(6 days, 5 hours ago)
Lords ChamberMy 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.
(1 week, 3 days ago)
Lords ChamberAs I have discussed before at the Dispatch Box, summer is quite a flexible concept in the Civil Service, but we expect the report of the New Towns Taskforce imminently. I would like to say how successful it has been with the task force running an extensive round of consultation around the current new towns, with people with lived experience of what it is like to live in a new town, both to learn the lessons where things did not work and to see what did work to inform its work. So I am pleased to have been working with Sir Michael Lyons and the task force on that, and I very much look forward to its report.
Does the Minister recall the exchange last December, when I raised the problem of private developers completing affordable homes on a site but being unable to find a housing association to take them over, leaving those homes empty and in some cases leaving the site uncompleted? Can the Minister give me an assurance that that problem has now been resolved and that there are housing associations ready to take over these Section 106 homes?
(1 week, 5 days ago)
Lords ChamberMy 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.
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.
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.
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.
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.
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.
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.
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.
(2 weeks, 4 days ago)
Lords ChamberMy Lords, may I say how much the whole House will miss the contributions of the noble Lord, Lord Hunt, from the Dispatch Box? We welcomed the clarity of his contributions, and the Back Benches will be reinforced by his presence now that he is free to say what he actually thinks.
Here we go with another planning Bill. I start with a quote:
“Conflict is not uncommon between those in both the public and private sectors who wish to change the use of land … The planning system provides the framework for resolving these inevitable conflicts. The Bill brings the system up to date, and enhances its credibility”.—[Official Report, Commons, 12/3/1991; col. 816.]
That was me, as Planning Minister in the other place, introducing the then Planning and Compensation Bill in 1991. My imprint on the planning system did not last long. We then had the Planning and Compulsory Purchase Act 2004; the Planning Act 2008; the Localism Act 2011; the Housing and Planning Act 2016; the Levelling-up and Regeneration Act 2023, which was another planning Bill—and now this. The 1947 planning Act lasted until the Town and Country Planning Act 1990. Since then, we have kept on digging up the foundations without, apparently, making the structure any more durable, so I wish the Ministers well.
In the time available, I want to make just one point: the success of the Bill will depend on the efficiency of local government departments in responding to the challenge in the Bill. On 5 February, the Government told all councils in two-tier areas and small neighbouring unitaries to produce, by March, plans to go unitary. Professionals in planning departments are probably more affected than anyone else because all the plans will have to change. They will, understandably, be worried about their own future and the turbulence of reorganisation as they apply for jobs in the new structures or accept redundancy.
The Bill’s success depends on up-to-date plans to deliver certainty and avoid appeals. The Government state:
“Succinct and up-to-date plans should provide a positive vision for the future of each area; a framework for meeting housing needs and addressing other economic, social and environmental priorities”.
However, as of March 2024, only a third of local authorities had adopted a plan in the last five years and 291 had plans which were more than five years old. As they attempt to address the backlog—which will still be necessary until the Bill becomes an Act—they will also have to start all over again producing a plan for the new unitary authority. The Government have stated:
“Where reorganisation occurs, new unitary authorities are expected to promptly prepare a local plan covering the whole of their area”.
This all came on top of the December 2024 devolution White Paper. In another reorganisation, all of England is to be part of one of three new categories of local authority: foundation strategic authorities, mayoral strategic authorities and established mayoral strategic authorities. Under the Bill, the planners in these new strategic authorities must produce spatial development strategies, providing strategic policies for the use of land in their area. At the moment there are only three of these. In a masterly understatement, the Government said:
“We are aware that areas undergoing local government reorganisation and devolution will experience a transition period where responsibility for spatial development strategy might transfer between authorities”.
At the same time, the Government want to reduce all the current delays in processing planning applications so that we can get on with the infrastructure and with building the 1.5 million homes that we need.
If planning departments were fully staffed with the necessary skills, they might rise to this challenge, but they are not. The Local Government Association workforce survey found that 62% of councils have difficulties recruiting planning officers and 45% have difficulties retaining planning officers, many being tempted by higher salaries elsewhere. Two-thirds of councils rely on agency staff to address capacity issues. The RTPI says:
“We continue to have concerns about the chronic under-resourcing of our planning system and therefore … a long-term resourcing and capacity strategy should be published alongside the Bill”,
but it has not been. The new town development corporations will also require planners. The Government have recognised the problem, but the steps that they have taken to address it fall way short of what is needed and risk undermining the purpose of the Bill.
I remember a discussion, when I was a Treasury Minister, with a senior economist in the Treasury. When I suggested a new policy that had been tried in New Zealand, he said, “It may work in practice, but it doesn’t work in theory”. The risk with the Bill is exactly the opposite: it may work in theory, but it will not work in practice—unless planning departments are resourced.
(2 weeks, 6 days ago)
Lords ChamberI thank my noble friend for making that point so powerfully. We all know how urgent this work is. Retrofit work in support of decarbonisation must comply with building regulations, including those concerning fire safety. As the regulations state, the building’s compliance should be no worse than it was before the work started. No additional measures are needed to ensure that fire safety is integrated into retrofit. Under the Regulatory Reform (Fire Safety) Order, a fire risk assessment will be completed for all new builds, other than individual private homes. Building regulations require building control bodies to consult the local fire and rescue authority to ensure compliance with the order. There is a further requirement under the order for a responsible person to review the fire risk assessment for those premises where material changes, such as a significant retrofit, are made to the building in question.
My Lords, the National Audit Office estimated that the work to which the noble Baroness just referred will not be completed until 2035. Is that not far too late a date for people to live in unsafe buildings? What action are the Government going to take to bring that date forward?
I am sure that the noble Lord paid full attention to the remediation action plan that the Government published, and we want to move this forward as quickly as possible as there is a lot of work to be done on remediation. My honourable colleague in the other place, Minister Alex Norris, is moving forward the remediation action plan as quickly as possible, as we have to make sure that we get on with this now. Eight years is far too long not to move this forward, but we are getting on with the job now and cracking on with it as quickly as we can.
(3 weeks, 5 days ago)
Lords ChamberMy Lords, the Cabinet Office announced investigations into seven organisations, a few of which the noble Lord mentioned. These organisations were named in the Grenfell Tower Inquiry report, enabled by the Procurement Act 2023, which came into force on 24 February 2025. The Cabinet Office is considering options under this Act. This is rightly independent. While this process must run its course, further actions outside the debarments regime against those involved in this tragedy have not been ruled out.
My Lords, eight years after the Grenfell tragedy, the Public Accounts Committee in the other place reported that 3 million people are still living in unsafe buildings, unable to sell their properties and move on with their lives, facing high service charges and high insurance premiums, and in some cases facing repossession. The Minister’s own department says that this ordeal will not be completed until 2035, 10 years away. These leaseholders are the innocent victims of negligence and, as the noble Lord, Lord Rooker, has said, of greed. Do they not deserve a better deal?
My Lords, the noble Lord speaks with great expertise and makes a very important point. This Government have been taking decisive action to address the building safety crisis so that residents do not need to wait a day longer than necessary to feel safe in their homes. We continue to work closely with industry, local authorities and residents to accelerate remediation efforts while ensuring that those responsible for unsafe buildings cover the costs. On the important point of insurance, work has been ongoing to reduce building insurance premiums for leaseholders. On lending, we have seen improvements for leaseholders who previously found themselves unable to sell or remortgage their homes, but we will remain vigilant and continue to hold the 10 major lenders to account following their commitment to lend on properties even if remediation is not yet complete.
(1 month, 4 weeks ago)
Lords ChamberMy 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.
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.
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.
(2 months ago)
Lords ChamberMy 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.
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.
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.
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.
(2 months, 1 week ago)
Lords ChamberMy noble friend knows how strongly I agree with the comments she has just made. The Government view the Vagrancy Act as antiquated and no longer fit for purpose. No one should be criminalised for simply sleeping rough on the streets. We must ensure that we avoid criminalising those who are the most vulnerable, while also ensuring that police and local authorities have the wide range of tools they need to make sure that communities feel safe. We are in the process of making sure that happens. As my noble friend will know, repeal of the Act needs to be included in forthcoming legislation. Colleagues in the Home Office are exploring options to do just that, and I want to make sure it is done as quickly as possible.
My Lords, as the noble Baroness said, a very high proportion of young people who become homeless were originally in care, with one survey indicating that a third of care leavers become homeless within two years. The Children and Social Work Act 2017 requires local authorities to continue to support care leavers until they are 25. Is the Minister satisfied that local authorities are doing all they can in that respect?
As I said in my initial Answer, we continue to strive to make sure that we offer the best support possible for care leavers. The noble Lord is right to say that they deserve to have that support right through to the age of 25. Earlier this year, we introduced a measure into the DfE’s Children’s Wellbeing and Schools Bill to make sure that no care leaver in scope of corporate parenting duties can be found intentionally homeless. We also made the decision to further strengthen legislation as the Government are all too aware of the long-term impact that pre-care and post-care experiences can have on young people. It is essential, as part of local authorities’ role as corporate parents, that this vulnerability is recognised and that care leavers are provided with the care, stability and support they need to build a secure and successful future.
(2 months, 2 weeks ago)
Lords ChamberMy 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.
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.
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?
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.
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.
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.
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.
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.
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.
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.