Section 21 Evictions

Heather Wheeler Excerpts

Thursday 6th December 2018 Westminster Hall

[Grahame Morris (Easington) (Lab)]

I congratulate my hon. Friend the Member for Westminster North (Ms Buck) on securing this important and timely debate. It is an honour to serve under your chairmanship, Mr Hollobone. I apologise for arriving a little late.

As hon. Members on both sides of the House should recognise, my hon. Friend has done some steadfast work to advocate the rights of tenants. She has my unwavering support in her campaign for all homes to be fit for human habitation. The Government’s failure to support the Homes (Fitness for Human Habitation) Bill in 2015, or to back a similar amendment to the Housing and Planning Act 2016 a year later—I served on the Bill Committee as an Opposition Whip—shows the scale of the challenge we face on this side of the House.

We have a flawed system that completely lacks balance, as my hon. Friend said. The housing security enjoyed by the post-war generation has been systematically eroded through the right to buy, the failure to build truly affordable low-rent social housing, and the boom in the buy-to-let sector. Those factors have moved many tenants from housing security to housing insecurity in the private sector. The right to buy, coupled with the failure to build, has created generation rent, as my hon. Friend said, and our children are paying the price. They are financially excluded, and for many home ownership is a distant dream. Their reality is insecurity and relatively high-cost private rents with few enforceable rights.

We must address the issue of tenants’ rights. The private rented sector has substantially increased, even in my time in the House. The private rented sector comprised just 9% of households in 1988. It has more than doubled since then and today accommodates one in five households.

Clearly, section 21 of the Housing Act 1988 and “no fault” evictions create—in fact, add to—a one-sided power imbalance, with landlords having practical rights while tenants have what are, in effect, unenforceable paper rights. This power imbalance encourages poor management practice, with tenants worried about challenging rent rises and often afraid to ask for essential repairs because they fear eviction.

I am grateful to my hon. Friend for circulating a briefing in advance of this debate, which notes that there were 12,711 evictions by bailiffs under section 21, which was recorded by the Ministry of Justice under the “accelerated” procedure. However, that figure is a baseline; it is really the tip of the iceberg, with the vast majority of tenants actually moving out without going through the daunting court process.

I will now mention some of the issues in my constituency; they are different from those in the inner-city areas of London, but they are very real, and in some respects probably more acute. I have seen constituents move from one bad landlord to another and from one dilapidated house to another. It is a never-ending cycle of debt and disruption, which traps families in poverty. And no matter how hard they try to escape, it seems that they are caught in a vicious circle.

I hope that the Minister is aware of Horden in my constituency. I have raised the problems of the private rented sector there on a number of occasions. Indeed, I invited the Under-Secretary of State for Housing, Communities and Local Government, the hon. Member for Rossendale and Darwen (Jake Berry), who is the Minister with responsibility for the northern powerhouse, to visit Horden. He promised that he would do so, but has not so far. In addition, I have written to the Minister for Housing, the hon. Member for North West Hampshire (Kit Malthouse), inviting him to visit and discuss some of the particular problems that we have and how they might be addressed.

Without going into too much detail, I will just mention that some of the problems arise from the withdrawal of Accent Housing and the subsequent fire sale auction of houses in Horden, which led to an influx of absentee landlords with little interest in their tenants. We talked a little earlier about the tale of landlords who are not acting in a socially responsible manner, and that is certainly evident in some of the former mining communities that I represent in east Durham. Many people now find themselves living among derelict houses. Dilapidated housing, smashed windows, arson and fly-tipping are the epitaph of a failed private rented sector market in Horden, in my constituency.

Frankly, the situation in Horden is nothing short of a national housing scandal and I hope that the Government will engage with this issue, because we cannot sit by passively and see the situation continue. I hope that the Minister and her colleagues will prove me wrong.

My own local authority, Durham County Council, is nearing the publication of a Horden master-plan to address some of the issues with the private rented sector. It will set out a range of options and I hope that if we can work with the council, it will help to deliver some housing regeneration. However, there is still a need for Ministers to engage and support the proposal with appropriate funding, because we have an influx of absentee landlords, housing conditions are poor and tenants are being exploited. I am glad that my local authority is now seeking to challenge that situation.

I am told that it is not a formality to get an authority-wide landlord licensing scheme. I had thought it was a formality, but I understand that the Government have some reservations about such schemes.

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Mrs Heather Wheeler)]

indicated dissent.

[Grahame Morris]

The Minister is shaking her head. However, where we have had a landlord licensing scheme in a small defined area, that has proven to be effective. However, that has simply pushed the problem into another area.

The consensus is around a scheme that I believe has worked very effectively both in Liverpool and in Newham in London. I am grateful to my hon. Friend the Member for Liverpool, Walton (Dan Carden), who has hosted visits from local elected representatives.

--- Later in debate ---

[Lyn Brown]

And less long-winded!

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Mrs Heather Wheeler)]

We live in hope.

[Andy Slaughter]

We will hear from the new shadow Minister in a moment, but I hope she will not take it amiss if I say that I am particularly looking forward to hearing what the Minister has to say and finding out how far policy has moved on within the Government—not just on the rabble-rousing Conservative Back Benches where the hon. Member for Cheltenham sits with the radical, provisional wing of the Conservative party.

Can the Minister give us some indication that the issues of balance and no-fault eviction are understood? May we look forward to some beneficial changes that give security to families, particularly in high rent areas, but also—as we heard from my hon. Friend the Member for Easington—across the country? Those changes are long overdue. Whatever the merits or demerits of the 1988 Act, it is time we took another comprehensive look at housing legislation and redressed some of the obvious unfairness in the private rented sector.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Mrs Heather Wheeler)]

It is a pleasure to serve under your chairmanship, Sir Graham. I refer Members to my entry in the Register of Members’ Financial Interests. I congratulate the hon. Member for Westminster North (Ms Buck) on securing the debate and thank all those who have made wonderful contributions today for their interesting stories from across the country, which tug at the heartstrings.

This is an important issue and I am glad to be able to respond to some of the concerns raised. We are committed to rebalancing the relationship between tenants and landlords, to deliver a fairer, better-quality and more affordable private rented sector. The sector plays a pivotal role in providing homes across the country and is an integral element of the Government’s approach to making the housing market work for everyone.

On the specific points made by the hon. Members for Westminster North and for Hammersmith (Andy Slaughter) on section 21, the legal framework underpinning the private rented sector works to build a fair and robust private rented sector that protects tenants, supports landlords and empowers local authorities to deliver a healthy rental sector. The Government provide support to landlords and tenants to navigate the legislative landscape and have recently updated the “How to Rent” guides that offer comprehensive guidance and signposting to relevant resources. The Government are committed to providing practical guidance to relevant agencies and local authorities when new legislation is created.

Interestingly, according to the most recent English housing survey, 84% of private renters were satisfied with their current accommodation, and two thirds were either very satisfied or fairly satisfied with their current tenure. However, we also recognise that many tenants feel insecure and that their house is not their home because they are on short initial fixed-term tenancies of six to 12 months. We are committed to improving security for tenants.

Section 21 provisions provide an important guarantee to landlords that they will always be able to get their property back at the end of the tenancy. The flexibility for landlords and mortgage providers to recover their asset if they need to is crucial to retaining investment and supply in the sector, including the availability of buy-to-let mortgages. I want to make this point specifically in reply to my hon. Friend the Member for Cheltenham (Alex Chalk), who has had to leave us. There are clear legal protections for tenants and a clear process that landlords must follow when carrying out a section 21 eviction.

Outside the fixed-term tenancy period, a landlord can evict a tenant using a section 21 notice, but only when they have complied with certain legal obligations. Those include protecting their tenants’ deposit in a tenancy deposit scheme, providing a gas safety certificate, and also providing a copy of the Government’s “How to Rent” guide. If, in response to a complaint about property condition by a tenant, the local authority has served either an improvement notice or a notice of emergency remedial action, a landlord cannot evict a tenant using a section 21 notice for six months. Furthermore, under the Tenant Fees Bill, we propose that if a landlord charges a prohibited fee, they will not be able to serve a section 21 notice until those payments have been reimbursed.

The Government want to protect the rights of tenants and give them more security, but we must do so in a way that does not impact on the supply of good-quality rented accommodation.

[Andy Slaughter]

The Minister highlights important and hard-won preconditions for taking eviction proceedings, but that does not alter the fact that, in the generality of cases, we are talking about no-fault evictions. Opposition Members are anxious to hear what the Government will do about no-fault evictions. Do they still maintain that that is the right general approach or do they think that its day has come to be removed?

[Mrs Wheeler]

Fortunately, as we have so much time, I have an extremely long speech and the hon. Gentleman might be stunned to hear what I have to say. Or he may not.

Growing numbers of tenants are families or older people and the Government are firmly committed to helping them. The measures announced in the housing White Paper mean that most tenants in the build-to-rent sector are now being offered tenancies of a minimum of three years. We recently consulted on overcoming the barriers to longer tenancies in the private rented sector. We sought views on a three-year longer tenancy model with a six-month break clause and asked for views on its viability and how it can be implemented. The consultation closed at the end of August and we are now analysing responses.

A three-year tenancy is one option. However, we have not made any policy decisions regarding tenancy length, whether to change the legislation on section 21 evictions or how our proposed model could be implemented. We are considering the consultation responses fully before making any policy decisions and will set out next steps shortly. In the meantime, for tenants who want a longer tenancy, we have published a model tenancy agreement that landlords and tenants can choose to use as the basis for longer, family-friendly tenancies. We have also published “How to Rent” and “How to Let” guides for tenants and landlords to support them in understanding their rights and responsibilities.

To answer some of the points made by the hon. Members for Westminster North and for Easington (Grahame Morris), the Government recognise the important role that private landlords play in supporting the UK economy and in providing homes to millions of people across the country. We recognise that in order to continue to offer housing, landlords need the flexibility to be able to get their property back quickly when circumstances change. Without those assurances, landlords would be less willing to enter and stay in the market, which does not help tenants.

We recognise that some landlords have concerns about the section 8 eviction process and instead use the section 21 accelerated procedure. We are keen to understand those concerns, and last month, on 13 November, we launched a call for evidence to better understand the experience of courts and tribunal service users in property cases. The call for evidence seeks views from members of the judiciary, landlords and tenants on the private landlord possession action process in the county court and the case for structural changes, such as an extension to the remit of the property tribunal or a new housing court.

There have been calls from hon. Members here today to abolish section 21 evictions. As I have said, we have not yet made any firm policy decisions on whether to legislate to alter the provisions set out in section 21. We first want to consider carefully the responses to the call for evidence on user experience of the courts.

[Lyn Brown]

I am grateful to the Minister for giving way; she knows that I have a soft spot for her. What will I say to Martin about what she has offered this afternoon? Can I say that she is considering getting rid of section 21, or that his rights will be enhanced by the Government’s future actions? What advice would she like me to give to Martin?

[Mrs Wheeler]

I am sure that the hon. Lady has espoused the brilliance of the licensing scheme in Newham and the brilliance of her council. Perhaps her council should have gone round to the flat to deal with the dreadful situation that she has enlightened us with today.

[Lyn Brown]

We will talk about it outside.

[Mrs Wheeler]

We will indeed; I would be delighted to have that conversation.

As I stressed at the start of my speech, property is a valuable asset and landlords may need to gain possession quickly for various reasons, perhaps because they wish to sell the property, or to enable them or a family member to move in. As I said, there is a clear legal protection for tenants, and a clear process that landlords must follow when carrying out a section 21 eviction.

I appreciated hearing what the hon. Member for Easington had to say about selective licensing and borough-wide licensing, and about enforcement of property standards. Selective licensing is meant to be a targeted tool that can deliver improved standards and safety in the private rented sector for areas suffering serious problems. It can be used at local authorities’ discretion, but where it covers more than 20% of the private rented stock, confirmation by the Secretary of State is required. That is to ensure that local authorities focus their activity on the worst areas and avoid an adverse impact on good landlords. Local authorities have an array of powers at their disposal for enforcing property standards. We expect them to use those to maximum effect and have set up a £2 million fund to help them kick-start enforcement and share best practice. Having said all that, the offer that I would like to make to the hon. Gentleman is that my officials will contact his local authority to talk about an application for licensing.

The 2016-17 English housing survey found that only a tenth of private tenants, when asked about their most recent move, said that they were asked to leave or were given notice by their landlord. There were 1.1 million moves into and within the private rented sector in 2016-17, with private renters making up a larger proportion of movers compared with other tenures. However, there has been an overall decrease in the number of private landlord possession cases since 2014. In England and Wales there were 20,590 private landlord possession cases in 2016-17. That shows that only a small percentage of moves in the sector end in the courts. Of course, where that does happen it can have a devastating impact on the tenants involved. The Government acknowledge that the end of an assured tenancy in the private rented sector can cause homelessness.

I want to make it clear that we have one of the strongest safety nets in the world to prevent homelessness, and we recently strengthened it through the Homelessness Reduction Act 2017. The Act came into force in April and brought in a new prevention duty, extending the period for which an applicant is “threatened with homelessness” from 28 days to 56 days. That will ensure that those served with a valid section 21 notice that is due to expire will be classed as threatened with homelessness and supported until their situation is resolved—to answer a question that was put during the debate—with no gap between prevention and relief duties, if they have nowhere else to go. If the landlord intends to seek possession and there is no defence to the application, the local housing authority must take reasonable steps to prevent a person’s homelessness. Local authorities must work with applicants to develop personalised housing plans, tailored to the needs and circumstances of the household.

[Melanie Onn]

I thank the Minister for her further explanation of the point about the Homelessness Reduction Act 2017. Can she confirm that, were someone to leave their property early, having received the possession notice, and were they to attend the local authority, they would be deemed homeless, and not intentionally homeless, and given the same support as someone who was homeless as a result of another set of circumstances?

[Lyn Brown]

No, she cannot.

[Mrs Wheeler]

The hon. Lady says from a sedentary position that I cannot. The absolute truth is that the person must go to the local authority as soon as they get the section 21 notice, and the local authority then has a duty to help them.

[Ms Buck]

They will not.

[Mrs Wheeler]

They will not go? Okay, we will find out.

The hon. Member for Bath (Wera Hobhouse) mentioned affordability. That issue is exactly the reason the Government introduced the £1 billion Build to Rent fund, and the £3.5 billion private rented sector guarantee scheme, to help support the building of thousands of extra homes specifically for private rent. We want Build to Rent to continue to grow and make a significant contribution to housing supply.

[Wera Hobhouse]

I fear that the Minister may have misunderstood what I meant. We need to build social homes for rent, because the private sector will just not build the affordable homes we need. Giving the private sector money to build homes for the private sector will not solve the crisis.

[Mrs Wheeler]

Fortunately, as I go on with my speech, the hon. Lady will hear even more good news.

We are going further, delivering the homes that the country requires. The Government are committed to building more affordable homes, supporting the different needs of a wide range of people. The Government are committed to increasing the supply of social affordable housing and have made £9 billion available through the affordable homes programme to March 2022, to deliver 250,000 new affordable homes on a wide range of tenures, including homes for social rent. Furthermore, we abolished the housing revenue account borrowing cap on 29 October. That will help to deliver a new generation of council homes. We expect it will help local authorities to double their building from around 5,000 to 10,000 homes per year by 2021-22.

[Melanie Onn]

The Minister is being incredibly generous in giving way. On the lifting of the HRA cap, which has been well received on the whole, what is the Government’s plan for those local authorities that do not have an HRA account because they disposed of their stock wholesale, at the time when housing associations became involved, about 10 years ago?

[Mrs Wheeler]

From memory, if a local council wants to go back into the market, as long as it builds a minimum of 100, it can. Obviously, I shall write to the hon. Lady to confirm that.

The change will diversify the house building market, as councils are better able to take on projects and sites that private developers might consider too small. To help further, we are providing a longer-term rent deal for five years from 2020 that provides housing associations and local authorities with a stable investment environment to deliver new homes. That will help to deliver the new generation of council house building that the Prime Minister announced recently.

Our position on retaliatory eviction is clear. To answer the hon. Members for Blaydon (Liz Twist) and for Leeds North West (Alex Sobel), no tenant with a genuine complaint about the condition of their property should be fearful of retaliatory eviction. That is why we have already taken steps on the matter, legislating to protect tenants from retaliatory eviction through the Deregulation Act 2015. As we are all aware, the vast majority of landlords provide well-maintained properties, and thankfully only a small number of tenants encounter the threat of retaliatory eviction. We share the ambition of ensuring that tenants are properly protected from retaliatory eviction—I shall begin to call it RE, as I cannot get my teeth around it.

We want to take a strategic approach, empowering tenants to raise issues with their landlords through greater security of tenure. Our recent consultation on overcoming the barriers to longer tenancies in the private rented sector included a question seeking views on the effectiveness of RE provisions. That ensures that we have the most up-to-date information to inform our thinking. We are currently analysing responses. We are supporting the private Member’s Bill promoted by the hon. Member for Westminster North, the Homes (Fitness for Human Habitation) Bill. It adds a new dimension to the fight against rogue landlords, empowering tenants by allowing them to seek redress from their landlords if their rented house or flat is in an unacceptably dangerous condition. Tenants will be able to seek that redress without having to rely on their local authority. Of course, they will still be able to report problems to their local authority if they prefer, and will then be protected from unfair eviction by the 2015 Act. We are also exploring how we can strengthen redress in the housing market and are committed to requiring all private landlords to join a redress scheme as part of that. We will be publishing the response to our redress consultation shortly.

I hope that my remarks today demonstrate the Government’s commitment to building a private rented sector that works for everyone—one that supports good landlords to deliver the homes the nation needs and provides safe, affordable and secure homes for tenants. We do not shy away from the challenges facing us and are aware that we need the support of the entire private rented sector if we are to achieve those goals. It is in that spirit that I thank all hon. Members for their speeches and questions. I hope the hon. Member for Easington survives his cold—he has just toddled off. It would be a pleasure to talk to him about organising a visit to his area. I look forward to working with the hon. Member for Westminster North and other hon. Members in the coming weeks and months on this very important issue.