Renters’ Rights Bill

Carla Denyer Excerpts

Tuesday 14th January 2025 Commons Chamber

[Madam Deputy Speaker (Caroline Nokes)]

Before I call the next speaker, who I am sure will speak to her amendments, I remind Members that on Report we should consider the amendments and new clauses to the Bill; the debate is neither a rehash of Second Reading, nor a precursor to Third Reading.

[Carla Denyer (Bristol Central) (Green)]

I should declare that I am a member of the Association of Community Organisations for Reform Now, which campaigns on renters’ rights. I thank it for its important work on this Bill, including alongside me.

The Bill is hugely welcome, but it can and should go further to fix the grave and urgent housing crisis. I therefore rise to speak to my new clause 7, on rent controls and affordability; new clause 9, on home adaptations for disabled people; and new clauses 17 and 18, on selective licencing schemes. I also want to put on the record my strong support for a number of amendments tabled by others, including the hon. Members for Leeds Central and Headingley (Alex Sobel), and for Liverpool Wavertree (Paula Barker).

We have people living on the streets and in temporary accommodation because they cannot afford their rent. New clause 7 proposes a living rent body, which would set the rules that applied to the calculation of rent between tenancies. That would control rents and make them fair, considering factors such as the home’s property type, condition and size, average local incomes and so on. Local flexibility will be important. The measure is needed. The Bill gives renters a once-in-a-generation set of new rights that they have long been denied, but rent controls are still needed, because it is no help to anyone if they have a right to something that they cannot afford or access.

Once the Bill does away with section 21, we will need rent controls to prevent rogue landlords from instead hiking rents to kick people out. The Government’s changes to the tribunal system do not go far enough to protect renters from that. First, most tenants do not have the time or energy to navigate the system. Secondly, tribunal panel judges only judge whether a rent rise is fair compared with market rates, and the market rates are too high.

We have a generation of people who will never be able to earn enough to have a mortgage, and who cannot even afford their rent now. If a 21-year-old in my home city of Bristol rents a single room today at the average rate, they will have put £80,000 into their landlord’s bank account by their 30th birthday. No wonder that a third of private renters struggle with their housing costs. New clause 7 addresses the plain fact that the market is failing, with terrible costs for people who are struggling and made homeless.

There are huge economic costs, too; the Government are set to pay private landlords £70 billion of taxpayers’ money in the five years from 2021 to 2026. That is multiple times the spend on new affordable homes. Surely that is the wrong way round. We can add to that the huge annual spend on temporary accommodation, which cost councils at least £1.74 billion in 2022-23. Rent rises are far outstripping inflation. The Deposit Protection Service rental index found that rents outstripped inflation by one third in 2023. Rightmove reports show that asking rents outside London have risen 60% since 2020, and I assume that I do not have to tell the House that incomes have not grown by the same amount.

As I set out in Committee, discussion is vital if we are to avoid unintended consequences, and I do not dismiss the importance of that detailed work. At the same time, we cannot ignore the acute affordability crisis for renters. Key workers are being forced out of cities, and people are being forced out of communities that they have made their home. The average rent in my constituency of Bristol Central has hit nearly £1,800 a month.

I know what the criticisms will be, but let me remind the House that rent controls are an established part of private renting in 16 European countries, where they are a completely normal part of housing policy. It is interesting that private renters in England spend a higher proportion of their income on rent than those in any European country apart from Luxembourg and Norway. Our homes are in worse condition, too.

Rent controls are of course not a panacea. They are needed alongside a suite of housing policies, and increasing social housing supply is really important. However, the private rented sector is in an affordability crisis now, and it will take huge amounts of effort and time, even with the best will in the world, to increase the social housing supply on a scale that will impact private rents. Modelling from Generation Rent and other economists predicts that building 1.5 million homes over this Parliament will decrease the private rent burden by just over 1%.

Moving on to new clause 9, there are 16 million disabled people in the UK—more than a fifth of the population—and 19% of them live in the private rented sector. The Equality and Human Rights Commission estimates that a shocking one in three disabled people in the private rented sector lives in unsuitable accommodation, and a Government survey reveals that an appalling 44% of private landlords have said that they will not rent to someone who requires home adaptations.

My amendment seeks to ensure that, if all tenants can put up shelves, disabled tenants should be allowed to put up grab rails. If all tenants can replace a showerhead, disabled tenants should be allowed to put in accessible washing facilities. It is not acceptable that disabled tenants must get permission for these most basic adaptations.

In Committee, the Minister was sympathetic to my concern but argued that the Equality Act 2010 already covers this issue. However, it clearly is not doing the job. Disabled people are explaining this very clearly and patiently, as did the Chair of the Housing, Communities and Local Government Committee, the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi), whom I thank.

--- Later in debate ---

[Matthew Pennycook]

I am sympathetic to the hon. Gentleman’s question and his desire for that information, but it is not for me to give a date from the Dispatch Box today; my colleagues in the Ministry of Defence will provide further information on the review of that target standard early this year.

The Liberal Democrat spokesman, the hon. Member for Taunton and Wellington, along with my hon. Friend the Member for Liverpool Wavertree (Paula Barker) and the hon. Member for Bristol Central (Carla Denyer), spoke in support of their respective amendments to introduce forms of rent control. I assure each of those Members that I entirely understand their concerns about the affordability of rent generally, and specifically the potential for retaliatory no-fault economic evictions. Once section 21 evictions are done away with, unscrupulous landlords will no doubt attempt to evict tenants who assert their rights by means of extortionate rent rises.

However, as we debated extensively in Committee, the Government sincerely believe that the introduction of rent controls in the private rented sector could harm tenants as well as landlords by reducing supply and discouraging investment. While I fully appreciate that there is a broad spectrum of regulation that falls under the title of rent control, there is, as we debated at length in Committee, sufficient international evidence from countries such as Sweden and Germany, cities such as San Francisco and Ontario, and the Scottish experience since 2017, to attest to the potential detrimental impacts of rent control. For that reason, we believe that we should proceed on the basis of the protections that the Bill provides against unreasonable within-tenancy rent rises, as well as wider action to improve affordability, not least support for the growth of the build-to-rent sector.

My hon. Friend the Member for Liverpool Wavertree also tabled new clause 5, which would place a duty on the Secretary of State to conduct a review of the tenancy deposit protection schemes and requirements. The contracts governing those schemes are due to end next year, and their re-procurement provides an opportunity for the Department to review their objectives and how they operate. I am more than happy to engage with my hon. Friend on that process; on that basis, I ask her to not divide the House on her new clause. I am also more than happy to ensure that she is closely involved in the development of the PRS database. We believe that there are good reasons for the detail relating to that database to be laid out in secondary legislation, rather than put in the Bill, as her amendment 7 stipulates. However, it is our clear expectation that the database will capture key information about landlords, and we recognise that there may be clear benefits in using it to collect a wider range of information, as her amendment suggests.

My hon. Friend also tabled new clause 6, which would require local authorities, if requested, to pay or guarantee the tenancy deposits of care leavers seeking to access the private rented sector. I am of the view that local authorities, rather than central Government, are best placed to assess the best way of supporting care leavers in their area. I reassure my hon. Friend that while local authorities maintain their ability to support care leavers in their areas, the Government are committed to putting in place the support that local government needs to do so effectively.

My hon. Friend the Member for Leeds Central and Headingley (Alex Sobel) made a strong case for new clause 11 on acting to limit guarantors. I appreciate fully that obtaining a guarantor can be difficult for some prospective tenants, and I understand the reasoning behind his amendment. However, I am also mindful that in some instances the use of guarantors can provide good landlords with the assurance necessary to let their properties to tenants who may otherwise find it difficult to access private rented accommodation. For example, there are those with a poor credit history—the kind of tenant who the shadow Minister worries our rent-in-advance amendments will harm. Having considered this issue in great detail, I ultimately concluded that limiting guarantors could inadvertently make life more difficult for certain types of renter. That said, I will keep the matter under review, and I am more than happy to engage in a dialogue with my hon. Friend about this in the weeks and months to come.

Several Opposition Members mentioned new clause 22, in the name of the hon. Member for St Albans (Daisy Cooper). The Government are clear that all landlords must keep their properties in a fit state, and that there need to be robust routes of redress when they do not. However, tenants can already take their landlord to court if their home is unfit for human habitation, and if the courts find that landlords have not met their obligations, they can award compensation, as well as requiring landlords to carry out repairs. For that reason, while agreeing entirely with the objective, I believe that the hon. Lady’s amendment is unnecessary.

I will briefly refer to two amendments on the amendment paper that were not spoken to by the Members who tabled them. My hon. Friend the Member for Nottingham East (Nadia Whittome) rightly called for protection from discrimination for renters who require home adaptations. The rental discrimination provisions in the Bill are specifically designed to protect victims of discrimination who may not be eligible to make a case under the Equality Act 2010, such as those who have children or are in receipt of benefits. People with a disability are already afforded protections from discrimination relating to the provision of housing or services under the Act. For that reason, we do not believe her new clause 24 is warranted, but I am more than happy to discuss the matter with her outside the Chamber.

My hon. Friend the Member for Warrington North (Charlotte Nichols) tabled amendment 11 to make rent repayment orders available for initial failure to be a member of the PRS landlord ombudsman or to register with the PRS database. She will recognise that we have significantly strengthened the RRO provisions in the previous Government’s Renters (Reform) Bill. However, I took the view that it would be inappropriate to extend rent repayment orders to non-criminal breaches of the kind that her amendment covers. Instead, local authorities will be able to issue civil penalties for the initial failures in question, with the possibility of higher financial penalties and RROs if landlords fail to sign up, having been fined.

Finally, I will mention the amendments relating to home adaptations—both new clause 9, in the name of the hon. Member for Bristol Central, and new clause 23, in the name of the hon. Member for Taunton and Wellington. Both amendments seek to require PRS landlords to permit home disability adaptations for assured tenants when these have been recommended in a local authority home assessment. The hon. Member for Bristol Central tabled the same amendment in Committee, and as we discussed then, the Equality Act already provides that landlords cannot unreasonably refuse a request for reasonable adjustments to a disabled person’s home. As I said in Committee, measures already in this Bill will improve the situation for disabled renters who request home adaptations. The abolition of section 21 notices will remove the threat of retaliatory eviction, empowering tenants to request the home adaptations they need and to complain if their requests are unreasonably refused. In addition, we are establishing the new PRS ombudsman, which will have strong powers to put things right for tenants where their landlord has failed to resolve a legitimate complaint.

I must say candidly to the hon. Lady that I remain somewhat unconvinced that these amendments are the way to address this absolutely legitimate issue—I recognise the problem she identifies—and for that reason, the Government will not be able to accept them. However, I can give her the assurance that we will commit to continuing to consider what more we may need to do to ensure that requests for reasonable adjustments cannot be unreasonably refused, including those recommended by local authority home assessments. I am more happy to engage with Members across the House, and to meet her, the hon. Member for Taunton and Wellington and other Members who have concerns on the subject, to discuss her amendment and the problem generally in more detail. I hope that, on that basis, she will consider not pressing her new clause to a vote.

[Carla Denyer]

If the Minister can confirm that the cross-party meeting will include the Chair of the Housing, Communities and Local Government Committee, and that it will take place before the Bill goes to the Lords, I will be happy to withdraw my new clause.

[Matthew Pennycook]

I will happily give the hon. Member that assurance, and I am more than happy to ensure that my hon. Friend the Chair of the Committee attends, as well as any other Member with an interest in this issue. It is important, and I understand the problem that the hon. Member outlines. There are reasons why we do not think the new clause is necessarily the best way to approach the issue, but I am more than happy to have a dialogue on that point.

In conclusion, today we are making targeted amendments that aim to ensure that the Bill operates as intended. In many cases, we think that the amendments pushed by hon. Members are unnecessary, because we think that the Bill strikes the right balance between the interests of landlords and those of tenants. On that basis, I hope the whole House can get behind the Bill this evening.

Question put and agreed to.

New clause 13 accordingly read a Second time, and added to the Bill.

Prohibition of rent in advance before lease entered into

(1) Schedule 1 to the Tenant Fees Act 2019 (permitted payments) is amended in accordance with subsections (2) and (3).

(2) After paragraph 1(1) (rent is a permitted payment) insert—

“(1A) But a payment of rent is a prohibited payment if—

(a) it is payable before the tenancy is entered into, and

(b) the tenancy is an assured tenancy.

(1B) This paragraph is subject to paragraph 1A.”

(3) For sub-paragraph (2) of paragraph 1 substitute—

“Increased rent

1A (1) If the amount of rent payable in respect of any relevant period (“P1”) is more than the amount of rent payable in respect of any later relevant period (“P2”), the additional amount payable in respect of P1 is a prohibited payment.

(2) That is subject to the following provisions of this paragraph.”

(4) After section 5 of the Tenant Fees Act 2019 insert—

“Other provision about rent in advance

5A Pre-tenancy payments of rent: prohibitions

(1) A landlord must not—

(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to the landlord in connection with an assured tenancy of housing in England,

(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to the landlord in connection with an assured tenancy of housing in England, or

(c) accept from a relevant person a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.

(2) A landlord must not—

(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connection with an assured tenancy of housing in England,

(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connection with an assured tenancy of housing in England, or

(c) accept from a third party a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.

(3) A letting agent must not—

(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to the letting agent in connection with an assured tenancy of housing in England,

(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to the letting agent in connection with an assured tenancy of housing in England, or

(c) accept from a relevant person a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.

(4) A letting agent must not—

(a) invite or encourage a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connections with an assured tenancy of housing in England,

(b) accept an offer from a relevant person to make a prohibited pre-tenancy payment of rent to a third party in connection with an assured tenancy of housing in England, or

(c) accept from a third party a prohibited pre-tenancy payment of rent in connection with an assured tenancy of housing in England.

(5) The Secretary of State may, by regulations made by statutory instrument, amend this section for the purpose of making provision about the descriptions of rent due in advance to which any provision of subsection (1), (2), (3) or (4) applies.

For this purpose “rent due in advance” means rent due before the period for which it is payable.

(6) Regulations under subsection (5)—

(a) may make different provision for different purposes;

(b) may make supplemental, incidental, consequential, transitional, transitory or saving provision;

(c) are to be made by statutory instrument.

(7) A statutory instrument containing regulations under subsection (5) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(8) In this section “prohibited pre-tenancy payment of rent” means a payment of rent that is prohibited by paragraph 1(1A) of Schedule 1.

5B Effect of a breach of section 5A

A term of an agreement between a letting agent and a relevant person which breaches section 5A is not binding on a relevant person.

Where a term of an agreement is not binding on a relevant person as a result of this section, the agreement continues, so far as practicable, to have effect in every other respect.”

(5) The Tenant Fees Act 2019 is further amended as follows—

(a) in section 6 (enforcement by local weights and measures authorities)—

(i) in subsection (1), in paragraph (b) omit “and” and after that paragraph insert—

“(ba) section 5A (pre-tenancy payments of rent: prohibitions), and”;

(ii) in subsection (3), for “or 2” substitute “, 2 or 5A”;

(b) in section 7 (enforcement by district councils), in subsection (1), for “and 2” substitute

“, 2 and 5A”;

(c) in section 8 (financial penalties), in subsection (1), for “or 2” substitute “, 2 or 5A”;

(d) in section 10 (recovery by enforcement authority of amount paid)—

(i) in subsection (1)(a), for “or 2” substitute “, 2 or 5A”;

(ii) after subsection (2) insert—

“(2A) But that obligation to pay the amount, or remaining part, of the prohibited payment is subject to subsection (3), unless it is a case where the payment is prohibited by paragraph 1(1A) of Schedule 1 (pre-tenancy payment of rent).”;

(iii) in subsection (3), for “But subsection (2) does not apply in relation to a prohibited payment” substitute “Subsection (2) does not apply in relation to the prohibited payment”;

(e) in section 15 (recovery by relevant person of amount paid), in subsection (1)(a), for “or 2” substitute “, 2 or 5A”.”.—(Matthew Pennycook.)

This amends the Tenant Fees Act 2019 so that rent in advance payable before the tenancy is entered into is a “prohibited payment” for the purposes of that Act. The new section 5A then also adds new prohibitions relating to that kind of prohibited payment.

Brought up, and read the First time.

Question put, That the clause be read a Second time.

The House divided: Ayes 372, Noes 114

[Division lists to follow.]

Question accordingly agreed to.

New clause 14 read a Second time, and added to the Bill.