Butterfields Estate

Brandon Lewis Excerpts

Wednesday 20th April 2016 Commons Chamber

[The Minister for Housing and Planning (Brandon Lewis)]

I congratulate the hon. Member for Walthamstow (Stella Creasy) on securing this debate about the future of the Butterfields estate. I also take the opportunity to extend my sympathies to the residents affected, as I recognise the difficult position in which they have been placed, which they must feel is quite precarious. I shall deal with some of the key issues the hon. Lady has outlined, as well as some of the wider general issues.

I appreciate the hon. Lady’s comments about Walthamstow and know the area fairly well—as she might know, I went to school just down the road. It is a fabulous part of the country and a great part of London. She made some political comments, and I appreciate that we sit on opposite sides of the House. She talks about the opportunity to ensure that there are homes for people and that we have housing supply coming through, but I would make the point that we have a good track record, having doubled the number of first-time buyers since 2010 and having seen house building increase by 25% just last year. I gently remind her that next time she raises housing supply she might want to bear in mind that the previous Labour Government—in fact, the current shadow Housing Minister—left the country with the lowest level of house building since 1923. We have had quite a lot of work to do to get from that paltry 88,000 a year back to 181,000 over the past year. I am proud of that work.

To move on to this specific case, the decision by Glasspool to sell the estate is, as she will appreciate, a private matter relating to the charity’s management of its assets. However, as she outlined, Dolphin Living, which I know and which is an excellent organisation, wants to negotiate with the new landlords to keep the residents of the Butterfields estate in their new homes at the correct rent. I am happy to do what I can to support driving forward that negotiation to get the parties to the table. I cannot imagine that the residents could be in better hands than if they had Dolphin Living as an organisation to work with. The fact that Dolphin Living wants to be involved is good news and I encourage all parties to get involved. If I can play a part in helping with that, I will happily do so.

The Government recognise that people want the security of a home that is stable and sustainable. The residents in this case will feel that poignantly. Most people strive to have their own home and we are determined to do all we can to deliver for them, both in terms of supply and, as the hon. Lady outlined, by making sure that people are protected. I will come on to that in a moment.

It is right that the local authority should do all it can to support and encourage the parties to work together. Despite the hon. Lady’s comments, she may want to go back and talk to her council about whether it will consider spending some of the £90 million that it has in reserves to be supportive and helpful. I am sure the council will want to help the residents in that situation.

We have embarked on the largest Government house building programme for 40 years. Over the past few years we delivered almost a million new homes, and we will deliver a million more by the end of this spending review, helping hundreds of thousands of people take the first step on the ladder to home ownership. We are also committed to building a bigger, better private rented sector, providing security and stability for both tenants and landlords. Increasing supply is the best way of improving quality, choice and, more importantly, affordability for tenants, but that will not be achieved without a significant boost to the investment coming into that sector. That is why we have put Government support behind it through our £1 billion Build to Rent fund, making sure that we are using our economic record to offer up to £10 billion of innovative housing guarantees. The affordable housing guarantee scheme has already provided more than £2 billion of investment.

On the existing legislation and how it is moving forward, the hon. Lady touched on the Housing and Planning Bill. Before shorthold tenancies were introduced by the Housing Act 1988, the private rental market was in decline. Regulated rents and lifetime tenancies meant that being a landlord was simply not commercially viable for many property owners. Since the changes in 1988, that sector has grown steadily, responded to the flexibility and created changes in the wider housing market. Private sector landlords play an important role in meeting the housing needs of many households. Of those who choose to live or have to live in the private rented sector, the vast majority will have an assured shorthold tenancy, which gives them certain rights under that Act. These include the right to live in the property as their home, and tenants can enforce their rights, for example, to get repairs done.

The legislation enables a landlord to regain possession of their property at any time after a fixed term comes to an end or at any time during a contractual or statutory periodic tenancy, provided it is at least six months since the start of the original tenancy. The landlord must give the tenant at least two months’ notice that they require possession. Without the certainty that landlords can do that when required, landlords and lenders would be reluctant to allow those properties to be let. We believe that more restrictive and excessive legislation, such as forcing longer tenancies or notice periods, would mean that fewer homes were available in the market to rent. That would not help landlords or tenants.

I agree with the hon. Lady’s comments about charities in the sector being very aware of their charitable purpose and their duty to their clients and beneficiaries.

[Stella Creasy]

I am pleased to hear the Minister say that he will help with the negotiation with Dolphin. That will take time. May I press him on no-fault evictions? One of the things that residents present here tonight are afraid of are letters telling them that they could generate thousands of pounds in court fees. I am sure that many of them would love to be able to save for their new home, but sadly they will not be able to get on the housing ladder, given the prices in Walthamstow. The thought that they might incur several hundred or even several thousand pounds of fees is a stick that the landlord is using to beat them with. Just as we dealt with revenge evictions, I encourage the Minister to think about no-fault evictions. These tenants are paying their rent and they are not at fault, but their rights are being undermined. Is there a way of dealing with that?

[Brandon Lewis]

I will come to some of the provisions of the Housing and Planning Bill. I hope the hon. Lady will consider, possibly for the first time, supporting the Government’s work to provide more homes at an affordable rate for people in Walthamstow by delivering starter homes—homes for first-time buyers at a discount on the market price, which make house buying affordable again. Our increase in shared ownership also aims to do that. I hope she will get behind the Bill when it returns to the House in the next few weeks, before it gets Royal Assent, as we hope it will.

I will come to the wider issue of legislation in a second, but increasing the supply of private rented homes is only part of the picture, as the hon. Lady rightly says. The private rented sector is currently dominated by small landlords, with larger landlords owning 10 or more properties accounting for only 1% of the market. Many landlords provide a very good service, and by far the majority of tenants are happy with it, but I share the hon. Lady’s view that we want standards to rise across the board so that we drive out every last bad and rogue landlord, regardless of their position.

The Government therefore published the “How to rent” guide so that tenants know what they should expect from their landlords. The guide improves transparency, making more information available, and helping tenants to make informed decisions and to know their rights. That in itself can prevent more poor and substandard accommodation from being rented. Empowering tenants is key to our approach.

We have introduced legislation requiring all letting and management agents in England to belong to one of the three Government-approved redress schemes. We have also required them to publicise prominently in their offices and on their websites whether they are a member, for example, of a client money protection scheme and which redress scheme they are a member of, giving landlords and tenants a clear route to pursue complaints against agents and helping to drive up standards.

Just today, we have introduced an enabling power into the Housing and Planning Bill to make regulations to require letting agents and property management agents to belong to a client money protection scheme. That will protect the money of landlords and tenants if an agent goes into administration or from theft while the money is in the agent’s control.

We are determined to do all we can to protect people who rent privately against a tiny minority of rogue and criminal landlords who exploit their tenants by renting out unsafe or substandard accommodation, or who act unfairly. We have also made millions of pounds available to local authorities to identify and successfully prosecute rogue landlords.

We have introduced legislation to protect tenants against retaliatory eviction where they have legitimate complaints about the standard of their accommodation. We have placed restrictions on repossessions where a landlord has failed to comply with legal responsibilities on, for example, gas safety and the provision of information to tenants.

We are going further by introducing measures in the Housing and Planning Bill to tackle rogue landlords and property agents. That includes establishing a database of landlords and property agents who have been convicted of serious offences; introducing banning orders for the most prolific and serious offenders; issuing civil penalty notices of up to £30,000 for some breaches of housing legislation, and ring-fencing those resources for housing-compliance activity; extending rent repayment orders to cover situations where a tenant has been illegally evicted, or where the landlord has failed to rectify a serious health and safety hazard in the property or breached a banning order; and applying a more stringent “fit and proper person” test for landlords letting out licensed properties, such as houses in multiple occupation, to help ensure that those landlords have the appropriate skills to manage such properties and that they do not pose a risk to the health and safety of their tenants.

As with the penalties introduced through the Immigration Bill, those measures are meant to make sure that we target criminal landlords who ignore their existing legal obligations. The penalties will not have an impact on the vast majority of good landlords who comply with the law and who rent out good-quality and well-managed accommodation.

However, we need to do all we can, and the Government are going further than any Government before us to crack down on rogue and bad landlords. I am happy to continue to make the case to the hon. Lady that landlords who behave in a manner that is not fair or appropriate, and who do not provide the right services and accommodation to their tenants, should be driven out of the market.

[Stella Creasy]

I do appreciate what the Minister says about wanting to tackle rogue landlords. May I press him, then, to use his good offices to engage with NatWest because of the concerns about this landlord, its previous business history and its behaviour towards residents of the Butterfields estate? In particular, its use of the idea that residents will somehow incur thousands of pounds in fines is evidence that those involved are not fit and proper people. If they will not engage with Dolphin, at least their bank might. May I therefore press the Minister to say whether he will engage with NatWest—yes or no?

[Brandon Lewis]

The hon. Lady has great experience of dealing in this House with issues relating to the financial markets. She will appreciate that there is a difference in legal terms between the landlord and property owner on the one hand and the bank that has a financial agreement with the landlord and property owner on the other. The hon. Lady has outlined the situation, but the reality is that NatWest will not have any legal ability, as it is not the property owner.

I am very happy, through my office, to contact NatWest to see whether we can get it to involve itself in making a point of looking at the situation with the landlord. We have to be very clear, however, that there is a difference between a bank’s financial agreement with the landlord, which is purely a financial agreement about lending money, and the landlord or property owner’s duty to their tenants. I hope that, ultimately, the charity will talk to Dolphin Living, to get the right result for the tenants.

Question put and agreed to.