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Dan Carden (Liverpool, Walton) (Lab)
I beg to move,
That this House has considered regulation of the private rented sector.
It is a pleasure to serve under your chairmanship, Mr Davies. I am grateful to have secured time for a debate on this matter, which continues to directly affect all our constituents. I pay tribute to my constituents in Liverpool, Walton who continue to be the innocent victims of the UK’s broken housing system, and I commend stakeholders including the Merseyside Law Centre, the Vauxhall Community Law and Information Centre, ACORN Liverpool at the local level, and the excellent Renters Reform Coalition at the national level.
The private rented sector continues to be dominated by insecure tenure, increasingly unaffordable rents, poor housing quality and the ever-present threat of homelessness. No one in this House should underestimate the dislocating and exhausting experience of being removed from one’s home.
I am unsure whether anyone in this House has received a section 21 notice, or has felt unable to complain about damp, mould or other poor conditions for fear of a retaliatory eviction. I am unsure whether anyone in this House has had to endure the stress of having only two months to find a new property in a chaotic and punishing market—or to search for a new school for their children, a new doctor, dental surgery or other basic services that we take for granted—following the receipt of a section 21 notice. What I am sure of is that the Government were absolutely right to ban section 21 evictions, alongside taking other measures in the Renters (Reform) Bill, to correct the power imbalance between landlords and tenants; but we must not forget what the cost of delay and inaction has been. To illustrate that, I will discuss just one of my constituents.
My constituent received a section 21 notice through the post, which gave her two months to vacate the property. The landlord gave two reasons for the eviction: he was looking at increasing rental income and was also looking to sell the property. My constituent has two children, a daughter aged seven and a son aged four, who has a severe learning disability and is non-verbal. Despite that, at the start of June, she and her family will become homeless. I invite the Minister to hear directly from my constituent about the impact of that eviction on her and her family’s mental and physical health. I would be happy for my office to make contact with her office to facilitate that.
The measures in the Renters (Reform) Bill will come too late for that constituent, but we can now work to ensure that no other constituent faces the same crushing uncertainty. Thankfully, after a four-year delay following the announcement of the Renters (Reform) Bill, the Government have finally found time to introduce that important piece of legislation. I stand ready and willing to work with colleagues from across the House to ensure that the Bill makes the private rented sector as fair as possible and gives local authorities resources to enable them to regulate the sector effectively for the benefit of all our constituents.
Caroline Lucas (Brighton, Pavilion) (Green)
I congratulate the hon. Gentleman on securing this really important debate; he is making a powerful case. My Brighton constituency is one of the most expensive places to rent outside London, and my constituents are being ripped off daily. Does he agree that there is a big gap in the Renters (Reform) Bill—which is very welcome, if very late—when it comes to more enforcement powers for local authorities to target rogue landlords, and also this outrageous discrimination whereby blanket bans on renting to people with children or those who rely on benefits are still allowed? Those loopholes absolutely must be closed now. It is not good enough for the Minister to say, “We’re going to do it sometime in the future.”
Dan Carden
I am grateful for my colleague’s intervention. I will touch on both those points in some detail, and I hope the Minister will respond and that we can work together to see the Bill strengthened over time.
I will use the rest of the time I have available today to cover actions that could be taken to ensure that the reforms were robust enough to provide renters with real security in their homes. I aim to do that in the spirit of genuine co-operation, and there is considerable appetite across the House to make the legislation as effective as possible. I want to cover three primary areas in which policy could be improved: in the Bill itself, on action related to enforcement, and addressing the crisis around affordability.
As I have outlined, the abolition of section 21 evictions is a much welcome step, but the Government must go further to guarantee that private housing providers do not use other routes to subject renters to unfair eviction. Landlords can continue to reclaim possession of their properties in the case of a sale, or if they or a family member wishes to move into a property. However, under the Bill, following an eviction on those grounds, landlords can re-let their properties after three months. That period is too short, and it will not act as a proper deterrent to landlords who seek to exploit the abolition of section 21 evictions. Therefore, the Government must extend the no re-letting period to a minimum of 12 months. If they do not, renters will not feel the assurance and safety that are intended to be at the heart of the reforms.
Further, will the Minister explain what recourse tenants will have if they are evicted unlawfully on those grounds? Can tenants apply for a rent repayment order, for example? If not, what other forms of compensation are available? The proposed two-month notice period and six-month initial protected period leave those evicted on legitimate no-fault grounds in the same position as they are under section 21. The notice period should be extended to four months at an absolute minimum.
Such a proposal is not new to the Government, because in the midst of the covid pandemic, the section 21 notice was extended to four months. I can tell the Minister that the situation in the housing market has deteriorated, not improved, so it is only logical that the Government look at that proposal and seriously consider extending the period again. The benefits are obvious: if tenants were given more time to find somewhere to live, that would spare the taxpayer and tenants the cost of homelessness, which is devastating both financially and mentally.
Organisations including Shelter have expressed concern about the amendments that the Renters (Reform) Bill will make to homelessness legislation. Private renters who receive a possession notice will no longer have the right to immediate help from the council to avoid homelessness. That is because the law will no longer specify when help to prevent homelessness should be available to private renters. Instead, it will leave that to the discretion of local authorities, and that despite the Government knowing that early intervention is paramount in protecting tenants and preventing homelessness. Will the Government move urgently to address that weakness in the Bill, which directly undermines the Homelessness Reduction Act 2017 and the rough sleeping strategy? We should be boosting and improving protections related to homelessness prevention, not weakening them.
I want to speak about enforcement. The property portal and the ombudsman are positive elements of the Bill, but they will help to drive up standards only if the Government arm local authorities with the means to properly investigate and enforce. There is a postcode lottery in the sector, and enforcement action depends on how diligent and well resourced local authorities are. In my local authority area, Liverpool, we have a selective licensing scheme that aims to proactively regulate the private rented sector.
Despite the Government shrinking the area to which the licensing scheme applied in 2020, the team at Liverpool City Council has reported that, out of 2,308 inspections, 917 disrepair matters have been identified, as well as 1,053 breaches of licensing conditions. This is despite the National Residential Landlords Association previously describing the scheme as a “waste of time”. The local authority looks to work in co-operation with licence holders where possible, but unfortunately some enforcement action will always be inevitable. The council describes the number of referrals to the service as “substantial”. It says that resourcing and recruitment remain a challenge. Will the Minister commit to ringfencing resources to ensure that new regulations can be properly enforced through the property portal and ombudsman?
There is a crisis of affordability in the private rented sector, and yet calls continue to be ignored by Government. Research by Rightmove has shown that, in the past year alone, rents have risen at their fastest rate in 16 years, increasing by an average of 11% across Great Britain, yet I have never heard anyone on the Government Benches express concern that rent increases have contributed to inflation. That argument is often made when it comes to pay restraint or welfare payments, but why are landlords never asked to heed the same advice? These price increases represent an emergency, and the Government are moving too slowly to combat these rises.
There have been five housing Ministers in the past year. It seems that private renters are the losers from years of indifference and delay by the Government. Housing generally is already the biggest expense for renters. According to Crisis, private tenants on the lowest 10% of incomes are facing combined rents, food and utility costs that exceed their total incomes by 43%. The impact of further rent increases will be deep. According to Government figures, between January and March 2023, the number of section 21 claims increased by a huge 52%, and there was a 16% rise in non-section 21 evictions, the highest since the data began in 2009. The rent tribunal still continues to allow rents to go higher than the landlord may initially request, which acts as a major disincentive to using it. Will the Minister work with me to increase constituents’ means to challenge rent increases and improve the utility of the rent tribunal? If action is not taken to combat rent increases, landlords will simply evict tenants by pricing them out of staying in the property.
Caroline Lucas
It is generous of the hon. Gentleman to give way again; he is making a powerful case. Does he agree that we also need to look at rent controls, which are used in many other countries without a problem? We simply cannot allow rents to spiral out of all control. People will never be able to earn enough to have a mortgage, and they cannot even earn enough now to pay their own bills, so we need something far stronger even that what he is describing.
Dan Carden
Absolutely; I would back the hon. Lady’s calls for the Government to look at rent controls and the best international comparisons, because this is an issue not just for our constituents, but for the economy and inflation, and in the end it hurts all of us.
The Minister could also move to increase the local housing allowance. LHA rates have been frozen since 2019. Following the huge increase in inflation and house prices, this freezing means that private tenants face an ever-increasing gap between housing benefit and their actual rent. What discussions are taking place within Government to modify that? Inaction is prolonging and deepening homelessness. Further, there are White Paper commitments missing from the version of the Bill that was recently published. Where are the measures to outlaw blanket bans on renting to those in receipt of housing benefit? The Government have recognised that this discrimination is wrong, but measures to address it are missing from the Bill. I would appreciate some guidance from the Minister on that point in her response.
I will conclude by discussing an important amendment that I intend to table to the Renters (Reform) Bill. Awaab Ishak was a two-year-old boy killed by mould in a social housing flat. Unfortunately, Awaab’s story echoes much of the casework that comes through my office—and, I am sure, the offices of many Members across the House. It followed Awaab’s social landlord repeatedly failing to fix the mould problem in his family’s flat, blaming the problems on his family’s lifestyle.
In response, the Secretary of State moved quickly to table amendments to the Social Housing (Regulation) Bill to impose timeframes on landlords to investigate hazards and make repairs. That was absolutely the right move, and the Government must now put the same protections in place for private renters. As the Citizens Advice report, “Damp, cold and full of mould”, has shown, 2.7 million renting households in this country, including 1.6 million children, are living in damp, cold or mouldy homes. These conditions have a disastrous effect on people’s physical and mental health.
Abena Oppong-Asare
Abena. I thank my hon. Friend for putting forward this important debate. I have a huge number of housing cases that involve constituents of mine who live in damp and mouldy properties, and I have had responses from housing associations saying that that is down to their lifestyle, which is factually incorrect. Constituents are also facing soaring rents. Like my hon. Friend, I want to see a proper ombudsman in place for constituents living in private rented accommodation. Does he agree that the private renters charter will make things a lot fairer for individuals up and down the country?
Dan Carden
I am grateful to my hon. Friend for her intervention. I agree with her, and I hope that this Bill is an opportunity for us to ensure that the Government can put more protections in place for our constituents.
The conditions in which people live can have a disastrous effect on their physical and mental health, but tenants are left with little choice than to stay in homes that make them ill, and even kill them. Will the Minister meet with me to discuss how we can bring the private sector in line with the social sector and ensure that landlords deal with serious hazards in privately rented homes in a timely manner? Sadly, as we have witnessed, the cost of failing to do so can be fatal. I will leave the Minister with that, and I look forward to working with her and colleagues on this hugely important area of policy.
Navendu Mishra (Stockport) (Lab)
I congratulate my hon. Friend the Member for Liverpool, Walton (Dan Carden) on securing this debate. On a more negative note, housing is a constituency issue on which I receive a vast amount of correspondence. I am grateful to several local organisations, including Citizens Advice Stockport, Stockport Tenants Union and Stockport Homes, which do a lot to support tenants who might be struggling and homeless people in our constituency and town. They do a really important job, but the bottom line is that those organisations are a last resort. The Government have failed, and they continue to fail.
It also happens to be the case that when issues arise in the private sector it is always the social housing sector that must pick up the pieces, at a considerable cost in terms of emergency and temporary accommodation. I have cases in my inbox about landlords who are serving section 21 notices because they know they can get more rent from a new tenant. I have cases in which the housing standards are very poor, with damp and mould—my hon. Friend mentioned a couple of such cases in his inbox. People have come to my office who have an informal agreement with their landlord with regard to their tenancy, which offers them zero security and has a negative impact on their physical and mental health.
Members on both sides of the Chamber will be aware of people in their constituency who cannot afford deposits for a tenancy and who can forget about saving up for a deposit for a mortgage because their wages are so low. Rents keep going up, and they keep getting priced out of tenancies, mortgages and secure housing, which I believe is a fundamental human right—I am sure many Members will agree that secure, safe, clean housing is a fundamental human right. People with pets are often disadvantaged when looking for tenancies; I have had several cases on that issue. The local housing allowance simply is not adequate in my borough. The median rent value in Stockport is much higher than the local housing allowance in the two broad rental market areas, so it simply is not good enough.
I would like to mention a couple of cases. One constituent said that his son had to enter a bidding war to get his apartment in Stockport—not a house, an apartment—which was advertised at £850 per calendar month. At the end of the bidding war, the agreement was made at £880 per calendar month. I appreciate that £30 a month might not be a lot for some people, but for a lot of people struggling in the current cost of living crisis it is a large amount of money. If we multiply that by 12, it is a significant amount for many people on low wages. Another constituent had his rent increased by a huge £300 per calendar month, and the landlord still refused to undertake essential repairs to the property. That sort of behaviour is simply shameful. I do not see much action from the Government, and I do not see a credible plan to tackle these issues.
I would like to mention one more case, which is that of a single person earning less than £30,000 a year who does not qualify for any help and has lived in a tiny one-bedroom flat of 42 square metres for many years. The property has not been updated in many years. It has dated storage heaters, which are very expensive to run during the daytime, and rent increases annually by 3%. However, the constituent has been told that this year it will increase by 5%. She feels that she has no security and stability. In addition to the rent going up by 5%, she was issued an affordability assessment by the landlord’s estate agent, which implied that if she was not able to meet the threshold, she would be asked to leave. When questioned, the landlord’s agent said that they are
“employed by Landlords to protect their assets and to minimise their risks”.
That sort of behaviour has to be labelled as shameful. Protecting an asset should not be more important than someone having the opportunity to live in safe, clean and secure housing. This person told me that she cannot find alternative affordable accommodation, and she has a cat, which many landlords will not accept. That goes back to my point that many people who have pets are simply excluded from the market.
The average rent in Stockport is £850 per calendar month, which is almost a 9% increase since 2021. Most people in England have not seen their wages go up by 9% since 2021. Increasing rents and the cost of living crisis are adding up. Last year, Citizens Advice reported that rent growth was at its fastest in five years, and one in five expect their rent to rise this year. Additionally, it estimated that 425,000 renters are in arrears, owing an average of £937 each. That is almost £1,000, which is a significant amount of money for anyone.
A point has to be made about the demographics. Young people and people from working-class backgrounds are now losing at least 30% of their monthly income to rent. The Government’s Renters (Reform) Bill is a positive step, but there are lots of loopholes, and there have to be assurances on a number of factors in the Bill.
Mr Gregory Campbell (East Londonderry) (DUP)
Does the hon. Member agree that one factor that should be taken into account is Government support for greater availability of good-quality social housing, which would help to suppress the increase in rents? Allied with that, the Bill and the tax regime should pursue bad landlords, support good landlords and protect tenants at the same time.
Navendu Mishra
I agree, although my experience is that Stockport Homes, one of the major local social housing providers, has been struggling to secure properties because their cost has risen significantly. Recent census data shows that Stockport has seen a 48% increase in property values in the past five years, whereas the average in England is 20%. For social housing providers, securing or building new properties, particularly with the rising cost of building materials, is a significant financial commitment that many of them are not able to make. I agree that bad landlords need to be pursued. I do not think the enforcement regime is good enough. Of course, there are good landlords out there—I am not going to dispute that—but they often get tarred with the same brush that bad landlords leave us with.
The Renters (Reform) Bill is a positive step, but there are many loopholes. The rules around section 21, on landlords evicting tenants by claiming to move families in, need to be looked at. There is no provision on rising rents. It is unclear what the penalties will be for landlords who break the rules. There are so many loopholes that we need a serious discussion about how to deliver for people across England.
I have already mentioned the statistics on the average rent values in my constituency. I would like to conclude by making two further points. Owner-occupiers spend 18% of their household income on mortgage payments, while private renters spend 31% of their household income on rent. That is simply unfair, and it is also unsustainable. It is evident from the data for constituencies across England that many—not all—private landlords are making large amounts of money out of the cost of living crisis.
Yesterday, Labour MPs, along with those of several opposition parties, voted to end the unfair leasehold system. Labour is serious about reforming the housing sector; it is not just warm words. I am sorry to say that the Government have failed and continue to let down renters consistently, year after year. In 13-plus years of this Government, we have not seen serious action. I hope the Minister will address these points.
Wera Hobhouse (Bath) (LD)
I congratulate the hon. Member for Liverpool, Walton (Dan Carden) on securing this debate and setting the scene so powerfully. May I draw attention to my entry in the Register of Members’ Financial Interests?
My Bath constituency is a special place to live, but that comes at a very high cost. Soaring rents have forced out many who consider Bath home. The average monthly rent in Bath and North East Somerset has risen by more than £200 in the past three years. The Government have consistently failed to stand up for the fifth of UK households who privately rent. Legislation has not kept up with demand.
There are many responsible landlords, but there are also those who are unfit to be part of the sector. They provide a public service and we must regulate them as such. The ban on section 21 evictions was first promised four years ago. Since then, more than 54,000 households in England have been threatened with a no-fault eviction, and almost 17,000 households have been evicted by bailiffs. Research by Shelter and YouGov has found that private renters who complained to their landlords, letting agent or local council were two and half times more likely to be handed an eviction notice in the past three years.
Although I welcome the Government’s decision to introduce a ban on no-fault evictions, I am appalled that it has taken so long. Even now, we do not have a date for the Second Reading of the Renters (Reform) Bill. In passing that Bill, we must not enable no-fault evictions through the back door. I am concerned that the Government will allow evictions for anything that is “capable” of causing nuisance or annoyance. That is clearly open to abuse, and needs further clarification. Tenants will continue to be victimised if robust regulation is not in place.
Liberal Democrats have long fought hard to ban revenge evictions, where rogue landlords evict tenants who make complaints. I ask the Minister to implement provision on the specific set of circumstances in which a landlord can evict a tenant. The law on illegal eviction must be reformed alongside section 21. Court backlogs mean that landlords must wait for a court order and may be tempted to break the law. Landlords have been known to get rid of tenants’ possessions or cut off utilities such as water and heating. That is an awful practice that reflects the contempt in which some landlords hold their tenants.
We have talked quite a lot about the relationship between landlords and tenants. I have drawn attention to my entry in the Register of Members’ Financial Interests because I am a landlord. I believe that the best way to solve the problem is to create an atmosphere in which landlords and tenants treat each other with respect. That scene has to be set by the landlord, who must respect the tenants living in their property rather than holding them in contempt, as many landlords do, and using them for money. Homes that are rented out must be seen as homes for people who live in them, rather than as just a way of making money.
The current illegal eviction law is complex and rarely enforced. Police officers are unaware of their powers to stop illegal evictions and often do not intervene. If section 21 is abolished, we risk some rogue landlords evading the courts and taking matters into their own hands. I hope the Minister will confirm that the Government intend to reform the law on illegal eviction to make it modern, effective and easy to understand. I have met the Under-Secretary of State for Levelling Up, Housing and Communities, the hon. Member for Kensington (Felicity Buchan), and a group of lawyers who have raised concerns about the matter. I hope to hear about some of the Government’s progress in looking at reforming the Bill on illegal eviction at the same time.
Irresponsible landlords cannot be allowed to use rent rises to force out tenants. Many of my constituents have faced rent increases that left them with no choice but to leave their homes. An average couple spend 21% of their income on private rent. A survey by the Department for Levelling Up, Housing and Communities shows that 31% of people in my region of the south-west are already struggling to pay rent. When will the Government address unaffordable rent? People simply cannot cope with arbitrary rent increases, which can be as high as 60%.
We Liberal Democrats would change the default rental period from one year to three years. Rents would only rise with inflation in that period. I accept that more discussions are needed on the student housing market, in which rental periods typically last only a year or two, but the overall policy would give many tenants the thing they are missing the most, which is certainty.
It is not just the price of rent that concerns my constituents. We have already heard about the terrible conditions in many private rental properties. That is an appalling open secret. The UK has some of the oldest and coldest houses in Europe. More than half of tenants had issues with damp or mould last year. It is the same in my Bath constituency: 31% had problems with hot water or heating and 21% of privately rented homes do not meet the decent homes standard. People are trapped in uninhabitable homes. We need tougher inspection and much higher standards.
We Liberal Democrats would introduce a new regulator for all private renters and require all private landlords with more than 25 homes to register with it. The regulator would have the power to subject landlords to regular inspections, and to inspect properties at shorter notice. Everyone should have the right to a safe and secure place to live. It is a national scandal that people are trapped in insecure and uninhabitable homes. The Government must not delay action any more.
Sarah Owen (Luton North) (Lab)
It is a pleasure to see you in the Chair, Mr Davies. Before I start, I would like to put on record my disappointment and anger at the misnaming of my wonderful colleague and dear friend, my hon. Friend the Member for Erith and Thamesmead (Abena Oppong-Asare). The frequent misnaming of particularly my black women colleagues in this place is not okay and needs to stop.
Philip Davies (in the Chair)
As the Chairman in this debate, I apologise profusely to the hon. Member for Erith and Thamesmead (Abena Oppong-Asare). I hope that she will accept that genuine apology. It is no one else’s responsibility other than mine. The shadow Minister is quite right to draw attention to that.
Sarah Owen
Thank you, Mr Davies. I will move on.
I congratulate my hon. Friend the Member for Liverpool, Walton (Dan Carden) on securing this incredibly important debate. He has put forward compelling points that the Minister needs to hear, and I hope she will take them back to the Secretary of State, because we will not stop pushing until justice is granted for renters.
Labour believes that housing is a human right. Everyone, regardless of whether they are a homeowner, a leaseholder or a tenant, is entitled to a decent, safe and secure affordable home. Housing that is fit for habitation should never be a bank account-emptying privilege, but under 13 years of Tory rule that is exactly what it has become.
We have all been let down by negligent housing policy, from the persistent inability to end the feudal farce of the leasehold system to the abandonment of housing targets altogether, and from the economic experiment of the former Prime Minister and Chancellor, which sent mortgages soaring, to the shattered promise to end rough sleeping. Whole towns are taken up by second homes for the privileged few, while families are holed up in B&B bedrooms.
Our housing crisis is not that complicated. It is not an issue that only specialists in Whitehall can understand or that Ministers can gatekeep. It is quite plain to see for all of us that our Government do not prioritise building homes, and that the homes that we have built are not up to a decent enough standard. That is a failure of production and regulation. The Renters (Reform) Bill does not come close to meeting the scale of the problem. We need boldness, creativity and backbone if we are to fix the rotten and decrepit private rented sector.
Poor housing is directly linked to poor physical and mental health. Mould and damp can aggravate or even create chest issues, and overcrowding can cause anxiety and depression, which can lead to the breakdown of relationships. One in five privately rented homes do not meet the decent homes standard, and one in 10 have a category 1 hazard that poses a risk of serious harm. That is a shameful statistic. The knock-on impact on school attendance, workplace absence and NHS resources cannot be overstated. Surely the Minister agrees that providing decent affordable housing would provide an economic boost in a variety of ways, so why is that reality not reflected in Government policy?
Wera Hobhouse
Students often do not have a good reputation, but they often have to live in appalling conditions and they never really have a way of addressing the issue. In Bath, that is a particular issue. Does the hon. Lady agree that we should also look at the appalling conditions in which some students are forced to live?
Sarah Owen
It behoves all of us to represent everybody who lives in rented accommodation, whether they are students, pensioners, workers, people who are not working at all or families. I will talk more about that.
Only last week, more than three and a half years after it was first promised, did we finally see the Secretary of State’s Renters (Reform) Bill. We welcome that long-overdue legislation and look forward to engaging constructively on its development, but it is clear that in improving it we will have our work cut out for us. My hon. Friend the Member for Liverpool, Walton was right to highlight the loopholes in the Bill. He mentioned unfair evictions and spoke powerfully and movingly about the heartache and uncertainty caused by section 21 notices, which are a leading cause of homelessness in England. The Government’s delay since first committing to ending them in April 2019, more than four years ago, has resulted in 60,000 households being threatened with homelessness by section 21 notices.
Labour and our stakeholders welcome the Bill’s steps towards scrapping section 21 evictions, but there remain ways for ill-intentioned landlords to remove tenants unjustly. The Government must take steps swiftly to amend that flaw in their legislation. In the short term, we call on them to extend notice periods to a legal minimum of four months, with firm, punitive measures for landlords who do not abide by the law.
We are not naive about the fact that some evictions are warranted. Landlords who are dealing with antisocial behaviour or even criminal activity from their tenants must be supported in reclaiming their properties. We recognise that robust and effective grounds such as those cannot be diminished. However, the Government have yet to assure us that grounds could not be exploited by bad-faith landlords to continue their unjust evictions. Will the Minister provide any detail on how the Government will defend against that?
The Bill also lacks support for local authorities to act on injustices in their local private rented sector, as has been mentioned throughout the debate. We expect measures that would strengthen enforcement powers, require councils to report on enforcement activity and allow them to cap the advance rent that local landlords can ask for. The Government owe local authorities an explanation of why they have neglected to give them the muscle to ensure that the new legislation is successfully enacted.
It is also incredibly troubling that the Bill does not include a ban on landlords refusing to rent to benefit claimants or those with children. That allows discriminatory “no DSS” practices to continue. No children? This is hardly a family-friendly policy, is it? I would be grateful if the Minister assured us today that this oversight will be reviewed and amended.
Navendu Mishra
I receive a lot of correspondence from people who have pets and are not able to get a secure tenancy. Often, they are people who live on their own with their pet, and they do not have a family member or are housebound. Does my hon. Friend agree that the Government need to strengthen the legislation in relation not only to people on benefits but to people who have pets? There is a whole other debate to be had about people who have no recourse to public funds.
Sarah Owen
I thank my hon. Friend for that really important intervention, and he is absolutely right. What we should see from this legislation is the removal of barriers to good housing for all renters, but what we are actually seeing is, unfortunately, opportunities being missed. I sincerely hope that the Minister takes on board some of the suggestions that have been made today.
When it comes to affordability—or, in reality, unaffordability—the freezing of local housing allowance has only exacerbated the problem, as my hon. Friend the Member for Liverpool, Walton explained. In many parts of the country—including, as we have heard, in the constituencies of the hon. Members for Brighton, Pavilion (Caroline Lucas) and for Bath (Wera Hobhouse); in the constituencies of my hon. Friends the Members for Stockport (Navendu Mishra), for Erith and Thamesmead and for Liverpool, Walton; and in my own constituency in Luton—rents in the private rented sector are surging and the costs involved with moving are soaring. By making the shameful decision to freeze LHA yet again, the Government have pushed millions of hard-pressed tenants to breaking point, with the risk of mass arrears and evictions that that entails—more evictions, more temporary accommodation and more people sleeping on the streets.
My hon. Friend the Member for Stockport highlighted the situation when it comes to affordability. It is becoming harder for our constituents not only to find an affordable place to rent but to stay for the long term. Some of our lowest-paid workers face rent rises of 30% to 40% within their tenancy. Labour is exploring options to address this, starting with consulting landlord and tenant groups on how best to stabilise rent increases within tenancies. I would be grateful to hear from the Minister what discussions she has had on the issue. We do not want to see people continually having to jump from place to place, finding somewhere affordable that turns out to be overcome with mould or somewhere decent that then has its rent doubled. That is no way to live.
It does not have to be this way: Labour has other ideas. Our housing White Paper, to be produced within our first 100 days if we are elected to government, will set out how longer-term tenancies will become the norm, because we know that tenancy security is key for a settled life and that home must be a place where we can relax, knowing that another catastrophe is not around the corner.
We are ambitious about revolutionising what “home” means in Britain. We stand for building new homes. That is why the Shadow Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for Wigan (Lisa Nandy), proudly has the mantra of “council housing, council housing, council housing”, and it is why Labour-led councils, such as my own in Luton, are building homes. They are building eco-friendly council homes, fit for the future.
We will help more first-time buyers to get on the housing ladder; we will abolish the scandalous leasehold scheme; and we will introduce a national register of landlords and licensing for letting agents, as well as a legally binding decent homes standard, updated for the next decade. We will afford new rights and protections to tenants, including the right to have pets, the right to make reasonable alterations, the right to request speedy repairs and, as has been mentioned, mandatory longer notice periods from landlords.
Labour will tilt the balance of power back towards renters by introducing a powerful new private renters charter, to make renting fairer, more secure and more affordable. We will achieve this by finally bringing forward an effectively regulated private rented sector. This is what our constituents need and it is certainly what they deserve.
The Minister of State, Department for Levelling Up, Housing and Communities (Rachel Maclean)
It is a great pleasure to serve with you in the Chair, Mr Davies, and to have the opportunity to make my remarks. Of course, I thank the hon. Member for Liverpool, Walton (Dan Carden) for securing this debate. I also thank the other Members who have spoken, who I will turn to in just a moment. They have spoken passionately about the need for greater security for tenants and improved standards in the private rented sector.
I am grateful to the hon. Gentleman for bringing his considerable experience to this debate. He has a long history of campaigning and speaking on this issue in Parliament, and I say to him and to any Member that of course the Government will listen to constructive dialogue from all parties in the House. That is the right thing to do as we go forward and get this legislation right.
I thank the other Members who have spoken—the hon. Members for Stockport (Navendu Mishra), for Bath (Wera Hobhouse), for East Londonderry (Mr Campbell), for Brighton, Pavilion (Caroline Lucas) and for Erith and Thamesmead (Abena Oppong-Asare)—who all made useful contributions. We all agree there is a considerable amount of consensus that we need to provide a better deal for renters, which is exactly what we are doing through the Renters (Reform) Bill. Members have brought to the House’s attention, again, the very good reasons why we need to act and are acting.
The private rented sector is the most expensive, least secure and lowest quality of all housing tenures. A fifth of renters pay a third of their income to live in substandard accommodation. That is the reality and it is unacceptable. We are determined to crack down on irresponsible and criminal landlords and to make the private rented sector a better place to live and work. That is why I am delighted to talk about the vital measures we are bringing forward to meet the needs of renters and good landlords.
The hon. Member for Liverpool, Walton brought to my attention, as did other Members, the experiences of constituents. I assure him and the House that I have spoken to many tenants who have faced situations similar to the ones he described. I visited tenants in Leeds last week and saw for myself some of the conditions and why we need to act. It is worth reminding the House that the reforms are the biggest in a generation and the biggest in the sector for many years. They have been welcomed by tenants’ groups, people who represent tenants, Shelter and many others that have been referenced by Members. They have also been welcomed by groups who represent landlords. It is important to get that balance right.
I know that feeling safe and secure in a home is vital to a person’s wellbeing and so that they are able to put down roots in a community. The threat of a section 21 no-fault eviction with just two months’ notice hangs over many renters and prevents them from complaining about poor standards. The Renters (Reform) Bill will deliver our manifesto commitment to end section 21 no-fault evictions. Tenants will be able to challenge poor standards without fear of retaliatory eviction. We will abolish fixed terms and move to periodic tenancies that allow either party to end the tenancy when they need to.
As Members have highlighted, there are legitimate reasons why landlords could or would need to regain their properties, which is why we are reforming the grounds so that they are fair, comprehensive and efficient. In future, landlords will be able to regain possession only if one of the grounds for possession defined in law applies. We will introduce a new ground for use when the landlord intends to sell the property and extend the existing moving-in ground so that it can also be used if close family members of the landlord intend to live in the property.
We have changed the rent arrears grounds so that they are fair and proportionate, striking a balance between protecting tenants’ security and supporting landlords who face undue financial burdens. We have retained the existing mandatory rent arrears ground that allows a landlord to serve notice once a tenant is in two months’ rent arrears, and introduced a new ground for repeated rent arrears.
To ensure that landlords can swiftly gain possession when a tenant’s antisocial behaviour is causing problems for their neighbours and communities, we are allowing landlords to make a possession claim to the courts immediately, and we have lowered the discretionary ground to include behaviour capable of causing nuisance or annoyance. We are considering further changes to the way the courts handle antisocial behaviour possession cases, including in respect of prioritisation and the matters that judges must consider when deciding whether to award possession under the discretionary ground. There are other grounds, and I encourage Members to look at the information that the Government have published.
We understand that rent is likely to be a tenant’s biggest monthly expense. It is important that tenants have notice of any rent rises so that they are able to plan effectively. Our reforms will simplify the system for tenants and landlords. All rent increases will take place via one mechanism. We will retain existing legislation that allows rent increases once per year in periodic tenancies, and increase the notice that landlords must give to two months, thereby giving tenants more time to plan and seek advice.
Our reforms will also prevent revenge or forced evictions by the small minority of landlords who may look to use rent hikes to force a tenant out once section 21 can no longer be used. That will create a fairer system that allows both parties to negotiate rents effectively, while protecting security of tenure. Where the landlord has served notice on the tenant to increase their rent, the tenant may refer the notice to the tribunal. The tribunal will assess what the landlord could expect to receive if re-letting the property on the open market and will determine the rent. That will help to avoid the large rent increases used by a minority of landlords as a back-door method of eviction. We will update the guidance to ensure that tribunal users have the confidence and information they need to engage with it effectively. That includes helping parties to understand how they can provide evidence of comparable rents.
The Conservative party does not support rent controls. Evidence suggests that they would discourage investment in the sector, lead to declining property standards, and be negative for both tenants and landlords. We are absolutely committed to outlawing the unacceptable discrimination against families with children and people in receipt of benefits through blanket bans, but we want to ensure that landlords retain the final say over who they rent to. Members have asked for more clarity on that, and we are carefully considering how we get it right. We will introduce legislation at the earliest opportunity.
Members raised local authority enforcement. We expect local councils to take a proactive approach to enforcement and make it a priority. Substantial civil penalties will be available if landlords fail to comply with our reforms. Local councils are able to keep the revenue they receive from civil penalties; it is ringfenced for further enforcement activity. In accordance with the new burdens doctrine, we will ensure that, where necessary, the net additional costs that fall on local councils as a result of our reforms are fully funded, and we will continue to explore how best to create a sustainable self-funding system over the long term, including through fees.
Members will be interested to hear that we are providing £14 million to 10 pathfinder projects that have been designed to build capacity and team capabilities and to test and disseminate innovative enforcement approaches. I am pleased that one of those pathfinder projects is being led by Liverpool City Council, which covers the constituency of the hon. Member for Liverpool, Walton. It is working with a number of other key players locally to create a multi-agency, intelligence-led model for proactive enforcement in the PRS. That will ensure that enforcement is streamlined more effectively, particularly against landlords engaged in serious criminality. I have seen for myself the effectiveness of the selective licensing scheme in Leeds, to which Members referred, and how effectively the housing teams work to deal with issues.
Navendu Mishra
The Minister is generous to give way. Will she address the point that, over the past 13 years, local authorities have lost hundreds of millions of pounds in central Government funding? My local authority in Stockport has lost a significant amount of money since 2010, when the Conservative-Liberal Democrat coalition came in.
The Government do not seem to have a sense of urgency in addressing the loopholes in the Renters (Reform) Bill and the crisis in the private rented sector. There are no Conservative Back Benchers in this debate; they must have either local authorities that are financially secure or tenancies that are long-term and reasonably priced.
Rachel Maclean
I gave way to the hon. Gentleman because I thought he was going to ask a question about the issues in front of me. I am happy to address them. I will continue my remarks, which will address the substantive issues of this debate.
Information is key when it comes to regulating effectively and efficiently. That is why the Bill will legislate for a new private rented sector database that will support the new privately rented property portal digital service. That service will support the Government’s aim of reducing the number of non-decent rented homes by 50% by 2030, and will give local councils tools to drive criminal landlords out of the private rented sector. It will help landlords to understand their obligations and give tenants the information they need to make informed choices.
My team is working hard to develop the portal, which recently passed its Government Digital Service assessment. It was assessed against standards to ensure that it meets clear user needs, is simple to use, is designed securely to protect privacy, and uses tools and technology that are fit for purpose. We will take forward the development of that service and continue to engage with end users to ensure we get it right.
Abena Oppong-Asare
I welcome some of the proposals, particularly the private rented database, but one of my concerns is that some of my constituents in private rented accommodation are living in poor-quality housing, and there is nowhere for them to go that will advocate for them and take that further. It is particularly important to have some sort of ombudsman for the private rented sector so that constituents can take their cases further and hold private landlords to account.
Rachel Maclean
I hope the hon. Lady will listen carefully to what I am about to say: we will introduce a new PRS ombudsman to enable all private tenants to escalate complaints when their landlord has failed to resolve a legitimate complaint, which is exactly what the hon. Lady talked about. That complaint may relate to property standards, repairs, maintenance, and poor landlord practice or behaviour. That will give all tenants free access to justice, so that they have control over the standards and service they are paying for.
All private landlords who rent out property in England, including those who use a managing agent, will be required to join the ombudsman scheme. Landlords committed to providing a decent home and a good service to their tenants will benefit from a swift and impartial decision maker having the final say on their tenants’ issues, maintaining tenant-landlord relationships and, ultimately, sustaining tenancies.
As we all know, pets can bring a huge amount of joy to their owners. That is why our reforms will ensure that private landlords do not unreasonably withhold consent when a tenant requests to have a pet in their home. We will give tenants the right to challenge unreasonable refusals. We know that some landlords are concerned about the potential of pets to cause damage; therefore, landlords will be able to require insurance covering pets, which will provide them with reassurance that any damage caused by a pet will be taken care of by the tenant, on whom responsibility for damage will fall. Alternatively, landlords could deduct damage costs from deposits, as is already possible.
Let me conclude—
Rachel Maclean
I will not give way. Can I ask for your guidance, Mr Davies, because I believe the hon. Member for Liverpool, Walton will have time to sum up at the end?
Dan Carden
I am grateful to the Minister and I recognise that she has given a full response but, as she said she was concluding, I wanted to pick up on two points that I do not think she covered. I apologise if I am incorrect. The first point was on the ability of landlords to repossess properties if they declare they are going to sell them or if they or a family member are going to move in. They currently need to give only three months’ notice; will the Department consider extending that to 12 months?
Secondly, I mentioned the Secretary of State’s amendments to the Social Housing (Regulation) Bill to impose timeframes on landlords to investigate hazards and make repairs. I will table an amendment to the Renters (Reform) Bill; I would appreciate time with the Minister to discuss how we can use the Bill to ensure those protections in the private rented sector.
Rachel Maclean
I thank the hon. Gentleman. On his first point, we believe that we currently have the right balance. Of course, the Bill will proceed through the House. On his intention to table an amendment, I am of course happy to meet him to discuss that.
A number of Members referenced housing issues more generally. The Opposition Front-Bench spokesperson, the hon. Member for Luton North (Sarah Owen), referred to the affordable eco-homes being built by her local council. The House must be made aware—I am sure it is already—that those affordable homes are being built with support from the Conservative Government through the affordable homes programme. We are delivering homes all across the country.
Rachel Maclean
No. I need to wind up. This Conservative Government have made the provision of affordable housing part of our plan to build more homes across the country, including in Luton, so that we can provide aspiring homeowners with a step on to the housing ladder. The affordable homes programme is worth £11.5 billion and will deliver thousands of affordable homes to rent or buy.
The Government are committed to increasing the supply of social rented homes. A large number of the new homes delivered through the affordable homes programme will be for social rent. We have a strong record of building homes all over the country since we have been in Government. We intend to continue that.
I thank all Members for their contributions and look forward to working with colleagues from all parties as we take the Renters (Reform) Bill through Parliament.
Dan Carden
I thank the Minister for her response to the debate, and I thank all colleagues who contributed. Although there is a welcome for the legislation, which the Minister says is the biggest reform of the sector in a generation, there is a danger that it is a missed opportunity. The test will be the impact that it has on our constituents. Does it give them security in their homes? Does it rebalance the power inequality between landlords and tenants? Does it tackle the affordability crisis that exists across the sector? Does it deal with the millions of people, including children, who live in damp, squalid, unsafe houses across the country?
I look forward to following the legislation through the House and to seeking to amend and improve it. I am grateful for the time we have had for today’s debate.
Question put and agreed to.
Resolved,
That this House has considered regulation of the private rented sector.