle that local authorities can impose civil penalties for housing offences is well established. Since they were introduced in 2017, civil penalties have proved an effective enforcement tool. I agree with the noble Baroness, Lady Thornhill. I do not think we have any need to question the professionalism of local authorities in dealing with these matters. They are more than well versed in exercising legal duties and have legal professionals to support them.
It is important to emphasise that £40,000 will be the maximum, not the norm. Local authorities will need to have a clear rationale for why they have set a civil penalty at a certain level and apply aggravating and mitigating factors. Penalties of up to £40,000 will be available only in respect of landlords who have committed serious or repeat non-compliance. Initial failure to sign up to the database, for example, will carry a penalty of only up to £7,000. However, local authorities will be able to impose a penalty of up to £40,000 if the landlord continues or repeats this conduct after being given an initial, lower penalty.
When considering whether to issue a civil penalty, local authorities are required to issue a notice of intent—a bit like the notice about parking that the noble Baroness, Lady Thornhill, mentioned—allowing time for landlords to make representations. The local authority will need to be satisfied beyond reasonable doubt that the landlord has committed an offence. If the landlord disagrees with the imposition or amount of the penalty, they will be able to appeal to the First- tier Tribunal. This approach to civil penalties ensures efficiency for local authorities, protection for tenants, and fairness for landlords. As noted in Committee, we will also publish new guidance to help local authorities pursue civil penalties with greater consistency and effectiveness.
Amendments 98 and 99 are in the name of the noble Baroness, Lady Scott. She spoke about the scale of fines. We have increased the maximum civil penalties to take account of inflation since the £30,000 and £5,000 maximums were introduced for the similar housing offences that I referred to earlier. We want to ensure that the deterrent value of civil penalties is maintained. As I have stressed before, they are maximum penalty amounts. Local authorities will need to take into account a number of factors, such as the culpability of the landlord and the harm caused to tenants in determining the appropriate level of the civil penalty.
On the point about the single landlord in the depths of the Welsh countryside, and to the point made by the noble Lord, Lord Carrington, housing is devolved in Wales, so it is a different matter altogether in Wales.
Amendments 98 and 99 would require there to be persistent breaches of certain provisions in Clause 83 or persistent offences committed under Clause 93 before the local authority could fine an individual. I appreciate that the noble Baroness is acting in good faith by laying these amendments, but they would have significant negative consequences for the effectiveness of the database. Under these amendments, individuals could avoid penalties for failing to register or knowingly or recklessly providing false information to the database operator, to name two of the relevant provisions, unless they did so persistently over a protracted period. For the database to be useful to users, it is important that as many landlords as possible register with the service. Indeed, as the noble Baroness commented in Committee:
“It is essential that the accuracy, completeness and timeliness of the data be maintained if it is to be a useful resource for both tenants and for landlords”.—[Official Report, 14/5/25; col. 2219.]
I would add local authorities.
I fear that these amendments could discourage registration and reduce the quality of the data recorded by watering down the threshold at which financial penalties will be imposed. Furthermore, it would be unfair to those good landlords—the vast majority—who comply with the legislative requirements from the outset. It may create an environment where negligent landlords could escape sanction for significant periods of time, and disadvantage the compliant landlords the Bill intends to support.
I recognise that the noble Baroness is trying to protect landlords from being unduly punished. Therefore, I hope she is reassured that the level of fines is the maximum level rather than the standard. Local authorities must also be satisfied beyond reasonable doubt that a requirement under Clause 83 has been breached or an offence under Clause 93 has been committed before they can impose a fine. Moreover, new guidance will be published in due course to help local authorities with consistency and effectiveness.
Lord Keen of Elie (Con)
My Lords, I am obliged to all who have contributed to this aspect of the debate, and to the Minister for her explanation. On the financial provisions and our pursuant Amendments 89, 92 and 101, I will not insist on those amendments. I comment merely that, in my noble friend’s Amendments 98 and 99, it appears to be conceded that what is being addressed is persistent offences by particular rogue landlords. Therefore, it appears to me that the use of that term in the context of Clause 92 would be appropriate. I withdraw Amendment 89.
Lord Jamieson
Member’s explanatory statement
This amendment would only require a residential landlord to be a member of the landlord redress scheme if their tenant does not already have access to one by virtue of the landlord using an agent who is a member of another approved independent redress scheme to avoid duplication.
Lord Jamieson (Con)
My Lords, Amendment 91 would require a residential landlord to be a member of the landlord redress scheme only if their tenant does not already have access to redress through a letting agent who is a member of another approved independent scheme. The purpose of this amendment is to avoid duplication, prevent unnecessary regulatory burden, and ensure that the system remains proportionate and clear. Clarity and efficiency in regulation are not just desirable, they are essential for both compliance and effective enforcement.
In Committee, the Minister said:
“We take seriously the noble Baroness’s concerns about duplication. Careful consideration will be given, during the implementation process, as to how the PRS landlord ombudsman service will interact with the agent redress provision”.—[Official Report, 14/5/25; col. 2211.]
We fully agree that tenants should have a clear and accessible route to redress, but that route must be simple, coherent and proportionate. A system that is overly complicated by parallel and potentially overlapping redress obligations could hinder rather than help. For example, if a landlord were a member of two redress schemes, which one should the tenant apply to—or both? How would liability be determined and does this not risk delay and confusion as lawyers from both redress schemes seek to argue it out?
This amendment seeks not to water down tenants’ rights but to ensure that those rights are delivered through a streamlined, efficient system that works in practice for tenants, landlords and agents alike. Clarity here is important. I hope that the Minister agrees. I beg to move.
Lord Best (CB)
My Lords, I will comment on Amendment 91 in the names of the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson. Their amendment would exempt a landlord from joining the new redress/ombudsman scheme if that landlord’s property is managed by an agent who is already a member of one of the existing redress/ombudsman schemes. I declare a past interest as chair for eight years of the Property Ombudsman, which handles complaints about agents. This amendment’s intention of avoiding duplication of membership of redress/ombudsman schemes is entirely right, otherwise the tenant is left puzzling over which ombudsman—their landlord’s or the agent’s—they should address their complaint to.
However, this amendment would not achieve the desired result. I know, from having had some responsibilities for redress in respect of managing/lettings agents, that the response from the agent to a complaint by a renter is often, “I was only doing what the landlord told me to do”. The agent may be justified in this: a renter may have requested an urgent repair and the agent did nothing, but the problem has been the landlord telling the agent that the cost is too high or the work is not needed. The intolerable delay is not the result of the agent’s negligence; it is the landlord who has held things up. These cases cannot be resolved because the landlord is not a member of any redress scheme, and that problem would persist if the landlord was exempted from having to join the new redress/ombudsman scheme.
To avoid duplication of having one redress/ombudsman scheme for landlords and one for property agents, I suggest the solution is for a single redress/ombudsman service for both. This would avoid complaints resolution being stymied and tenants being sent from pillar to post where two different ombudsman services are involved with one issue. I know the Government are still considering how best to introduce the new redress scheme for landlords in this Bill, and I recommend one port of call for tenants with a complaint. The position is already confusing, with the Housing Ombudsman providing a redress service for a few private landlords— as well as for all social landlords—and the Property Ombudsman and the separate Property Redress Scheme both providing redress schemes for property agents. Bringing in the new mandatory redress scheme for complaints about private landlords will add to the confusion for the consumer and the renter. This is a good moment to rationalise and consolidate the arrangements, but not by excluding the landlords who use an agent, which would not solve the problem.
Baroness Thornhill (LD)
My Lords, I agree with the noble Lord, Lord Best. In fact, one of my lines says that there should be only one port of call. If one of the main planks of the Bill is to drive up standards, it is critical that landlords are mandated to be part of the ombudsman scheme. It should be a catch-all. Unfortunately, this amendment would allow landlords to opt out of the government redress scheme and, as has been explained, deny tenants access to redress via the national private sector ombudsman that the Bill intends to set up.
To make this advantageous move, all landlords would need to do is use a letting agent that is signed up to one of these alternative schemes. This would create a significant loophole in the legislation and deny such tenants access to redress for issues that lie solely with the landlord and not the managing agent, such as damp and mould caused by structural issues. Generation Rent’s polling found that one in three tenants has had maintenance issues in their home that they have reported but the landlord has not dealt with. This is quite a widespread problem. If we want to drive up standards, we want to make it easier for tenants to complain and landlords to comply.
In addition, if this amendment were to pass it would create more confusion, as there are currently multiple independent letting agent schemes that compete with each other, arguably creating a race to the bottom on standards. This phenomenon arguably exists to some extent with deposit protection schemes—which, incidentally, are also chosen by landlords or agents, not by renters, so the landlord will choose the one that thinks like they do or favours the way they work.
The system as proposed in the Bill seems to be the correct way forward, as making membership of an ombudsman scheme mandatory for landlords who use managing agents will mitigate a situation where a good agent—and there are good agents—tries to remedy a complaint but is reliant on an overseas landlord who refuses to engage. As well as these advantages, one ombudsman can tackle the root cause of problems, address systemic issues, provide feedback and education to all interested parties, and offer support to vulnerable consumers. Amendment 91 would dilute all these potential good impacts of the new ombudsman, reducing tenants’ ability to hold bad landlord practice and behaviour to account. I cannot think why anybody would want to do that.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Scott of Bybrook, for her amendment on the landlord redress scheme, and the noble Lord, Lord Best, and the noble Baroness, Lady Thornhill, for their comments.
Our new private rented sector landlord ombudsman will ensure that tenants are able to seek redress against their landlord when they have a legitimate complaint about the landlord’s action, inaction or behaviour. We are clear that landlords who use letting agents cannot delegate responsibility for their own actions or behaviours. Landlords almost always retain some responsibility for their property that cannot be passed on to agents—for example, making structural repairs in buildings. Tenants should be able to access redress if they experience issues such as this, regardless of whether their landlord uses an agent. That is why we think it is essential that both landlords and agents can be held to account for their individual responsibilities.
For landlords who have already voluntarily joined a redress scheme, once a mandatory private landlord ombudsman service is in place it will be tailored to the specific needs of the private rented sector, and those landlords will have to move to it. This will work better for the private rented sector, rather than having it mixed up with social housing. Landlords will be required to sign up to the new landlord database, and we are exploring how to align the sign-up process for this with the landlord ombudsman. That will help make it simple for landlords who are already members of an existing redress system to join the new landlord ombudsman service.
We are committed to ensuring that private residential tenants know where to complain and enjoy consistent standards of service and outcomes. Having private residential landlords as members of the same service will support this aim. We also want to ensure that, where it is not clear which scheme a tenant should complain to, there is no wrong access point for tenants. The schemes will be expected to work together to ensure that, regardless of where a tenant raises a complaint, it is effectively triaged and referred on to the right body with minimal input from the complainant.
I understand the noble Baroness’s concerns about duplication, but we will work closely with the new ombudsman and the property agent redress schemes, support them to work effectively together and ensure that the process works smoothly for both tenants and landlords. For the reasons I have set out, I kindly ask the noble Lord to withdraw the noble Baroness’s amendment.
Lord Jamieson (Con)
My Lords, I am grateful to the noble Lord, Lord Best, and the noble Baroness, Lady Thornhill, for speaking on this important topic. I think we all agree that we want a system that works and is clear and easy to understand, although we seem to have some slight disagreements on how that might be best achieved. I am grateful to the noble Lord, Lord Best, for his agreement that the current system is confusing. I am also grateful to the Minister for her response and for engaging seriously with the concerns that have been raised.
Baroness Thornhill
“(d) in respect of a landlord entry, details of any banning orders or rent repayment orders that have been made against the landlord.”Member’s explanatory statement
This amendment would require the Private Rented Sector database to include information on any banning orders or rent repayment orders made against a landlord, improving transparency and supporting tenant decision-making.
Baroness Thornhill (LD)
Noble Lords will realise by now that I am a bit messianic about the database. I listened very carefully to what the Minister said at the end of Committee about the database, which is that much of it will be given to us in guidance and by statutory instrument. I look forward to the opportunity to contribute to that, but the reason for continuing to press this case is to put on the record just how important this is as a plank of this Bill—and how transformative it could be. So I will speak to my Amendments 94, 95 and 96 and speak against Amendment 97.
The private rented sector database presents a major opportunity to drive up standards through empowering tenants to make informed decisions before entering into a new tenancy, while giving local authorities the information they need to proactively enforce the new regulations. Those are two really important prongs.
The database will only be as useful as the information it stores. My amendments seek to ensure that it is as useful as possible. It is probably my shopping list of things that I would like to see, but I am sure that interested bodies and people other than myself will be putting into that further guidance and further information.
Renters will not be reading it in bed at night, or on holiday; they will look for it when searching for a new home. If it has useful information that helps them make informed choices—such as, past enforcement actions taken against the landlord in question, accessibility features of the home or rent levels for similar properties in the area—they will be able to choose a home that is right for them. For example, a recent Generation Rent survey found that more than three-quarters of renters would support including any prior prosecutions of a landlord on the database, as per my Amendment 94. Having this information will help foster more of the long, stable tenancies that both renters and landlords alike want, while discouraging landlords from attempting to sidestep the Bill or exploit tenants. Furthermore, renters who have used the database will tell their family and friends about it. In my experience, this kind of word-of-mouth marketing is the most effective.
My Amendment 96 would ensure that actual rents are recorded on the database. The Government have put much trust in the First-tier Tribunal, protecting renters from unaffordable rent hikes. At the moment, however, the tribunal uses advertised rents to see whether a rent increase is fair. Often, these are inflated and could become even more so with the end of bidding wars. So, recording actual rents will allow the tribunal and tenants to have a better understanding of the local market.
The issue of local authority finances has been debated many times as the Bill has progressed. We are right to be concerned about their capacity to proactively enforce the Bill. Having key information in one place, such as Section 8 eviction notices, as per my Amendment 95, would be a massive help to enforcement when the Bill comes into action—cutting out much of the proactive fact-finding work that local authorities often lack the capacity to do.
Outside the renting process, the database could also be of use to both national and local policy-making. Recording rents, for example, would help inform national decisions on housebuilding and crack down on landlords’ tax avoidance, which the think tank TaxWatch estimates to be as high as £1.7 billion a year.
We oppose Amendment 97, to limit costs related to the database, given that some areas of the Act inevitably may turn out to need more enforcement than others. It makes sense for the Government to have some wriggle room to set some costs at a later date. The legislation’s success relies heavily on enforcement, and therefore having the ability to raise funds through the database feed written into primary legislation is an important mechanism in case it is needed in future to cover costs, such as an awareness campaign or guidance and training to tenants and landlords.
Finally, I will end on a positive note. Much of this debate often pits landlords against renters, seeing the issue like a see-saw. But findings from Generation Rent’s survey of its supporters in April this year found that the more information about a landlord that renters have, the better their relationship with them. Nearly a quarter of renters who had a direct contact line to their landlord rated them five out of five, compared with fewer than one in 10 of those who did not. With the right information, the database will help foster more of these relationships. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baroness, Lady Thornhill, for her expansive and constructive thinking on what more the database could do to support a rental market that works fairly and effectively for both landlords and tenants alike. During Committee, we had a thoughtful and wide-ranging discussion about the purpose, function and future potential of this database, and many noble Lords suggested that it could, and perhaps should, do more. I agree: in time, that may well be prudent. But, from my experience as a Minister, I have learned the value of taking one step at a time. Let us focus first on getting this system up and running and getting it right.
I am very much reminded of the Second Reading of the pensions Bill in the other place. When the Minister, Torsten Bell, began to explain its provisions, he was met with laughter from both sides of the House. The joke was all in very good faith and the Minister joined in at the moment, but it speaks to a deeper truth. We cannot allow this database to become the next pensions dashboard—a project weighed down by scope creep and plagued by delay. So, although I welcome the noble Baroness’s ambitious vision and her efforts to think beyond the immediate text of the Bill, we must begin with the basics, especially if additional functionality comes at the cost of higher system complexity and, crucially, higher financial burdens on those who provide rental homes to millions across this country.
That brings me to Amendment 97, which concerns limited relevant costs. This cannot become a system that imposes unlimited and never-ending costs on landlords. They need certainty—clear and reliable reassurance from the Government—that relevant costs will not spiral every time a new Minister has a bright idea.
It is that word again—balance—and I know that noble Lords are probably sick of hearing it by now, but it remains the guiding principle. We must strike the right balance between the cost of this system and the functions that it is expected to perform. Only then can we ensure that the database succeeds, not just in theory but in practice, for those who depend on it. Despite this, I will not seek to test the opinion of the House on Amendment 97.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baronesses, Lady Thornhill and Lady Scott, for their amendments concerning the database. I thank the noble Baroness, Lady Thornhill, for all the thought and work she has put in and the assistance she has given us to aid our thinking around what may or may not be in the database. I appreciate that the intention behind Amendment 94 is to empower tenants with more information and to support their decision-making before they decide to rent a property. As the noble Baroness helpfully outlined in Committee, that forms part of a broader and more ambitious vision for the database. We need to ensure that the database is helpful to both landlords and tenants.
I hope that the noble Baroness is pleased that Clause 84 mandates that we will indeed record banning orders on the database. This clause specifies that we will record relevant banning order offences and related financial penalties on the database. We intend to make this offence information available to the public, using the regulations set out in Clause 87. Furthermore, the Bill includes the regulation-making power at Clause 84(6) for the database to record other housing-related offences committed by landlords. We will specify which offences will be recorded through secondary legislation, but I hope the noble Baroness is encouraged to hear that rent repayment orders are among those we are actively considering for inclusion.
Our approach to recording offences will consider the necessity and proportionality of recording this information, alongside making sure, of course, that it complies with data protection and human rights legislation. We need to give that careful consideration as well. As we discussed in Committee, we intend to retain flexibility regarding the information the database records and makes public, so that it can evolve in response to the changing needs of the sector, including those of tenants and landlords—enough information to be helpful but not so much that only Torsten Bell can understand what is on it.
Amendment 95 seeks to record historical Section 8 notices on the database to enhance tenant awareness and promote responsible landlord practices. I recognise that this would be a positive addition to improve the database and help it be a driver of higher standards and tenant protection, built on comprehensive and reliable foundations, so I thank the noble Baroness for the thoughtful amendment. The Government are currently considering recording possession information on the database and whether that information should be made available to the public. Any decision on what information will be recorded on the database has to take into account both the benefits and the burdens for different users, and we will ensure that the information collected remains necessary and proportionate.
As the noble Baroness will be aware from our previous conversations about what information the database will record, we place significant importance on the flexibility of the database for future circumstances. We therefore believe that the information collected on the database should be set out in secondary legislation, as stated in Clause 78.
Amendment 96 aims to make the commencement of rent and historical rent increase information visible on the database, to improve transparency for prospective tenants and support informed decisions in the private rented market. The Government are still considering whether to collect rent data on the database. However, we recognise the potential value the information could provide to tenants, by allowing a more informed rental experience. We are also aware that other government departments and bodies, such as HMRC and the NAO, may find this data useful. We believe, however, that for the database to remain flexible, the information it collects should be specified through regulations.
Amendment 97 would restrict the calculation of PRS database fees to be set with reference to costs associated with the operation and enforcement of the database only, not by reference to the costs of wider PRS enforcement activity. I appreciate the need to keep the fee at a manageable level and to justify any new costs to landlords. However, I draw the noble Baroness’s attention to what we have heard in previous debates regarding the challenges that local authorities face in resourcing their enforcement actions.
We believe it is appropriate that, as far as possible, costs of enforcement should be met by those individuals who break the rules. However, a well-regulated and well-enforced PRS benefits all good landlords, as well as tenants, and clearly local authorities must be properly resourced to achieve this. This clause provides Ministers with the option of using a proportion of fee income to provide revenue to fund private rented sector enforcement activities beyond those relating to the database.
As I have set out previously, database fees will be determined and fixed at a later point, via secondary legislation. I assure noble Lords that fee calculations will be reasonable and will bear in mind the cost to landlords, among other factors. Given what we have heard about the importance of local authority resourcing, I do not think it would be prudent to limit the calculation and use of database fees in this way.
I thank the noble Baroness for saying that she will not press her amendment, and ask the noble Baroness, Lady Thornhill, to withdraw her amendment.
Baroness Thornhill (LD)
My Lords, I am nothing if not a realist, but I am glad to have pursued this to this stage, because the Minister has just given me some very serious reassurances about what will be included in the database. I am particularly pleased to hear about the consideration of rent repayment orders. I urge the Government to think again about rent collection—because rent is the big issue—and perhaps about how the database can help.
However, I am under no illusion that all these proposals, processes and functions will need further discussion, particularly with regard to human rights and legal matters. I agree with the noble Baroness, Lady Scott, that we need to get this right and to begin with the basics. I look forward to the Minister giving us some sort of timeline, perhaps, and working with the secondary legislation. In the meantime, I beg leave to withdraw my amendment.
Baroness Scott of Bybrook
Member's explanatory statement
This amendment would allow a financial penalty to be imposed only for persistent breaches.
Baroness Scott of Bybrook (Con)
My Lords, I have no confidence in the response I had from the Minister on my Amendment 98 that landlords would be protected in law against unfair fines. I therefore wish to test the opinion of the House.
Member’s explanatory statement
This amendment would make the Decent homes standard apply to all homeless temporary accommodation provided under the Housing Act 1996.
The Lord Bishop of Manchester
My Lords, I declare my interests as set out in the register. My wife and I own one apartment; it is in the West Midlands, and it is let out. Nothing in this amendment or any others in this group would provide me with any advantage that I can foresee.
Amendment 105 seeks to extend the decent homes standard to temporary accommodation. As I said in Committee—and hence I can be extremely brief today—those in temporary accommodation are among the most vulnerable in our society. They are already battling against major disadvantages, and being placed in properties that fail the standard simply adds to their burden.
There are now over 150,000 children living in temporary accommodation, a number that continues to rise remorselessly. Often, these young people may be many miles from their school and are struggling in inadequate space to study for exams whose results will affect the rest of their lives. The very word “temporary” is something of a misnomer. It is not uncommon for such residence to last beyond a year. If any households need the protection of decent housing, it is these.
Baroness Grender (LD)
There are three amendments in my name in this group, and I thank the noble Baroness, Lady Coffey, and the noble and gallant Lord, Lord Stirrup, for putting their names to Amendment 106. I also thank the noble Lord, Lord Best, for his wisdom and support, as ever, and the Minister for the many meetings she has held on this and other matters. We on these Benches are supportive of the other two amendments in this group and look forward to hearing the government response to both.
Amendment 106 is a crucial and necessary addition to the Bill that speaks to our fundamental duty to those who sacrifice so much for our nation’s security: the application of the decent homes standard to Ministry of Defence accommodation. We on these Benches have pushed votes on amendments sparingly because we support the Government bringing forward this long-awaited and much-needed legislation to reform the private rented sector. But it is imperative that we do not leave any group behind, especially dedicated military personnel and their families.
This Government have already taken welcome first steps: the landmark deal in January to bring 36,000 military homes back into public ownership; the launch of a new defence housing review in February; and the April announcement of a new consumer charter for forces family housing. These are all positive developments but they are not enshrined in law, and this Bill is the opportunity to do just that. They are policy pledges, subject to the whim of goodness knows what future Governments, changes in ministerial priorities or economic pressures. The housing and morale of our Armed Forces should not remain dependent on policy changes alone.
The current state of service accommodation is in many cases unacceptable. There have been persistent reports of damp, mould, rats, inadequate maintenance and poor communication. Satisfaction levels with service family accommodation fell to their lowest reported levels in 2023. The Defence Select Committee has reported that one-third of single living accommodation and two-thirds of service family accommodation is essentially no longer fit for purpose. Reports have shown that service families were badly let down for many years under past housing contracts. This deplorable situation impacts recruitment and retention within our Armed Forces, undermining our national security in a time of global uncertainty.
Applying the decent homes standard through the Renters’ Rights Bill would provide a clear, legally binding benchmark for acceptable housing quality for service family accommodation. It would ensure accountability and establish a right to a decent home for those who serve our nation. They deserve homes fit for heroes, and Amendment 106 would be a vital step towards making that a reality.
This continues the work of Liberal Democrat defence spokesperson Helen Maguire MP in the House of Commons. She is a former captain of the Royal Military Police who served in both Bosnia and Iraq, and she has tirelessly campaigned to ensure that MoD housing is included under the decent homes standard. Her experience, first-hand understanding of military life and dedication to our service personnel is invaluable. The Kerslake Commission report—we miss Lord Kerslake so much—Homes Unfit for Heroes, commissioned by John Healey MP, has laid bare how poor the standards in military housing are.
Amendment 106 would directly build upon and reinforce the work of both Helen Maguire MP and the recommendations of the Kerslake Commission. It moves beyond mere acknowledgement of the problem and the setting of targets, seeking to legally enforce the standards our service families deserve. The Minister has previously argued that this amendment is unnecessary because this approach is not right for service family accommodation, due to unique challenges such as access to secure sites. We have therefore set out in Amendment 109 some of the detail that could be added to the Bill to reflect these obstacles and considerations.
Amendment 119 is consequential on Amendment 109. I will not test the House on either of those, but they do provide some of the detail on how this could be done. However, if the Government do not accept Amendment 106 or some other tangible and strong process, I do intend to test the opinion of the House. Pride in our Armed Forces must mean pride in how we house them. We owe it to them to guarantee in the strongest possible terms that their homes meet a basic, dignified standard. This change would be a powerful and lasting declaration of our commitment to our service personnel and their families, and they deserve nothing less.
Lord Stirrup (CB)
My Lords, I rise to support Amendment 106, to which I have attached my name. For decades now, I have seen at close hand the deficiencies in service families’ accommodation. They range from an inability to get things fixed to serious problems with damp and mould. They are always irritating, and too often disgraceful. For years, I have listened to successive Governments undertake to get to grips with the issue. For decades, I have seen them fail to do so, not because they do not care—of course they care—but because of budgetary constraints, institutional inefficiencies, bureaucracy and other organisational issues.
I served in the military for 43 years and I have been out of it for nearly 15; and yet, the problems persist. So why should I, or anybody who comes after me, put any faith in any Government’s promises that are not backed up by enforceable measures? We have been told that we should not worry too much, because 90% of service families’ accommodation meets or exceeds the decent homes standard already. Well, even if that is so, does the Minister think that one in 10 service families living in substandard accommodation is acceptable? I do not. Perhaps she could clarify that point later.
In the debate in another place, the Government maintained, as we have heard, that this amendment is impracticable because there would be problems with local authorities gaining access to service families’ accommodation behind the wire on military sites. We debated this very issue during the passage of the Armed Forces Commissioner Bill, when the Government saw no difficulties with civilian officials gaining access to sites behind the wire that are much more sensitive than service families’ accommodation. Frankly, this kind of bureaucratic brush-off is not worthy of such a serious debate on such a serious issue.
I refer the Minister to the recent strategic defence review, the conclusions of which have been accepted by the Government. It says that the
“transformation of UK Defence must ultimately be delivered by its people … Targeted intervention is needed to tackle Defence’s workforce crisis”,
including
“prioritised investment … in accommodation that falls well short of the standards required”.
In the context of the future security of this country, can the Minister explain to the long-suffering families of service personnel why they are not entitled to the same formal protection being accorded to renters in the civilian sector? I think she will find that extraordinarily difficult to do. If we are forced to divide on this issue, I trust that the House will send a message loud and clear to those people that they are entitled to that protection and much more besides.
Baroness Coffey (Con)
My Lords, it is a pleasure to follow the noble Baroness, Lady Grender, and the noble and gallant Lord, Lord Stirrup. I put my name to Amendment 106 because of my experience in representing the Armed Forces in a previous role in the other place. Also, to be candid, I am sure that several of us have had family members in the Armed Forces over the years. It has always struck me that if it is good enough for social housing, and good enough for private rented housing, as is being put in through the Bill, why on earth is it not good enough for the homes of our brave men and women who put their lives on the line every time they don that Armed Forces uniform?
Furthermore, in my experience, undoubtedly the quality of housing—I will not pretend it is homogenous; right across the country, some fantastic new accommodation is being built—is unfortunately a key factor in why people leave the Armed Forces. I will use the example of Rock Barracks, home to 23 Parachute Engineers, just outside Woodbridge. That is the kind of base where people are not there for lifetime basing. The strategy going ahead is that once people are part of a lifetime base, they might be able to buy their own home rather than be necessarily in Armed Forces accommodation. That does not happen with some of these specialist regiments. Actually, the base commander was one of the people who invited me in when I was getting letters from constituents who were really irritated about what was going on in their homes and how it was taking time to be fixed.
Of course, that can be fixed with a better company, but the key point here is that putting this into legislation not only gives reassurance to our soldiers and officers who are thinking about their families—they should not even have to think about what is going on with their families while they are abroad—but gives the families the assurance that they can have a very clear legal expectation about the state of their homes and what should be done if they are not in that state.
Going further, welfare is of course an element in the Armed Forces Commissioner Bill, and I think the Government have talked about housing. But the legislation specifically refers to matters where the Secretary of State can specify, and if it is believed that these matters might go against the safety of somebody or against national security, the commissioner can be stopped from investigating. Frankly, we all know how long it takes to get a commissioner to do anything. It is better to have the high standard in the first place. I am very conscious that the Government may try to say, “Things will be better in the future”. I am in a position now to say that enough is enough. We will be very happy if the noble Baroness, Lady Grender, pushes this to a Division; I will certainly be in the voting Lobbies with her this afternoon.
Baroness Altmann (Non-Afl)
My Lords, I will speak to my Amendment 106A in this group. I also echo fully the support for Amendments 106, 109 and 119, which is consequential, from the noble Baroness, Lady Grender. I thank the right reverend Prelate for his support as well.
Lord Sentamu (CB)
My Lords, first, I support Amendment 105, from the right reverend Prelate the Bishop of Manchester. I am very glad to support him; he and I have worked together quite a lot on homelessness in York, where some noble Lords assisted us to make sure that those who were homeless could get a house where they would have a bed and a little kitchen, so that they had a bit of independence. The standard that we expect for others ought to be given to the homeless as well.
I also support Amendment 106, movingly spoken to by the noble and gallant Lord, Lord Stirrup. When we had a debate in your Lordships’ House on the duty of having regard to the covenant, I told your Lordships a story; I think some of you were not here, and if you have forgotten, I can remind you—I will be very brief. A gentleman who had survived in Afghanistan in the Parachute Regiment returned to Yorkshire. He had been injured, and therefore could not go back to service. He visited four widows who had already been rehoused out of service accommodation because their husbands had died in the line of duty. Their accommodation, they said, was not any better than it had been in the service, so he said, “We should make the point very clearly by having a parachute jump”. At my age, people were advising me not to do it, but we did it, and we landed. When I got home, there was a retired soldier who had just sold his business. He was the first to give to this fundraising for four houses for widows. He gave £50,000 pounds. Of course, the amount went up, and I am very grateful to all those people who supported us.
If there is a duty in the covenant, it should apply to all our service personnel, and their accommodation ought to be as good as the instruments they use when they go to war. There is a similar story of the Yorkshire Regiment, where widows were put into accommodation that was not suitable. It breaks your heart. We signed a covenant, if your Lordships remember, to all the people who are in the service—Army, Air Force and others—that we have a duty to support them. This amendment is a challenge to all of us: we passed that covenant and we had better show up.
Lord Jamieson (Con)
My Lords, I speak to this group on the decent homes standard, a commitment to ensure that all tenancies, regardless of tenure or circumstance, have access to safe, healthy and secure housing. In particular, I turn to Amendments 106 and 119, tabled by the noble Baroness, Lady Grender. She, the noble and gallant Lord, Lord Stirrup, and my noble friend Lady Coffey highlighted the persistent and ongoing issues that military and service accommodation faces.
We are in no doubt that those who serve our country and whose families bear the burdens of that service deserve decent homes. It is regrettable that, despite the application of the decent homes standard to military housing on a non-statutory basis since 2017, serious concerns persist about the condition and upkeep of military accommodation. These amendments offer Parliament an opportunity to reaffirm that military and service families should not be left behind.
We therefore welcome the commitments made in the strategic defence review on 2 June 2025, in which the Government announced an additional £1.5 billion in funding for our service family accommodation, bringing a total investment of £7 billion. Alongside this, the development of a new defence housing strategy and consumer charter, including timelines for repairs, named housing officers and a strengthened complaints process, is a step in the right direction. But such undertakings must be matched by effective and timely delivery. We would be grateful for greater clarity from the Minister on when the additional investment will begin to make a difference on the ground; what time- frame the Ministry of Defence has set for the implementation of these reforms; and how progress will be assessed, monitored and reported back to Parliament. Commitments of this scale demand not only ambition but accountability. Our Armed Forces and their families deserve more than expressions of appreciation; they deserve action and results. These amendments speak to that imperative, and that is why we are pleased to support them.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the right reverend Prelate the Bishop of Manchester and the noble Baronesses, Lady Grender and Lady Altmann, for their amendments regarding the decent homes standard. I thank the noble and gallant Lord, Lord Stirrup, for his experience and knowledge, which he showed in his contribution. I thank the noble Baroness, Lady Coffey, the noble and right reverend Lord, Lord Sentamu, and the noble Lord, Lord Jamieson.
Amendment 105 would take away the power of Ministers to set out in regulations the types of temporary homelessness accommodation that the decent homes standard would apply to. I completely understand the sentiment and intent behind these amendments. The Government intend to apply the decent homes standard to as much temporary accommodation as possible. Indeed, the consultation that we launched on the decent homes standard, which was published on 2 July and closes on 10 September, makes this very clear and asks for further information on it.
As I said in Committee, we have to strike the right balance between improving standards and avoiding risk to supply. Given the pressure on local authorities, which we all understand, there is sometimes no choice but to use forms of temporary accommodation, such as commercial hotels. It may not be possible for this to meet all decent homes standard requirements—for example, where there are no kitchen facilities. We want to avoid a situation where applying the decent homes standard could mean that such accommodation can no longer be used, even where there is no alternative, as this could make things worse for people who are homeless or at risk of homelessness, not better. Of course, the long-term solution is to provide a much greater quantity of affordable housing. In the meantime, we have to make sure we do not shut off vital resources to local authorities.
I hope that the right reverend Prelate is reassured by the Government’s intention to apply the decent homes standard to as much temporary accommodation as possible and to deliver the affordable housing that we know we need to solve the problem in the longer term, and that he recognises that the most practical way to make this change to the decent homes standards is through a regulation-making power. I therefore ask that he withdraw his amendment.
Amendment 106 would bring Ministry of Defence service family accommodation within the scope of the decent homes standards measures in the Bill, including enforcement of this standard by local authorities. No one, especially me, is going to disagree that those who defend our country deserve to live in decent homes. As I said in Committee, the Government absolutely recognise that action is required to tackle the poor state of forces’ housing. That is why we are already taking decisive steps to remedy the situation that we have inherited— I gently remind the noble Baroness, Lady Coffey, and the noble Lord, Lord Jamieson, that their party was in government just over a year ago, and we inherited this situation from them.
As noble Lords will be aware, the Ministry of Defence has concluded a landmark deal to bring military housing back into public ownership. It is also developing a defence housing strategy, which will be published later this year, that will set out further steps to bring about a renewal of military housing to restore it to the quality housing that we all want to see for our armed services.
As my right honourable friend John Healey, the Secretary of State for Defence—and a great expert on housing, as the noble Baroness, Lady Grender, acknowledges—said in his Statement to the other place on the strategic defence review,
“we will invest £7 billion of funding during this Parliament for military accommodation, including £1.5 billion of new money for rapid work to deal with the scandal of military family homes”.—[Official Report, Commons, 2/6/25; col. 53.]
He has also announced a consumer charter that will introduce new consumer rights for families in military homes. The Defence Secretary is instructing the MoD to immediately plan improvements to enhance service family homes after the years of neglect from which they have suffered. Improvements set out in the charter will be in place by the one-year anniversary of the announcement to buy back military homes, made last December, with the final detail to be shared in the defence housing strategy later this year.
In relation to standards, the MoD already uses the decent homes standard as a benchmark and applies its own decent homes-plus standard as the target standard for service family accommodation. The MoD is reviewing this standard in line with recommendations from the Kerslake review and the House of Commons Defence Committee.
The Lord Bishop of Manchester
My Lords, I am grateful to all noble Lords who have taken part in this short debate. I thank my former boss, my noble and right reverend friend Lord Sentamu, for his support. His passion on all matters that concern those in the greatest need in our society is well known in your Lordships’ House. I thank him for demonstrating it once again today.
I thank the Minister for her response to my amendment. I think that we are not very far apart. With those reassurances, I will not press the matter any further. I will leave it for the noble Baroness, Lady Altmann, to say whether she too is satisfied with the response to her amendments. The case for our military families remains compelling. If the House divides on Amendment 106, I shall be voting with the noble Baroness, Lady Grender. But, with that, I beg leave to withdraw my amendment.
Baroness Grender
“(iii) that is provided by the Ministry of Defence for use as service family accommodation.”Member’s explanatory statement
This amendment would extend the Decent Homes Standard to service family accommodation.
Baroness Grender (LD)
My Lords, I thank all noble Lords who have participated. There is no doubt on these Benches about the sincerity of the intentions of Minister John Healey. However, we believe that enshrined in law is the right way to proceed. We heard some eloquent arguments from the noble and gallant Lord, Lord Stirrup, about behind the wire inspections and what is feasible. Therefore, I would like to press this matter. We have pressed very few matters from these Benches, because we are behind the Bill a great deal, but on this occasion we wish to test the opinion of the House.
Lord Shipley
“Use of licence conditions to improve housing conditionsIn section 90(1) of the Housing Act 2004 (licence conditions), for “the management, use or occupation of the house concerned” substitute “all or any of the following—(a) the management, use and occupation of the house concerned, and (b) the condition and contents of the house concerned.”” Member’s explanatory statement
This amendment would enable local authorities operating selective licensing schemes to use licence conditions to improve housing conditions.
Lord Shipley (LD)
My Lords, in moving Amendment 107, I will also speak to Amendment 108. These amendments would remove unnecessary barriers to the use of licensing schemes to improve housing standards. Licensing raises housing standards: it can help to regenerate areas that are blighted by poor housing and other social problems. Licensing provides a means for local authorities to inspect privately rented housing using enforceable conditions, and to identify and resolve problems without the need for tenants to have complained.
Licensing schemes pay for themselves through the fees that are charged and enable local authorities to target regulation where it is most needed: in other words, at tackling the worst landlords and supporting the most vulnerable tenants. My amendments would remove unnecessary barriers to the effectiveness of licensing schemes and increase the maximum duration of schemes from five years to 10 years.
Amendment 107 would permit local authorities operating selective licensing schemes to use licence conditions to improve the physical state of the licensed properties. It would remove a peculiar disconnect in current legislation, highlighted by the Chartered Institute of Environmental Health, whereby local authorities are permitted to introduce selective licensing schemes to address poor housing but are not permitted to include in the licences themselves conditions requiring the physical state of the licensed properties to be improved. The amendment would give local authorities the same discretion in relation to the licence conditions used in selective licensing schemes as they already have in relation to licence conditions used in additional HMO licensing schemes.
In Committee, the Government implied that the introduction of a decent homes standard and Awaab’s law to the private rented sector will make this amendment unnecessary. However, I do not accept that view. Neither the decent homes standard nor Awaab’s law will remove the need for local authorities to be able to use licence conditions to deal proactively with general disrepair in areas with poor housing conditions.
There are four reasons why the decent homes standard will not remove the need for local authorities to be able to use licence conditions in this way. First, when licence conditions are in place, if a breach of these conditions is proved, local authorities can serve a civil penalty notice on the landlord without first having to issue an improvement notice and/or take other action that involves unnecessary delay. However, they will be able to do this for breaches of the proposed decent homes standard only in more serious cases—possibly only where there is a serious and immediate risk to a person’s health and safety—and only where they can prove that the landlord has failed to take reasonably practicable steps to address the issue. Licence conditions would therefore give landlords a much stronger incentive than the decent homes standard to address general disrepair.
Secondly, the enforcement of licence conditions can be funded by licence fees. The cost of enforcing the decent homes standard will fall on council tax payers. In practice, therefore, the use of licence conditions would lead to local authorities undertaking a much higher level of enforcement.
Thirdly, licence conditions give local authorities a clear justification as well as sufficient funding for entering properties to carry out inspections without the tenant having complained. It seems likely that, outside of licensing schemes, the vast majority of inspections under the decent homes standard will be in response to complaints. Fourthly, licence conditions could deal with items of disrepair that would be difficult to address using the decent homes standard.
With regard to Awaab’s law, it will not remove the need for local authorities to be able to use licence conditions to deal proactively with general disrepair in areas with poor housing conditions. The enforcement of Awaab’s law will depend on the ability and willingness of tenants themselves to seek redress and ultimately to take legal action through the courts. It is often difficult for tenants to use legal remedies themselves; areas with poor housing conditions contain many poor and vulnerable tenants, who are particularly badly placed to do so. Licensing would clearly be a much better way of targeting support at them.
Amendment 108 would permit local authorities to implement longer additional HMO licensing schemes and selective licensing schemes without repeating the time-consuming and expensive designation process. Local authorities introduced these schemes to bring about large-scale improvements, but those are unlikely to be fully achieved within five years. This amendment would allow them to advertise longer-term posts for staff and to include training of new staff in these schemes. It would also provide more time for local partnerships formed through such schemes—for example, to resolve anti-social behaviour—to become embedded and effective.
The Government suggested in Committee that a maximum duration for licensing schemes of five years strikes the right balance between the needs of local authorities and the needs of landlords. But that does not take proper account of the time and money wasted through councils being unnecessarily required to repeat the designation process.
In conclusion, the removal of these unnecessary barriers to the effectiveness of licensing schemes would make a major contribution to the regeneration of some of the most deprived areas of the country. A new general approval to establish selective licensing areas came into effect last December, and local authorities are no longer required to obtain confirmation from the Secretary of State before implementing a selective licensing scheme of any size. That is most welcome, but it needs to be accompanied with the powers identified in my amendments, and I hope the Government will now understand the importance of them. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Lord, Lord Shipley, for bringing these two amendments once again to the attention of the House. However, we on these Benches do not consider them to be necessary. We recognise and wholeheartedly share the noble Lord’s ambition to see housing conditions improved. When I was in government, I was proud to support the decent homes standard and helped to lay the groundwork for what has now become Awaab’s law. The Government’s approach should be focused on delivering tangible improvements to living conditions. This includes tackling poor-quality housing wherever it exists, not slowly within selective licensing areas.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Shipley, for his amendments on licensing schemes. On Amendment 107, we share the noble Lord’s desire to improve housing conditions, and we have always been clear that all renters deserve safe, secure and good-quality homes. That is why we are introducing a decent homes standard and Awaab’s law to drive reform and improve conditions across the sector. I acknowledge the work that the noble Baroness, Lady Scott, did on Awaab’s law when we were on different sides of the House. As discussed in Committee, we think this is the right approach so that all renters and local authorities are able to challenge and address poor-quality homes, not just those in selective licensing areas.
On Amendment 108, we believe that licensing schemes are crucial in helping local authorities tackle specific issues and improve standards. We also think that local authorities are best placed to make decisions regarding the use of these enforcement tools in their local areas. That is why, at the end of last year, we removed the requirement to obtain Secretary of State approval to introduce larger selective licensing schemes. However, we know that licensing schemes also place additional responsibilities on landlords. Local authorities must therefore keep schemes under review so that they remain proportionate and targeted at delivering the intended outcomes.
As discussed in Committee, a maximum duration of five years for schemes achieves the right balance. It gives local authorities time to assess the effectiveness of schemes while providing landlords with assurance that they will not be subject to increased regulation for extended periods. Where issues in the private rented sector persist after a scheme has ended, a local authority may introduce a new scheme to take further action, provided that the statutory criteria are still met. I therefore ask the noble Lord, Lord Shipley, to withdraw his amendment.
Lord Shipley (LD)
My Lords, I am grateful to the Minister and the noble Baroness, Lady Scott of Bybrook, for their comments. We clearly have a difference of opinion about the importance of selective licensing and the future operation of the decent homes standard. The Government have accepted the importance of selective licensing schemes because, in December, they removed the requirement for Secretary of State approval, as the Minister just said.
I am reluctant to press Amendments 107 and 108 to a Division because, clearly, the House will vote against them, and I think that would not be helpful in the current situation. Both Front Benches of the two largest parties in this Chamber have indicated their opposition to them, so any Division that I moved would be lost.
It is important for me to withdraw the amendment because two pieces of work are going on in the House of Commons on this matter. One is the consultation on the decent homes standard that the Government are undertaking, which the Minister referred to a moment ago. Also, the Housing, Communities and Local Government Committee is taking evidence on housing conditions generally in England. It will be important for the government consultation and the Housing, Communities and Local Government Committee to take the evidence from our debate on these amendments to see the concerns that I and professional bodies have been expressing about the importance of selective licensing in driving up housing standards in the private rented sector, as well as in the public sector more generally.
In the hope that there will be sufficient good will around the Chamber to allow this debate to be referred to the bodies now undertaking consultation, I beg leave to withdraw Amendment 107.
Lord Cromwell
“Offences under the Protection from Eviction Act 1977: report(1) The Secretary of State must publish a report about the application of the Protection from Eviction Act 1977, including—(a) an assessment of the level of understanding among tenants, landlords, and the police about the criminal nature of offences under the Protection from Eviction Act 1977,(b) a plan to increase awareness about the nature of offences under the Protection from Eviction Act 1977 among groups in paragraph (a),(c) a clarificatory statement about the nature of offences under the Protection from Eviction Act 1977 which tenants, landlords and the police can use as a reference, (d) the reasonable steps which the police should take to prevent such offences being committed, and(e) the training and relevant reference materials which must be made available to all police officers to support the discharge of their duties under this section and the Protection from Eviction Act 1977.(2) The report under subsection (1) must be published within six months of the day on which this Act is passed and must be laid before Parliament.”
Lord Cromwell (CB)
My Lords, I thank all those who spoke in support of this amendment. The noble Lord, Lord Hogan-Howe, was very candid in his acknowledgement—he is on his way here, I believe—of the issue with the police’s application of the 1997 Act. The noble Lord, Lord Best, underlined the need for clarification and the achievable nature of this amendment. I particularly thank the noble Baroness, Lady Thornhill, for her kind support for the amendment and what she rather charmingly called the “formidable trio” who were putting it forward.
Finally, I thank the Minister for her comments, which I listened to with care. I have to say that her assurance that, if I may quote, she or her department is “actively working” to “explore” with a number of various bodies what to do is, I am afraid, not good enough. It is clear what needs to be and what should be done within the next six months, which would solve the core issue here: the correct understanding and application of the 1997 Act to do right by vulnerable tenants, target rogue landlords and support the police in the correct performance of their duties. For that reason, I would like to test the opinion of the House.
Member’s explanatory statement
This is consequential on the amendment in my name which would add the new subsection (3A) to this clause.
Baroness Taylor of Stevenage (Lab)
My Lords, government Amendments 111, 112 and 113 to Section 239 of the Housing Act 2004 and Clause 126 of the Renters’ Rights Bill amend the requirements for entering premises without a warrant for the purposes of certain enforcement action. Notice to the property owner or landlord will now be provided after the entry has taken place, within a reasonable amount of time, rather than at least 24 hours before. The 24-hours prior notice requirement for tenants and occupiers will remain, so residents will always be aware that a power of entry is going to be exercised, whether that is under Section 239 of the Housing Act 2004 or Clause 126 of the Bill.
I thank the right reverend Prelate the Bishop of Manchester for raising this issue in Committee. We have given considerable thought to his proposal, as well as to feedback from local authorities. Local authorities have told us that providing notice can result in unscrupulous landlords hiding evidence of breaches, intimidating tenants, and temporarily fixing issues before reverting to non-compliance. We recognise that landlords will want to be aware of any inspection, and indeed the outcome of the inspection. The local authority will therefore need to provide notice after the inspection has taken place and engage with the landlord about any issues raised as a result.
We have heard, throughout the passage of this Bill, about the importance of local housing authorities having the right resources and tools to enforce. Making this change will make a real difference in their ability to address unsafe or hazardous living conditions more promptly and tackle unscrupulous landlords. I beg to move.
The Lord Bishop of Manchester
My Lords, I thank the Minister for her comments. I declare my interest: I own, with my wife, one apartment in the West Midlands. It will not help me in any way if this amendment is passed, but I still think it is the right thing to do, for exactly the reasons that the Minister has given—ones that I myself pressed in Committee. I am very grateful to her and her colleagues for meeting with me in the meantime, and for taking up the amendment at this stage. I urge noble Lords, if these matters are put to a Division of the House, to support the government amendments.
Baroness Thornhill (LD)
My Lords, we supported the right reverend Prelate in Committee and will support the Government now. In my experience, a local authority takes very seriously whether it decides to enforce an entry and go into a property. Again, we are not talking about the nice little cottage or the cottage belonging to the noble Lord, Lord Hacking; we are talking about properties where bad stuff goes on, where modern slavery can be happening, where people are refugees and people are living in appalling conditions.
There is no way we would support saying, “Cooee, rogue landlord, we’re just letting you know that we’re coming in 24 hours”. There has to be an opportunity at this extreme end of enforcement to be able to make a surprise snap inspection. I am glad that the Government have listened to that. Of course there need to be safeguards, but I think this is another of those instances where the good landlords need not fear. The right reverend Prelate need not worry about his flat in the Midlands, because I cannot imagine that they are going to be dashing in at six in the morning. Because of some of the extreme things that happen in our country, sadly, the power needs to exist and therefore we will support the Government.
Lord Jamieson (Con)
My Lords, this group of amendments concerns powers of entry, particularly in relation to notices served to landlords and occupiers under Clauses 126 and 135. The amendments in the name of the Minister seek to make targeted changes to when and how notice must be given before entry is exercised by local authorities under their enforcement powers.
The noble Baroness, Lady Thornhill, makes the case via the “extreme end” of the spectrum. The extreme end of modern slavery and other criminal activities, I do believe, might just be a police matter. This is dealing, rightly, with things that may need enforcement. The notice would be given to the tenant, but owners have rights such as also being given notice, not retrospective written notice after entry has taken place.
On these Benches we have consistently supported effective enforcement, but it needs to be proportionate, accountable and clearly justified. The balance between enforcement and individual rights is delicate, and changes to that balance demand close scrutiny. Government Amendment 111 may appear a consequential provision linked to wider changes proposed in other amendments in this group, but together they are not technical amendments. These amendments, brought to this House so late in the process, underpin a significant shift in approach, one that removes long-standing procedural protections for landlords and residents without adequate explanation or assurance.
These changes introduce ambiguity into what should be a tightly regulated area of enforcement. They risk undermining trust in local authority investigations and could lead to a greater number of legal challenges, confusion and even misuse. We cannot and will not support provision that weakens accountability without offering clear safeguards in return. Powers of entry are intrusive by their nature. If they are to be exercised without prior warning, there must be rigorous justification, robust checks and balances and explicit limits to prevent overreach. That bar has not been met.
We also have deep reservations about government Amendment 113, which proposes similar changes in relation to Section 239 of the Housing Act 2004. Again, the proposed move from prior notification to retrospective notice raises serious concerns, particularly in the absence of a defined threshold for when such unannounced entry would be deemed necessary or proportionate.
This Bill is an opportunity to rebuild confidence across the housing system, but confidence rests on fairness. These amendments risk tipping the balance too far, undermining transparency and weakening the very safeguards that protect landlords and tenants alike. For those reasons, we will vote against this package of amendments and urge the Government to reconsider their approach in this area.
Baroness Thornhill (LD)
Can I just ask the noble Lord a question? I absolutely understand that the extreme end is criminal, but will he concede that local authority officers are very often the ones to uncover the criminal practices in their proportionate response to local concerns that have built up over time? They will go in and then find that there is more there than they originally thought, and then it is time to hand over to the authorities. In my experience, that prevents overreach. You have to be able to build your case and be quite confident before you would ever assert these powers, because they are quite strong.
Lord Jamieson (Con)
I refer to my comments. If they are to be exercised without prior warning, there must be rigorous justification, robust checks and balances and explicit limits to prevent overreach. That bar has not been reached, and it is not in the Bill. It needs to be in the Bill.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank those who have contributed to this debate. We believe this is a well-balanced approach that enhances enforcement while respecting the rights of both landlords and tenants. Allowing local authorities—which have been very keen that we support the right reverend Prelate the Bishop of Manchester’s proposal—to enter premises without giving advanced notice to owners and residential landlords will help them better target unscrupulous landlords, ensuring that properties are compliant with PRS legislation and meet safety standards.
On the points raised by the noble Lord, Lord Jamieson, and the noble Baroness, Lady Thornhill, local authorities are able to use these powers of entry only if they consider them necessary to determine whether enforcement action is needed. Officers will need the correct authorisation and will need to state the purpose of the inspection and ensure lawful use of the power of entry. Compliant landlords will not face any detriment as a result of this change, which is not intended to impact on good landlords. They will benefit from streamlined enforcement, with transparency through timely post-inspection notices.
As I set out in my opening speech, this change will make a real difference to the ability to address unsafe or hazardous living conditions more promptly and will assist our local authorities to promptly tackle unscrupulous landlords.
“(3A) A notice need not be given in accordance with subsection (1)(c)(ii) to a person who is a residential landlord within the meaning of Part 2 (see section 64).(3B) If—(a) premises are entered in exercise of the power conferred by subsection (1), and(b) notice is not given to any person because of subsection (3A),an officer of the local housing authority must give that person notice in writing of the exercise of that power within a reasonable period after its exercise.(3C) The notice must—(a) identify the premises that were entered,(b) state when the premises were entered, and(c) state the purpose for which the premises were entered.”Member's explanatory statement
This removes the requirement to give prior notice of entry under this clause to certain landlords and instead requires notice to be given after entry has taken place.
“(5A) In relation to any qualifying residential premises within the meaning given by section 2B, notice need not be given—(a) to any owner;(b) to any occupier who has waived the requirement to give notice.(5B) If—(a) premises are entered in exercise of the power conferred by subsection (3), and(b) notice is not given to any person because of subsection (5A)(a),the authorised person or proper officer must give that person notice of the exercise of that power within a reasonable period after its exercise.(5C) The notice must—(a) identify the premises that were entered,(b) state when the premises were entered, and(c) state the purpose for which the premises were entered.”Member's explanatory statement
This removes the requirement to give prior notice of entry under section 239(5) of the Housing Act 2004 to owners of “qualifying residential premises” (see clause 101(5) of this Bill) and instead requires notice to be given after entry has taken place.
Baroness Thornhill
“Repeal of right to rent(1) The Immigration Act 2014 is amended as follows.(2) Omit Sections 20 (residential tenancy agreement) to 37 (interpretation).(3) Omit Schedule 3 (excluded residential tenancy agreements).”Member's explanatory statement
The new clause would abolish the right to rent provision introduced by the Immigration Act 2014.
Baroness Thornhill (LD)
My Lords, in Amendment 115 I am asking that the Government seriously consider repealing the right-to-rent policy. If any Bill is appropriate to repeal it, it is the Renters’ Rights Bill. I am picking up the baton from the noble Baroness, Lady Lister, who tabled this amendment on Report. The noble Baroness clearly listened to the words of her colleague, the Minister, and has decided not to pursue her amendment—but I bet her commitment is just as strong, as is mine.
I was surprised at the strength of the Minister’s response in Committee, so firmly closing the door on repeal. This is pernicious legislation that is designed to sound tough on immigration and is therefore for public consumption and political soundbites, rather than effective policy. The right to rent was introduced as a mechanism to make it harder for those without legal status to live and work in the UK—part of the so-called hostile environment. It placed a legal obligation on private landlords to carry out immigration checks before renting out their property, turning them into de facto border officials. Landlords and letting agents are ordinary citizens who are neither trained nor equipped to make complex legal determinations. When even the National Residential Landlords Association is saying loudly and clearly that this is not working, you know it is not a good thing. You have to question its ability do what it says on the tin.
This is not about being soft on immigration; it is about being fair, proportionate and practical, and on all three counts the right to rent fails. The evidence is clear: the right-to-rent scheme fuels racial and xenophobic discrimination. With landlords fearing the consequences of getting it wrong, including fines and even prison, they are more likely to play it safe and reject any tenant who does not hold a UK passport. Both the NRLA and Shelter say that one in four landlords believe they can rent only to British passport-holders.
The Minister in her previous response also asserted that it is possible to carry out the checks proportionately and without unlawful discrimination, but the reality is that it is not happening. Landlords and letting agents often end up resorting to proxies like names, accents and skin colour to rule out prospective tenants they assume will not pass the right to rent. We are seeing the chilling effects of this policy. Vulnerable groups are being pushed further into the shadows and forced into unsafe housing; unable to assert their rights, they are greater risk of exploitation by rogue landlords. Across the House, we have all been saying that we hope this Bill will eventually flush out rogue landlords and make it more difficult for them to exist, but this legislation delivers vulnerable people right into their hands.
The fact is that the Government have turned ordinary landlords into immigration officers—no training or guidance, just threats of fines and prison sentences if they get it wrong. The resulting discrimination is plainly evident. Let us be clear: this is not just a policy failure; it is a moral failure. It is pushing people into the shadows and into dodgy housing, and they are unable to complain or seek help; and all the while—this is the killer—there is no evidence that this policy even works. None at all.
Baroness Lister of Burtersett (Lab)
I am grateful to the noble Baroness, Lady Thornhill, for taking over this amendment, to which I was pleased to add my name. I assure her that I am as committed as ever to opposing this policy. Given the widespread support for the repeal of this discriminatory legislation, including among landlords’ organisations, I had hoped the Government might consider accepting the amendment in Committee. I made then what I believed was a strong case for repeal. I will not repeat that now, especially as the noble Baroness, Lady Thornhill, has made it so powerfully, but I will make just two points.
First, since Committee, a new research report into race, ethnicity and homelessness has been published which underlines the racism all too often faced in the housing market by racially minoritised tenants, especially refugees and other migrants. I am indebted to the lead researcher, Professor Suzanne Fitzpatrick of Heriot-Watt University, for sharing some of the findings with me. Although the research was not specifically into the right-to-rent scheme, a substantial number of participants have faced private landlords who clearly did not want to let to racially minoritised tenants. Practitioners repeatedly flagged up a reluctance to enforce housing rights among this group, even when they were aware of them. Professor Fitzpatrick suggests that confidence in exercising housing rights might well have been eroded by “hostile environment” policies, including the right-to-rent policy. In its recommendations the report thus argues that ending the right-to-rent policy, which has been shown to drive racial discrimination, would demonstrate the Bill’s commitment to addressing anti-discrimination practices.
Secondly, I was left somewhat bemused in Committee. Speaking for the Opposition, the noble Lord, Lord Jamieson, who is not in his place, stated that I had raised a very valid issue regarding the right to rent and the fact that introducing what may seem quite a sensible rule leads to complications and places landlords in an awkward situation when they do not fully understand the legislation in front of them. When I pointed out that many people, including my noble friends Lady Smith of Basildon and Lord Kennedy of Southwark, highlighted the potential problems at the time the legislation went through Parliament, I was grateful for his acknowledgement of the problems now and his observation that:
“Where the law is complex we need to make it simple and easy to comply with”.
He then went on to say:
“This is one of our major concerns with this legislation”,—[Official Report, 12/5/25; col. 1987.]
apparently forgetting that it was his party that introduced it.
I would say that it is never too late for a sinner to repent, but I am sat behind the right reverend Prelate. However, we are now saddled with this unfair legislation, which all too easily leads to the kind of discrimination uncovered by the Heriot-Watt research. My party, which was so critical of it at the time, now defends it, despite the evidence of its damaging impact on migrants and members of racially minoritised communities.
It was described by Wendy Williams in her Windrush Lessons Learned Review as one of the “most contentious aspects” of the hostile environment. It saddens me that, despite the evidence to the contrary, my noble friend the Minister, for whom I have the greatest respect, rejected the amendment in Committee on the grounds that, as we have heard:
“The right-to-rent scheme is capable of being operated proportionally by landlords and letting agents in all cases”.—[Official Report, 12/5/25; col. 1989.]
I disagree and therefore believe that it really is not compatible with the aims of the Bill.
The Lord Bishop of Manchester
My Lords, I added my name to this amendment. I am grateful for the powerful speeches from the noble Baronesses, Lady Thornhill and Lady Lister of Burtersett. They have left me with little to say, except that the noble Baroness, Lady Lister, has given me a cue with her words about the repentant sinner. I will take us even further back in history to the book of Genesis and the destruction of the cities of Sodom and Gomorrah. Abraham argues with God against the destruction of the cities, and God agrees that he will not destroy the cities if only 10 people can be found who are righteous. The principle that established, which passes down into our present law, is that it is better to let the guilty off than for the innocent to be punished.
That is what this particular amendment is about, because the people who are suffering are not the guilty few who may be here illegally and should not be here; they are the many people from minority ethnic backgrounds who just do not get a look-in because landlords play it safe. The noble Baroness, Lady Thornhill, referred to that when she introduced the debate. That is the problem. If we do not get rid of this pernicious bit of legislation, we will continue to see innocent people who, just because they have a different skin colour to my own, suffer because landlords will not let them properties just on the off-chance that there might be something not quite right in their paperwork. So I do not believe that the right-to-rent Act can be reformed, and I support this amendment.
Lord Cashman (Non-Afl)
My Lords, I hesitate to follow when Sodom and Gomorrah have both been mentioned. However, the noble Baroness, Lady Thornhill, has made a powerful case for her amendment, and I associate myself with everything she has said and with the passionate defence of this amendment by my noble friend Lady Lister of Burtersett.
As has been said, the amendment seeks to repeal the right-to-rent provisions introduced by the Immigration Act 2014. I remember being a newbie here in 2014 and sitting on the Benches opposite, hearing those speeches against the clauses and provisions in the Immigration Act that we now seek to repeal. At its core, as we know, this scheme turns landlords and letting agents into immigration officers. It was part of the hostile environment created at that time, and I am sad to say to the Minister on the Front Bench that this is a continuation of that hostile environment. There is no excuse for this provision. It is a policy that has enabled and indeed legitimised discrimination, and I believe that it has no place in a housing system that should be fair and should treat everyone equally and with dignity.
Landlords and letting agents are making judgments based on what they think will fall within protecting themselves. They are immigration officers. It has been shown—I thank Shelter for its briefing—that a prospective white tenant is 36% more likely to get a positive response than a black tenant. Renters with south Asian names get 25% fewer replies than those with white-sounding names—evidence of the consequences of this pernicious piece of legislation.
The courts recognised this reality. In 2019, the High Court found that the policy causes discrimination. That ruling was later overturned on appeal, not because the discrimination was not happening but because it was deemed justifiable. That, I believe, is not acceptable. I could go on, but the noble Baroness, Lady Thornhill, has pointed out that the Home Office has never produced evidence on which we should legislate that the scheme reduces irregular immigration or improves enforcement.
Discrimination, particularly when sanctioned by the state, is never justifiable. There are many reasons to accept this amendment, but I urge the Front Bench to accept the decent, just and fair case. I see the realities of the discrimination in the housing sector in my own borough, the London Borough of Tower Hamlets. Now is the time to do the decent thing. I urge the Government to listen, reply and do the decent thing and repeal the right-to-rent provisions introduced by the Immigration Act 2014.
Baroness Scott of Bybrook (Con)
My Lords, I will be brief. On these Benches, we find the argument for full repeal unconvincing. The right-to-rent scheme was designed to serve a clear and important public interest, ensuring that access to the private rented sector is not used as a back door to unlawful residence in the United Kingdom. That principle remains relevant. The Bill is not the right vehicle to reopen immigration law. Any reform of the right-to-rent scheme must be considered in the round and as part of a wider conversation about enforcement, fairness and social cohesion in our immigration system. For those reasons, we cannot, and I will not, support this amendment.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Thornhill, for Amendment 115, which would abolish the right-to-rent scheme that applies in England. I thank the noble Baronesses, Lady Lister and Lady Scott, the noble Lord, Lord Cashman, and the right reverend Prelate the Bishop of Manchester for their contributions.
The scheme was introduced to ensure that only those lawfully in the United Kingdom can access the private rented sector and, importantly, to tackle unscrupulous landlords who exploit vulnerable migrants, sometimes in very poor living conditions. Some landlords who rent to those who are here illegally are criminal operators. We all have a shared objective to drive them from the rental market and to deter unscrupulous landlords from entering into exploitative practices.
We have always been absolutely clear that discriminatory treatment on the part of anyone carrying out right-to-rent checks is unlawful. The checks apply equally to everyone seeking private rental accommodation, including British citizens. The scheme has been independently evaluated twice. Although some examples of discriminatory attitudes were found, there was insufficient evidence to claim that there was any systematic, unlawful discrimination as a result of the right-to-rent scheme. There are therefore no current plans to end the scheme.
It is our view that it is wrong to seek to abolish right-to-rent legislation in its entirety by simple notice of amendment. This immigration legislation was designed to address those who are disqualified from living in the UK by virtue of their immigration status, and that remains an important priority for this Government. The Government will continue to support legitimate landlords and letting agents who continue to act properly by carrying out the prescribed checks in legislation and published guidance. We have made big strides to improve the digital capability of the systems involved.
I emphasise that the Home Office has listened to and taken on board concerns expressed about right to rent during the progress of the Renters’ Rights Bill and from wider stakeholder engagement. As a result, officials will actively engage further with tenants and their representative groups to ensure that the right-to-rent scheme works fairly and inclusively for all. Early engagement has helped the Home Office identify individuals who may struggle to prove their identity and, in consequence, face barriers to accessing housing and other services. The Home Office has begun to work with local authorities to understand how individuals can overcome these barriers, with the aim of extending successful approaches across the UK.
As we move forward, we remain committed to working with stakeholders, including community-based initiatives and the third sector, to strengthen the inclusivity and accessibility of the right-to-rent scheme. I thank the noble Baroness, Lady Thornhill, for her interest in the scheme and would be happy to facilitate a meeting with the appropriate Home Office officials to discuss how to ensure that the scheme can operate inclusively and fairly for all tenants, landlords and letting agents. In the light of these reassurances, I ask that the noble Baroness, Lady Thornhill, withdraws the amendment.
Baroness Thornhill (LD)
I thank the Minister for her answer. It seems to me that the Government want to make the scheme work, whereas on our Benches we are fundamentally opposed, as a matter of principle, to making ordinary citizen landlords immigration officers.
Noble Lords know that we do not fight injustice by staying quiet; we fight it by shining a light, telling the truth—the truth is that this is not working—and demanding better. That is what those of us who have spoken have tried to do, in some small way, by supporting this amendment.
I am disappointed that this Labour Government have not taken an opportunity to repeal this, and I feel so strongly about it that I did want to push it to a vote, but I am not silly and I do not want to waste noble Lords’ time, knowing that it will come to nothing. So I will not push it to a vote, but I will explore every avenue to bring it up again and again in any legislation. For now, I beg leave to withdraw the amendment.
Baroness Thornhill
“Review of the impact of this Act on the judicial system(1) The Secretary of State must conduct a review of the impact of this Act on the judicial system.(2) The review must, in particular, assess the impact of the Act on—(a) the volume of cases brought before the courts;(b) the efficiency and timeliness of judicial proceedings;(c) the resource and administrative burden on the courts;(d) individuals’ ability to access justice.(3) In conducting the review, the Secretary of State must consult—(a) legal practitioners and their representative bodies,(b) court administration officials, and(c) any other persons or bodies the Secretary of State considers appropriate.(4) The Secretary of State must lay a report setting out the findings of the review before Parliament no later than two years after the day on which this Act is passed.”Member’s explanatory statement
This new clause would require the Secretary of State to review and report on the impact of the Act on the judicial system — specifically in relation to case volumes, court efficiency, resource implications, and access to justice — within two years of the Act being passed.
Baroness Thornhill (LD)
My Lords, I have been pleasantly surprised by the support for this amendment from a range of bodies, including the Law Society and the National Residential Landlords Association, plus many and various housing legal practices. Thus I can say with confidence that the reassurances we have had thus far about the capacity and capability of the courts to deal with the impact of the Bill when it becomes an Act are clearly challenged by those who actually have to deal with the courts regularly and currently, and I have listened to them. It seems we are still recovering from the backlog of Covid; they are not convinced that it is sorted, and neither are we yet, but we hope that this amendment provides an opportunity for the Minister to do that.
Put very simply, this amendment asks for a review of the impact of the Bill, when passed, on the judicial system, with the findings set out no later than two years after the day on which it is passed. It asks the Government to consider the effects on case volumes, court efficiency, resource demands and access to justice—all key areas to measure the effectiveness of the court process for both landlords and tenants and to ensure confidence in the whole system. Does the Minister have access to the measures on current case loads from which we can measure progress?
This amendment also reflects concerns raised across this House about the capacity of the courts to deal with the additional case loads that the Bill might generate. I seek reassurance that the Government will give a clear commitment today to provide the necessary resources that the courts might need going forward. Of course, that begs the question of how the Government will know this if they do not carry out some sort of fundamental review. If reviews or something similar are promised by the Minister, given the widespread concerns there still are about the courts, can the Minister give a reason why this cannot be included in the Bill?
I know we have all received emails from around the country from landlords giving their own instances of the length of time it takes for an application for a possession order to get to an actual hearing. It has gone from weeks to months and varies depending on where you live in the country, and that is now. I hope the Minister can give us all some assurance of what the current situation is so that we can have a benchmark before the Bill becomes an Act. In Committee the noble Baroness, Lady Scott, stated:
“Backlogs are rising, court rooms lie unused for lack of staff and overburdened judges are stretched too thin”.—[Official Report, 28/4/25; col. 997.]
Can the Minister please give us a progress report?
Amendments 120 and 121 in the name of the noble and learned Lord, Lord Keen, seem to be asking for a delay, setting the unrealistic measure of cases being processed as quickly as they were before the first lockdown. To achieve this some might say desirable benchmark would, we believe, inevitably delay the implementation of the very important rental reforms in the Bill, so we cannot support them, but we would like to hear that the Government and the courts are now in tandem and have an agreed commencement date. I beg to move.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Baroness, Lady Thornhill, and the noble and learned Lord, Lord Keen of Elie, for their amendments. Starting with Amendment 116, we fully recognise the importance of the justice system, both courts and tribunals, needing to be ready for our reforms, and for individuals to access timely justice. We are therefore, as I have commented in previous sittings on the Bill, working closely with the Ministry of Justice to assess the impacts of our reforms on the courts and tribunals, and to lessen these wherever possible. This work has been ongoing for years and in great detail. The digital service for possession claims is well advanced and will make it more efficient and easier to understand for landlords and tenants.
The amendment we have tabled to our rent increase measures shows that we are listening to the concerns of the sector and this House about tribunal workloads. It puts in place a sensible and proportionate safeguard in case it is needed. The Ministry of Justice already publishes quarterly statistics on the operation of the county court possession process, including the volume of cases going through the system and average timelines. This data is widely available and regularly reported on in the press. As set out in the impact assessment for the Bill, and in debate, we are already committed to monitoring and evaluating the private rented sector reform programme.
I have spoken at length about the ambition of this programme, so I will simply reiterate that we will use a wide range of sources to support this monitoring and evaluation work. Existing datasets will be used, and new data will be collected. The department is fully committed to publishing our evaluation findings at the two-year and five-year points after the Bill’s implementation. I can therefore assure the House that we will already be collecting extensive data. In this context, it is not necessary to commit to undertake any further review. I welcome the wish of the noble Baroness, Lady Thornhill, to give our reforms a regular MOT, but I hope she accepts that we have ambitious evaluation plans and do not want to duplicate them unnecessarily. Therefore, I respectfully ask her to withdraw her amendment.
Amendment 121 would require the Secretary of State to certify that landlord possession actions in respect of residential property are processed by the courts in no greater time, on average, than they were in the year before the first Covid lockdown before most of the Bill could be capable of coming into effect. The noble and learned Lord, Lord Keen, has also tabled Amendment 120, which would confirm that commencement of these important reforms would be delayed until this proposed certification had been carried out. I fully appreciate the need for the justice system to be ready for our reforms, and for landlords and tenants to access justice in a timely way, and that landlords need a smooth and efficient process in the county court for the minority of cases where court action for possession becomes necessary.
I want to be clear that we will not link the implementation of most of the provisions in this Bill to an arbitrary target of court timeliness. The sector has already waited too long for these urgently needed reforms. Court rules already specify that possession cases requiring a hearing should be listed between four and eight weeks from the issue of the claim. The MoJ quarterly landlord possession action statistics for the period January to March 2025 indicate that claim to order median timeliness is 8.3 weeks. I understand that there will be cases outside that, but they often have different circumstances. Setting a target for other parts of the possession process is not sensible, as it is dependent on the actions of the parties to the proceedings.
For example, an important stage of the process is the application for a warrant of possession, and this is dependent on the actions of a landlord and is outside the control of the court service. Where a tenant stays in a property beyond the date in the possession order, a landlord can choose if and when to apply for a warrant to enforce the possession order granted by the court. They can also decide whether to apply to transfer the case to the High Court.
Instead of agreeing to these unnecessary commitments, we are working in partnership with the Ministry of Justice to assess the impact of the reforms on the county court and lessen these wherever possible. This close collaboration has been done in a great deal of detail. It includes the development of a new digital service for possession claims, which is well advanced, that will make the possession process more efficient and easier to understand for landlords and tenants. As set out in the impact assessment for the Bill, and in debate, we are committed to monitoring and evaluating it.
I welcome the wish expressed by the noble and learned Lord, Lord Keen, for a more efficient possession action process, but I hope he accepts that we are making good progress on bringing these processes online and will not press his amendments.
Baroness Thornhill (LD)
I am pleased that the Minister sounded assured in what she told us, and I accept what she says. However, that view is not shared by everyone. The Minister said that everyone should know, it is in the press, et cetera, but that does not appear to be the case. I think the Minister is confident in the good news and she is in tandem with the courts, and therefore there is a message to get out. Without meaningful court reform, the ambitions of the Renters’ Rights Bill could be seriously undermined, and we all know and understand that. I will cut to the chase: I beg leave to withdraw my amendment.
Baroness Scott of Bybrook
“Report of the impact of this Act on the housing market(1) The Secretary of State must publish an annual report outlining the impact of the provisions of this Act on the housing market in England, Wales and Scotland.(2) A report made under this section must include the impact of this Act on—(a) the availability of homes in the private rental sector,(b) rents charged under tenancies,(c) house prices, and(d) requests for social housing.(3) A report made under this section must be laid before Parliament.” Member’s explanatory statement
This amendment would require a report of the impact of the Act on the housing market, particularly in relation to availability of rented homes, rents charged, house prices and requests for social housing.
Baroness Scott of Bybrook (Con)
My Lords, this amendment was spoken to earlier on Report. In our view, it is a very important amendment because it asks that there be an annual report on the Bill laid before Parliament. The reason for this is that we are beginning to see problems within this sector; we would want to see published the availability of homes, the rents charged as a result of a lack of available homes, house prices in and around the same sector, and, very importantly, requests for social housing, because as the rented sector starts to cool down, the social housing sector hots up.
We think that the Government should accept this type of annual report so that if anything goes badly wrong in this sector, something can be done about it very quickly. The Government are offering some sort of review with figures that will come out, but that is not what is wanted by this side of the House. We want an annual report—not a review—to be laid before Parliament so that it can be debated properly and, if needed, amendments can be proposed to change things and bring the sector back up to what it is at the moment. I know it is late, but I intend to test the opinion of the House on what we consider a very important amendment.
Lord Carrington
“(9) Different days may be appointed for different purposes in relation to Chapter 1 of Part 1 so that—(a) one day (not sooner than three months after this Act is passed) is appointed for the purposes of new tenancies, and(b) one day (not sooner than six months after this Act is passed) is appointed for the purposes of existing tenancies.”Member's explanatory statement
This amendment seeks to ensure that at least three months’ notice is given prior to new tenancies becoming section 4A assured tenancies and that at least a further three months’ notice is given before existing tenancies become section 4A assured tenancies.
Lord Carrington (CB)
My Lords, I speak in support of Amendment 122 and welcome the support of the noble Lord, Lord Hacking. The amendment aims to introduce a transition period of three months for new assured tenancies and six months for existing tenancies before the Bill’s provisions take effect.
Much of the debate surrounding this legislation focuses quite rightly on the need to tackle rogue or criminal landlords, while ensuring that the new responsibilities applied to PRS landlords are fair, equitable and sustainable. However, there is another important consideration which has received considerably less attention but which is equally critical if we are to maintain a vibrant PRS.
The implementation of the Bill’s measures must avoid any disruption in the flow of mortgage finance that underpins most of our country’s privately rented homes. Careful consideration must be given to the implementation of the legislation to ensure a smooth transition to the new tenancy system. A great many landlords have no knowledge of the Bill and what it entails. Landlords, lenders and others in the PRS will need time and support to adjust to the significant changes that the new tenancy system requires.
I would like to explain why this, or a very similar amendment, was not tabled in Committee. Lenders rightly wanted further engagement with government to discuss how the legislation can be implemented successfully, to share insights on the impact on the lenders and to consider how the sector can be supported to ensure the best outcome for tenants. In order to achieve a smooth transition to the tenancy system, following Second Reading in February the mortgage lenders, led by UK Finance, wrote to the Minister at MHCLG in early March requesting a meeting. The Minister’s officials at MHCLG responded in mid-April, offering that meeting. Ongoing discussions then started regarding the concerns of the lenders. I thought it best to wait till the outcome of those discussions was known before muddying the waters with an amendment. Unfortunately, these discussions, which also involved HM Treasury, have not so far satisfied the mortgage lenders. In fact, no follow-up has been received from the Treasury. Current meetings continue to take place with the Bank of England.
As noble Lords have been made aware, the PRS currently houses one in five households, including workers, students and those unable to buy homes or access social housing. Some 60% of landlords rely on buy-to-let mortgages. To maintain the supply of PRS homes needed to meet sustained demand, a continuing flow of buy-to-let mortgage finance is therefore essential. As such, the Government should welcome this amendment to introduce a transition period for the introduction of reforms before the Bill’s provisions take effect, so that the buy-to-let mortgage lenders have sufficient time to implement the necessary system changes.
I believe the Government have committed to implementing the new tenancy system in one stage, avoiding unnecessary cliff edges and working with all parts of the sector to ensure a smooth transition. To achieve this, sufficient time will be needed for the sector to prepare. The changes will include drafting new tenancy agreements, developing training materials to support property professionals, helping agents understand the new procedures, and enabling insurance and mortgage providers to adjust their policies, among other issues.
It would make enormous sense to provide a transition period to support the industry to implement the required changes. These lenders will need at least three to six months, depending on whether the tenancies underpinned by their mortgages are new or existing, to implement the changes required by the legislation. To give some examples, lenders will need to review new mortgage application terms and conditions, mortgage offers and lending policies. Additionally, lenders with forward flow or warehouse agreements for funding may need approval from their funders and forward flow partners.
Lord Hacking (Lab)
My Lords, I am very pleased to support the noble Lord, Lord Carrington. There is nothing political about the stand that he is, and I am now, taking; it is a purely practical amendment. Indeed, in Committee, I tabled a great number of amendments to do with the start date of the provisions in the Bill. They were also not in any way political; they were purely administrative or practical.
As your Lordships know, in the Bill there are absolutely fundamental changes to the law of landlord and tenant. The short-term tenancy has gone, and it is being replaced by a periodic tenancy. There are a number of other features which we have gone through in detail, both in Committee and on Report, which are new and represent some massive change. The consequence of that is that everybody involved in the lettings of property —estate agents and the landlords—needs time to draw up entirely new tenancy agreements.
As it happens, I personally write all my tenancy agreements with each of my tenants, and I have to get down to this task of completely rewriting these tenancy agreements. Of course, I have the advantage of having participated in the Bill at Second Reading, in Committee and now on Report. I do not need the full three months for either new or existing tenancies, but I am sympathetic to others who are going to need more time. I ask my noble friend the Minister—not for any political reasons, but for purely practical reasons—would she consider giving more time, because there is a lot of work to be done? I think I can do it within the requisite time, but others may find it very difficult.
Baroness Thornhill (LD)
To the noble Lords, Lord Carrington and Lord Hacking, I have to say that we do not want to do anything that would delay the Bill. We want its key statutes to be on the books as soon as possible. Being blunt, the key players who are talking about to buy-to-let mortgages have known that this is coming for a long time. They really should have been on it for months. If they have not, I am not quite sure what planet they have been on.
Lord Hacking (Lab)
Would the noble Baroness kindly help me when I have to write all these tenancy agreements? It takes time.
Baroness Thornhill (LD)
I am hoping that some of the larger players will have ones that are off the shelf for the noble Lord to use. I am sure the Minister will be able to help out with that. Basically, we do not want to delay things any more. We genuinely believe that the trailing of the key planks of the Bill has been so public and so out there. But I say to the Minister that some definite timescales would be helpful.
Baroness Scott of Bybrook (Con)
My Lords, we think that the amendment from the noble Lord, Lord Carrington, is sensible and measured. The amendment provides for a minimum of three months’ notice before new tenancies are treated as Section 4A assured tenancies and a further three months before existing tenancies are reclassified in the same way. This introduces a clear and reasonable transitional period, giving landlords and tenants time to prepare for the significant legal and practical implications of these changes.
Crucially, it gives banks time too. As the noble Lord, Lord Carrington, noted, Amendment 122 is supported by UK Finance, including lenders such as Nationwide and Paragon. Banks need time to adjust. Any change to how a landlord can evict a tenant makes lenders more cautious about the security of their investments. These lenders will want to have seen it in writing before they start to make too many changes.
Additionally, lenders will need to reassess their understanding of rental income flows. Lenders will have to adjust their risk models, and potentially their loan terms, to accommodate the risks under the new regime, not only in relation to individual properties but with regard to the broader market stability. It is vital to understand how the regime affects overall demand in the rental market.
I take this opportunity to raise the specifics of buy-to-let mortgages. Flexibility in increasing rents in these cases is especially important and an area where sufficient time for adjustment will be needed. Lenders must evaluate the continued attractiveness of buy-to-let properties as collateral for loans.
Operational readiness matters too. Quite simply, new systems and processes will need to be adapted to the framework. Earlier today, we discussed systems such as the database and the pensions dashboard. Of course, many private companies are often more agile when responding to challenge and change, but even they need time.
This is a complex Bill, and I have said several times that its implementation will require careful communication and a phased approach. I see this amendment as a practical way of helping the Government ensure that no stakeholder is caught off guard by the shift to the assured tenancy regime.
I would welcome clarity from the Minister on the Government’s plans for commencement—so, I am sure, would landlords and tenants—and all stakeholders will need time.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank the noble Lord, Lord Carrington, for his amendment and for his engagement generally on the Bill. Subsequent to our meeting earlier this week, I had a detailed response prepared for the noble Lord on Clause 145. Unfortunately, it arrived in my inbox just as I was coming into the Chamber this afternoon. It probably has not reached him yet, but that is on its way to him.
On Amendment 122, the Government are committed to introducing the new tenancy system for the private rented sector in one stage to bring to an end Section 21 no-fault evictions as soon as possible. These evictions cause utter misery for the tenants on the other end of them and a huge amount of cost to local government in picking up the pieces when people get evicted at very short notice. A single implementation date for both new and existing tenancies will enable all tenants to benefit from the reforms as soon as possible and prevent a confusing two-tier system during transition.
We are continuing to work very closely with stakeholders. The noble Lord, Lord Carrington, referred to meetings between my honourable friend the Minister for Housing and financial institutions. He has also met with many landlords’ associations and other stakeholders to ensure that the sector is prepared for the reforms in the Bill. I want to be very clear that we are committed to providing sufficient notice to ensure that all parts of the private rented sector have time to prepare. Implementation will not be immediate, as we have secondary legislation to pass. We are making good progress on drafting that and the necessary guidance that goes alongside it. All this will help us to implement in a timely manner.
In addition, the Bill makes specific provision to ensure a smooth transition to the new system and avoid unnecessary cliff edges. For example, the Bill will ensure that notices served by landlords before the commencement date remain valid after that date. Based on our ongoing work to ensure a smooth transition to the new system, we consider that there will be no benefit to requiring arbitrary minimum time periods after Royal Assent before the tenancy reform measures in the Bill can come into force.
With these reassurances that we are committed to a smooth and responsible approach to implementing the Bill, I respectfully ask the noble Lord, Lord Carrington, to withdraw his amendment.
Lord Carrington (CB)
My Lords, I thank the Minister very much for her engagement with me, although the letter has not arrived yet. I am in a position of enormous power now, in the sense that this is the very last amendment and I am keeping noble Lords from their drinks and everything else. I am very pleased that the Minister has now reassured me that the cliff edge will not happen just like that as far as financial institutions are concerned, and that there will be time for preparation.
I also thank the noble Lord, Lord Hacking, for his support and his emphasis on the fact that this was not a political amendment but a practical one. I wish him great success in the work he does with his tenants. Happily, I have someone to help me.
Having thanked everybody for their kind engagement and sometime support, I have pleasure in withdrawing the amendment.
Lord Hacking (Lab)
I am entitled to intervene here. I thank the noble Lord, Lord Carrington, for his words and the Minister for reassuring me that more time will be given, and more time for me to rewrite these tenancy agreements.
Member’s explanatory statement
This is consequential on the amendment in my name which inserts new sub-paragraphs (2) to (6) into paragraph 13 of Schedule 6.
Member’s explanatory statement
This corrects a cross-reference.
“(2) In relation to an existing tenancy which is a qualifying student tenancy, ground 4A in Schedule 2 to the 1988 Act has effect—(a) subject to the modifications in sub-paragraph (1) of this paragraph, and(b) additionally as if, in the first paragraph of ground 4A, paragraphs (a) and (e) were omitted.(3) For the purposes of this paragraph, an existing tenancy is a “qualifying student tenancy” if any of the following is a member of a specified housing management code of practice—(a) the landlord;(b) a person appointed to act on the landlord’s behalf in respect of the tenancy;(c) a person appointed to discharge management functions in respect of the building which comprises the dwelling-house or in which the dwelling-house is situated.(4) In sub-paragraph (3)—“housing management code of practice” means a code of practice approved by the Secretary of State under section 233 of the Housing Act 2004 (codes relating to the management of HMOs or excepted accommodation);“management functions” in respect of a building includes functions relating to—(a) the provision of services, or(b) the repair, maintenance, improvement or insurance of the building;“specified” means specified in regulations made by the Secretary of State.”Member’s explanatory statement
This ensures that ground 4A in Schedule 2 to the 1988 Act (inserted by paragraph 10 of Schedule 1 to this Bill) is available in relation to certain existing tenancies of purpose built student accommodation.
Renters’ Rights Bill
Monday 21st July 2025
(1 year ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 128-I Marshalled list for Third Reading - (18 Jul 2025)
The Lord Privy Seal (Baroness Smith of Basildon) (Lab)
My Lords, I have it in command from His Majesty the King to acquaint the House that His Majesty, having been informed of the purport of the Renters’ Rights Bill, has consented to place his interest, so far as it is affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Clause 12: Duty of landlord and contractor to give statement of terms etc
Amendment 1
Lord de Clifford
Lord de Clifford (CB)
My Lords, these two amendments in my name relate to reference changes within the Bill due to the Government’s amendment with regard to pet insurance and my amendment which the House kindly supported last week with regard to the addition of pet insurance deposits. I beg to move.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, once again I thank the noble Lord, Lord de Clifford, for all his thoughtful contributions and engagement during the passage of the Bill. Amendments 1 and 2 correct two cross-references in Clause 12 and Schedule 2 and follow on from Amendment 53A on Report. These amendments do not change the substance of the amendment that was agreed on Report and, on that basis, we are happy to agree to them.
Lord de Clifford
Baroness Taylor of Stevenage (Lab)
My Lords, I thank noble Lords for their contributions and engagement during the passage of the Renters’ Rights Bill. We have debated this Bill at length—passing the midnight hour on one occasion—over the past six months, with many thoughtful and considered contributions from across the House. I am grateful, in particular, to the Opposition Front Bench, namely the noble Baroness, Lady Scott of Bybrook, and the noble Lord, Lord Jamieson, for their robust and constructive challenge throughout the passage of the Bill. I also thank the noble Baronesses, Lady Thornhill and Lady Grender, for their continued engagement and support. I believe we are in broad agreement that this Bill is long overdue and are looking forward to seeing it make a real difference to people who rely on the sector to live and work.
Many noble Lords generously lent their extensive expertise to this debate, including the noble Earl, Lord Kinnoull, the noble Lords, Lord Young of Cookham, Lord Cromwell, Lord Best, Lord Carrington, Lord de Clifford and Lord Pannick, the noble Baroness, Lady Wolf of Dulwich, and many more. While there may be disagreement on some of the issues we have debated, I know we all share the same aim of ensuring that the private rented sector continues to work for all.
Finally, I thank my Whip who sat with me throughout the Bill, my noble friend Lord Wilson of Sedgefield. I am grateful to all the officials who have worked on this Bill, including the Bill team, particularly Aidan Hilton, the Bill manager, but also Hermione, James, Caragh, Tom, Ross, Anna, Camilla, Guy and Stephanie, and my private office. I also pay tribute to all the parliamentary staff, including the clerks, doorkeepers, security and the Public Bill Office, many of whom have had to stay late as we debated this Bill into the early hours. I beg to move.
Baroness Scott of Bybrook (Con)
My Lords, I begin by thanking all noble Lords across the House for their contributions to the scrutiny of the Bill. While we may differ in our views, the commitment shown by Members to improving the private rented sector is evident and deeply valued.
I also extend my sincere thanks to the Minister. She has shown courtesy, patience and great resilience throughout this process, defending what we would consider a difficult Bill and, often, an indefensible one. She has defended a policy that we think reflects more political positioning than practical policy-making.
Despite the Minister’s efforts, we are left with a piece of legislation that risks doing more harm than good. The facts are stark. According to Savills, the number of rental properties on its books dropped by 42% in quarter 1 this year, compared with the same period in 2024. That means 42% fewer homes available: fewer homes for families, less mobility for renters, less choice, and more pressure on rents.
This is not theoretical; it is happening now, and the Bill is accelerating that trend. Its uncertainty around fixed-term tenancies, poorly defined possession grounds, and reliance on stretched tribunals are driving responsible landlords away from the sector. When providers exit, supply shrinks—and when supply shrinks, rents rise.
We understand why tenants seek greater security but let us be honest: much of what the Bill tries to fix are symptoms of a very deep problem. There are simply not enough rented properties in this country, and there will be fewer. Instead of addressing that shortage, this legislation papers over the cracks, with layers of regulation that risk doing more harm than good. It treats the pressures of scarcity—rising rents, insecurity and limited choice—as issues that can be regulated away. Regulation without supply is a dead end.
What we need is a balanced approach. Yes, let us protect tenants, but let us also create the conditions for responsible landlords to stay in the market, invest and offer decent homes. Without that balance, the consequences are predictable, and they are already playing out.
The real target should be the rogue landlords: those who exploit vulnerable tenants and undermine confidence in the sector. The Bill misses that mark. Instead of cracking down on the worst offenders, it heaps new burdens on the majority who act responsibly. What the sector truly needs is a rogue landlord Bill that is targeted, proportionate and enforceable, one that protects tenants without pushing decent landlords out of the market.
Instead, we have a Bill that gets the balance wrong. It risks shrinking supply, increasing costs and adding complexity just when we most need clarity and confidence. The Bill does not strike the right balance between protection and provision. It fails tenants, landlords and the very market that it claims to reform. On this side of the House we will continue to monitor the market and challenge the Government to act on any negative outcomes.
Before I sit down, I congratulate Sam and Molly in my office—it is her first Bill in this House. I thank them sincerely for the fantastic support they have given me and my noble friend Lord Jamieson throughout the passage of the Bill.
Baroness Thornhill (LD)
My Lords, we on these Benches have been clear throughout the Bill that we support it very much: its main provisions, including the abolition of no-fault evictions and fixed-term tenancies, and its clear emphasis on tenants’ rights and much more transparency. There is no doubt that it is a radical Bill that will make significant changes to the private rented sector. It has also been said, and I wish to repeat it, that good landlords have nothing to fear from these reforms, and we on these Benches sincerely hope that that will be proved to be the case.
It is usual to say that this process is about improving the Bill through reasoned debate and using the expertise of the House. In truth, to me it felt more like a conflict—a battle of tenants versus landlords—with the bold reforms of the Government pitted against the fears and genuine concerns of the landlords, articulated sincerely and robustly by the Opposition Front Bench and others around the House.
There were also cross-House issues where only time will tell, such as the capacity of the courts. Another is the impact on all aspects of the housing market, including student landlords and the supply of homes to rent, about which let us say there were polarised views. We share the concerns expressed by the noble Baroness, but we also hope that the recent figures will steady and that, after inevitable initial upheaval, the market will settle down. We look forward to more build-to-rent and more social housing, because both are needed.
We hope that the Minister’s assurances on the military homes standard will also come to pass, as our amendment on that issue was won convincingly.
Lastly, I have some very genuine thanks. I thank everyone who took part in the many debates on amendments, which were based on honest beliefs and genuine experience, but particularly the Minister for her time, which was generously given, and for her patience—tested perhaps just a little by the determined double act of the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson. I admired their persistence, but the Minister showed that she was not willing to be moved on the Government’s core planks of the Bill, and her steeliness in the onslaught, however politely delivered, was commendable.
We cannot forget the valuable contributions of several noble Cross-Benchers. The noble Lords, Lord Cromwell, Lord Best and Lord Carrington, formed a new trio. There was also much legal wrangling. My learning curve was greatly assisted by several noble Lords who are lawyers, especially the noble Earl, Lord Kinnoull, even if I did not always agree with them.
For its advocacy on behalf of tenants and for shining a light on the reality of many renters, the Renters’ Reform Coalition deserves a big thank you. Generation Rent deserves a special mention—as does the National Residential Landlords Association. For me, it was challenging to read its excellent briefings and pit its persuasive arguments against my own.
It is also appropriate to thank all the officers of the House, who have no doubt worked tirelessly to get everything done on time and correctly delivered. This was my first Bill lead, and I am grateful to have had a small but dedicated team behind me, especially my noble friends Lady Grender and Lord Shipley. Where would any of us be without our able and professional staff—in this case, Adam Bull from our Whips’ Office? It has been a worthy task to contribute to the much-needed reform of the private rented sector.
Lord Hacking (Lab)
My Lords, traditionally, Third Reading is an occasion to give thanks and congratulations to all those involved in the Bill, whether inside this Chamber or outside. My noble friend the Minister has led us well, as the noble Baronesses, Lady Scott and Lady Thornhill, who is leader of the Liberals on this, have kindly done. At this stage, our Companion makes it plain that the debates of previous stages of the Bill should not be reopened and speeches should be brief. I hope that my noble friend Lord Leong is noting that I am saying this. I intend to abide by these requirements.
Lord Hacking (Lab)
I am now getting congratulations from my noble friend, which are very warmly felt. We cannot, however, leave the Bill without giving profound thanks to my noble friend the Minister for her pioneering of the Bill through all stages of its passage through this House. I think I echo the words of the noble Baroness, Lady Scott, in that regard.
Throughout, the Minister has been a paragon of patience and courtesy. She has also been enormously conscientious, holding meetings right up to the third day on Report and sending letters—even though the letter to the noble Lord, Lord Carrington, was somehow in transit on the third day of debate. Not wishing to leave anybody out, she recently thanked and congratulated a Peer on a speech he had not made, but nobody was left out as a result.
A special reason to thank and congratulate the Minister is the sheer length and complexity of the Bill. I also congratulate the noble Baronesses, Lady Scott and Lady Thornhill, on dealing with the length and complexity of the Bill, as well as the noble Lord, Lord Jamieson—I am sorry that I did not bring his name to the fore until now. The Bill itself—this is somewhat alarming—stretches over 258 pages but still has to be spliced into earlier statutes, most particularly the Housing Act 1988.
I have in my hand the annotated current edition of the Housing Act 1988. It stretches over 383 pages but, by the time the provisions of this Bill have been spliced into it, it will be 600 or 700 pages long. I do not wish to introduce this debate now, but I believe the length of these Bills is a subject that should have attention on another occasion. For example, the Housing Act 1988 can be read in its completion. It tells you the state of landlord and tenant law in 1988. When I first came to the House 54 years ago, legislation was not run in this direction. As I said, this is a matter for another debate on another occasion.
I will just end on a personal note. I am aware that it must have been difficult for my noble friend the Minister to have me sitting right behind her and muttering from time to time, but I ask her forgiveness. I am very lame. I always used to sit at the back, but I am afraid my lameness has taken me to immediately behind the Minister. I apologise, but I hope that she will accept that my many interventions were made in a genuine attempt to improve the Bill: to focus more clearly on the rogue landlord and to protect the honest landlord.
Lord Carrington (CB)
I give my very personal thanks to the Minister for her work on this Bill and the enormous amount of follow-up she achieved. Her final letter arrived, as the noble Lord, Lord Hacking, just mentioned, on Friday.
I have two reservations. All my amendments were about two matters. The first was the difference of the private rental sector in rural areas and the second was the effect of the Bill on institutional investment in the sector. I will be watching these in the remainder of my stay in the House of Lords. In the meantime, I would like to thank everybody who has been involved and not waste any more of your Lordships’ time.
Baroness Taylor of Stevenage (Lab)
My Lords, for the thousands of renters and the good landlords who have been disadvantaged by the actions of rogue landlords around this country, not to mention the local authorities that have had to pick up the pieces of the failure to act over the last 14 years, which has created the worst housing crisis in generations, I hope this Bill will be a blessed relief.
This Bill, combined with the comprehensive package of measures on housing delivery, including £39 billion in funding for affordable and social housing, comprehensive reform of the planning system and unprecedented investment in construction skills and training, will start the process of delivering what we all want to see—that everybody has a fit, safe, secure and affordable home. My young grandson, who is only nine years old, was asked to write about home the other day. He did a diagram with lots of things saying what he felt home was. At the bottom, he wrote, “Home is as special as love”. I thought that was a marvellous phrase from a nine year-old.
I know we will continue to debate some of the detail around the Bill. I hope we can all keep in our minds as we do so how important just having a home is to everybody and how it being safe, secure and affordable is important to everybody.
Renters’ Rights Bill
Monday 8th September 2025
(11 months ago)
Commons ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Commons Consideration of Lords Amendments as at 8 September 2025 - (8 Sep 2025)
19:42 - The House divided: - Ayes: 398 / Noes: 93 - Question accordingly agreed to.
19:58 - The House divided: - Ayes: 402 / Noes: 97 - Question accordingly agreed to.
20:13 - The House divided: - Ayes: 336 / Noes: 158 - Question accordingly agreed to.
20:25 - The House divided: - Ayes: 404 / Noes: 98 - Question accordingly agreed to.
20:40 - The House divided: - Ayes: 325 / Noes: 171 - Question accordingly agreed to.
20:52 - The House divided: - Ayes: 401 / Noes: 96 - Question accordingly agreed to.
21:10 - The House divided: - Ayes: 335 / Noes: 160 - Question accordingly agreed to.
Madam Deputy Speaker (Ms Nusrat Ghani)
I must draw the House’s attention to the fact that Lords amendments 39 and 68 engage Commons financial privilege. If either of those Lords amendments is agreed to, I will cause the customary entry waiving Commons financial privilege to be entered in the Journal.
Clause 12
Right to request permission to keep a pet
The Minister for Housing and Planning (Matthew Pennycook)
I beg to move, That this House disagrees with Lords amendment 11.
Madam Deputy Speaker
With this it will be convenient to discuss:
Lords amendment 14, Government motion to disagree, and Government amendment (a) in lieu.
Lords amendment 18, and Government motion to disagree.
Lords amendment 19, and Government motion to disagree.
Lords amendment 26, and Government motion to disagree.
Lords amendment 27, and Government motion to disagree.
Lords amendment 39, and Government motion to disagree.
Lords amendment 53, and Government motion to disagree.
Lords amendments 55 to 62, Government motions to disagree, and Government amendment (a) in lieu.
Lords amendment 64, and Government motion to disagree.
Lords amendment 67, Government motion to disagree, and Government amendment (a) in lieu.
Lords amendments 1 to 10, 12, 13, 15 to 17, 20 to 25, 28 to 38, 40 to 52, 54, 63, 65, 66 and 68 to 77.
Matthew Pennycook
This Government were elected with a clear mandate to do what the Conservatives failed to do in the last Parliament—namely, to modernise the regulation of our country’s insecure and unjust private rented sector, and empower private renters by providing them with greater security rights and protections. Our Renters’ Rights Bill does just that, and it needs to receive Royal Assent as quickly as possible so that England’s 11 million private renters can benefit from its provisions.
Before I turn to the Lords amendments, I want to thank Baroness Taylor for so ably guiding the Bill through the other place. I put on record my appreciation of all the peers who contributed to its detailed scrutiny.
As you will know, Madam Deputy Speaker, the Government made several important changes to the Bill in the other place with a view to ensuring that it will work as intended and in response to the legitimate concerns raised about the implementation of specific provisions. In the interests of time, I will update the House only on the two that are most apposite.
The first change concerns the date from which a tenant is required to pay a new rent in instances where the first-tier tribunal has set a new rent amount following a tenant’s challenge to a proposed increase. The Government were elected on a clear manifesto commitment to empower tenants to challenge unreasonable rent increases. It is essential that we deliver on that commitment not only to protect tenants from undue financial pressure, but to prevent rent hikes from being used as a form of back-door eviction once section 21 notices have been abolished.
However, recognising that there is inherent uncertainty about the volume of rent increase challenges that will be brought when the new tenancy system comes into force, and as a safeguard against a scenario in which the first-tier tribunal is overwhelmed by a sharp increase in challenges, Lords amendments 6 to 8 introduce a new delegated power that will enable the backdating of rent increases following determinations by the tribunal of new rent amounts. I want to reiterate what Baroness Taylor made clear in the other place—namely, that it is not the Government’s intention to make use of this new power unless and until it is considered necessary to avoid lengthy delays for genuine cases to be heard. If used, it would be subject to the affirmative procedure to allow appropriate parliamentary scrutiny. In addition to introducing that important safeguard, the Government also concluded that there is a compelling case for the use of an alternative body or mechanism to make initial rent determinations. Subject to a final viability assessment, we intend to establish such an alternative body or mechanism as soon as possible, and will confirm further details in due course.
The second important change the Government made in the other place concerns insurance to cover potential damage from pets. As hon. Members will be aware, the Bill as originally introduced, mirroring provisions in the previous Government’s Renters (Reform) Bill, enabled landlords to request such insurance in instances where a tenant had requested a pet. In response to concerns expressed by several peers that the insurance industry appears unlikely to provide suitable financial products at the speed and scale required, and that the reasonable request of tenants to keep pets might be hampered as a result, Lords amendments 10, 12 and 13 remove the provisions in the Bill which made landlord consent to a request to keep a pet conditional on the tenant taking out, or paying for, pet damage insurance.
Jim Shannon (Strangford) (DUP)
Just last week, I was asked a similar question back home; the legislation back home is not covered by this House. The issue for those who have animals is that almost every person who has an animal in a flat, apartment or other property always looks after the property as if it were their own and the issue of animal damage does not come up. It does, however, come up the odd time, so is it not better—I think the Minister is saying this—to have an obligation rather than legislation to ensure that the tenant covers any damage by a pet, because most tenants will be accountable for their pets no matter what?
Matthew Pennycook
As ever, I thank the hon. Gentleman for his intervention. He makes a good point. There is evidence that pet damage is, in many cases, not extensive or a particular issue. Where pet damage occurs, as I will come on to make clear in response to the relevant Lords amendment, we think that the provisions in the Tenant Fees Act 2019, which allow for tenant deposits to be changed in response to such issues, mean that we have the necessary delegated powers, but I will set out further detail on that particular issue in due course.
I will now turn to the amendments made by peers in the other place. We welcome the scrutiny and challenge provided, and are willing to make sensible concessions in some areas, but most of the amendments in question serve to undermine the core principles of the Bill and for that reason we cannot accept them. Let me make clear precisely, in each instance, where that is the case, starting with Lords amendment 53.
Lords amendment 53 dramatically broadens the scope of possession ground 4A, so that it encompasses not only full-time students living in houses in multiple occupation, but non-typical students, such as older students with families undertaking postgraduate studies who may live in self-contained one and two-bed properties. Ground 4A exists precisely because the Government recognise the unique nature of the student rental market and are determined to ensure that the annual cycle of student lettings continues accordingly. However, ground 4A was deliberately designed to ensure that the benefits of the new tenancy system introduced in the Bill were not denied to non-typical students. We believe restricting its use to HMOs or dwelling-houses in HMOs strikes the right balance, and I therefore urge the House to reject Lords amendment 53.
Lords amendment 64 introduces a new ground for possession for the sole purpose of allowing a landlord to regain their property to house a carer for themselves or a member of their family living with them. Everyone in this Chamber recognises the vital work carers do to support people to live independently and with dignity. However, while the Government are profoundly sympathetic to the needs of those who require care, I am afraid we cannot support this amendment for two main reasons. First, while I appreciate entirely that some peers currently own and let rental properties in close proximity to their homes, with a view to one day using them to house a carer for themselves or members of their family, there is no compelling evidence to suggest that this practice is sufficiently widespread to justify the insertion into the Bill at this late stage of a dedicated possession ground to cater specifically for it. Secondly, the definition of “carer” in the amendment—namely, anyone providing any form of care in a voluntary or contractual arrangement, is so broad that the scope for abuse, in our view, is substantial. I therefore urge the House to reject the amendment.
Lords amendment 18 would reduce the prohibition on re-letting or re-marketing a property following the use of possession ground 1A from 12 months to six. We recognise that there will be occasions when landlords regain vacant possession of their property using ground 1A but are unable subsequently to sell it despite repeated attempts to do so, but we are not prepared to weaken the strong safeguard against abuse provided by the 12-month no-let provision. It is essential to prevent landlords misusing ground 1A and evicting tenants who are not at fault, whether that be because they have made a legitimate complaint or simply because the landlord wants to re-let at a higher rate. The Government remain firmly committed to the 12-month no-let restriction, and I urge the House to reject Lords amendment 18 on that basis.
Lords amendment 19 is a related amendment that exempts shared owners from the 12-month re-letting and re-marketing restriction, as well as other important restrictions. I want to make it clear that the Government recognise the plight of shared owners living in buildings that require remediation. I know from my own efforts to support shared owners in my constituency of Greenwich and Woolwich that those affected by the building safety crisis often face unaffordable costs, often with no viable exit route other than a distressed sale.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the shadow Secretary of State.
Sir James Cleverly (Braintree) (Con)
The UK needs a vibrant and fluid private rented sector. We need it to deliver communities that are happy and cohesive, and to deliver fairness, stability and security for families. I have been looking at the Government’s position on the Bill, and I pay tribute to the Minister for Housing and Planning, the hon. Member for Greenwich and Woolwich (Matthew Pennycook), for the work he has done on it—or is he the right hon. Member?
Sir James Cleverly
Well, he deserves to be the right hon. Gentleman. He has been doing the hard yards; he has done loads of work on this Bill. I am sure he was disappointed that he did not get to lead the Department—congratulations to the new Secretary of State—but I have no doubt that the opportunity will come in the near future. I would just say: be patient for the moment.
While I have no doubt that the Bill is full of good intentions, it is poorly though through and counterproductive. In fact, I am assuming it is poorly thought through, but it is entirely feasible that the measures within it are well though through, and are designed to undermine the private rented sector. It is inept, either by accident or on purpose—I will go with inept by accident, because that is more in keeping with the Government’s actions in this Department.
The Bill is clearly a mishmash of measures on issues that are Back-Bench hobby horses—issues that those on the Front Bench do not have the authority or the courage to put to bed. It is entirely counterproductive, as has been recognised and highlighted by their lordships in the other place. The Bill risks driving private landlords out of the sector, reducing the supply of private rented accommodation and pushing up rents for those in the private rented sector. Limiting the supply of such accommodation means limiting the options for tenants in the private rented sector, and leaving them worse off.
We do not need to look very far to see what happens when Governments get this wrong. In Scotland, fixed-term tenancies were abolished, rent controls imposed and regulations tightened, and what was the result? Fewer landlords, shrinking supply and the fastest rises in rents in the UK, with Edinburgh and Glasgow facing steeper rent rises than ineptly Labour-run London. The Labour Government in Westminster are about to make the same mistake, because Government Back Benchers are, for whatever reason, obsessed with “fixing” an already highly successful sector. The private rented sector has the highest satisfaction levels of any tenure type—higher than levels in the social rented sector or among owner-occupiers.
Danny Beales (Uxbridge and South Ruislip) (Lab)
I do not know what correspondence the right hon. Gentleman is looking at, but the correspondence I receive from my constituents in Hillingdon does not tell a story of a sector that is secure and safe; instead, my constituents tell me that they are battling damp and mould, and have had 35% rent increases in recent years. Is that success, in the Opposition’s view?
Sir James Cleverly
The hon. Gentleman makes the classic statistical error of assuming that his inbox is representative of all the people in the sector. Has it not occurred to him that people who are happy in their private rented accommodation do not tend to write to their MP, saying, “Apropos of nothing, I just want to let you know that I am happy”? I have it on good authority from my hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds)—my good friend and colleague—that the hon. Member for Uxbridge and South Ruislip (Danny Beales) is not doing a terribly good job of championing the social rented sector in his constituency. He seeks to deny the private rented sector, while simultaneously denying people the social rented sector. I am not sure where he thinks people in his constituency should live.
The point is that the Bill is a mishmash of incoherent proposals, which, instead of being designed to improve the private rented sector, are designed to keep angsty Back Benchers happy, but Front Benchers are already starting to learn that they cannot pay political Danegeld to their Back Benchers. I give the Front-Bench team due notice: their Back Benchers will be insatiable. They will take whatever red meat they are thrown, and they will ask for more. We have already seen this, Madam Deputy Speaker, with the proposed changes to social security and disability benefits. The Front Benchers had plans, but their Back Benchers had other plans, and guess who won? Those showing courageous leadership on the turbulent Back Benches. The Government will see the same again on this issue.
The Opposition understand that a good tenure mix is good for the UK. We took measures to improve the private rented sector, but we made sure that we did it in the right order. We made sure that the courts were ready.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
I was intrigued by the right hon. Gentleman’s remarks about the success of the private rented sector. If the sector is so successful and is working so well, why have the Opposition consistently held the position—both when they were in government and, I believe, going into the election—that they would go forward with ending no-fault evictions? I am confused. I would be grateful if he could explain.
Sir James Cleverly
It is interesting that on the one hand, we have voices on the Front Bench saying that we did not do anything in government, while at the same time, voices on the Labour Back Benches say that we were doing something.
Sir James Cleverly
No. Perhaps Labour Members should co-ordinate their criticism.
The previous Conservative Government understood that there is a need to reform the system, but that every part of the system needs to be ready. That is why we made sure that the justice system was ready first before we started making changes to the legal frameworks, giving tenants, landlords and courts the time to adjust. However, the Labour Government have abandoned that discipline. The changes put forward by their lordships came about through careful consideration of the provisions in the Bill and their implications in real-world scenarios, not the fantasy world of many Labour Back Benchers.
The Labour Government were defeated in the other place on several important amendments. There is a pattern to the Government’s defeats: time and again, Ministers accepted a principle but when it came to taking action to deal with the principle, they fell short. I will give some examples from amendments on Report in the other place. Amendments 87 and 88 in the name of Lord Keen would raise the standard of proof for financial penalties to “beyond reasonable doubt”. The principle is clear: setting serious penalties requires having serious evidence. The noble Lord Keen made the case powerfully in the other place, yet the Government still refuse to act. In doing so they are introducing a huge degree of uncertainty for both landlords and councils, and uncertainty is toxic to the provision of homes in the sector. Making these changes will reduce the housing supply.
Dave Robertson (Lichfield) (Lab)
Earlier in response to my hon. Friend the Member for Uxbridge and South Ruislip (Danny Beales), the shadow Secretary of State said that my hon. Friend did not need to pay any attention to the people in his inbox who had contacted him. Was he not advocating exactly that—we should not listen because it is a small number of people, and we should accept these amendments so that this legislation can be watered down? Is he not arguing both sides of the same coin on this?
Sir James Cleverly
If the hon. Gentleman was going to criticise what I say, he should have at least listened to what I said. What I said was that extrapolating—
Sir James Cleverly
No, no, get it right first time. What I said was that extrapolating from a Member of Parliament’s inbox is not a good way of gauging the full spectrum of opinion within a cohort of people. At no point did I say—and I would never say—that we should ignore the people who write to us, and no one should assume that we do. I am pretty certain that the hon. Gentleman would not, and I certainly do not. That is absolutely not what I said.
The point I am making is that the Government’s argument was, “There aren’t that many people, and frankly they’re all posh, so we can ignore them.” That was basically the framing of their argument, but tell that to the extended families of people, typically of ethnic minority origin, who often live in close proximity to each other. There will be communities all across the country where the elders of the family have rented properties that have tenants in them, but because those properties are near where they live, they envisage at some point in the future members of their extended family moving into the properties in order to provide care for them. Disregarding and diminishing this as an idea just because it is something that the Government Front Bench accuse only the posh Members of the other place of doing is rather distasteful.
Matthew Pennycook
The shadow Secretary of State failed to address the second concern the Government have about amendment 21, which is the substantial risk of abuse that will flow from the definition of a “carer”. The definition under the amendment could be anyone providing any form of voluntary care. It could be someone who provides the weekly shop. Does he not see the risk of abuse that comes with a ground that is so broadly drawn? That was our other concern, and he has not addressed it.
Sir James Cleverly
There are always opportunities for abuse, but we cannot be closing off a provision that would be really valuable to many families around the country because there is a risk of abuse. If we were to do that, there would be loads of areas where Government would not legislate. We do not disregard an opportunity just because of the potential for abuse; we manage that potential for abuse.
I will move on a bit more quickly as I want to ensure that all Labour Back Benchers get their opportunity to speak. [Interruption.] It is their legislation.
Lords amendment 58 in the name of Lord Cromwell would reduce the ban on re-letting from 12 months to six months. That is a wholly pragmatic point. There is the idea in the Bill that a landlord would have to wait for 12 months, but if it is clear after six months that, despite genuine efforts—there is provision to ensure that efforts are genuine—there is no chance of selling, it is entirely reasonable that a landlord should seek to re-let. That is not as quickly as Members on the Labour Benches would do so; nevertheless, it is an entirely fair provision.
The largest Government defeat in the other place came on amendment 59 in the name of Lord Young of Cookham, which is about the exemption for shared owners from the 12-month ban on re-letting. The Minister said at the Dispatch Box that he recognised that this area created challenges, but I urge the Government not to dig in their heels on the issue. The cohort of people envisaged by the amendment are often those most in need of flexibility—people who are not of significant financial means—and limiting their options when it comes to, perhaps, a distressed asset would be entirely wrong. I have no doubt that he recognises that. I urge him to move quickly to a resolution on this matter to reassure the Chamber and the other place that those people will not be disadvantaged by the Bill.
The Lords amendments are well thought through. They attempt to take this mishmash of a Bill and knock it into some credible shape, providing protection for tenants and a bit of reassurance for landlords so that they can continue to provide a supply of private-rented accommodation to help people get on the housing ladder and to live in homes they love and value in communities that they cherish. If the Government choose to blindly ignore those amendments, I have no doubt that the Bill will have the effect of reducing the number of landlords, reducing the number of homes and increasing rents, which is the opposite of what any of us in the Chamber should want. That is why the Opposition will support the amendments.
Antonia Bance (Tipton and Wednesbury) (Lab)
Once again, I stand here proud to speak in favour of this groundbreaking legislation that finally brings some balance back between the landlord’s right to profit from an asset and the renter’s right to a home. I oppose in particular Lords amendments 26, 27 and 18 proposed by the landlord lobby in the other place. Amendments 26 and 27 would increase the evidence bar for all civil penalty offences to the criminal standard of proof—beyond reasonable doubt rather than on the balance of probabilities. That would gut the ban on discrimination against housing benefit recipients, the ban on refusing to let to families and the ban on bidding wars. Those measures would be almost unenforceable if the amendment stood.
Discrimination is notoriously hard to prove, and we all know that early interactions between a renter and a prospective landlord are often not in writing, so proving beyond reasonable doubt that a prospective renter was prevented from letting a property because they might be a benefits claimant or have kids would be extremely challenging; it is the same for proving bidding wars. Councils already struggle to pursue civil penalty cases because of the staff time and resource involved in gathering evidence to support those cases. Introducing that new, higher bar of evidence for already challenging cases would make them almost unenforceable. It would also be out of line with other legislation, such as the Equality Act 2010, which require only the civil standard of proof. If we do not oppose those Lords amendments, such unlawful practices will continue unchecked, and renters will continue to face homelessness as a result.
Madam Deputy Speaker (Caroline Nokes)
I call the Liberal Democrat spokesperson.
Gideon Amos (Taunton and Wellington) (LD)
I am grateful to the Minister for presenting the Government’s position on the Lords amendments, as indeed he presented their position on the 92 amendments we tabled in Committee. I only regret that, in doing so, he rejected all 92 of them. I was going to congratulate the Secretary of State on his new position, but he has escaped just in time. I will come to our amendments—the other place took a different view on some of them—but I will first declare my interest in a registered provider of social housing.
A generation have been cut off from the dream of home ownership. After half a century of flogging off council houses—over 4.5 million have been sold off since 1980 by successive Conservative Governments—there are now, in effect, none left for the thousands of families who now need them. That is why the Liberal Democrats have a vision to restore hope to millions who aspire to a decent home by building our target of 150,000 social and council rent homes per year, backed up with a commitment of an extra £6 billion on top of the affordable housing programme budget, funded by fairly reforming capital gains tax so that more people benefit from relief but those who make bigger gains pay more. Alongside that, the Liberal Democrats want a new generation of rent-to-own homes so that people can get on to the ownership ladder. It is the biggest and most ambitious programme since council housing was invented by Lloyd George and Addison back at the beginning of the 20th century.
We have also long campaigned for an end to no-fault evictions and for longer and more stable tenancies for tenants. The Government have put both those key measures in the Bill, and that is why we support it and want to see it enacted. Tenants have lived for far too long with insecurity and the fear that, if they speak up, they might lose their home.
Some of the Lords amendments before us would improve the Bill, while others would weaken it. Lords amendment 11 would require tenants to pay pet deposits, which would pile on new financial burdens, putting the right to own pets out of reach for those already struggling. It is not in the spirit of the Bill, so we cannot support it.
Similarly, Lords amendment 18 would cut the prohibition on re-letting unsold properties from 12 months to six. That might sound like a neat compromise, but in practice it would give cover to any rogue landlord looking for an excuse to evict. A six-month ban would be far too short to give tenants the protection from abuse that they deserve. Lords amendment 26 seeks to raise the bar for enforcement by moving the burden of proof from civil to criminal.
Steve Darling (Torbay) (LD)
In Torbay, we have almost 50% more people who rent in the private sector than the national average. While the vast majority of landlords are good landlords, sadly there are some rotten apples out there. Pushing against Lords amendment 26 is essential, because we need to ensure that local authorities have the powers to hold these landlords to account. I hope my hon. Friend agrees.
Gideon Amos
I do agree with my hon. Friend, and I pay tribute to the sterling work he does in Torbay, and has done in the past as leader of the council, on these issues.
That change in the burden of proof may sound technical, but in fact it would gut the powers of local authorities to hold bad landlords to account, as my hon. Friend has just said. At a stroke, it would make justice for tenants far harder to achieve.
Lords amendment 53 points in the same wrong direction. It seeks to introduce fixed-term tenancies, but the whole point of the Bill is to shift to periodic tenancies—arrangements that give renters both flexibility and more security. Dragging us back to fixed terms, which would become standard across that particular element of student housing, would undermine those core principles.
On the other hand, there are amendments that make the Bill fairer and more workable, which we support. Lords amendment 19 recognises the reality faced by shared ownership leaseholders, who can be can be, and are, hit disproportionately hard when sales fall through, through no fault of their own. Without that exemption, they could face financial ruin. This is a simple matter of justice and we support it.
Lords amendment 64, which would create a new possession ground where a landlord needs to house a carer, is in keeping with the Liberal Democrats’ belief in the importance of supporting the millions of carers out there who are so often overlooked. It is right that the law should recognise the vital role they play, and if there are risks of abuse, it is open to the Government to table their own amendments to set out how they would make the same provision for accommodation needed by carers.
Lords amendment 39, which would legislate for a decent home standard for our military, goes to the heart of who we are as a society and our obligations to those who serve. I pushed for this amendment at earlier stages in the Commons, and indeed this has long been the Liberal Democrats’ position, having been raised by my hon. Friend the Member for North Shropshire (Helen Morgan) in the previous Parliament. It is therefore disappointing that, while the Government have come forward with their own amendments on other matters, they have not come up with any such amendments on decent homes for our military, although that has been agreed across the parties in the other place.
Helen Maguire (Epsom and Ewell) (LD)
Does my hon. Friend agree that if the Ministry of Defence itself says that the MOD housing standard is already higher than the decent homes standard, the Government should do the decent thing and accept Lords amendment 39 and put it on the face of the Bill?
Gideon Amos
Indeed, our military deserve no less than this being on the face of the Bill, in whichever way the Government wish to do it. If it is so easy and, as my hon. Friend points out, it is the Government’s position, surely it can hold no fear for them.
It would be disappointing not to have those amendments. We are told that 90% of service accommodation meets the decent homes standard—my hon. Friend the Member for Epsom and Ewell (Helen Maguire) had clearly already read this part of my speech—but those figures come from contractors who are responsible for managing those properties and have an interest in saying that they already meet the standards. There is no independent assessment.
The Defence Committee painted a very different picture, when families reported to it. The Committee stated:
“It is disingenuous for DIO to present glossy brochures about being ‘decent homes plus’ when they are anything but. It is clear that the DIO’s property frequently does not meet the standards.”
Crucially, it added:
“Moreover, there is no local authority”—
or anyone else—
“to hold them to account as would be the case for private and other local landlords.”
We are also told that it would be impractical to extend the decent homes standard to military housing because of access “behind the wire”, yet former Chief of the Defence Staff, Lord Stirrup, reminded colleagues in the other place that civilian officials already go into far more sensitive areas of military bases, so that is not a serious objection.
Matthew Pennycook
Do those on the Lib Dem Benches have any concerns about one of the issues that I raised: applying the decent homes standard to the defence estate in England when a different standard will apply to Scotland and Wales—to other parts of the United Kingdom? Fracturing the defence estate in that way is problematic.
Gideon Amos
Any opportunity to give our service people decent homes, beginning with England, should be taken. I am surprised that the Minister has not grasped it with both hands. The Minister and the Government are in the position, with a large majority, to legislate for this in whichever way they choose, but it needs to be on the face of the legislation. That is what our military deserve. Warm words about things improving are not enough; we have heard them before. My hon. Friend the Member for North Shropshire gained a categoric assurance from the last Government’s Housing Minister at the Dispatch Box that that Government would legislate. They did not.
Danny Beales (Uxbridge and South Ruislip) (Lab)
The hon. Gentleman says nothing has changed, yet again, but does he not welcome—as I do, as a constituency MP with a significant amount of military housing around RAF Northolt—the significant £1 billion-plus investment into military housing and the insourcing back into public ownership of thousands of MOD homes, after the previous Government’s botched privatisation deal, which cost taxpayers huge amounts of public money?
Gideon Amos
I welcome the moves to which the hon. Gentleman refers, including the insourcing, but the responsibility for determining whether the homes meet the “decent homes plus” standard is down to contractors, who have a commercial interest in reporting that. The difference with the decent homes standard generally is that it is subject to independent inspection. That is a crucial difference. Surely there should be a robust and accountable regime set out in primary legislation to ensure that that investment continues and those standards are reached. That is the least that our service people should be able to expect.
As I was saying, my hon. Friend the Member for North Shropshire was given categoric assurances that the Government would legislate in this regard, but they did not and neither have this Government. Lord Stirrup, the former Chief of the Defence Staff, reminded the Lords, speaking from experience, that this is not a new problem but one that Governments had failed to tackle for decades. He said:
“For decades now, I have seen at close hand the deficiencies in service families’ accommodation…For years, I have listened to successive Governments undertake to get to grips with the issue. For decades, I have seen them fail to do so…So why should I, or anybody who comes after me, put any faith in any Government’s promises that are not backed up by enforceable measures?”—[Official Report, House of Lords, 15 July 2025; Vol. 847, c. 1759.]
That is the nub of the issue. Service families have heard promises for decades. Now, surely, is the time for action. Our military deserve the gold standard, and that means they deserve legislative provision for decent homes, however the Government wish to do it.
Matthew Pennycook
I urge the hon. Gentleman to engage with the clear concession I made from the Dispatch Box: the confirmation that the Ministry of Defence will lay before Parliament—and publish on gov.uk—an annual report on the standard of service family accommodation in the UK, giving transparency, accountability, and reassurance that the standards we all want to see improve and be met will be.
Gideon Amos
I welcome any report that will deal with this issue, but the fact is that unless the Government accept an amendment or table their own amendment to provide this protection for service families in primary legislation, our service people will be the only category of renters who are not guaranteed the decent homes standard in primary legislation. Private renters will be, social renters will be, but our military service families will not be. That cannot be right. The balance is wrong and the Government need to do more; they need to legislate.
The Government’s final objection is that they want to do it differently. So be it. I will wait with bated breath, as I am sure the whole House will, for the Government’s amendment giving servicemen and servicewomen the gold standard they deserve. Since the Government have tabled no amendment of their own, however, we shall continue to press ours, both here and in the other place. Our armed forces should not be the only group in Britain excluded from the right to a decent home in legislative terms. That is what Lords amendment 39 delivers, and it must stand part of the Bill.
This Bill is about a vision for better homes and for dignity, security and fairness for renters. That must include the families of our armed forces, such as those of the 40 Commando Royal Marines in Norton Fitzwarren and elsewhere in Taunton. I was proud to start a petition to save Norton Manor camp following its proposed closure by the previous Conservative Government. That commitment must sit alongside our national mission to build more social and council homes—150,000 per year—to restore hope for a whole generation. That is what Liberal Democrats are fighting for, and that is the change the country desperately needs.
Danny Beales
The Bill before us is one of the most important and impactful Bills currently before Parliament. I say that not as someone who has seen a few emails in my inbox, but as someone who has felt the impact of the sector, having experienced homelessness twice in my teenage years and having been evicted through a section 21 eviction. As a renter as an adult for many years in London, I know the worry that many go through when pushing for simple repairs to be made or for mould to be addressed, fearing that ultimately their reward for asserting their legal rights will be a section 21 eviction.
The private rented sector in this country is unbalanced and insecure, and the rights of tenants are far outweighed by the powers of the landlord in our legal system. Like many in this place, I am aware of countless cases of constituents who have experienced section 21 evictions and poor treatment right across the sector—treatment that the Bill will go a significant way to remedying. That is why I hope Members will support the Government in opposing the Lords amendments, which seek to weaken, neuter and undermine key provisions of the Bill. Specifically, I want to mention Lords amendments 26, 27, 11 and 18; I am pleased that the Minister has outlined that the Government will oppose them.
Lords amendments 26 and 27 would require local authorities to meet a criminal standard of proof to impose financial penalties for discrimination and rental bidding. That seems completely inappropriate for the offences, with a relatively small maximum penalty of £7,000. That is also completely out of kilter with other provisions that local authorities would enforce to a similar civil standard. It would be incredibly hard to meet that burden of proof for many of those offences. How would a tenant prove beyond reasonable doubt that, for instance, they had been discriminated against for being on benefits? Anyone in that situation would know quite clearly that that is incredibly difficult—if not impossible—to do. Clearly, the amendment would neuter the provisions of the Bill. Local authorities have incredibly limited resources, particularly for enforcement action, and such a high bar would be likely to deter them from pursuing those offences further.
Lords amendment 11, which would allow a landlord to require a pet deposit of up to three weeks’ rent as a condition of consenting to a tenant keeping a pet in their property, is again disproportionate. First, it would hit the poorest hardest. I am pleased that the Opposition spokesperson, the right hon. Member for Braintree (Sir James Cleverly), has pets and has no problem with such a provision, but many people not on a parliamentary salary would struggle to pay three weeks’ extra deposit on top of the five weeks’ deposit already in place. The Minister mentioned an average cost of £900. In a constituency like mine in London, the cost would be even more than £900; for a rented three or four-bed family home, it would probably be several thousand pounds. That is a completely disproportionate charge for simply having a cat or dog at home.
Secondly, there is no evidence that such a pet deposit is required to protect a property. Recent research by the University of Hull found that three quarters of pet-owning tenancies result in absolutely no claim against the existing deposit levels, so I would argue that the five-week deposit is more than adequate to support pet-owning households. In fact, Battersea Dogs & Cats Home found that owning a pet increased the length of time someone stayed in a tenancy and reduced tenant turnover, benefiting the landlord financially, not harming them.
I am also significantly opposed to Lords amendment 18, which would reduce the period for which landlords could not re-let their property from 12 months to six months after they had evicted a tenant on the basis that they intended to sell their property. My concern is that this six-month reduction is not sufficient time to meaningfully disincentivise landlords from gaming the system and would reintroduce section 21 through the back door.
Take the London market, for instance, where average rents have increased by 32% over the last five years—the successful sector that Opposition Members have highlighted. Six months is not long enough to dissuade a landlord from benefiting from that sort of rental increase over short periods of time. The inconvenience that a 12-month time period would cause to a well-meaning landlord who is struggling to sell is relatively minor compared with the potential harm caused to the many tenants who would be affected by such a loophole.
In conclusion, houses are homes, not just investments. This Bill was written to rebalance the relationship between the landlord and the tenant in the tenant’s favour, fixing a decades-long power imbalance that has deprioritised the rights of tenants to a safe, stable and affordable home. All the amendments have in common a shared motive to shift the balance back towards landlords to weaken this landmark legislation. That would save some good landlords a small inconvenience, but it would be at the expense of the rights and protections afforded to each and every tenant. That is not reasonable or justifiable, and that is why I will vote against the amendments. I hope that others will do the same and give renters the rights and security they deserve.
Vikki Slade (Mid Dorset and North Poole) (LD)
Renters have waited long enough: this Bill is overdue, and it is time to deliver. The Conservatives had their chance. They promised reform, then watered it down. The Renters (Reform) Bill gathered dust while tenants were left to suffer, so Liberal Democrats absolutely welcome this Government’s Renters’ Rights Bill. But let us be clear: this Bill must hold firm in protecting the rights of tenants. My inbox is overflowing with experiences that should shame us all: families sleeping on the floor, windows that whistle in the wind, homes riddled with damp and mould, and tenants harassed by landlords to intimidate them out of their homes. This is not just about comfort and health; it is about dignity, justice and fairness.
Energy efficiency must be front and centre. Too many renters are living in homes that make them sick and are paying through the nose to heat them. Fuel poverty is a national scandal, and the Bill has a role to play in ending that. While the spotlight is on private renters, we must not forget those in social housing or in homes owned by institutions. They deserve the same rights, protections and standards.
I want to talk to Lords amendment 39 and Ministry of Defence housing. It is outrageous that the families of those who serve and who risk their lives for us are denied the legal protection that others will enjoy. These families are often uprooted, isolated and left behind while loved ones serve abroad or at sea. Yet they are told that they do not qualify for the same decent housing standards as everyone else. I have met families and service personnel around the country and even around the world through the armed forces parliamentary scheme, and one of the issues most frequently cited by those thinking of leaving the armed forces is their housing. Too many of their homes are below par.
The Government say that most MOD homes already meet the standard—fine, then what is the harm in giving these families the legal right to decent housing? If the homes are good, the law will confirm it. If they are not, that is why we need the law. Let us be honest: many tenants, whether in military housing, Church estates or country manors, are afraid to speak out. They are afraid to challenge their landlord and lose their home. Rights must be for everyone, accessible without fear or favour.
The Government claim that councils cannot access the homes for security reasons, but I am sure the Minister will know, as do those of us who have military homes in our areas, that most family homes are not behind the wire. For those that are, there are solutions. We must find a solution and ensure that these families have the same rights. No one should be denied decent housing because of who they work for. I want to address the attempts to water down the Bill.
Carla Denyer (Bristol Central) (Green)
We in this House all know that some landlords use the excuse of selling up to evict tenants only to re-let at a higher price. Does the hon. Member agree that Lords amendment 18, which would shorten that re-let period from 12 months to six months, would severely undermine one of the main aims of the Bill—to end no-fault evictions—by making it disappointingly easy for landlords to evict on just that basis?
Vikki Slade
I thank the hon. Member for raising that point and saving me the trouble of doing so. Absolutely, landlords give excuses that are perhaps not all they seem to be.
I have heard from tenants who are terrified of being evicted under section 21, with landlords rushing to act before the law changes and evicting with absolutely no excuses. I have heard from renters who feel like they are in a David and Goliath battle.
Lords amendment 11 is an attempt to treat pets more harshly. The proposers of the amendment have it wrong. As the hon. Member for Uxbridge and South Ruislip (Danny Beales) said, tenants with pets are good news for landlords: research shows that their landlords are better off by £3,800 over 12 years thanks to lower vacancy rates and marketing costs for their properties. I would be a landlord who happily took pets.
Amendment 26 requires a criminal standard of proof for a civil matter. In my mind, that is not justice but obstruction. Last week, I met the housing ombudsman service. It told me that one in five calls that it deals with are from people it cannot help: private renters, people in new builds and people in conversions. The system is broken and the scales are tipped too far from our tenants. The Bill must fix that. We need one ombudsman, one law, one standard, one rule: wherever someone lives, if their home is owned by someone else and it is not up to scratch, they should be able to challenge it, get it fixed and live in a decent home. Housing is not just bricks and mortar; it is the foundation of everything else—health, education, family and work. Every renter deserves a home that is safe, warm, and fair.
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
I declare an interest as the chair of the all-party parliamentary group on cats.
As an animal owner myself—I have two cats—I rise to give voice to the many concerns expressed to me by pet owners across the country. Their concerns relate specifically to Lords amendment 11, which would allow landlords to request a pet deposit equivalent to three weeks’ rent. The amendment was narrowly agreed to on Report in the House of Lords in July, in response to the Government’s decision to remove the right for landlords to require tenants to take out pet damage insurance. Cats Protection has argued that the Government’s decision to remove the provision allowing landlords to request pet-related damage insurance was the right one, as the insurance sector was not ready to meet demand competitively.
The Minister in the Lords outlined many arguments against the pet deposit amendment, including that an extra three weeks’ deposit is unaffordable for many tenants. She also referred to a report commissioned by Battersea Cats & Dogs Home and the University of Huddersfield, which found that 76% of landlords reported that they did not encounter any damage caused by dogs or cats in their rental properties. She noted that the Government were
“content that landlords would be suitably protected against the cost of pet damage through existing tenancy deposits”,
and I wholly agree.
Cats Protection is also strongly of the view that charging an additional pet deposit is neither necessary nor proportionate. Measures already exist for landlords to seek additional compensation from the tenant in the very rare circumstances in which damage caused by a pet may exceed the value of the existing security deposit. The amendment could see tenants forced to find up to £1,500 extra for a one-bedroom flat in high-rent areas. That would mean that those without additional ready funds are priced out of having a pet.
Another problem with the addition of a pet deposit is the potential lack of transparency in landlord decisions on what constitutes pet damage and what constitutes the type of damage that would otherwise be funded by the standard security deposit. Some landlords may just see the extra fund as an option to withhold more money for standard wear and tear. Damage can be avoided with the use of throws and rugs, for example. I know that Cats Protection and Dogs Trust adopters are always given information on how to provide enrichment activities to keep pets happy. Perhaps the right hon. Member for Braintree (Sir James Cleverly) would like to take advantage of those to ensure that his terriers do not tear up his carpet.
I am concerned that the amendment will reintroduce the very inequity that the pet provision was designed to remove, putting the price of pet ownership out of reach for many tenants and entrenching geographical inequality. We all know how beneficial pet ownership is not just for the welfare of the animals, but for our wellbeing. “Cats and their stats”, a 2024 Cats Protection report, found that over half a million households who would like a cat do not have one simply because their rental agreement forbids it. I strongly believe that the additional pet deposit should be withdrawn from the Bill; the standard security deposit is more than adequate to cover any damage caused by a pet. I will oppose Lords amendment 11, and I encourage colleagues from across the House to do likewise.
Andrew Rosindell (Romford) (Con)
I rise to speak to Lords amendment 11 and on the wider issue of pet ownership, which many other Members have spoken about. Pet ownership in rented accommodation is an issue on which I have campaigned for many years in this House. Some Members will remember the Dogs and Domestic Animals (Accommodation and Protection) Bill, otherwise known as Jasmine’s law, that I introduced to the House in 2020. It supported the principle of a pet in every home.
The British people care deeply for the welfare of animals, especially in my Romford constituency. We all understand how important animals are to the lives of human beings. As the owner of two Staffordshire bull terriers, Buster and Spike, who are sadly no longer with us, I know just how important the companionship of pets is to so many people, especially those who live on their own. Owning a dog or cat, or any kind of household pet, improves both physical and mental health, provides vital companionship and helps to tackle loneliness. In fact, pet ownership is estimated to save our NHS around £2.5 billion a year by reducing the number of GP and hospital visits.
Despite those clear benefits, housing issues remain the second most common reason for animals to be relinquished to animal shelters and sanctuaries such as Battersea Dogs and Cats Home, which I was privileged to visit only a few weeks ago. I have had many links to that charitable organisation over the years, particularly during my time as shadow Minister for animal welfare some years ago. With growing numbers of people renting, it is absolutely essential that the Bill works in support of responsible pet ownership in rented homes, rather than putting further barriers in the way. That is why I must express my opposition to amendment 11, and any clause that makes it harder for tenants to keep pets.
The introduction of large up-front deposits will only serve to price many people out from owning pets, especially in the ongoing cost of living crisis. It is absolutely wrong that someone should be prevented from owning an animal that they love and want to be with because of this situation. The law needs changing, as I have argued for many years, including with Ministers in the previous Government, whom I had to go and see before they eventually agreed that this policy was the right one. I hope that my shadow Front-Bench colleagues will reconsider their stance. I commend the hon. Members for Uxbridge and South Ruislip (Danny Beales), for Mid Dorset and North Poole (Vikki Slade) and for Paisley and Renfrewshire South (Johanna Baxter) for all their comments on this issue.
What should have been a Bill to unlock pet ownership for those in millions of homes now risks excluding them altogether, entrenching the idea that pet ownership is a privilege for homeowners only—that cannot be right. I do not believe that is what the Government intended.
Earlier proposals on pet insurance—I know issues to do with that have been raised today, but they can be overcome—provided a fairer balance between the concerns of landlords and the ability of tenants to meet the costs. Insurance spreads the expense more evenly across the year, and avoids the burden of large, one-off deposits. It is disappointing that that approach appears to have been set aside by the Lords amendment.
Finally, I urge His Majesty’s Government to work closely with animal welfare charities, and the animal welfare sector in general, when developing the guidance that will accompany the Bill. I speak as an honorary member of the Kennel Club—perhaps I should have declared that at the start—and a supporter of the Dogs Trust, Battersea Dogs and Cats home, and of course Cats Protection; it is important always to remember our cats. We need a clear definition of what constitutes unreasonable grounds for a landlord to refuse a tenant’s request for a pet. That clarity will help landlords and tenants alike, and avoid unnecessary disputes ending up before the ombudsman or courts. Jasmine’s law has always been about the simple belief that people should not have to choose between a home and a beloved companion. We must not let the Bill, through the Lords amendments, and particularly Lords amendment 11, undermine that vital principle.
Rachel Blake
I wish to speak against Lords amendments 58 to 62, which expand eviction grounds, and Lords amendment 27. I also wish briefly to revisit the core principles of the Bill, which are: ending no-fault eviction, and providing stability, not just for individuals but for the private rented sector; introducing a private renters’ database and an ombudsman, to restore rights to private renters, as well as transparency, so that they understand their tenancy in more detail; and to establish Awaab’s law in the sector. Those are vital interventions in the private rented sector, which we know is diverse, and it is important that the Bill becomes law as soon as possible. All of us, on both sides of the Chamber, will recognise the impact that uncertainty on the issue has had on the private rented sector for a number of years.
I have to say that it was pretty unedifying to listen to the Opposition reneging on their previous commitments to ending no-fault eviction. The first commitment from the Conservatives to ending no-fault evictions was in 2019—I think that was about four Conservative Prime Ministers ago, but I have given up counting. I understand that the shadow Housing Secretary might not remember the position that the previous Prime Minister took on the issue, but this provision cannot come into law soon enough. The number of private rented sector no-fault eviction notices that my constituents receive, and the instability that they cause in the sector, are causing real harm and distress to those who live in it.
Lords amendments 58 to 62 would expand possession ground 5C, and those completely unnecessary expansions provide yet more uncertainty in the sector. They open up the risk of further additional claims, and of introducing other grounds for eviction, which undermines the overall principles of the Bill. I support my colleagues who have spoken against Lords amendment 27, which would raise the evidence bar. It is completely unrealistic to think that it would be possible to do that, not only because bidding wars and contests often take place through verbal dialogue, but because of the lack of resources available to local authorities to investigate such cases. I do not believe that the amendment is practical, or was tabled in particularly good faith. We want renters’ rights restored, and a balance between renters and landlords. I cannot stress enough the urgent need to bring forward the Bill, to give confidence to renters, all those who rely on people living in private rented accommodation, and those living and working across the UK who need the sector to be successful. I urge Members to vote against the Lords amendments, and to support the Government in getting the Bill into statute.
Caroline Voaden (South Devon) (LD)
I welcome the Government’s move to empower tenants. For too long in this country, owning property has been seen as a way to create additional wealth, rather than the intention being to provide a safe, secure and warm home for tenants. Not all landlords are bad, but there are some bad apples out there, and all those who are unable to get on to the housing ladder, or who actively choose to rent, deserve security of tenure, and confidence that they will not be evicted at the whim of a landlord, which often means being forced to move out of the area, and uprooting children from schools.
I declare an interest, because my younger daughter has spent four years renting in London, and for the last two, she has been living in horrific, mould-covered flats. She had to move out of the last one early, because the mould crawling up the walls was so bad that it was affecting the health, and ruining the belongings, of her and her flatmates. In 2025, that is simply not acceptable. For the thousands of people living in unsuitable accommodation, we must ensure that local authorities can take action against negligent landlords. For that reason, the Liberal Democrats do not support Lords amendment 26.
I support Lords amendment 39, which would extend the decent homes standard to accommodation provided by the Ministry of Defence for use as service family accommodation. In my constituency of South Devon, the prestigious Britainnia royal naval college brings a large number of military families to the town of Dartmouth, some of whom live in MOD housing. Those families, who commit to a life of service—the whole family is involved when one member serves our country—deserve, at the very least, a home that is safe, comfortable, warm, energy efficient and decent. I am not sure that I agree with the security argument offered by the Minister, given that much MOD housing is located outside military bases. It is not beyond possibility to find a way to ensure that local authorities can access that housing. Liberal Democrats have long campaigned for decent homes for military families, who deserve exactly the same standards and legal protection as other renters, and I urge the House to support Lords amendment 39.
Turning to pets, a friend of mine recently failed to move back to Devon because she simply could not find rented accommodation in her price bracket, and her search was severely hampered by the fact that she has a much-loved family dog. Being told that she was not eligible even to look at properties because of the dog was discriminatory, and it made a difficult search impossible. We are in an area that is short of houses available to rent. If we take the average rent in the south-west of £1,181 per month, the proposal to allow landlords to request pet damage deposits of up to three weeks’ rent equates to an additional £817 up front, which is simply out of reach for most tenants. The current rental deposit cap of five weeks’ rent is sufficient to cover any potential pet-related damage, and nobody should be priced out of pet ownership simply because they do not own their own home. I therefore do not support Lords amendment 11.
Finally, I turn to agricultural workers. Agriculture is one of the largest industries and employers in South Devon, which is a predominantly rural constituency. Many of those working on farms as dairy workers, relief milkers and tractor drivers are required to live on site, as they have to work incredibly unsocial hours, and living on site makes the job slightly more manageable. I support measures in the Bill that allow repossession when a property is required to house agricultural workers, whether they are employed or self-employed. Farmers regularly tell me how difficult it is to find housing for farm workers, with many having to rely on caravans and cabins that are not suitable for long-term living. As it is increasingly common in farming for workers to be self-employed, we must ensure that they, too, are covered by the grounds for repossession, so I support Lords amendment 55.
Dave Robertson
I am glad that I managed to sneak in this speech, and I hope I will finish it. There have been many speeches made by Members on both sides of the Chamber, many of which have focused on the many things that the Bill will hopefully achieve. I confirm that my hon. Friend the Member for Paisley and Renfrewshire South (Johanna Baxter) does have two very cute cats.
Matthew Pennycook
With the leave of the House, I will close what has been a brief but good-natured and considered debate. I thank all right hon. and hon. Members who have spoken. In opening the debate, I set out in some detail the reasons the Government are resisting the bulk of the amendments made in the other place, but in the time remaining, I will further substantiate some of the Government’s arguments and respond to a number of the issues that have been raised in the debate.
Several hon. Members questioned the Government’s logic in resisting Lords amendment 75 related to ground 4A. They argued that it is too narrow. As I made clear, ground 4A exists precisely because we recognise the unique nature of the rental market. We think that the ground as it exists covers the majority of the market, but the truth is that no one-size-fits-all solution covers all circumstances. We have been clear: we do not want to deny to non-typical students the benefits of the new tenancy system under the Bill. Removing the restriction could lead to students who need more security of tenure, such as single parents living with children or postgraduate couples living together who have put down roots in an area being evicted more regularly. The possession ground as originally drafted strikes the right balance and we will resist the amendment on that basis.
Several hon. Members raised the issue of pet insurance and questioned why the Government have changed their position. Debate in the other place was extensive. Furthermore, alongside that, drawing on the expertise of peers such as the Earl of Kinnoull, Lord de Clifford and Lord Trees, the Government consulted the Association of British Insurers and the British Insurance Brokers’ Association. Following such engagement, we concluded that we are no longer confident—as we once were, and as the previous Government were—that the insurance and underwriting sector will have sufficient or suitable products available at the scale and speed required for either landlords or tenants to purchase.
We do not want to leave tenants in a position where they cannot comply with conditions set out as part of the pet consent granted by their landlord, as that would mean—as several hon. Members have made clear—that they simply would not be able to have a pet, which would defeat the object of having the pet provisions in the Bill. The Government’s position, I am pleased to say, is supported by Battersea Dogs and Cats Home and other organisations. I hope that hon. Members note that.
A report produced by the University of Huddersfield, which was commissioned by Battersea Dogs and Cats Home, found that 76% of landlords reported that they did not encounter any damage caused by dogs or cats in their rental properties. When damage was caused by pets, that was an average additional cost of £300 per property, compared with £775 for non-pet-related damage. The report also shows that renters with pets tend to stay longer in their properties than those without pets, indicating financial and social advantages for landlords in fostering longer and more stable tenancies.
In the rare cases where the insurance and deposit do not cover the cost of the damage caused by a pet, a landlord could take the tenant to a small claims court by bringing a money claim to recoup any outstanding funds. On that basis, and having reflected, we are satisfied that the existing requirement for five weeks’ deposit for typical tenancies is sufficient to cover the risk of increased damage by pet ownership. As I noted in my opening speech, however, the Government will continue to keep that under review. We already have powers available to allow for higher deposits for pets if needed.
The very topical and pertinent issue of shared owners affected by the building safety crisis was raised by a number of Members. The Government are absolutely clear: we recognise their plight. As I made clear, we have already taken a number of measures to better support shared owners in that position. We recognise more can be done outside this Bill. We are more than happy to continue conversations with peers, hon. Members and organisations such as the Shared Owners’ Network about what more we can do in this space on issues such as valuations, sub-letting requests and repurchases.
We remain of the view, however, that the amendment in question could undermine protections for that cohort of tenants who happen to rent a sub-let home from a shared owner. Carefully considering arguments made by the peers and their validity, we will have further conversations. I will carry on those conversations to ensure that we are satisfied whether a solution that does not undermine the core principles of the Bill would allow us to provide that greater support to shared owners.
Carers and the carers ground were raised by a number of hon. Members. We have all recognised the contribution that carers make, but we believe that not only is there not sufficient evidence that the scenario in question is extensive—that it is common—but that there are real risks of the ground being abused. The shadow Secretary of State, the right hon. Member for Braintree (Sir James Cleverly), mentioned the example of families across the country who own properties and who may wish to move a family member back in as a carer. I gently point out to the right hon. Gentleman that, if the carer is a family member as set out in ground 1, a landlord can already use that ground to gain possession, enabling them to accommodate a carer. We think that Lords amendment 64 is drawn too widely and is open to abuse. We will resist it on that basis.
Finally, I come to the last couple of issues that were raised. Several hon. Members made a powerful case for not accepting Lords amendments 26 and 27, related to the criminal standard of proof. We are absolutely clear that the civil—not criminal—standard of proof is the appropriate one. The standard of proof is lower for the breaches in question—breaches of the rental discrimination and rental bidding clauses in the Bill—precisely because they are purely civil, rather than criminal matters. Raising that standard of proof to align with other criminal offences would logically result in repeated instances of those breaches on rental discrimination and rental bidding, attracting the higher fine of £40,000, rather than £7,000. I do not understand the logic of the Opposition’s position, but we very much think that those breaches should remain subject to the civil standard of proof, with the penalty of £7,000 and without the impact on local authorities across the country.
I will briefly address the arguments made by Liberal Democrat Members about service family accommodation. We have had extensive debates about the subject and I know that they are coming from an honourable place when they make those arguments, but I gently point out that the Ministry of Defence has made it clear that in its view, subjecting secure defence sites to local authority inspections, as proposed in the amendment tabled by Baroness Grender, is unworkable because of access and security arrangements. As several hon. Members have said, let us find a solution to that. The MOD does not think there is a workable solution and is worried about fracturing how standards are applied across the defence estate, as this legislation applies only to England. As I have said, in the coming months, the Government will bring forward a defence housing strategy, setting out clear renewal standards and further steps to improve accommodation. I have offered a very clear concession from the Dispatch Box that we will provide for annual reporting to give the transparency and accountability that those standards will be met.
Gideon Amos
I am grateful to the Minister for giving way and for his engagement in the issue of service family accommodation. Will he consider bringing forward primary legislation, on the face of this Bill or another Bill, so that service families are given the same legislative protection that private and social tenants are given?
Matthew Pennycook
I am more than happy to continue the conversation with the hon. Gentleman and with Liberal Democrat peers in the other place, but our argument today is that we cannot accept the amendment tabled by Baroness Grender. We think that the concessions that I have offered today from the Dispatch Box should be sufficient to satisfy the concerns that have been raised.
I will briefly address the incredibly important issue of implementation, which was raised by my hon. Friend the Member for Tipton and Wednesbury (Antonia Bance). This Bill must receive Royal Assent as soon as possible. The time that it has taken for the legislation to make its progress through the House is not cost-free. Families across the country have been subject to no-fault section 21 evictions, which we know are a leading cause of homelessness, and renters across the country need the Bill on the statute book.
Following Royal Assent, we will allow for a smooth transition to the new system, and we will support tenants, landlords and agents to understand and adjust to the new rules. We want to make that change as smoothly and efficiently as possible, and to introduce the new tenancies for the private rented sector in one stage. On that date, the new tenancy system will apply to all private tenancies: existing tenancies will convert to the new system and any new tenancies signed on or after the date will be governed by the new rules. We will work closely with all parts of the sector to ensure a smooth transition and we will provide sufficient notice ahead of implementation.
To conclude, this Labour Government are going to succeed where their Conservative predecessor failed. We will level decisively the playing field between landlord and tenant, and transform the experience of private renting in England. While we have shown ourselves more than willing to make sensible changes to the Bill in response to concerns raised, we are not prepared to accept amendments that undermine its core principles. I look forward to continuing the constructive conversations that I have had with peers over recent weeks, with a view to securing agreements across both Houses in the near future, and I commend the Government’s position to the House.
Question put, That this House disagrees with Lords amendment 11.
Renters’ Rights Bill
Tuesday 14th October 2025
(9 months, 4 weeks ago)
Lords ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 131-I Marshalled list for Consideration of Commons Reasons and Amendments - (13 Oct 2025)
16:41 - Division on Motion A1 - Ayes: 192 / Noes: 239 - Motion A1 disagreed.
17:36 - Division on Motion C1 - Ayes: 204 / Noes: 215 - Motion C1 disagreed.
18:24 - Division on Motion H1 (as an amendment to Motion H) - Ayes: 169 / Noes: 212 - Motion H1 disagreed.
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 11, to which the Commons have disagreed for their Reason 11A.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, in moving Motion A I will, with the leave of the House, speak also to Motions E, F, G, G1 and L, which are grouped together.
It is a great pleasure to bring the Renters’ Rights Bill back to the House of Lords to consider the amendments and reasons from the other place. I start by thanking my colleague in the other place, the Housing Minister, for setting out the Government’s position on the amendments agreed by your Lordships. As he outlined, the Government made a clear manifesto commitment to the people to modernise the insecure and unjust private rented sector. The Renters’ Rights Bill delivers on this promise by empowering private renters with more rights, protection and greater security of tenure. I thank the noble Lord, Lord de Clifford, the noble and learned Lord, Lord Keen of Elie, and the noble Baroness, Lady Grender, for their amendments in this group.
I begin with the amendment in lieu tabled by the noble Lord, Lord de Clifford, Amendment 11B, which would allow landlords to require an additional deposit equivalent to one to three weeks’ rent as a condition of their consent to a tenant’s request to keep a pet. A requirement for a further three weeks’ deposit would cost the average tenant in England over £900. This is unaffordable for most tenants and would greatly exceed the average deposit deduction for pet damage of £300.
While I truly appreciate that the noble Lord, Lord de Clifford, has considered these affordability issues to a degree in his amendment in lieu by stating that the additional deposit may be from one to three weeks at the landlord’s reasonable discretion, I am afraid that we still cannot accept this amendment. In practice, this provision would effectively be the same as allowing landlords to request up to three weeks’ deposit, as the original amendment did. Many landlords will charge the full amount, giving rise to the same affordability challenges as the original amendment.
As outlined at Lords Report, the Government have existing powers under the Tenant Fees Act 2019 which will allow Parliament to require a larger deposit where a landlord has consented to the tenant having a pet. We will continue to keep this position under review following Royal Assent. If there is clear evidence that pet damage is exceeding normal tenancy deposits, we have the Tenant Fees Act power, which would allow us to remedy this.
Amendment 39D, tabled by the noble Baroness, Lady Grender, would introduce an annual reporting requirement on the quality of military accommodation. I express my grateful thanks to the noble Baronesses, Lady Grender and Lady Thornhill, for their continued engagement on this issue. I also extend my thanks to the noble and gallant Lord, Lord Stirrup, for his tireless advocacy for service personnel and their families. I am sure that the whole House will agree that our armed service personnel and their families must live in safe and decent homes. The Government acknowledge the vital role that accommodation plays in their lives. We are determined to ensure that our personnel have access to safe, high-quality accommodation that meets their needs and reflects the importance of their service to our nation.
As I have previously outlined, the Government are committed to driving up the standards of military accommodation further. Earlier this year, the Ministry of Defence announced an additional £1.5 billion investment in service family accommodation over the next five years, above that already committed. Later this year, the Government will publish a defence housing strategy, setting out clear renewal standards and further steps to improve the lived experience of our personnel.
I welcome the amendment in lieu tabled by the noble Baroness and can confirm that the Government support this approach in principle. We have therefore tabled Amendments 39B and 39C as amendments in lieu, which will introduce a statutory requirement for annual reporting on the extent to which service family accommodation meets the decent homes standard. This amendment will place on a statutory basis the commitments the Housing Minister made in the other place for greater transparency and accountability on the quality of military accommodation. Alongside the Government’s wider actions that I have already highlighted, this will make a real difference in ensuring that service personnel and their families have homes of the quality they deserve. I have discussed the Government’s amendment in lieu with the noble Baronesses, Lady Thornhill and Lady Grender, and with Gideon Amos MP, to whom I am grateful for his strong advocacy on this issue in the other place. They have indicated their support, and I hope that noble Lords will also support this amendment.
Finally, Lords Amendments 26 and 27, which were tabled by the noble and learned Lord, Lord Keen of Elie, would require local authorities to meet the criminal, rather than civil, standard of proof when imposing penalties for rental discrimination and rental bidding breaches. I am grateful to the noble and learned Lord, Lord Keen, for his constructive engagement on this issue. We believe that local authorities will enforce these measures against the relevant standard of proof effectively. However, we understand the concerns from noble Lords that if this is not the case, there is a risk of an unsatisfactory decision.
With that in mind, I can confirm that the Government will include in the relevant statutory guidance to local authorities advice that a local authority exercises a quasi-judicial function when imposing a civil penalty, and should therefore be satisfied by credible, reliable and sufficient documentary or other evidence on the balance of probabilities that a person has breached a relevant requirement before imposing a penalty. Moreover, the Bill already gives a person against whom a local authority proposes to impose a penalty a right to make representations before a final decision is made, as well as a right to an appeal by way of rehearing against a penalty. I am pleased to have come to an agreement with the noble and learned Lord, Lord Keen of Elie, on this issue. I hope this is sufficient to address the concerns of noble Lords and that they will agree to the Motion not to insist from the other place.
Motion A1 (as an amendment to Motion A)
“16D Pet damage deposit
(1) It is an implied term of every assured tenancy to which section 16A applies that if, at the time of consenting to the tenant keeping a pet, the landlord informs the tenant in writing that the payment of an additional pet damage deposit by the tenant is a condition of the consent, then the tenant must comply with that condition.
(2) The additional pet damage deposit under subsection (1)—
(a) can be used to make good pet damage,
(b) must be of equivalent value to a minimum of one weeks of rent and a maximum of three weeks of rent, depending on the nature of the pet, at the landlord's discretion acting reasonably,
(c) cannot be subject to the limits for deposits in tenancy agreements, and
(d) is subject to the rules governing deposits in tenancy agreements, for purposes of monies handled.””
Lord de Clifford (CB)
My Lords, first, I thank the Minister for her opening remarks. Your Lordships should please note my interest in the register that I work for and am a shareholder in a veterinary business that cares for many pets. I also have the privilege of being a dog owner for many years.
My updated amendment seeks to provide protection and reassurance to landlords and give tenants much more opportunity to find a rentable property that allows pets. The Government quite rightly included in the Bill the right of tenants to request landlords to allow pets, as currently there is a limited number of properties available.
At the commencement of the Bill, the Government wished to support landlords with a change with regards to the financial risk that pets may cause damage to a property during a tenancy. This proposed solution was an insurance policy which provided a level of cover. The proposal was supported by many housing and pet charities. Due to the risk profile of this type of cover, the insurance market could not provide the appropriate policies. As a result, the Government withdrew the proposal from the Bill. That risk still exists. The tenant’s five-week deposit covers the risk that tenants may cause damage to a property. Housing a pet is an additional risk and therefore asking for an extra amount of deposit is surely not unreasonable.
One of the Government’s objections to the amendment, as already stated by the Minister, was the increase in the deposit, and I acknowledge that this is an issue that exists for some. We have considered this in updating and reducing the number of weeks’ deposit required to a minimum of one week and in an obligation on landlords to be reasonable when asking for the amount of deposit considered and the nature of the pet or number of pets.
The Government said that the five-week deposit will cover the damage of pets. They used figures from the University of Huddersfield survey provided to the Battersea Dogs & Cats Home, which say 76% of landlords have no issue with pets. That leaves 24% of landlords with issues; that is not a small number and the summary does not define what those pet issues are. The report did quote that the average cost of pet-related damage was about £300 per tenancy. I believe the average weekly rent is about £300, as mentioned in the passage of the Bill, so one weeks’ rent would cover the damage.
It may be that if a pet damages a property, a good tenant will repair it. Sadly, not all tenants are the same, just like we have a range of good and bad landlords. If a tenant has a pet that causes some damage and it is not repaired, is it not likely that, if there are other damages, they will not be repaired? That is what the five-week deposit will cover, and an additional pet deposit could cover the pet damage.
There is good evidence that tenants with pets tend to stay longer, and many take care of their properties to a high standard. One conclusion would be that these tenants stay in certain properties for longer due to the lack of supply of alternative rental properties—which, happily, the Bill wishes to address—but we need to support landlords with this change. By supporting this amendment, we will be supporting landlords and making the process of more landlords accepting pets without objection a far greater reality, as they will have the protection of an additional deposit. It will, I hope, also encourage existing landlords to stay in the private rental sector market and potentially encourage new landlords to choose long-term tenancies over short-term holiday and Airbnb lets, so maintaining supply of rental properties.
A table in the University of Huddersfield report asks landlords whether different policies or incentives would encourage them to consider pet owners as tenants in the future. Some 53% asked said that having a tenant with insurance cover for pet damage would help. Sadly, this is not available. Some 51% said that allowing landlords to charge for a deep clean would help; this would be covered by a pet deposit. Some 43% said that allowing landlords to be allowed to hold a pet deposit would help them, and this is what this amendment does.
Pets provide so much to us human beings in companionship and health benefits and provide friendship and support at difficult times. When owning a pet, we have a responsibility to maintain their welfare and health. This is both a time commitment and a financial commitment for the owners. If someone is a potential tenant with a pet, an additional deposit for a property should be thought of as part of that financial commitment.
I hope my revised amendment will find some support with your Lordships today, and that we can find a balance between landlords and tenants to increase the supply of pet-friendly accommodation. I beg to move.
Baroness Grender (LD)
My Lords, I welcome Amendments 39B and 39C in particular—on my behalf and on behalf of our most able leader on this Bill team, my noble friend Lady Thornhill. We are absolutely delighted that military housing is going to be held to the same legal standard as the private rentals in the Bill. Putting this on a statutory footing fulfils the wishes of this Government and the campaigning work by some of my colleagues, particularly in the Commons: MPs Gideon Amos and Helen Morgan, to name but two. I thank Adam Bull in our Whips’ Office, who has been working very hard on this over the recess.
I thank the Minister, the noble Baroness, Lady Taylor of Stevenage, for her time and patience in discussing this issue and us getting to this very happy mutual agreement. I also thank Minister Pennycook for the time he spared, and the noble Lord, Lord Coaker, who has spent time on this. The noble Lord, Lord Best, and the noble and gallant Lord, Lord Stirrup, have provided wisdom, backing and advice, and I am grateful to them both as well.
At the heart of this issue are those in the military who give the ultimate sacrifice and the families who live with them and stand by them. Let us hope, as a result of this change, that the appalling conditions they have endured so far will change and will be a thing of the past. We are enormously grateful for this change and are looking forward to seeing it introduced.
With regard to the Motion in the name of the noble Lord, Lord de Clifford, we have consistently not supported this. We recognise the eloquence of his arguments in this area, but we continue to argue that this will place undue financial pressure on tenants and could be exploited by rogue landlords to impose excessive deposit charges. We believe that tenants, owner-occupiers and social tenants should be viewed on a much more equal footing. This speaks to some of the speeches that both I and my noble friend Lady Thornhill have made. Therefore, we feel we cannot support it, but we are absolutely delighted with the government amendment, and we look forward to its implementation.
Lord Black of Brentwood (Con)
My Lords, as we have heard, Amendment 11B in the name of the noble Lord, Lord de Clifford, seeks to allow landlords to request a pet deposit equivalent to up to three weeks of rent. Like many of the charities involved in the animal welfare sector that have campaigned tirelessly on this issue, I am disappointed that we are having to return to this subject after it was clearly rejected in the other place, having been the subject of intense discussion. Charities including Battersea, Cats Protection and the Dogs Trust strongly support the Government’s position, and so do I. The reason for that is clear. Such an obligation would defeat the very purpose of the pet provisions in this carefully balanced Bill, which are designed to make pet ownership easier for tenants and remove the iniquity that owning a pet is the preserve of the increasingly small number of people who can afford to own their own home. I declare my own interests as the owner of a cat.
Let us be clear: as I said in Committee, for tenants seeking to have a single pet in rented accommodation, there is likely to be only very minimal, if any, damage. The standard security deposit is more than sufficient to cover any damage beyond standard wear and tear, as a survey conducted in 2021 by YouGov on behalf of the Dogs Trust and Cats Protection concluded. In rare circumstances, where damage caused by a pet may exceed the value of the existing security deposit, measures already exist for landlords to seek additional compensation from the tenant. As such, charging an additional pet deposit is unnecessarily and wholly disproportionate.
This costly proposal would put the wonderful aspiration of pet ownership beyond the reach of many. Allowing landlords to require a pet deposit equivalent of up to three weeks’ rent could see tenants forced to find up to an additional £1,500 for a one-bedroom flat in high-rent areas such as London—a figure which is unaffordable for many. It would also introduce an unfair geographical disparity, with those living in cities, where rents are higher, being far worse off compared with those living in rural areas.
Another problem with the addition of a pet deposit is the potential lack of transparency regarding what a landlord decides should constitute pet damage and what constitutes the type of damage that would otherwise be funded by the standard security deposit. Many landlords, I fear, would see this as an extra fund to provide an option to withhold more money simply for standard wear and tear.
The pet provisions in the Bill have been thoroughly and energetically debated, both inside and outside this House. It is clear from all those discussions that the standard security deposit is more than adequate to cover any damage caused by a pet and that this amendment is completely unnecessary. Its only result would be to neuter one of the key planks of this vital legislation, destroying the hopes of so many tenants who dream of having a pet in their home. Today, we should make that dream a reality, so I am afraid that, if the noble Lord presses his Motion, I shall be voting against it.
Baroness Scott of Bybrook (Con)
My Lords, I will speak briefly on two matters: first, the Ministry of Defence accommodation, and then the pet deposit. On the Ministry of Defence housing, we thank the Government for listening and engaging so constructively on this issue. The concerns raised have been recognised, and the Government’s response has been both proportionate and pragmatic. On these Benches, as ever, we strongly support our service personnel and the vital contribution they make to us and our country, and we are happy to support the Government’s Motion.
Turning to pets, I support the noble Lord, Lord de Clifford, on an issue that has filled my inbox and, I know, that of my noble friend Lord Jamieson as well. When the Bill was first introduced, the Government rightly sought to balance the cost of pet-related damage through the requirement of pet insurance. However, as we pointed out repeatedly, and as the noble Earl, Lord Kinnoull, emphasised, no such insurance product actually existed. Once the Government accepted that fact, the requirement was removed, but nothing was put in its place.
The noble Lord’s amendment would restore that missing balance. It offers a fair and proportionate settlement, ensuring that renters can keep pets in their homes while landlords have reassurance that any pet-related damage can be covered. If there is no damage, the deposit will be returned. Recent research by Propertymark shows that 85.3% of landlords and agents have incurred damage to their properties by pets. Yet more staggeringly, 57% of landlords and agents report being unable to recoup pet-related damage costs.
Allowing an additional deposit of one to three weeks’ rent is therefore a reasonable and balanced step that protects tenants’ rights while recognising the realities faced by landlords, particularly small landlords. Landlords are not always wealthy investors. Many, as we have said many times on this Bill, are ordinary people for whom a second property represents their pension or their life savings. If a property requires major cleaning or repair, those costs can be prohibitive, and in some cases could drive properties out of the rental market altogether. Therefore, if the noble Lord, Lord de Clifford, chooses to test the opinion of the House once again, we on these Benches will support him.
Finally, I thank the Government for their constructive engagement and the assurances given in writing and from the Dispatch Box on the standard of proof. Those commitments provide much-needed clarity and reassurance on how this will be applied in practice, and we are grateful for the Minister’s response.
Taken together, we believe that these measures improve the Bill, and make it fairer, more workable and more balanced for tenants and landlords alike.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank all noble Lords who have spoken in this debate. I thank again the noble Lord, Lord de Clifford, and the noble Baroness, Lady Grender, for their positive approaches throughout the course of the Bill. I thank the noble Lord, Lord Black, for his support—I will come on to some of the points that he raised in a moment—and the noble Baroness, Lady Scott.
I think the responses to this part of the debate are pragmatic. I am afraid that we cannot accept the amendment tabled by the noble Lord, Lord de Clifford. He mentioned the Government’s change in position on pet insurance. We had an extensive debate, in both your Lordships’ House and the other place. We drew on the expertise of Peers such as the noble Earl, Lord Kinnoull, and the noble Lords, Lord de Clifford and Lord Trees. The Government consulted further with the Association of British Insurers and the British Insurance Brokers’ Association. Following that engagement, we concluded that we were no longer confident that the insurance and underwriting sector would have sufficient or suitable products available for landlords or tenants to purchase.
In view of that, we did not want to leave tenants in a position where they could not comply with conditions set as part of the pet consent granted by their landlord, as that would mean they would not be able to have a pet, which would defeat the object of having pet provisions in the Bill. I am pleased to say that, as the noble Lord, Lord Black, mentioned, Battersea Dogs & Cats Home has indicated its support for the Government’s approach, including the approach of not accepting this amendment. I received just today a letter of very strong support from Dogs Trust and Cats Protection, and another email from Shelter expressing its support and hope that this amendment would not be accepted, because it did not feel that it was in the interest of tenants or their pets. We used the information from the University of Huddersfield as part of our consideration.
It is important to say that, as I noted in my opening speech, we will continue to keep this under review. We have powers to allow for higher deposits for pets, if needed. We are satisfied at the moment that the existing requirement of five weeks’ deposit for typical tenancies is sufficient to cover the risk of any increased damage by pet ownership. I know some landlords are concerned about potential damage that may be caused by pets. Landlords can deduct damage costs from the normal tenancy deposit, as they do now. In rare cases, where the deposit did not cover the cost of the damage, the landlord could take the tenant to the small claims court and bring a money claim to recoup any outstanding amounts, in line with the wider rules in the sector.
We do not want to put tenants in a position where they cannot have a pet because there are no suitable insurance products available or they cannot afford the additional cost of a deposit. We will keep this matter under review, and I hope the noble Lord will consider withdrawing his Motion.
Lord de Clifford (CB)
I thank your Lordships for your thoughts and speeches. I am pleased about, and support, the amendment from the noble Baroness, Lady Grender, being accepted by the Government.
The Minister has not changed her position on my amendment. I understand the comments regarding the deposit scheme. On the remarks made by the noble Lord, Lord Black of Brentwood, I am just as passionate about allowing more people to have pets. With this amendment, I am trying to encourage landlords not to leave the sector due to tenants having pets. I would like more people to have pets, and I realise how important that is, but there is a balance to be struck with trying to reassure landlords, because they do not accept pets at the present time. There are very few properties on the market that allow them.
This amendment is trying to create a balance. I appreciate that some tenants will struggle to find that deposit, but I believe that, by having it in place, more landlords would be willing to accept pets, and there would be less disruption between landlords and tenants when tenants ask to have pets. On that basis, I would like to test the opinion of the House on my Motion.
The Deputy Speaker (Baroness Fookes) (Con)
My Lords, before we turn to Motion B, I remind your Lordships that, during a Division in particular, I need a clear sight of the clerk at all times. It is therefore strictly forbidden for any Peer to move between the Table and me so that I cannot see the clerk.
Motion B
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 14 and do agree with the Commons in their Amendment 14A in lieu—
Baroness Taylor of Stevenage (Lab)
My Lords, with the leave of the House I will speak also to Motions C, C1, D and D1, which are grouped together.
I thank the noble Lords, Lord Cromwell and Lord Young, for their amendments relating to the no-let restriction. Lords Amendment 18, tabled by the noble Lord, Lord Cromwell, is intended to reduce the no-let period to six months where the property has been demonstrably on the market and no suitable offers have been received for that period. The noble Lord and I, alongside the noble Lord, Lord Pannick, have discussed this amendment at length and I thank them again for their continued engagement on this issue. The Government understand that there may be situations where landlords genuinely intend to sell their property but cannot do so. However, the reletting and remarketing restriction is one of the strongest safeguards we have in the Bill.
I know that many noble Lords agree with the restriction in principle but disagree with its length. The Government believe that the 12-month period will make it unprofitable for a landlord to abuse this ground. It is vital that these strong protections for tenants remain in place, and I want to be clear about the Government’s position and commitment. This is shared by Members in the other place, and today I was pleased to receive strong support from Shelter, citing research from the Nationwide Foundation that one in five landlord sale evictions does not result in a sale.
Lords Amendment 19, tabled by the noble Lord, Lord Young of Cookham, would exempt shared owners from the re-letting and re-marketing restriction and other important restrictions. I am very grateful to the noble Lord for taking the time to meet, particularly during recess when he was kind enough to have meetings to discuss this important issue, and for his continued support for shared owners. I also thank him for his amendments in lieu: Amendments 19B, 19C and 19D.
The Government are very sympathetic to shared owners experiencing building safety issues and the particular challenges they face. We have already taken a number of steps outside the Bill to provide greater clarity for shared owners on what flexibilities and support they can expect from providers. These include new commitments in the update to the Government’s remediation acceleration plan, published in July. The noble Lord’s amendments in lieu acknowledge the unique circumstances in which shared owners operate, while not compromising on the core aim of the Bill to improve security of tenure in the sector. The Government are delighted to support his amendments and we encourage the House to agree to them. We will continue to work with the noble Lord as the Bill is implemented. I beg to move.
Lord Cromwell (CB)
My Lords, I will address Amendment 18, Motion C1 in place of Motion C. To recap very briefly on the substance of the amendment, the Bill punishes any landlord who serves notice on a tenant because the landlord is selling the property but the property fails to sell.
The Deputy Speaker (Baroness Fookes) (Con)
My Lords, forgive me for interrupting, but we were on Motion B and I was under the impression that the noble Lord wanted to speak on Motion B, but it appears that he has gone to Motion C. Am I correct?
The Deputy Speaker (Baroness Fookes) (Con)
Oh, they are in the same group. It is not my afternoon, is it? Pray continue.
Lord Cromwell (CB)
We could set this to music if the noble Baroness wishes. Where did I get to? I will not start again, the House has been too patient, but I will start halfway through.
The Bill punishes any landlord who serves notice on a tenant because the landlord is selling the property but the property then fails to sell. They are not allowed to re-let it for 12 months. The property must stand empty and unrented for that 12 months. The amendment does not quibble with that punitive intention of the Bill. It accepts that, in order to prevent a few bad landlords trying to abuse the system, all property, belonging to all landlords, that fails to sell will stand empty and be impossible to live in for anyone seeking rental accommodation. The amendment simply sets that punitive period at six months and requires the landlord to furnish proof to a court of a genuine and reasonable, including reasonable pricing, attempt to sell the property during that time.
The House of Commons debate on this amendment acknowledged that the landlord being hit with 12 months of no income, along with the costs of their property standing empty for a year, is a problem. However, this was considered to be “relatively minor” and simply an
“inconvenience … to a well-meaning landlord who is struggling to sell”.
It was claimed that it is “far too easy” for
“any rogue landlord looking for an excuse to evict”
to abuse the proposed period of six months, and that
“landlords give excuses that are perhaps not all they seem to be”.—[Official Report, Commons, 8/9/25; cols. 651, 646, 652.]
I am sorry to say that no facts were presented, quantified or examined, and no evidence was provided, just these dismissive anti-landlord assertions.
Lord Pannick (CB)
My Lords, I support Motion C1 in the name of the noble Lord, Lord Cromwell. I repeat my interest, in that my wife owns properties in London which she rents out, from which I occasionally benefit. I thank the Minister for meeting the noble Lord, Lord Cromwell, and me to discuss the matter. Her engagement with us was much appreciated.
I want to emphasise what the Minister in the House of Commons said when the Lords amendment was defeated. He said:
“We recognise that there will be occasions when landlords regain vacant possession of their property using ground 1A but are unable subsequently to sell it despite repeated attempts to do so”.—[Official Report, Commons, 8/9/25; col. 637.]
So the Government expressly acknowledge that there will be landlords who are unable to sell, having intended to do so, and who are acting in perfect good faith. The issue is whether it is really appropriate in this Bill to penalise such good faith landlords by preventing them renting out their property for 12 months because of abuse—and there is abuse—by other landlords.
I suggest to the House that this is a plain and obvious case of a disproportionate sanction. It is a sanction against those who have done no wrong and who have acted in perfect good faith. This Government are often eager to emphasise the importance of human rights law. It is important to acknowledge that human rights law does not just protect prisoners and illegal entrants; it also protects law-abiding citizens who own property and who wish to rent it out.
It is a basic principle of the common law, adopted by the Human Rights Act, that any interference with the right to property requires a fair balance between the interests of the property owner and the interests of the community. I suggest to the House that to penalise a landlord who has acted in good faith by preventing them renting out their own property for 12 months when they have done no wrong defies the need for a fair balance. It is manifestly disproportionate. The modest amendment from the noble Lord, Lord Cromwell, to reduce the period to six months is fair and balanced, and if he divides the House, as he has indicated he will, he will certainly have my support.
Lord Hacking (Lab)
I do not know if the noble Lord is wanting to speak. I am perfectly prepared to give way to him, although I seem to have the Floor of the House.
The noble Lord, Lord Cromwell, made a very powerful case, which was well supported by the noble Lord, Lord Pannick. The noble Lord and others will remember that I supported him on this measure in Committee, and I think also on Report. It covers a wider ground than just the landlord who has been unable to sell. There is another ground, where the landlord has got possession of a property to put members of their family in. I cited the example of a landlord having done that for, let us say, parents coming in, one of whom then has a stroke, meaning that the landlord then needs to do something with the property that involves putting it back on the market. In that situation, the landlord is penalised in exactly the same way as when a landlord fails in a genuine attempt to sell, as the noble Lord has described.
In Committee, and I think also on Report, I proposed a better way of dealing with this problem: a prohibition on any landlord putting property on the market again at a higher price than the price at the time of the change of ownership. I should have succeeded in that argument, but I did not. However, I am certainly supporting the noble Lord, Lord Cromwell, as supported by noble Lord, Lord Pannick. I hope that your Lordships have heard the arguments from the noble Lords and will support them on this issue.
Lord Young of Cookham (Con)
My Lords, I will speak to Motion D1 in my name, which the Minister referred to sympathetically at the beginning of our debate.
As we have heard, the Bill currently precludes a landlord who gives notice to a tenant because he wants to sell from re-letting that property for 12 months if that sale falls through. The Government want all tenants to be protected against abusive eviction by landlords, and I have no difficulty with that principle. However, in the case of shared owners, there are already safeguards against such abuse that are not there for conventional landlords, and their sales are more likely to fall through, through no fault of their own.
The amendment exempting shared owners from this provision was carried on Report in your Lordships’ House by the largest majority of any amendment to the Bill. While sympathy was expressed by Ministers in the other place for the plight of shared owners, the amendment was overturned there. Last week, the Government tabled their Motion asking your Lordships not to insist on that amendment. On 10 October, the Minister followed that up by writing to all Peers, hoping that they would support her Motion not to insist. Then last week, we had a Damascene conversion, and here I obviously had more good fortune than the noble Lord, Lord Cromwell. I am most grateful to the Minister for the time she spent with me on this last week, and indeed earlier, and to Matthew Pennycook and the officials. The amendment in my name is the outcome of those discussions and represents a deal that I can accept.
To briefly summarise the case, shared owners are social housing residents. They own a portion of their property and rent the rest of it from the housing association. They purchased a share of their home because they could not afford to buy on the open market. They are a distinct, legally identifiable group of people, and they are actually precluded from subletting without permission from their registered provider.
Lord Best (CB)
My Lords, I congratulate the noble Lord, Lord Young of Cookham, on the compromise he has achieved on this important amendment. I must declare a family interest: my wife owns rented property in Dorset. I shall speak in opposition to the amendment to Motion C in the name of my noble friend Lord Cromwell, well-intentioned though I believe it is.
My noble friend’s amendment would mean that a landlord who had gained possession of a property using the grounds of an intention to sell would be able to relet that property after six months if it had not been sold, rather than having to wait up to a year, as specified in the Bill. In normal circumstances, one would expect a sale to be agreed within around six months, or, if not, the landlord would still want to go for a sale rather than relet the property, so the issue would not arise in most instances where this ground for possession could be used. However, the Government want to prevent an unscrupulous minority of landlords using these grounds for eviction as a way of bypassing the Bill’s fundamental intention of giving renters greater security. The fear is that the landlord will profess to want to sell but has no such intention; they simply want to evict the tenant. They may want to switch to more profitable Airbnb-style lettings, or they may want to replace a tenant who is complaining about the landlord’s neglect of essential repairs and find a more malleable or more desperate tenant.
There is some evidence of such cheating behaviour from Scotland, where similar legislation has not had constraints on how quickly a vacated property can be relet, so the Government want to prevent abuses. The Bill needs to ban reletting for long enough to deter a landlord from misusing these grounds for possession. The question is how long a pause before re-letting is permitted would be long enough. Let us take a case where a renter is complaining about damp and mould. The property needs, say, £15,000 to be spent on rectifying various defects. If the tenant is paying £900 a month, it would be advantageous for the landlord to go without six months’ rent, that is £5,300, to be rid of that tenant and find someone who will tolerate the poor conditions. Having to forego 12 months’ rent before reletting, well over £10,000 in this case, would present a more robust deterrent against using this no-fault eviction route to removing the tenant.
I can see that a compromise of a nine-month ban on reletting would probably be acceptable all round, but in the absence of that halfway house, it is safer and more foolproof to stay with the Bill’s 12-month term and reject this amendment.
Baroness Thornhill (LD)
My Lords, first, I join the noble Lord, Lord Best, in praising the noble Lord, Lord Young, for his tenacity and commitment to shared ownership owners, who really are the raw end of the market and get a raw deal in many ways. He has really shown his mettle in his commitment to this. It is also fair to thank the noble Baroness, Lady Taylor, for listening and doing something about it. I hope that her commitment to shared owners continues in other areas that we will look at.
Turning to Motion C1, from the noble Lord, Lord Cromwell, which it appears we will vote on, it is very difficult to follow the eloquence of the noble Lords, Lord Pannick and Lord Cromwell, but I will try. The noble Lord, Lord Best, has already highlighted what we call “revenge evictions”, and we are approaching that issue from the position of working—for many years, in the case of my noble friend Lady Grender—with renter groups and renter charities. From that, we get a real idea of what is happening at the sharp end, which is not quite as narrow as we might like to think it is. There are probably more unscrupulous landlords out there than the number of homes that take over one year to sell.
On revenge evictions, there is the risk that a tenant will be kicked out because they ask for improvements—the noble Lord gave a very good example of that, but there are many others. In certain parts of the country where rents are not as expensive, six months’ rent would make it worth while for the landlord to kick somebody out on that ground if they ask for even some modest accessibility improvements and so on. We are arguing over six, nine or 12 months, and the truth is that only time will tell. What I seek from the Government is some reassurance that this will be looked at, because that could very well be the case.
The noble Lord, Lord Best, mentioned Scotland. It is interesting that the properties in one in five evictions that were made on this repossession ground then turned up on their database as still being for sale. That gives weight to the fact that people are prepared to do it, because in Scotland they have no period for not re-letting.
In several debates, I mentioned that I chatted to my women friends who are landlords; I referred to them as my “landladies”. I put this to them, and they looked at me as if it were a weird question. They said, “If I were concerned about my property sitting empty, I am actually able to sell my property with the tenants still in the property while the ‘For Sale’ board is up on the door, so I would talk to them and say that the ‘For Sale’ board is going up, but I certainly wouldn’t be serving notice until I was certain that I had a buyer”. That is due to—this is a statistic that has not been bandied about—the length of time it sometimes takes to sell a house. Interestingly, they did not see it as the kind of emotive, big, terrible, unfair problem that noble Lords have made it out to be. By keeping your tenants in the property, you are not only getting the rent but—much more importantly, in our view—you are giving your tenants more time to find a home.
Lord Jamieson (Con)
My Lords, I declare my interest as a councillor in central Bedfordshire. I will speak briefly to support two important Motions before us, one tabled by the noble Lord, Lord Cromwell, on no re-let provisions, and the other by my noble friend Lord Young of Cookham on shared ownership.
On Motion C1, as the noble Lord, Lord Cromwell, clearly explained, under the Bill, where a landlord seeks possession to sell a property and that sale then falls through—as it does in about one-third of cases—the landlord is prohibited from re-letting the property for 12 months. In practice, that means perfectly good homes must stand empty for a whole year. The amendment does not undermine the Bill’s purpose; it retains the requirement for a genuine sales process and safeguards against abuse. It introduces the vital element of proportionality. A six-month restriction would still deter bad actors while avoiding unnecessary loss of rental supply at a time when demand and rents are rising sharply. We have a housing crisis, and we must take every opportunity to improve the supply of housing and homes. Leaving homes empty for 12 months does not help those desperately looking for a home to rent.
Turning to shared owners, I would also like to extend my appreciation of the dedicated work of my noble friend Lord Young of Cookham, and we support the Motion in his name. He has made a compelling and deeply fair case on behalf of shared owners who, through no fault of their own, have found themselves trapped by the complexities of the shared ownership system. I want to thank Ministers for listening to the concerns raised across the House and for working constructively with my noble friend on this issue. We would support my noble friend if he took this to a vote, but from what the Minister has said, my understanding is that the Government are supportive of it. Therefore, we hope that a vote is not necessary.
Baroness Taylor of Stevenage (Lab)
My Lords, I am grateful for all the contributions to our ongoing discussions on these matters.
On the failure-to-sell points, the noble Lords, Lord Cromwell and Lord Pannick, queried why we are determined not to reduce the no-let period to six months if the landlord can prove that the property is not selling on the open market. Of course it is imperative that we provide the very strong protections against back-door evictions so that renters have more security and stability and can stay in their homes for longer, build lives in their communities and avoid the risk of becoming homeless.
The noble Lord, Lord Pannick, referred to 12 months being a disproportionate sanction, but we have carefully considered the balance between the rights of the landlord and the security of the tenant, and that is why we have come to the conclusion that the current 12-month restriction on reletting being introduced will prevent abuse of the possession grounds, for example, by potentially opening up the practice of backdoor Section 21-style evictions to unscrupulous landlords. This length of time will make it unprofitable for a landlord to evict a tenant with the intention of reletting the property to another tenant at a higher rent. Any noble Lords who have dealt with housing cases will know of cases where that has undoubtably happened. In the areas where the markets are very hot, it happens even more. The restriction also ensures that landlords cannot pursue the retaliatory evictions so clearly outlined by the noble Lord, Lord Best. We hear of frequent examples of that as well.
The noble Lord, Lord Cromwell, referred to me talking about people being forced to reduce the price. I do not think it was a matter of forcing people to reduce the price. If the property is on the market for that 12-month period, it discourages landlords from marketing their property at a price which they know will not sell. It will give time for that property price to be reduced over time and means it is less likely to encourage those Section 21 evictions via the backdoor.
The noble Lord, Lord Jamieson, talked about properties being empty for a whole year. As the noble Baroness, Lady Thornhill, very ably demonstrated, there is no need for those properties to sit empty. They can be marketed while the tenants are still there if notice has been given. We do not need to have this protection reduced to six months. It is very important. I have had a plea from Shelter, as well as other renters’ organisations, over the last few days that we do not water down this provision in the Bill. It is a very important part of the protection for tenants. We genuinely believe that we have got the balance right between the rights of the landlord and the protections for the tenant.
On the issue around shared owners, as other noble Lords have commented, I have been very impressed with the way that the noble Lord, Lord Young, has championed the cause of shared owners. We all realise the very difficult situation they find themselves in. I would also like to thank the Shared Owners’ Network, which has been very good in its briefings to all of us and in helping us to come to the conclusions we have reached on this. Shared owners find themselves in a very difficult position—I think the noble Lord, Lord Young, describes them as reluctant landlords, and we know that that is where they are.
The noble Lord asked how the requirement for a shared owner to inform the assured tenant of the exemption will work for existing tenancies. The Government will make provision during implementation to ensure that shared-owner landlords with an existing tenancy will have the opportunity to provide this information to their tenant after the Bill comes into force. We want to take time to make sure that we get the right approach and ensure that we find a solution that works for shared owners. We intend to do this by using the delegated powers to make transitional provision provided by Clause 147 of the Bill. I very much look forward to working with the noble Lord, Lord Young, on this point as we prepare for the implementation of the Bill. I beg to move.
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 18, to which the Commons have disagreed for their Reason 18A.
Lord Cromwell
Leave out from “House” to end and insert “do insist on its Amendment 18”.
Lord Cromwell (CB)
I understand that at this stage I should be very brief, so I simply say to the noble Baroness, Lady Thornhill, that I also speak to many landlords and tenants groups. Indeed, I have put amendments down on behalf of tenants groups during this process. I thank all those who have spoken. I particularly admire the ability of the noble Lord, Lord Best, to see into the mind of landlords who fail to sell their property and know what they would do next. I do question his maths, but perhaps we can come to that outside the Chamber. Selling with a sitting tenant is definitely a different matter to selling without a tenant on board. I simply say this: it is clear to me, and I hope to the House, that a rational basis suggests that a 12-month-long inability to rent out your property is disproportionate. Six months is still punitive, but it is effective. I have sought compromise on this in vain. On that basis, I wish to test the opinion of the House and beg to move Motion C1.
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 19, to which the Commons have disagreed for their Reason 19A.
Lord Young of Cookham
At end insert, “and do propose Amendments 19B to 19D in lieu—
“(3) Subsection (4) applies where the relevant person relies on Ground 1A and—
(a) before the assured tenancy was entered into, a relevant person had given the tenant under the assured tenancy (“T”) a written statement that the landlord under that tenancy (“L”) is a shared owner of the dwelling-house and that section 16E(2) or (3) might not apply to a subsequent letting, or grant of a licence, of the dwelling-house (because of this subsection and subsection (4)),
(b) when the assured tenancy was entered into, L was a shared owner of the dwelling-house, and
(c) before the date specified in the notice as mentioned in section 8(3)(b), a relevant person had given the landlord under the shared ownership lease of the dwelling-house a written statement that L intends to assign L’s interest under that shared ownership lease.
(4) Section 16E(2) or (3) does not prohibit a relevant person from carrying out a controlled activity if—
(a) before the relevant person carries out that activity—
(i) the dwelling-house has been valued by a member of the Royal Institution of Chartered Surveyors in connection with the assignment of L’s interest under the shared ownership lease, or
(ii) L has advertised, or made an arrangement under which another person has advertised, that the dwelling-house is or may be available for acquisition by way of the assignment of L’s interest under the shared ownership lease, and (b) when the relevant person carries out that activity, L is a shared owner of the dwelling-house.
(5) In subsections (3) and (4)—
“controlled activity” means an activity that would (if subsection (4) did not apply) be prohibited by section 16E(2) or (3); “shared owner”, in relation to a dwelling-house, means a person—
(a) who is the tenant of the dwelling-house under a shared ownership lease, and
(b) whose share in the premises demised by the lease is less than 100%; and for this purpose, the tenant’s share in the premises demised is the tenant’s initial share in those premises, plus any additional share or shares in those premises which the tenant has acquired; “shared ownership lease” means a lease—
(a) granted on payment of a premium calculated by reference to a percentage of the value of the premises demised by the lease or of the cost of providing them, or
(b) under which the tenant (or the tenant’s personal representatives) will or may be entitled to a sum calculated by reference, directly or indirectly, to the value of those premises.”
“(2) The Secretary of State may, by regulations, repeal section 16F(3) to (5) of the 1988 Act.”
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 26, to which the Commons have disagreed for their Reason 26A.
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 27, to which the Commons have disagreed for their Reason 27A.
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 39, to which the Commons have disagreed for their Reason 39A, and do propose Amendments 39B and 39C in lieu—
“The standard of MOD accommodation
(1) The Secretary of State must prepare and publish in relation to each year a report
on—
(a) the extent to which service family accommodation in England meets the relevant standards during that year, and
(b) the work to maintain and improve the standard of service family accommodation in England that is undertaken during that year and planned for subsequent years.
(2) The Secretary of State—
(a) may make the required assessment, or
(b) may arrange for an independent person to make the required assessment, in relation to any year.
(3) If the Secretary of State makes the required assessment in relation to a year, the Secretary of State must—
(a) arrange for an independent person to evaluate the assessment, and
(b) include that evaluation in the annual report relating to that year.
(4) The Secretary of State must lay each annual report before Parliament.
(5) The required assessment for a particular year may be made by reference to what is, in the view of the person carrying out the assessment, a representative sample of service family accommodation.
(6) The duty imposed by subsection (1) may be complied with by the preparation and publication of a report which relates to service family accommodation in England and elsewhere in the United Kingdom.
(7) For the purposes of this section, service family accommodation meets the relevant standards if the accommodation would be a decent home when assessed in accordance with the 2006 decent homes standard.
(8) The Secretary of State may, by regulations, amend this section so as to make provision about what it means for service family accommodation to meet the relevant standards (which may include provision that operates by reference to other subordinate legislation).
(9) But that power is not exercisable unless and until, in the Secretary of State’s view, it has ceased to be appropriate for the 2006 decent homes standard to be used for the purposes of the required assessment (having regard, in particular, to whether, or how, that standard continues to be used for other assessments of the standard of living accommodation).
(10) In this section—
“2006 decent homes standard” means the document called “A Decent Home: Definition and guidance for implementation” that was published by the Department for Communities and Local Government on 7 June 2006; “annual report” means a report prepared in accordance with subsection (1); “independent” means appearing to the Secretary of State to be independent of—
(a) the Secretary of State,
(b) other Ministers of the Crown,
(c) government departments, and
(d) persons who provide, manage or maintain service family accommodation;
“required assessment” means an assessment of the extent to which service family accommodation meets the relevant standards during a year;
“service family accommodation” means any building or part of a building which is provided for the use of service families as living accommodation (whether or not it is provided by the Secretary of State); and for this purpose a “service family” is—
(a) a person subject to service law and members of the person’s family,
or
(b) a civilian subject to service discipline and members of the civilian’s family;
and expressions used in this definition have the same meanings as they have in the Armed Forces Act 2006;
“year” means—
(a) 1 April 2026 to 31 March 2027, and
(b) each subsequent period of one year beginning with 1 April.”
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 53, to which the Commons have disagreed for their Reason 53A.
Baroness Taylor of Stevenage (Lab)
My Lords, I beg to move Motion H. With the leave of the House, I will also speak to Motions J, K and K1, which are grouped together.
I thank the noble Baroness, Lady Scott, and the noble Lord, Lord de Clifford, for their amendments relating to grounds for possession. Amendment 53, tabled by the noble Baroness, Lady Scott, would remove the restriction from ground 4A, which limits it to only students living in HMOs. This would allow students living in self-contained one-bedroom and two-bedroom properties, for example, to be evicted each year.
We have been clear from the outset that this ground has been carefully designed to ensure that the cyclical nature of the typical student market is maintained. We believe that the ground applying to typical groups of undergraduates living together in a shared house is the right position, while a postgraduate couple, for example, who have put down roots in the area and may live in a smaller property, should benefit from the full set of protections that the Bill gives tenants.
Noble Lords have expressed concerns about the impact that this restriction will have on the supply of one-bedroom and two-bedroom properties in the student market. With respect, I do not think that these fears will be borne out. There will continue to be demand for these properties, and many students will continue to move out in line with the academic year, even when not evicted. Renting to students continues to be a buoyant market, and I do not believe that the Bill will dampen this.
As I have stressed at length, one of the core principles of the Bill is that tenants should have more security in their homes. Removing this restriction could lead to students who need more security of tenure being evicted more regularly. I therefore ask that the noble Baroness does not insist on her amendment.
I turn next to Lords Amendment 64, tabled by the noble Lord, Lord de Clifford, which would introduce a new ground for possession for the sole purpose of allowing a landlord to regain their property to house a carer for themselves, their spouse or child. I thank the noble Lord for his thoughtful amendment in lieu. He has carefully considered some of the points I raised when we discussed his previous amendment. It is more specific on the type of care to be given and ensures that the ground can be used only where the dwelling is very nearby to the person requiring care.
The Government of course recognise the vital work that carers do to support people to live independently and with dignity. We will continue to look at what steps we can take to support the care sector, and phase 1 of the independent review into adult social care chaired by the noble Baroness, Lady Casey, should report next year. While we are profoundly sympathetic to the needs of those who require care, I am afraid that we cannot support the amendment.
I remind the House that we have already strengthened possession grounds to cover some situations, such as housing employees. In these cases, we believe that the needs of those involved can be deemed to overrule the general principle that renters deserve security of tenure and should be able to put down roots in their long-term homes.
Providing security for tenants in the private rented sector is the Government’s priority, and we have put much thought into the design of the possession grounds to ensure that they balance the needs of landlords and tenants. There must be a compelling case for new grounds, with strong evidence that it is justified for a tenant to lose their home. This proposal does not meet that bar.
We engaged extensively with stakeholders throughout the development of the Bill, and there have been only very limited calls for a ground for landlords who require care. Any added ground increases the complexity of the system, which allows more potential for abuse. The amendment could lead to a long-term member of the community losing their home to house a carer required only for a short period, and there have not been significant calls for it from the sector. I therefore ask that the noble Lord to withdraw his amendment in lieu.
On government Amendment 62A, I would like to extend my gratitude to the noble Lord, Lord Carrington, and the National Farmers’ Union for their very constructive work with the department to find a solution to the concerns they raised. As the Housing Minister explained in the other place, the Government have reflected on their position and tabled amendments in lieu, which narrowly expand ground 5A to allow agricultural landlords to evict assured tenants in order to house both employees and non-employed workers engaged in agriculture.
We believe that this is a small technical change that supports the Government’s ambition to ensure that the agricultural sector can continue to function effectively without compromising security of tenure. I am pleased that the noble Lord, Lord Carrington, and the National Farmers’ Union have indicated their support for these changes. I hope that noble Lords will also support the amendment. I beg to move.
Motion H1 (as an amendment to Motion H)
Baroness Scott of Bybrook
Leave out from “House” to end and insert “do insist on its Amendment 53”.
Baroness Scott of Bybrook (Con)
My Lords, I beg to move motion H1 as an amendment to motion H. I speak briefly to two important possession grounds, those concerning students and carers, and I also thank the Minister for her support on the amendment from the noble Lord, Lord Carrington, which this side of the House supported strongly.
First, on students, as your Lordships know, Amendment 53A sought to expand Ground 4A so that it also applied to one and two-bedroom properties let to students. Extending this ground would maintain essential stability in the market, ensuring that students arriving each autumn are not left without somewhere to live. Without it, landlords may be unable to gain possession in time for the new academic year, reducing availability, pushing up rents and increasing uncertainty. This is not simply about convenience—it is about fairness and inclusion. Many of these smaller homes are occupied by students who need quieter or self-contained accommodation. Often these include those who are neurodiverse and find shared living environments particularly challenging. For them, access to such housing is not a preference, it is a necessity. To exclude these properties from Ground 4A risks creating a two-tier system that leaves the most vulnerable in our society behind. I hope the Minister, and indeed our Liberal Democrat colleagues who once spoke so passionately in defence of students, will reflect very carefully on the points I bring forward.
We have a number of case studies that illustrate the implications of this ill-conceived plan, from Cornwall and Portsmouth to Loughborough. In Portsmouth, a letting agent and Propertymark member reported very high numbers of students renting one and two-bedroom flats, accounting for 20% or 30% of their portfolio—not a small number—and those included many international students. In Loughborough, feedback from another Propertymark agent on student tenancies showed a lower number of HMO lets compared with houses and flats. The evidence flatly contradicts the Government’s claims that one and two-bedroom student properties account for only a small fraction of the market. Regional variations exist, but the pattern is clear. These homes are a substantial and vital component of the student housing sector, and by excluding them from Ground 4A, the Government risk creating a two-tier system both geographically and between students themselves, particularly those with specific or additional needs.
I turn to carers and express my strong support for the amendment from the noble Lord, Lord de Clifford. As I said on Report, this amendment is tightly drawn and provides flexibility in exceptional circumstances, where a property close to home could be used to care for a loved one, enabling people to live independently and with dignity, rather than entering into the institutional care system. Propertymark has also highlighted a helpful precedent from Wales where, under the Renting Homes (Wales) Act, carers can have succession rights if the tenant they care for dies. While I understand that provision does not apply to landlords’ carers, it does demonstrate that such flexibility is possible in law and can be delivered responsibly.
If the noble Lord, Lord de Clifford, chooses to test the opinion of the House, we on these Benches will support him. I also beg to move Motion H1.
Lord Carrington (CB)
My Lords, I will speak to Motion J, specifically Amendment 62. I declare my interest in farming and rented cottages in Buckinghamshire and Lincolnshire. I want to set out on the record that the NFU and I have every reason to thank the Minister, the noble Baroness, Lady Taylor of Stevenage, for her tremendous work on these amendments, particularly the one I am speaking to. I also thank the Minister, Matthew Pennycook, for his attention to it as well. I very much hope that this sets a precedent, particularly in the realms of the Ministers of Defra and the Treasury, to take farming interests more seriously and learn from what we have learned here today.
Lord Willetts (Con)
My Lords, I will speak briefly in support of Motion H1 and the powerful points that have just been made by noble friend Lady Scott. The Minister spoke as if one-bedroom and two-bedroom student accommodation would be occupied by families and people who needed deep roots in their university environment, but much of it is also occupied by undergraduate students, who are often on low incomes, because this tends to be the lowest cost accommodation. If academic year tenancies in one-bedroom and two-bedroom accommodation become unviable then there is a real risk that this will act as a constraint on students going to university.
The Minister said that these fears would not be borne out, and I understand the sincerity with which she makes that point. However, we cannot be confident. My regret, looking back over the exchanges we have had as the Bill has progressed through this House, is that we have not heard at any point any kind of undertaking to review or assess year on year whether student accommodation is being affected by this measure. We simply cannot be as confident as she appears to be that these dangers will not arise. Therefore, I strongly support Motion H1.
Lord de Clifford (CB)
My Lords, my amendment would extend the grounds of possession to a family in need of providing a full-time carer for a family member. Regarding comments made in the other place, I confirm that I have no direct interest with regard to any property. My interest came only through contact with rural letting agents who have clients who might need a carer themselves or have a family member who does and wish to use their property to house a carer.
The amendment has been revised since the Commons debate on 8 September. One of the concerns, as already mentioned by the Minister, the noble Baroness, Lady Taylor, is that the amendment is drawn too widely and open to abuse. The new amendment restricts who the carers can be used for, this being the landlord, their spouse, their child or a child they have legal responsibility for. We have also changed it so that, if the landlord wishes to give notice to a tenant, they must provide evidence with the eviction notice that a full-time carer is required to care for one of those individuals. This significantly tightens the range of the clause and therefore reduces the ability of an unscrupulous landlord to use it wrongly.
I acknowledge, from having spoken with housing charities, that landlords hold the power in the tenant/landlord relationship, and that approaching and challenging a landlord is difficult. With these changes, the onus would now be on the landlord to provide evidence rather than the tenant. The tenant could then go to the appropriate authority to challenge the eviction if no evidence is provided. We are not looking to change in any way the four-month notice period that a landlord would have to give if a family member needed the house.
I acknowledge that these grounds will be used on very few occasions, but when they are used it will be by a family at a very challenging time, when full-time care is required for an immediate family member. Landlords will evict only if they believe they need a carer for a significant amount of time, such as for an elderly person or a child with a long-term illness or disability.
A family that is fortunate enough to be in a position with the appropriate accommodation that meets the criteria of this amendment could, and most likely will, be in a location with limited supply of available or alternative properties, such as rural settings, or a city or town with high demand for rental properties, of which there are currently many. I acknowledge that a tenant needing to leave the property will cause upheaval, stress and potential cost to that family or individual, but surely a family has the right to use what possessions it has to maximise the quality of care for a family member and to support the rest of the family at a time of need.
I look forward to your Lordships’ support on this amendment. If I need to, I may test the opinion of the House.
Baroness Warwick of Undercliffe (Lab)
My Lords, I will speak to Amendment 64B from the noble Lord, Lord de Clifford, to create a new possession ground for carers. I know that every noble Lord here appreciates and values the important work that carers do in our communities. It goes without saying that we should take every step possible, every step we reasonably can, to help them in their work. The noble Lord has been thoughtful and very considered throughout these discussions, and clearly has the best interests of carers at heart, as he has again shown.
I understand that this is a difficult issue and appreciate the arguments that landlords who organise their own care are not burdening the state and that they should be able to utilise their properties to do just that. On the other hand, I note that these debates have previously highlighted—as the noble Lord, Lord de Clifford, has again today—the difficulty of housing carers, for example in rural communities.
The scarcity of housing in rural areas also raises the counterpoint of the plight of the tenant. These tenants may be the local teacher or work in the post office—long-term members of the community who do not own their own homes. To evict them to house a carer for a landlord who may possibly be in the area for only a couple of years will upend their lives and leave them potentially struggling to remain in the area. It is worth adding that the only way currently to test whether there is a genuine need for a carer is if the tenant challenges their eviction and the landlord has to go to court to obtain a possession order. Unfortunately, I am afraid, experience shows that many tenants will not do that, as they will simply leave without the landlord ever having to prove a carer was really required.
I appreciate that this is very much a balanced argument but, on balance, I am of the view that allowing tenants to be evicted through no fault of their own in order to house carers for landlords is not the right approach, because of the threat and disruption this would cause to tenants and the scope for wider misuse of this ground. As the noble Baroness, Lady Thornhill, said, we should not underestimate the danger that this could become a loophole for unscrupulous landlords. There are enough of them, as we all know and realise from our experience in the private rented sector, so this could be a real danger.
There are dangers and scope for wider misuse. In my view, therefore, the benefit to a relatively narrow group of landlords should not be allowed to outweigh that disruption, so I hope that the Motion is not moved to a vote.
Baroness Neville-Rolfe (Con)
My Lords, I refer to my register of interests as the joint owner of a small cottage in the village where I live.
I strongly support Amendment 64B, tabled by the noble Lord, Lord de Clifford. It has had the support of the noble Baroness, Lady Bowles, and of caring organisations, which would be helped immediately, not just condemned to wait for the Casey review, which we are all very keen to see. The amendment has been tightened up considerably by the noble Lord, Lord de Clifford, to avoid any abuse, in response to comments that the Minister herself made in Committee, which is very helpful.
The Government’s negative response is an example of their unwillingness so far to take the demise of carers seriously. Being able to provide accommodation for carers can make a real difference to their availability.
Not every carer wants to be a live-in carer, especially if they have families, yet we need growing numbers of carers. This is because there are ever-growing numbers of the aged and the disabled, as well as a scarcity of care home and hospice spaces. There is an acute shortage of housing and a scarcity of short-term accommodation, partly as a result of this very Bill. At the same time, we have smaller families, more couples having no children and more people seeing their relatives working or moving overseas. The need for hired carers is increasing, therefore, and those carers need short-term accommodation—it can sometimes be for years—as they move, over time, from job to job in different locations. We need to look at this. This change will be a small and totemic positive that would help both the caring sector and families in need. I invite the Minister to think again.
Baroness Bowles of Berkhamsted (LD)
My Lords, I rise to speak to the amendment in the name of the noble Lord, Lord de Clifford. As previously, I declare my interest as a private landlord. In the context of this amendment, I had a relative to whom it would have applied; that interest no longer applies, as the Bill has caused plans to be advanced and the tenants in the relevant property were given notice under current law, but, of course, that does not take away my general concern around this topic.
This replacement amendment now has a narrower scope, applying only to homes needed to house carers in the immediate family—that is, the landlord, a spouse or children. Thus, it closes a loophole perceived by some of it being used by those with an awful lot of relatives, as was discussed with the Minister.
Some people have live-in carers. Others may need more than one carer or have progressive conditions. Whatever the reason—whether financial or in terms of availability—it may not be possible to have one large house to accommodate all the future carer needs under one roof or to sustain expenditure on such a property before it is required. People have to plan for the future deterioration of the person needing care and of the family members who are part of their support.
Some may have invested in an ideal adjacent property in good faith under current law as it became available. They may be using insurance payouts and—especially in the instance of children—are needing to plan for when parents are no longer around. Such plans have to be scrapped under this Bill, most likely resulting in property sales and earlier evictions. It may be a one-off readjustment, because nobody will make such plans in future, but is it really necessary to hit the vulnerable, such as children damaged at birth? That is among what we are doing.
To suggest that it is easy for affected people to set up and move elsewhere because they have the resources of more than one property is cruel. Avoiding upheaval can be an important factor, for reasons both of the health of the impaired person and of making bespoke adjustments to property—all of the equipment, bars, ramps, bathroom locations and so on. This is really not fair and not caring. I therefore support this amendment; with the narrower scope, I believe that it is a fair suggestion.
Baroness Thornhill (LD)
My Lords, I will speak very briefly. We opposed the amendment of the noble Baroness, Lady Scott, on Report, and we see no reason to change our minds now. We have reflected carefully upon it. My noble friend Lord Shipley was very vexed by this question and was in conversation with the noble Lord, Lord Willetts. We finally came to the conclusion that the Government have probably got this about right, for the reasons given by the noble Baroness, Lady Taylor. We are very pleased that the diligent work of the noble Lord, Lord Carrington, has finally got the concessions that I think it deserved.
Baroness Thornhill (LD)
I am sorry, but every single person who would use this would be evicting a set of people, and the Bill is about protecting tenants in their place. Very few people will be in that privileged position. We and the Government have to make decisions about where that balance lies, and the decision has been made that way. I am sorry if it offends some people, but that has to be considered when making a decision of this sort.
Baroness Taylor of Stevenage (Lab)
My Lords, I thank all those who contributed to this debate. There have been some emotive discussions—I will come on to those in a moment—and some very thoughtful and considered responses to the amendments, and I am grateful for that.
I will start with the potential expansion of ground 4A. The Government recognise that the new tenancy system will have an impact on the way the student market operates. While we believe the ground covers the majority of the market, there is no one-size-fits-all solution that covers all circumstances. We think it is reasonable that the ground will apply to full-time students in larger house-share situations. Removing this restriction could lead to students who need more security of tenure—such as single parents living with their children or postgraduate couples living together who have put down roots in the area—being evicted more regularly. I took my degree as a mature student. I am very sympathetic to people who have to run other parts of their life alongside their student life. They may be working or have families or caring responsibilities to cope with alongside their student life.
Noble Lords have raised concerns that the Bill could cause severe shortages of student accommodation or force students into expensive purpose-built student accommodation. We do not expect our reforms to have that level of destabilising effect on the rental market. I shall quote from Shelter’s email to me today: “This amendment would deny a group of renters the security and stability offered by the Renters’ Rights Bill, many of whom will be in employment or with caring responsibilities that sit alongside their student life”. That is when stability is key, and we do not believe they should be denied that stability. We will continue to work with good landlords and their representative associations throughout the implementation of the Bill.
I was grateful to the noble Lord, Lord de Clifford, for his amendment. As I have outlined, everyone in the House is aware of the remarkable and vital work that carers do to support families and individuals in difficult circumstances. However, given the risk of abuse and the very limited circumstances—I think the noble Baroness, Lady Thornhill, put this very well—in which it might apply or could be used, we do not believe this new ground is warranted. We have ensured that possession grounds are fair to both parties, giving tenants more security while ensuring that landlords can recover their property when reasonable. For example, if the carer is a family member, as set out in ground 1, a landlord can use that ground to gain possession, enabling them to accommodate the carer.
I was grateful to my noble friend Lady Warwick for illustrating some of the issues that may arise, particularly in rural communities, around who may be evicted as a result of this ground. I want to add to the list of those who could be evicted an existing carer living in a rural setting where there might be very scarce housing, so you may have to evict one carer to put another carer in place. If there is scarce housing in that area, you may end up in that circumstance. Of course, the Government will continue to look at ways that they can support carers. I reassure the noble Baroness, Lady Thornhill, that once the Casey review is published, we will look at all the issues around carer support once again.
I am grateful to the noble Lord, Lord Carrington, for his comments. I know that he was not able to stay in the Chamber for the end of the debate, but we had specific issues raised by stakeholders, including the National Farmers’ Union. We listened very carefully to what they said, and we have ensured that the ground now has appropriate protections in place preventing landlords evicting assured tenants to house short-term workers. I am glad that that met the noble Lord’s request in terms of the amendment that he submitted previously.
Baroness Scott of Bybrook (Con)
My Lords, I still do not understand why a group of students is not being looked after quite the same as other students. Therefore, I urge the House to support my Motion H1 to send the Bill back to the other place with our concerns for equality in the student housing sector, with housing for students who want, indeed need, small homes. Not every student can either work or live comfortably in an HMO, and not every student can afford specific student accommodation. Therefore, I beg to test the opinion of the House.
Baroness Taylor of Stevenage
That this House do not insist on its Amendments 55 to 62 and do agree with the Commons in their Amendment 62A in lieu of Lords Amendments 55, 56, 57, 58, 59, 60, 61 and 62.
“The landlord seeking possession requires the dwelling-house for the purpose of housing a qualifying agricultural worker.
For the purposes of this ground a person is a “qualifying agricultural worker” in case A or B.
Case A is where—
(a) the person will be employed in agriculture as a seasonal or permanent employee under a contract of employment, and
(b) the employer under that contract is—
(a) the landlord, or
(b) in the case of joint landlords seeking possession, at least one of those landlords.
Case B is where—
(a) the person will be—
(i) employed in agriculture under a contract of employment, but the employer under that contract is not the landlord or, in the case of joint landlords, any of those landlords, or
(ii) working in agriculture under a contract that is not a contract of employment, whether the contract is express or implied and (if express) whether oral or in writing,
(b) the person will be employed or working in agriculture under that contract wholly or mainly for—
(i) the landlord, or
(ii) in the case of joint landlords seeking possession, at least one of the landlords, and
(c) the relevant landlord intends that employment or work to continue for at least six months after the relevant date; and here “relevant landlord” means the landlord, or whichever of the joint landlords, the person will be wholly or mainly working for.
In this ground—
“agriculture” has the same meaning as in the Rent (Agriculture) Act 1976 (see section 1 of that Act);
“contract of employment” has the meaning given by section 230(2) of the Employment Rights Act 1996.”
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 64, to which the Commons have disagreed for their Reason 64A.
Baroness Taylor of Stevenage (Lab)
My Lords, I have already spoken to this Motion. I beg to move.
Motion K1 (as an amendment to Motion K)
“New ground for possession for property which is required for a carer for the landlord or landlord’s family
24A After Ground 8 insert—
“Ground 8A
The landlord seeking possession requires the dwelling-house for the purpose of housing a person who is a carer for—
(a) the landlord,
(b) the landlord’s spouse, or
(c) the landlord’s child or a child for whom the landlord is the primary guardian,
where the dwelling-house is in sufficiently close proximity to the person requiring care to facilitate emergency callout.
The landlord is responsible for producing evidence to demonstrate that a full-time carer is required for the person specified in paragraphs (a) to (c) above. For the purposes of this Schedule, “carer” means an adult providing personal care or nursing care to another person, who may be under the age of 18, under a voluntary or contracted arrangement.
The Secretary of State may by regulations—
(a) specify the nature of the evidence to be produced by the landlord above, and
(b) amend the definition of carer.”””
Lord de Clifford (CB)
I thank your Lordships for your contributions to the debate on this matter. What I drew from it is how much we all value what carers do for all our people in need of care. I look forward to the review by the noble Baroness, Lady Casey, to help the caring market, which is coming out next week.
One of the comments has been that tenants would be evicted if this amendment were accepted, but tenants are being evicted all the time, for lots of different reasons. It is an important matter that people should be able to use their possessions to care for their families, as I said in my speech. However, taking account of the votes today, I will not move my Motion K1.
Baroness Taylor of Stevenage
That this House do not insist on its Amendment 67, to which the Commons have disagreed for their Reason 67A.
Renters’ Rights Bill
Wednesday 22nd October 2025
(9 months, 3 weeks ago)
Commons ChamberRead Full debate Renters’ Rights Act 2025 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Commons Consideration of Lords Message as at 22 October 2025 - large print - (22 Oct 2025)
The Minister for Housing and Planning (Matthew Pennycook)
I beg to move, That this House agrees with the Lords in their amendments 19B, 19C and 19D.
Madam Deputy Speaker (Ms Nusrat Ghani)
With this it will be convenient to consider the Government motion to agree with the Lords in their amendments 39B and 39C.
Matthew Pennycook
Today is a momentous day, because, subject to agreement from this House, the Renters’ Rights Bill will have completed all its stages and will therefore shortly become law. This House last legislated to fundamentally alter the relationship between landlords and tenants in 1988—I was just six years old. In the decades since, England’s private rented sector has changed beyond all recognition. It now houses not just the young and the mobile, but many older people and families with children, for whom greater security and certainty is essential to a flourishing life.
The need to overhaul the regulation of the private rented sector and, in so doing, level decisively the playing field for landlords and tenants is pressing. That is why we introduced the Bill within months of taking office. We promised that we would succeed where the previous Conservative Government had failed by legislating to transform the experience of private renting. I am delighted that we are now within touching distance of seeing the Bill become law. Before I turn to the final amendments agreed to in the other place, I want to put on the record once again my profound thanks to Baroness Taylor for so ably guiding through its House of Lords stages.
Jeremy Corbyn (Islington North) (Ind)
I, too, welcome the Bill becoming law. Personally, I wish that it also regulated rent levels, but my question is: how quickly will it become law to protect people? While this Bill has been winding its way through Parliament over the last year, many have faced the appalling situation of no-fault eviction. Many have lost their properties as a result, whereas they would have been protected had the Bill become law more quickly. Can the Minister give me some idea—so that I can give some comfort to my constituents who are facing no-fault eviction—of how quickly they will get protection, and will there be any retrospective element to it?
Matthew Pennycook
I thank the right hon. Gentleman for that point. We want to provide both renters and landlords with certainty about how the new system will be implemented. I will say a bit more on that in the course of my remarks.
Matthew Pennycook
I am going to make a bit more progress.
As I made clear when we considered Lords amendments to the Bill on 8 September, although the Government were not prepared to accept amendments that would undermine the core principles of the Bill, we were more than willing to make sensible changes in response to the legitimate concerns that have been raised. The changes we are proposing today are firmly within the spirt of that commitment. I am delighted that we were able to reach agreement with those on the Liberal Democrat Front Bench and Lord Young of Cookham, and I thank all the noble Lords involved for their willingness to work collaboratively to strengthen the Bill.
Let me briefly set out the purpose and effect of the amendments in question, beginning with those that relate to shared owners. Lords amendments 19B, 19C and 19D exempt shared owners from the 12-month “no re-let” period in respect of new mandatory possession ground 1A, which allows a landlord to evict a tenant because they intend to sell their property. The exemption is subject to meeting set criteria, to ensure that shared owners have made a genuine attempt to sell their property. The amendments in question also include a delegated power to remove the exemption in the future—for example, once the building safety programme has been completed.
Jim Shannon
I welcome what the Minister has proposed. More and more of these issues have come to my attention in my constituency. Tenants then have to find alternative and affordable accommodation that is close to their work and close to their children’s education. I know this legislation applies to England and Wales only—I understand that. But the Minister is a good Minister, and he always shares information on the legislation that is put forward with the regional assemblies—in my case, the Northern Ireland Assembly. Will he do me and this House the favour of sharing the legislation with the Northern Ireland Assembly to ensure that the good things in the Bill can become good things for us in Northern Ireland as well?
Matthew Pennycook
The Northern Ireland Assembly can access this legislation online, but I will certainly continue to have conversations with Ministers in all the devolved Administrations about what lessons can be learned from what we have done with this Bill, and about what they can take from it.
I once again commend Lord Young of Cookham for championing the interests of shared owners affected by the building safety crisis, and I thank him for tabling his three amendments in lieu. As I made clear when we considered Lords amendments last month, the Government recognise the plight of shared owners living in buildings that require remediation. Many are facing unaffordable costs, often with no viable exit route other than a distress sale. We also appreciate that it is often harder to secure a purchaser for a shared ownership property, and that the sales of shared ownership flats are more likely to fall through due to the additional constraints involved. As such, we have always accepted that the 12 month no re-let period would have placed many shared owners in an extremely challenging position.
The reason why the Government did not feel able to accept Lord Young’s original Lords amendment 19 was that it could undermine protections for the small subset of tenants who happened to rent a sub-let home from a shared owner. I am therefore pleased to report to the House that the amendments in lieu deliver the core aims of that original amendment, while also ensuring that three key safeguards are in place to protect tenants.
First, there is a requirement for the shared owner to have informed the assured subtenant in writing at the outset of the tenancy about the exemption and its possible use. This will ensure tenants are aware of the particular circumstances of the tenancy they are entering into and can make an informed choice about whether they wish to enter into a tenancy agreement with the shared owner in question.
Secondly, shared owners must have informed their provider of their intention to sell before obtaining possession of the property from the tenant. This is an essential first step that all shared owners must take to begin the process of selling their property. I am satisfied that it is a proportionate requirement to evidence that a shared owner is genuinely intending to sell their home.
Thirdly, a valuation must be undertaken on the property by a member of the Royal Institution of Chartered Surveyors, or the shared owner must have advertised the property for sale. This can be done at any point before a property is re-let, recognising the need for flexibility in how shared owners will approach a sale.
Taken together with the protections that are already in place as a result of registered providers having to authorise sub-letting requests and having oversight of what rent levels can be charged, I am satisfied that these safeguards will reduce, if not eliminate entirely, the risk that an exemption from the 12-month no re-let period might otherwise have posed.
Lords amendments 39B and 39C will introduce a statutory requirement for annual reporting on the extent to which service family accommodation meets the decent homes standard.
Calum Miller (Bicester and Woodstock) (LD)
I thank the Minister for listening to Liberal Democrat colleagues who have made these points, as I have along with my hon. Friend the Member for Taunton and Wellington (Gideon Amos), on previous occasions. It is very good that those living in military service accommodation will now have the opportunity to access the decent homes standard. Could the Minister assure me that he will work with colleagues in the Ministry of Defence to ensure that all service families are aware of the decent homes standard—the standard to which they can hold their accommodation providers—so they can live in better homes in my constituency of Bicester and Woodstock and across the country?
Matthew Pennycook
We have ongoing dialogue with colleagues in the Ministry of Defence about this issue, and if the hon. Member will allow me, I will elaborate on how we think these amendments will work in practice and how they interact with what the Ministry of Defence is itself doing. First, however, I once again thank Baroness Grender, Baroness Thornhill and the hon. Members for Taunton and Wellington (Gideon Amos) and for North Shropshire (Helen Morgan) for their continued support and advocacy for service personnel and their families.
The Government have been clear throughout the passage of the Bill that our armed services personnel and their families must live in safe and decent homes. We remain determined to improve the standard of service family accommodation across the entire defence estate. Alongside the commitment to drive up standards through a record investment of £1.5 billion in service family accommodation over the next five years, the Government will soon publish a defence housing strategy setting out clear renewal standards and further steps to improve the lives of those who serve our country. That standard will be published, so service families will be able to see, judge their accommodation against and interact with this new statutory duty.
As I outlined in the previous debate on Lords amendments, the Government acknowledge the need for greater transparency and accountability to ensure that the commitments we have made are honoured. The amendments in lieu will place the commitments I made to this House last month on a statutory basis. The Government believe that this, alongside the wider steps I have already set out, will help ensure service personnel and their families have the quality of homes that they deserve. The amendments also include a delegated power allowing the housing quality standards that SFA is assessed against to be updated when the current version of the decent homes standard is no longer considered appropriate—for example, when it has been replaced by a new modernised standard. The Liberal Democrats have indicated their support for these amendments, and I hope hon. Members will join me in supporting them.
To conclude, I urge the House to support the amendments put forward by the other place, and I look forward to the remainder of the debate.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the shadow Secretary of State.
Sir James Cleverly (Braintree) (Con)
We are considering the Lords amendments in lieu to the Renters’ Rights Bill, and I begin by recognising the work that has taken place in both Houses to improve this legislation, and by thanking their lordships for the constructive way in which they have approached this endeavour.
On the amendments themselves, the issue of shared ownership leaseholders was rightly championed in the Lords by my noble Friend Lord Young of Cookham, and I pay tribute to him for his persistence. He made a fair and compelling case for shared owners who, through no fault of their own, may be unable to sell their share and should not be penalised for re-letting in those circumstances. The Government’s acceptance of that principle, although through a modified amendment, is a sensible and pragmatic improvement, which we will therefore support.
On the decent homes standard and the service family accommodation estate, the Government have placed a duty on the Secretary of State to report on the conditions of service family accommodation and provide independent oversight. Our armed forces and their families deserve and need decent, well-maintained homes, and we believe that greater transparency will strengthen service families’ confidence in the system. We support this improvement, and we hope that the Government will look at our policy to create an armed forces housing association that would oversee these changes and address the declining recruitment and retention rates that, sadly, we have seen under this Government.
While we support these improvements, I fear the Bill in its current form will in some areas be counterproductive, and drive landlords from the market as well as putting up rents for tenants. Labour’s own impact assessment for this Bill supports that concern, stating that
“landlords can pass through some, but not all, of their cost increases to their tenants in the form of higher rent”
due to new costs. Under the Bill, all tenancies will continue until either the tenant gives notice or the landlord obtains a court order for possession on specific grounds. The Government have committed to ending section 21 evictions, but they must also ensure matching court reform so that the system works for both tenants and responsible landlords. We need clarity about when and how these changes will be implemented, because uncertainty helps no one. Local councils must have the means to enforce the new rules effectively, and the Government should set out a clear and workable plan to that end.
The Lords amendments represent a sensible set of adjustments that I would say make this Bill slightly more workable, but sufficient challenges remain in how it will operate in practice. We recognise the value of the scrutiny that has taken place in both Houses, and the constructive way that many of the concerns have been addressed, but the uncertainty in this sector is seeing landlords leave the market at an alarming rate.
Jim McMahon (Oldham West, Chadderton and Royton) (Lab/Co-op)
The shadow Secretary of State knows that I have a great deal of time for him as a person, but he must reflect on how all of his speech is about the rights of the landlord with absolutely nothing about the rights of tenants. In my own constituency, 600 children are in temporary accommodation, having largely been driven out of their private rented accommodation because of no-fault evictions. Does he have anything to say about the rights of tenants?
Sir James Cleverly
I can only assume that the hon. Member has been asleep through the last couple of paragraphs I have read out, in which I specifically spoke about the rights of tenants in the military estate, for example, so I reject his characterisation of our position. The simple fact is that tenants’ rights are all well and good, but if accommodation for those tenants does not exist, they are no better off.
We have seen an estimated 18% of new homes for sale that were previously in the private rental market estate, and in London that figure is 29%. A reduction in the private rented sector market harms, not helps, people seeking to rent in the private sector. Labour Members will say, “Well, we are going to deliver 1.5 million new houses,” but no one—I doubt even their own Front Benchers—actually believes they have any chance of delivering that figure. The Office for Budget Responsibility certainly does not believe that they have any credible chance of doing it, so the housing and rental situation is likely to get worse.
I confirm that the official Opposition will support the Lords amendments, for the reasons that I have set out. We urge the Government to implement them professionally and swiftly, and to focus on delivering a fair and effective system for tenants, for the landlords that provide accommodation for those tenants, and for the wider housing market. However, there are still a number of flaws in the Bill—it does not do enough to protect renters or ensure a stable rental market, as it will reduce supply and, perversely, push up rents—which is why, having committed to not opposing the amendments, we will hold the Government to account on the Bill’s consequences.
Kevin Bonavia (Stevenage) (Lab)
I fully support my hon. Friend the Minister’s motion to agree with Lords amendments 19 and 39, and I thank him for all his work. I pay tribute to my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner) for piloting this momentous legislation through the House. If I may, I add my own thanks to the noble Baroness Taylor of Stevenage, who has been a doughty champion in the other place and, of course, in my constituency of Stevenage.
Some 7,000 households rent privately in Stevenage. They fear their tenancies coming to an end for no good reason. I was knocking on doors in the ward of Roebuck last weekend. A young mother opened her door, and I noticed that the window next to the front door was broken and patched up with a wooden board. I asked whether it was a council property, and she said, “No, I rent privately. He’s a good landlord.” I said, “Okay, so will he fix that window?” She replied, “Oh, no. He has given me this bit of wood. I am a bit worried that if I ask, he will throw me out.” That is what a “good” landlord is assumed to be. It must come to an end.
Renters like that young mother have been waiting 40 years for change. Today, should the House agree, the Bill will go for Royal Assent, and that fear will come to an end, so I support the motion. I thank the Minister.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
Gideon Amos (Taunton and Wellington) (LD)
I look forward to Parliament finally passing legislation that will bring long-overdue protections to tenants. We do not believe, like the shadow Secretary of State, the right hon. Member for Braintree (Sir James Cleverly), that tenants’ rights are “all well and good”. They are not all well and good. No-fault evictions are not all well and good, and the previous Government’s failure to outlaw them is unacceptable. It is a good thing that this legislation will finally change that.
The Liberal Democrats have long campaigned for—and stood on a manifesto that included—ending no-fault evictions of tenants, longer and more stable tenancies, a register of landlords, and decent homes for our forces families. Thanks to the Government agreeing to our proposals, all those things are to become law through the Bill and in MOD service accommodation. For too long, renters across the board have had a bad deal. It is time to redress the balance after years of Conservative government failing to deliver both on no fault evictions and on decent homes for our military families.
I warmly welcome Government amendment 39, which will make service family accommodation subject to the decent homes standard. I am glad that Ministers have listened to the calls from the Liberal Democrats and service families. I thank the Minister for doing the hard yards pragmatically in his negotiations on the Bill, and I pay tribute to my noble Friends Baroness Grender and Baroness Thornhill for their work to secure those important changes. The state of housing that service families have had to endure is a disgrace. The Defence Committee heard of dire conditions, with pest infestations, black mould, damp, flooding and unreliable heating and hot water in winter. I have heard similar stories and seen the photographs from constituent service families who were forced to live in damp and mouldy accommodation declared unfit for human habitation. Our soldiers, sailors, air force personnel and Royal Marines—such as those who serve in 40 Commando at Norton Manor Camp in my constituency, the Conservative closure of which I began campaigning against in 2017—sacrifice so much for our country. The very least that they deserve is a decent home for them and their family.
This is not an isolated issue. Research we obtained earlier this year found that, on Victory in Europe Day alone, more than 400 service families were forced to apply for emergency repairs. While the country celebrated our veterans, too many forces families were struggling with housing that falls far short of the standards that we rightly expect elsewhere. Their new decent home standard—which comes a year after my hon. Friend the Member for North Shropshire (Helen Morgan) tried and failed to get the Conservative Government to deliver it, and 18 years after Sir Menzies Campbell began the Liberal Democrat campaign for decent homes for our military—is a matter of fairness, as I hope the House will agree. This is a great first step, and I am proud that the Liberal Democrats have had a hand in securing it.
Decent homes for service families should be not just reported on but acted on. Defence Ministers have assured the House that housing standards are on an upward trajectory. We will hold the Government to account on that commitment. Can the Minister give any assurances that resources will be put in place to ensure that that happens? Nobody wants to see an annual report that leads to no progress. I also ask him to ensure that service family accommodation meets the commitments made in the Defence Infrastructure Organisation’s consumer charter—most notably the requirement to complete urgent repairs within a timeline consistent with Awaab’s law. That would ensure that Lords amendment 39 strengthens a Bill that already delivers vital reforms for renters and rightly includes protections for service families. It delivers broader transformation in renters’ rights by ending no-fault evictions, creating more secure tenancies and raising standards across the private rented sector. Amendment 19 would also allow shared owners to re-let if a sale falls through. As such, we support it.
Of course, we must not lose sight of the bigger picture: the need to build a new generation of council and social rent homes—150,000 per year. This week shows that determination, persistence and principle can deliver real change. Our forces families will now have statutory protections for their homes, tenants across the country will gain greater rights, and every step like this brings us closer to the fairer housing system that we all want. I congratulate all those who have campaigned for this change, particularly the forces families who have contacted me. More secure homes are what private renters need, and decent homes are the least our military deserve.
Helena Dollimore (Hastings and Rye) (Lab/Co-op)
Let us be clear: the Bill is the biggest uplift to renters’ rights in a generation. It will make a huge difference for so many people in my constituency. Before I come to the amendments, I place on the record my thanks to the Minister stewarding the Bill through Parliament, and to my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner) for her remarks as a champion of renters and social housing in this country.
I also place on the record my anger that the Bill has taken so long to pass through Parliament. It is an absolute disgrace that it has been slowed down—bogged down in amendments—by the other place, which has delayed these vital rights reaching my constituents. Opposition parties tabled 450 amendments, so our colleagues in the other place had to sit for a very long time to get the Bill through. In that time, my constituents have been stuck in damp and mouldy housing and subject to section 21 evictions, and many children have been growing up in temporary accommodation, because of the delays to the legislation in the other place. Opposition parties whose Lords placed so many amendments should be ashamed for slowing down the legislation.
Jeremy Corbyn
I will be brief, because this is a time-limited debate. I welcome the Bill, although it has deficiencies, because it does not regulate the amount of rent that is charged. In my constituency, a two-bedroom flat in the private rented sector goes for about £2,000 a month, which is way above what most people can afford. There is a desperate need, in inner-city areas in particular, for rent regulation.
I am pleased that we are ending no-fault eviction, but I absolutely agree with the points made by the hon. Members for Stevenage (Kevin Bonavia) and for Hastings and Rye (Helena Dollimore) about the extraordinary way in which the Bill has been delayed. Thousands of tenants all over the country have lost a home that the Bill, had it become law, would have prevented them from losing. It is outrageous, the number of people who have become homeless or been forced to move to an even more expensive place. I would be grateful if the Minister could assure us that the no-fault eviction protection will come in immediately when the Bill receives Royal Assent, and that there will be no delay. Some of us are concerned that there has been too long a delay.
There are two quick points that I want to put to the Minister. The Bill requires local authorities to play a much greater role in the private rented sector, but they lack the resources to do that. Is there a guarantee that they will get the resources to ensure proper monitoring of the Bill, and proper support for tenants? In the same vein, the provision of housing advice has disappeared in many parts of the country, so the demand grows on local authorities and organisations such as Citizens Advice for advice for tenants. Many tenants are simply unaware of their rights. If they are unaware of their rights, they can be exploited by unscrupulous landlords—and sadly often are.
Matthew Pennycook
With the leave of the House, I will close this brief but thoughtful debate. I thank all right hon. and hon. Members who have spoken for their contributions. In the time available, I will respond to as many of the issues raised as I can.
Let me start by saying that I welcome the broad support for the Lords amendments expressed by both shadow Front Benchers. In our view, the amendments are reasonable and proportionate, and respond to legitimate concerns that were raised. They have the safeguards in place that we felt were needed, and we are happy that they are being incorporated into the Bill.
The shadow Secretary of State, the right hon. Member for Braintree (Sir James Cleverly), raised the issue of supply. We acknowledge that it will take time for the sector, including build-to-rent providers but also landlords of any type, to adjust to this significant change in regulation, but we do not believe that the legislation will have a destabilising effect on the rental market, or a harmful impact on future rental supply, which, it should be noted, we are taking steps to boost, not least by providing more opportunities for investment in a growing build-to-rent sector.
According to the English housing survey, the size of the private rented sector has remained broadly stable since 2013-14. Landlords have been aware of successive Governments’ plans to reform the sector since 2019. It is worth noting that a study from the UK Collaborative Centre for Housing Evidence looked at whether regulation of the PRS over the past 25 years, in the UK and internationally, had affected PRS supply. It concluded that there was no evidence to support the assertion that non-price regulation impacts supply. We will, of course, continue to work with landlords and their representative associations throughout implementation. We are committed to robustly monitoring and evaluating the private rented sector reform programme, and we will, of course, continue to monitor trends across the PRS, including the supply of properties, to understand how the market is responding to our reforms.
The right hon. Member for Islington North (Jeremy Corbyn) raised the issue of rent controls. He knows that the Government are opposed to introducing rent controls. As I have made clear on many previous occasions, we do not support them, including rent stabilisation measures, because we believe that they could make life more difficult for private renters, both by incentivising landlords to increase rents routinely to a cap, where they might not otherwise have done so, and by pushing many landlords out of the market, thereby making it even harder for renters to find a home that they can afford.
The right hon. Gentleman asked me about implementation. Following Royal Assent, we will allow time for a smooth transition to the new system. We will support tenants, landlords and agents to understand and adjust to the new rules, and ensure the sector has enough time to prepare. As he is aware, the Bill will ensure that the new tenancy system for the private rented sector is introduced in one stage. At that point, the new tenancy system will apply to all private tenancies. Existing tenancies will convert to the new system, and any new tenancy signed off on or after that date will be governed by the new rules.
As I said, I am glad that there is broad support for the Lords amendments relating to shared owners. It is worth saying that the Government will make provision during implementation to ensure that shared owner landlords with an existing tenancy will have an opportunity to provide the information in question to the tenant after the Bill comes into force. We want to take the time to get this right, and find a solution that works for shared owners. We intend to do that using the delegated powers to make transitional provision provided by clause 147.
The Liberal Democrat spokesman, the hon. Member for Taunton and Wellington (Gideon Amos), asked about various issues relating to the amendments about service family accommodation. In particular, he asked about investment. As I outlined in my opening speech, the Ministry of Defence has announced an additional £1.5 billion investment in SFA as part of a £7 billion commitment over the next five years to improving and modernising defence housing. That investment will unlock rapid work to tackle the poor state of forces housing, helping to support recruitment, retention and morale. As I mentioned, the defence housing strategy, to be published later this year, will also set out wider plans to improve service family homes.
It is also worth saying that redress is already available to service personnel, who already have a robust system in place for raising a complaint about the standard of their accommodation and receiving remedy or reimbursement. If not resolved, complaints can be escalated to a service complaint, for which there are further powers of reimbursement, charge reduction and policy redress, and ultimately to the employment tribunal in cases of potential discrimination.
Sam Carling (North West Cambridgeshire) (Lab)
I agree with my hon. Friend the Member for Hastings and Rye (Helena Dollimore) about the delays to the Bill. I served on the Bill Committee more than a year ago now, and since then, so many tenants have experienced no-fault evictions. I encourage the Minister to move as quickly as possible to implement the Bill, so that I can tell my constituents how soon their assured shorthold tenancies will become rolling tenancies, and so they can benefit from that as quickly as possible.
Matthew Pennycook
I thank my hon. Friend for that point well made, which I will respond to directly as I wind up. We know that many tenants out there want the great security, rights and protections afforded by the Bill in place as soon as possible.
We promised in our manifesto to overhaul the regulation of our country’s insecure and unjust private rented sector, and this Bill delivers on that commitment. It will empower renters by providing them with greater security, rights and protections, so that they can stay in their homes for longer, build lives in their communities and avoid the risk of homelessness. It will ensure that we can drive up the quality of private rented housing, giving renters access to good-quality and safe homes as a matter of course, and it will allow us to crack down on the minority of unscrupulous landlords who exploit, mistreat or discriminate against renters. The Bill will also provide tangible benefits for responsible landlords who provide high-quality homes and a good service to their tenants, not only improving the reputation of the sector as a whole, but ensuring that good landlords enjoy simpler regulation and clear and expanded possession grounds, so that they can regain their properties quickly when necessary.
As I have argued many times throughout the passage of the Bill, the current system for private renting is broken. In abolishing section 21 no-fault evictions and modernising the regulation of the sector, the Bill will improve the lives of England’s 11 million private renters. It is a transformational piece of legislation and, if you will allow me a brief personal word, Madam Deputy Speaker, I take great pride in having developed and shepherded it through Parliament.
It would be remiss of me to conclude my remarks without thanking a number of people. I would like to express my gratitude to all hon. and right hon. Members and peers in the other place who have engaged with the Bill throughout its passage; the expertise and insight that have been brought to bear in both Houses have strengthened the Bill in a number of important respects. I particularly want to thank my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner), who was and remains one of the Bill’s biggest supporters. She was instrumental in ensuring that it was introduced so quickly after the formation of the Government.
I also thank all the stakeholders who have worked closely with the Government to ensure that the Bill will work for landlord and tenant alike. I cannot possibly credit them all in the time I have available, but I will put on the record my thanks to Generation Rent, Shelter, Crisis, Citizens Advice and the other members of the Renters’ Reform Coalition, as well as the National Residential Landlords Association, the shared ownership network and Propertymark. I will say a final thanks to all the officials in my Department who have devoted so much time and energy to developing and progressing the Bill, particularly the Bill team, Aidan Hilton, James Kennedy, our lawyers and many more, and my private office, specifically Will Gaby and Grace Doody, who provided me with invaluable support throughout the Bill’s passage.
Completing the Bill’s final stage today is obviously only the beginning; once the Bill becomes law, we need to implement its provisions. In doing so, we will balance the need to act quickly, so that tenants can soon benefit from the new rights and protections introduced by the Bill, with ensuring that the sector has sufficient time to adjust and prepare for a significant change in regulation. The Government understand the need for certainty, and we will set out our implementation plans as soon as possible. I very much look forward to working with hon. and right hon. Members, as well as all stakeholders, as we take forward that progress.
Lords amendments 19B, 19C and 19D agreed to.
Lords amendments 39B and 39C agreed to.
Royal Assent
Monday 27th October 2025
(9 months, 2 weeks ago)
Lords ChamberRead Full debate Read Hansard Text Amendment Paper: HL Bill 132-I Marshalled list for Consideration of Commons Amendments - (10 Oct 2025)