Private Rented Sector: Regulation

Dan Carden Excerpts

Wednesday 24th May 2023 Westminster Hall

[Dan Carden (Liverpool, Walton) (Lab)]

I beg to move,

That this House has considered regulation of the private rented sector.

It is a pleasure to serve under your chairmanship, Mr Davies. I am grateful to have secured time for a debate on this matter, which continues to directly affect all our constituents. I pay tribute to my constituents in Liverpool, Walton who continue to be the innocent victims of the UK’s broken housing system, and I commend stakeholders including the Merseyside Law Centre, the Vauxhall Community Law and Information Centre, ACORN Liverpool at the local level, and the excellent Renters Reform Coalition at the national level.

The private rented sector continues to be dominated by insecure tenure, increasingly unaffordable rents, poor housing quality and the ever-present threat of homelessness. No one in this House should underestimate the dislocating and exhausting experience of being removed from one’s home.

I am unsure whether anyone in this House has received a section 21 notice, or has felt unable to complain about damp, mould or other poor conditions for fear of a retaliatory eviction. I am unsure whether anyone in this House has had to endure the stress of having only two months to find a new property in a chaotic and punishing market—or to search for a new school for their children, a new doctor, dental surgery or other basic services that we take for granted—following the receipt of a section 21 notice. What I am sure of is that the Government were absolutely right to ban section 21 evictions, alongside taking other measures in the Renters (Reform) Bill, to correct the power imbalance between landlords and tenants; but we must not forget what the cost of delay and inaction has been. To illustrate that, I will discuss just one of my constituents.

My constituent received a section 21 notice through the post, which gave her two months to vacate the property. The landlord gave two reasons for the eviction: he was looking at increasing rental income and was also looking to sell the property. My constituent has two children, a daughter aged seven and a son aged four, who has a severe learning disability and is non-verbal. Despite that, at the start of June, she and her family will become homeless. I invite the Minister to hear directly from my constituent about the impact of that eviction on her and her family’s mental and physical health. I would be happy for my office to make contact with her office to facilitate that.

The measures in the Renters (Reform) Bill will come too late for that constituent, but we can now work to ensure that no other constituent faces the same crushing uncertainty. Thankfully, after a four-year delay following the announcement of the Renters (Reform) Bill, the Government have finally found time to introduce that important piece of legislation. I stand ready and willing to work with colleagues from across the House to ensure that the Bill makes the private rented sector as fair as possible and gives local authorities resources to enable them to regulate the sector effectively for the benefit of all our constituents.

[Caroline Lucas (Brighton, Pavilion) (Green)]

I congratulate the hon. Gentleman on securing this really important debate; he is making a powerful case. My Brighton constituency is one of the most expensive places to rent outside London, and my constituents are being ripped off daily. Does he agree that there is a big gap in the Renters (Reform) Bill—which is very welcome, if very late—when it comes to more enforcement powers for local authorities to target rogue landlords, and also this outrageous discrimination whereby blanket bans on renting to people with children or those who rely on benefits are still allowed? Those loopholes absolutely must be closed now. It is not good enough for the Minister to say, “We’re going to do it sometime in the future.”

[Dan Carden]

I am grateful for my colleague’s intervention. I will touch on both those points in some detail, and I hope the Minister will respond and that we can work together to see the Bill strengthened over time.

I will use the rest of the time I have available today to cover actions that could be taken to ensure that the reforms were robust enough to provide renters with real security in their homes. I aim to do that in the spirit of genuine co-operation, and there is considerable appetite across the House to make the legislation as effective as possible. I want to cover three primary areas in which policy could be improved: in the Bill itself, on action related to enforcement, and addressing the crisis around affordability.

As I have outlined, the abolition of section 21 evictions is a much welcome step, but the Government must go further to guarantee that private housing providers do not use other routes to subject renters to unfair eviction. Landlords can continue to reclaim possession of their properties in the case of a sale, or if they or a family member wishes to move into a property. However, under the Bill, following an eviction on those grounds, landlords can re-let their properties after three months. That period is too short, and it will not act as a proper deterrent to landlords who seek to exploit the abolition of section 21 evictions. Therefore, the Government must extend the no re-letting period to a minimum of 12 months. If they do not, renters will not feel the assurance and safety that are intended to be at the heart of the reforms.

Further, will the Minister explain what recourse tenants will have if they are evicted unlawfully on those grounds? Can tenants apply for a rent repayment order, for example? If not, what other forms of compensation are available? The proposed two-month notice period and six-month initial protected period leave those evicted on legitimate no-fault grounds in the same position as they are under section 21. The notice period should be extended to four months at an absolute minimum.

Such a proposal is not new to the Government, because in the midst of the covid pandemic, the section 21 notice was extended to four months. I can tell the Minister that the situation in the housing market has deteriorated, not improved, so it is only logical that the Government look at that proposal and seriously consider extending the period again. The benefits are obvious: if tenants were given more time to find somewhere to live, that would spare the taxpayer and tenants the cost of homelessness, which is devastating both financially and mentally.

Organisations including Shelter have expressed concern about the amendments that the Renters (Reform) Bill will make to homelessness legislation. Private renters who receive a possession notice will no longer have the right to immediate help from the council to avoid homelessness. That is because the law will no longer specify when help to prevent homelessness should be available to private renters. Instead, it will leave that to the discretion of local authorities, and that despite the Government knowing that early intervention is paramount in protecting tenants and preventing homelessness. Will the Government move urgently to address that weakness in the Bill, which directly undermines the Homelessness Reduction Act 2017 and the rough sleeping strategy? We should be boosting and improving protections related to homelessness prevention, not weakening them.

I want to speak about enforcement. The property portal and the ombudsman are positive elements of the Bill, but they will help to drive up standards only if the Government arm local authorities with the means to properly investigate and enforce. There is a postcode lottery in the sector, and enforcement action depends on how diligent and well resourced local authorities are. In my local authority area, Liverpool, we have a selective licensing scheme that aims to proactively regulate the private rented sector.

Despite the Government shrinking the area to which the licensing scheme applied in 2020, the team at Liverpool City Council has reported that, out of 2,308 inspections, 917 disrepair matters have been identified, as well as 1,053 breaches of licensing conditions. This is despite the National Residential Landlords Association previously describing the scheme as a “waste of time”. The local authority looks to work in co-operation with licence holders where possible, but unfortunately some enforcement action will always be inevitable. The council describes the number of referrals to the service as “substantial”. It says that resourcing and recruitment remain a challenge. Will the Minister commit to ringfencing resources to ensure that new regulations can be properly enforced through the property portal and ombudsman?

There is a crisis of affordability in the private rented sector, and yet calls continue to be ignored by Government. Research by Rightmove has shown that, in the past year alone, rents have risen at their fastest rate in 16 years, increasing by an average of 11% across Great Britain, yet I have never heard anyone on the Government Benches express concern that rent increases have contributed to inflation. That argument is often made when it comes to pay restraint or welfare payments, but why are landlords never asked to heed the same advice? These price increases represent an emergency, and the Government are moving too slowly to combat these rises.

There have been five housing Ministers in the past year. It seems that private renters are the losers from years of indifference and delay by the Government. Housing generally is already the biggest expense for renters. According to Crisis, private tenants on the lowest 10% of incomes are facing combined rents, food and utility costs that exceed their total incomes by 43%. The impact of further rent increases will be deep. According to Government figures, between January and March 2023, the number of section 21 claims increased by a huge 52%, and there was a 16% rise in non-section 21 evictions, the highest since the data began in 2009. The rent tribunal still continues to allow rents to go higher than the landlord may initially request, which acts as a major disincentive to using it. Will the Minister work with me to increase constituents’ means to challenge rent increases and improve the utility of the rent tribunal? If action is not taken to combat rent increases, landlords will simply evict tenants by pricing them out of staying in the property.

[Caroline Lucas]

It is generous of the hon. Gentleman to give way again; he is making a powerful case. Does he agree that we also need to look at rent controls, which are used in many other countries without a problem? We simply cannot allow rents to spiral out of all control. People will never be able to earn enough to have a mortgage, and they cannot even earn enough now to pay their own bills, so we need something far stronger even that what he is describing.

[Dan Carden]

Absolutely; I would back the hon. Lady’s calls for the Government to look at rent controls and the best international comparisons, because this is an issue not just for our constituents, but for the economy and inflation, and in the end it hurts all of us.

The Minister could also move to increase the local housing allowance. LHA rates have been frozen since 2019. Following the huge increase in inflation and house prices, this freezing means that private tenants face an ever-increasing gap between housing benefit and their actual rent. What discussions are taking place within Government to modify that? Inaction is prolonging and deepening homelessness. Further, there are White Paper commitments missing from the version of the Bill that was recently published. Where are the measures to outlaw blanket bans on renting to those in receipt of housing benefit? The Government have recognised that this discrimination is wrong, but measures to address it are missing from the Bill. I would appreciate some guidance from the Minister on that point in her response.

I will conclude by discussing an important amendment that I intend to table to the Renters (Reform) Bill. Awaab Ishak was a two-year-old boy killed by mould in a social housing flat. Unfortunately, Awaab’s story echoes much of the casework that comes through my office—and, I am sure, the offices of many Members across the House. It followed Awaab’s social landlord repeatedly failing to fix the mould problem in his family’s flat, blaming the problems on his family’s lifestyle.

In response, the Secretary of State moved quickly to table amendments to the Social Housing (Regulation) Bill to impose timeframes on landlords to investigate hazards and make repairs. That was absolutely the right move, and the Government must now put the same protections in place for private renters. As the Citizens Advice report, “Damp, cold and full of mould”, has shown, 2.7 million renting households in this country, including 1.6 million children, are living in damp, cold or mouldy homes. These conditions have a disastrous effect on people’s physical and mental health.

--- Later in debate ---

[Abena Oppong-Asare]

Abena. I thank my hon. Friend for putting forward this important debate. I have a huge number of housing cases that involve constituents of mine who live in damp and mouldy properties, and I have had responses from housing associations saying that that is down to their lifestyle, which is factually incorrect. Constituents are also facing soaring rents. Like my hon. Friend, I want to see a proper ombudsman in place for constituents living in private rented accommodation. Does he agree that the private renters charter will make things a lot fairer for individuals up and down the country?

[Dan Carden]

I am grateful to my hon. Friend for her intervention. I agree with her, and I hope that this Bill is an opportunity for us to ensure that the Government can put more protections in place for our constituents.

The conditions in which people live can have a disastrous effect on their physical and mental health, but tenants are left with little choice than to stay in homes that make them ill, and even kill them. Will the Minister meet with me to discuss how we can bring the private sector in line with the social sector and ensure that landlords deal with serious hazards in privately rented homes in a timely manner? Sadly, as we have witnessed, the cost of failing to do so can be fatal. I will leave the Minister with that, and I look forward to working with her and colleagues on this hugely important area of policy.

--- Later in debate ---

[Wera Hobhouse]

Will the Minister give way?

[Dan Carden]

Will the Minister give way?

[Rachel Maclean]

I will not give way. Can I ask for your guidance, Mr Davies, because I believe the hon. Member for Liverpool, Walton will have time to sum up at the end?

[Dan Carden]

I have a question for the Minister.

[Rachel Maclean]

I give way briefly.

[Dan Carden]

I am grateful to the Minister and I recognise that she has given a full response but, as she said she was concluding, I wanted to pick up on two points that I do not think she covered. I apologise if I am incorrect. The first point was on the ability of landlords to repossess properties if they declare they are going to sell them or if they or a family member are going to move in. They currently need to give only three months’ notice; will the Department consider extending that to 12 months?

Secondly, I mentioned the Secretary of State’s amendments to the Social Housing (Regulation) Bill to impose timeframes on landlords to investigate hazards and make repairs. I will table an amendment to the Renters (Reform) Bill; I would appreciate time with the Minister to discuss how we can use the Bill to ensure those protections in the private rented sector.

[Rachel Maclean]

I thank the hon. Gentleman. On his first point, we believe that we currently have the right balance. Of course, the Bill will proceed through the House. On his intention to table an amendment, I am of course happy to meet him to discuss that.

A number of Members referenced housing issues more generally. The Opposition Front-Bench spokesperson, the hon. Member for Luton North (Sarah Owen), referred to the affordable eco-homes being built by her local council. The House must be made aware—I am sure it is already—that those affordable homes are being built with support from the Conservative Government through the affordable homes programme. We are delivering homes all across the country.

--- Later in debate ---

[Dan Carden]

I thank the Minister for her response to the debate, and I thank all colleagues who contributed. Although there is a welcome for the legislation, which the Minister says is the biggest reform of the sector in a generation, there is a danger that it is a missed opportunity. The test will be the impact that it has on our constituents. Does it give them security in their homes? Does it rebalance the power inequality between landlords and tenants? Does it tackle the affordability crisis that exists across the sector? Does it deal with the millions of people, including children, who live in damp, squalid, unsafe houses across the country?

I look forward to following the legislation through the House and to seeking to amend and improve it. I am grateful for the time we have had for today’s debate.

Question put and agreed to.

Resolved,

That this House has considered regulation of the private rented sector.