Deregulation Bill

Lord Clement-Jones Excerpts

Wednesday 4th March 2015 Lords Chamber

I hope very much—although in reality I am not very hopeful—that the Government will reconsider and accept these amendments. It is notable, of course, that since our last discussions on this subject, the Government have rushed to put at least some of their thoughts on the face of the Bill, where it was all a bit cryptic before. What is there needs amending. It also needs a bit of substance behind it. I therefore support all of these amendments.

[Lord Clement-Jones (LD)]

My Lords, I would like briefly but very strongly to support the amendments which have been so well introduced by the noble Lord, Lord McKenzie, and my noble friend Lady Hanham. I may have been a somewhat sporadic attendee for this particular part of the Deregulation Bill, but it certainly has been visible to the naked eye that the goalposts seem to have been shifted somewhat in this area as we have moved from Second Reading in July to Committee in October, with an enormous gap between Committee and Report. The initial assumption was made, as far as I could see, on Second Reading and right up to Committee that the Government were going to completely deregulate in this area. We then discovered that new regulations will be introduced. Some consultation took place, and the policy paper was published. Then, on Report it was clearly understood that we were going to have a set of regulations, which were continuing to be consulted on, which would make changes to Section 25 of the Greater London Council (General Powers) Act 1973 at a later date. And yet we now find ourselves at Third Reading with a very comprehensive new clause setting out the Government’s view. It has been like a slow-slow-quick process and completely the reverse of the usual march that one would expect in these circumstances. I think the provisions contain great dangers, and that is why I very strongly support these amendments.

My noble friend the Minister made great play of the benefits to the tourism industry and I want to speak from the perspective of tourism hospitality. However, I believe that the boot is very much on the other foot. Of course, as we all know, tourism and hospitality businesses are a very important part of local communities in London and of the London economy. It is not that the tourism and hospitality industries are against new models; indeed, they believe that they are an important way of introducing new ways of delivering to tourists. The most recent newcomer—the Minister used this phraseology—is the sharing economy: the sharing model which offers guests the ability to pay to stay in someone’s residence on a night-by-night basis.

We have seen that many of those who let their properties this way are essentially running businesses, but they do not act as responsible hospitality providers and undertake the necessary precautions to ensure health and safety in the same way as more traditional tourism businesses. They have been described as “pseudo-hotels”. If they are allowed to spring up, they pose a real danger not only for their guests but in respect of noise and nuisance for nearby residents. We need to have safeguards to monitor and limit the use of these residences, ensure the rules are followed and quickly deal with any problems that arise. We have seen problems arise in many other cities around the world, and safeguards have been and are being put in to protect communities from the impact of these short-term lets in places such as Paris, New York and Singapore. We need to manage these genuine risks and ensure that safeguards are in place and are enforceable.

These government amendments effectively make it impossible in practical terms to enforce the limits on short-term lets in London. This has been made clear to the Government not only by noble Lords today but by London councils, including Westminster City Council, and by all those bodies that will, in the future, have the responsibility of enforcement. They must surely have a pretty good idea of whether these provisions are going to be enforceable by their own officers. Without local registration, there will be no ability to enforce any safeguards around short-term lets. At a minimum, local councils and the Metropolitan Police should have the transparency they need in the use of these London residences to identify them when they are being used for short-term lets and to ensure that safety and security measures are in place to protect communities.

All the other proposals in the cross-party amendments advocated by the noble Lord, Lord McKenzie, the noble Baroness, Lady Hanham, my noble friend Lord Tope and the noble Baroness, Lady Gardner, are extremely important from that perspective as well. The scale of fraud and lawbreaking around these short-term lets will otherwise increase and so will the nuisance and noise for residents. Both the tourism industry and local councils have made a very strong case, and we should adopt each one of those points. I was very glad to hear the noble Lord, Lord McKenzie, say that if this is put to a vote, it will be put as a package. The package of amendments is extremely important.

Whatever happened to localism? I thought that we had been debating it for the past few years. What could be more attuned to localism than the amendments that are on the Marshalled List today?

[Baroness Gardner of Parkes (Con)]

My Lords, I will address the points made by the noble Lord, Lord Ahmad, in his speech. He mentioned that there were 4 million overseas visitors to London last year. I should also start by reminding the House that my interests are on the register and that I am the owner of leasehold flats.

First, the noble Lord talked about the potential breach and the £20,000 fine. Is he aware that no one— but no one—has been asked to pay a £20,000 fine for an illegal letting? Boroughs have not implemented that at all. Then he talked about the 90 days in the calendar year. However, 90 days is three months, and if you choose to let in, say, October, November and December, it is a new calendar year for January, February and March—so you can have six months instead of 90 days, which is why 60 days seems to be a more reasonable amount.

The noble Lord said that disproportionate bureaucracy is involved in applying for planning permission. I agree with that, but local councils are willing to have a 24-hour online notification period. What could be more in tune with modern living and with the idea that, as the travel people say to you, we need to be able to supply someone with accommodation within 24 to 48 hours? If councils are prepared to accept that as a notification, surely that is keeping right up to date with modern practice. Your person could fly in tomorrow, in 24 hours, provided you have notified the council who it is, how long they are going to be there for and who will be responsible for the property. It is not disproportionate bureaucracy; it is a great reduction in bureaucracy.

My fear is that if you give the Secretary of State these powers, you will be loaded with bureaucracy and delay. Nothing is going to happen quickly. What if the threat is a terrorist one? By the time you have gone through the Secretary of State and everything, it will be too late. When I saw what happened in Sydney recently, I found it such a shock and realised that one of these terrorist attacks could happen anywhere in the world. Why should London think it can escape? We have even read in the papers about threats that are coming to us. London is different from other parts of the country: it has a special attraction and is quite a drawcard. Of course a lot of people come. The noble Lord, Lord Ahmad, believes that his amendments will give real freedom and flexibility. I do not agree with that at all. The amendments that we are proposing to his amendment will give much more real freedom and flexibility.

The noble Lord, Lord McKenzie, mentioned the question of a “principal residence”. I know from personal experience that, if a property is empty, the owner is liable for council tax. The day when you could have it empty and unfurnished and no council tax was payable has long gone. Everyone is liable for council tax on a property, and therefore using that as the judgment of whether or not you are suitable to let something is no answer at all. A principal residence has to be a place that you have to be living in some of the time. As we mention, it has to be the “principal residence in London”, as opposed to just a general principal residence. Notification within 24 hours is very reasonable and could be done by all authorities, although we are not insisting that all authorities do it. We believe there should be a flexibility for local authorities, because what is someone’s problem today will be someone else’s tomorrow. These problems move around rather than just staying in one place—conditions change. On Report, I mentioned that Camden was very upset about the huge number of council properties there that were being let on these short lets.

The noble Lord mentioned that he thought the provision relating to previous offenders was unreasonable. I do not think it is at all unreasonable. The fact that you cannot get away with it on a repeated basis is a very good justification for us saying that, if it has happened to you before, then things are slightly different.

The noble Lord, Lord McKenzie, mentioned back-to-back letting. I have mentioned how it can turn your three months into six months. Several speakers have also mentioned localism, and I absolutely agree with every word that they have said. However, unless the local authority has some awareness of who is in a property and for how long, it has no idea of what it is dealing with, and anything could happen.

The noble Lord, Lord Ahmad, mentioned the consultation document. I have mentioned before that I have asked who gave what answers to the consultation and have been denied an answer—not once but three times—when I have tabled that Question to be put before the House. Why are they so frightened to publish the consultation answers? Why has he not said tonight what they are? I find it unbelievable that you can table a Question and it can just be ignored by the Government of the day. That is very strange.

I have seen this short-letting business in practice and in reality—not personally, but it has been reported to the management of the block that I own flats in. Ten people come every fortnight, brought from the airport in a bus, and all of them live in a one-bedroom flat. I believe there should be a limit on how many people can live in a one-bedroom flat. There are three of these flats in a block where there is a communal hot water system—30 extra people in a 15-flat block is a huge drain on the central heating, the hot water and everything else. It is not fair to people. Elderly people living in the block have found it quite terrifying to have strangers coming in who abuse them and push them out of the lift so that they can take over. It is really unbelievable.

Many of them now have keys to the street door, but they do not even need them: they go down, open all the fire doors and leave them open, so there is no protection from anyone coming in from the street at all. Younger women have been threatened in these blocks. I cannot claim to have been personally affected, because my flats are higher up in the block and fortunately are not involved, but the lower floors suffer so badly. It is incredible that this goes on. Moving this into the hands of the Secretary of State would be wrong. It is right that we should have regulations and strange that we have not been given answers to Questions we have asked. I strongly support the amendment tabled by the noble Lord, Lord McKenzie.