Section 21 Evictions

Andy Slaughter Excerpts

Tuesday 25th October 2022 Westminster Hall

[Kevin Hollinrake (Thirsk and Malton) (Con)]

It is a pleasure, Ms Nokes, to speak with you in the Chair. I realise that when you are in a minority of one, although you are not necessarily wrong, it probably increases the chances of your being wrong, so I will probably swim against the tide of some of the speeches in this debate.

Before I go any further, I should say that there is no doubt that there is a problem in the private rented sector. Everybody would like to see a solution so that people who want to live in accommodation for the longer term are able to. However, let me take Members back to 1985, if I can. I was a relatively young estate agent in York. If someone wanted to rent a property back then, they had a very limited choice—it was probably between three or four quite dark and shabby two-bedroom terraced houses off Bishopthorpe Road in York. There was so little choice back then because we did not have section 21, so if someone invested in the private rented sector and rented a property out—if they were a landlord—and somebody occupied their property, in effect they did so permanently, if they wanted. Members might think that is a really good idea and the solution to our problems; I fear it would lead to many unintended consequences, as it did back then.

Back then we had rent controls. The hon. Member for Liverpool, Walton (Dan Carden) may say that having rent controls is a really good thing, but it would end up putting layer upon layer of legislation on top of what the Government are currently thinking of doing in terms of the abolition of section 21. That will lead to more and more regulation, which will lead to less and less supply. Ultimately, that is very counter—[Interruption.] The hon. Gentleman shakes his head, but that was the reality of the mid-1980s.

[Andy Slaughter (Hammersmith) (Lab)]

I know we are not here to talk primarily about rent controls, but they go back to at least 1915. On section 21, the hon. Gentleman may be flogging a dead horse. I do not know whether he has seen the briefing from the National Residential Landlords Association, but it says that 70% of landlords could envisage operating without section 21 and another 8% say that it had never been important to them in the first place. The hon. Gentleman may be defending the landlords’ cause, but they may have accommodated the Government’s position and our position already.

[Kevin Hollinrake]

Like the hon. Gentleman, I have seen that briefing. That means that in effect somewhere between 20% and 30% of supply might go overnight, or go very quickly, and we have seen that in Scotland—[Interruption.] The hon. Gentleman can shake his head, but it is a reality. We have seen in Scotland a reduction in supply on the back of the abolition of section 21, followed by rent controls.

Back in York in the mid-1980s, what the Government are saying will happen is—

--- Later in debate ---

[Andy Slaughter (Hammersmith) (Lab)]

It is a pleasure to serve under your chairpersonship, Ms Nokes, and to take part in a debate instigated by my hon. Friend the Member for Liverpool, Walton (Dan Carden).

I will start by trying to agree with the hon. Member for Thirsk and Malton (Kevin Hollinrake) on this point at least: it is a complex matter to get rid of section 21. Just doing so is not going to be an answer to all our problems in the private rented sector or the housing market as a whole. He took us back to 1985—somewhere I am always happier, politics apart. The housing market was very different in those days. We had just had the Housing Act 1985, which introduced secure tenancy for local authority tenants. A few years later, the Housing Act 1988 introduced assured tenancies, which are still the default tenancy, and are the main—should be the exclusive—tenancy for other social landlords, such as housing associations. We also had protected and controlled tenancies. Other Members with constituencies such as mine, with large private rented sectors, will still come across some protected tenancies, which predate that Act. Generally speaking, those tenants have had, by definition, decades-long good relationships with landlords, fuelled by the fact that they not only have security but a degree of rent control—a fair rent, though not entirely.

[Kevin Hollinrake]

That is an interesting point, but the hon. Gentleman will concede that when trying to sell a property with a protected tenancy, the value is usually about 30% below market value. If he is suggesting that that would be the effect of abolishing section 21, that would have a very detrimental effect on property values throughout the country.

[Andy Slaughter]

I will develop my argument and hope to take in that point.

I was giving the background to saying that the one thing that dramatically changed—one of the most fundamental changes in housing law, in the Housing Act 1988—was the ability to opt out of an assured tenancy and create an assured shorthold tenancy. Some social landlords do that; I deprecate it, but they do. Certainly, most private landlords would do that. That was a real change: introducing the free market, changing the relationship between landlord and tenant, and treating people’s homes as commodities for the first time. It is not that most landlords are not well intentioned or do not look after their tenants or, indeed, that they are not entitled to make a return on their investments, but I fundamentally believe there is a slightly different relationship because we are dealing with someone’s home.

The dramatic effect of that is disguised by the fact that—even in 1989, after council house sales had been going for most of a decade but had not really taken off—we still had a thriving social housing market in the 1980s. It was the first port of call for people who wanted a secure home in the rented sector. That disguised the full effect of assured shorthold tenancy and section 21. The briefing we have from Crisis for this debate tells us that 1.3 million families with children now live in the private rented sector of nearly 4.5 million households. I am sure that most of them would prefer the security and affordability of living in the social housing sector, but that is simply not open to them.

The dramatic decline in social housing really began with austerity in 2010, with the almost complete eradication of the social housing grant, after which more and more pressures and misery were piled on social landlords. Post Grenfell, we now have essential work on fire safety, but it is costing individual landlords tens of millions of pounds and they are getting very little of that back from the building safety fund. There is also retrofitting to comply with environmental standards. There are all those issues, along with the lack of resources among housing associations.

I have a major housing association in my constituency that has no build programme until at least 2030. It is selling off hundreds of its properties as they become void, just to make ends meet. The social housing that was the first port of call for people who wanted secure, affordable rented accommodation is no longer there for many people. As for the other source, which was through planning gain, I am afraid we are still—despite the best efforts of the Mayor of London and others, along with individual councils—subject to viability assessments. Therefore, we are not in any way delivering the degree of social housing that we need to.

Such is the context in which we see the private rented sector. It will take time and a Labour Government, I am afraid, to turn that round. I wish the last Labour Government had done more on building social housing and possibly on reforming the private rented sector. Yet as I say, the problems were not as apparent then; they are now. It will take years to build the properties we need. To make the substantive changes in the law, we probably need another major piece of housing legislation. In the time it takes to turn that round, the private rented sector has to be reformed; that is a quicker option. That includes getting rid of no-fault evictions to give people that basic security, but that will not be sufficient in itself. It has to be done in the round.

We have to look at rent levels; if landlords can put rents up as high as they want to, that will just be another way of evicting people without due cause. We have to look at disrepair, which is worse than I have seen it for 20 or 30 years. We have to look at what the exemptions and exceptions are that would allow a landlord to evict. Clearly, there have to be some, but if there are too many and they are too vague, we will simply be replacing one type of no-fault eviction with another.

I do not say all that to get the Government to say, “We will take this away and bring it back in a couple of years’ time.” We would like the Minister to keep the promise that has been made. I know it was a couple of Prime Ministers ago—I think it was last week—but I think we heard from the right hon. Member for South West Norfolk (Elizabeth Truss) that this was still part of the legislative agenda. I hope it still is and I hope they get on with it and do it. What they must not do is think that that is the end of the matter. We will have to wait for a Labour Government to have wholesale housing reform, but if the Minister is going to surprise me on that, I will be very grateful.

This is my last point. I mentioned earlier that the National Residential Landlords Association had given a very thoughtful briefing for this debate. As a body, it is helpful in engaging with people, including with tenants’ organisations and trying to represent decent landlords in that way—all their members probably are decent landlords, because indecent landlords would probably not be members of the NRLA. It specifically mentioned improving tenants’ access to legal support. That is absolutely vital, whereas other things that the Government are doing are not.

If tenants want to challenge matters—even section 21 notices can be challenged if they have not been properly served or executed, or if there are other matters, or if there has been harassment—legal advice is very important. Next April, the Government will impose fixed recoverable costs, which means that not-for-profit organisations such as law centres and those few solicitors who still operate under legal aid will not be able to subsidise their housing work by recovering costs inter partes in that way. I have nothing against fixed recoverable costs in principle, but in practice they will mean a further collapse in the housing legal sector, which in turn will mean that it will be increasingly difficult for people to challenge matters.

The other issues that the NRLA raised are local housing allowance and universal credit, including the delay in paying universal credit, and the gap between what housing allowance gives and the actual cost of properties. Those are all legitimate points. If the Government think they will get a big tick from the private rented sector—any part of it—simply by dealing with the section 21 issue, I need to disabuse the Minister of that notion. Nevertheless, we would like to hear a little more confirmation about what the Government are going to do to about the situation—most of these people, whether they would prefer to be in social housing or to be owner-occupiers, increasingly do not want to be in the private rented sector.

If we had a decent and thriving private rented sector, then some people would make it their first choice, but many people are in the sector because they have no other option. They have run out of options in terms of their living conditions, their overcrowding, their security and the amount of rent they have to pay. The sector needs a proper look. Since the Housing Act 1988, we have declined into a society in which people’s right to a decent home—that is a human right, although if we are going to have another change of Lord Chancellor, perhaps it will not remain one for very long—has declined. The Government need to look at this sector in the round. They cannot just say, “We will do one or two piecemeal things”. They cannot tinker with the housing market; it needs full, wholesale reform.