Renters' Rights Bill (Seventh sitting)
Jerome Mayhew ExcerptsTuesday 5th November 2024
(2 weeks, 2 days ago)
Public Bill CommitteesRead Full debate Renters' Rights Bill 2024-26 View all Renters' Rights Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 5 November 2024 - (5 Nov 2024)
Jerome Mayhew (Broadland and Fakenham) (Con)
I apologise for being rather slow on the uptake, but may I take the Minister back to clause 124, “Duties where occupiers are on residential premises entered without warrant”? Subsection (1) states:
“If an officer of a local housing authority enters premises under section 123(1) and finds one or more occupiers on the premises”—
in other words, if there are people there—
“the officer must produce evidence of the officer’s identity and special authorisation to that occupier or (if there is more than one) to at least one of them.”
That is very sensible—it means that the person must demonstrate who they are to the people in the premises—but subsection (2) states:
“An officer need not comply with subsection (1) if it is not reasonably practicable to do so.”
If we have already identified that an officer is entering premises that are occupied, what are the circumstances in which it would not be reasonably practicable for him to identify himself?
Matthew Pennycook
That is a very reasonable question. If the hon. Member will allow me, I will come back to him via written correspondence. In drafting the clause— I am raking my memory for our discussions about it—we thought that there would be certain circumstances in which the reasonability test might not need to be met. Some of the clauses have been developed following exchanges with local authorities. I will come back to the hon. Member on the specific point about whether we have met the test for it being necessary to include the subsection in the Bill.
Jerome Mayhew
The difficulty is that the Minister is asking us to support the wording of the Bill now, not subsequently to a letter being received. It is hard to support a clause that suggests on the face of it that an officer could come in and decide that it is not reasonably practicable to show their authority to somebody who is in occupation of their own residence. This is not an office building; it is where people live. I invite the Minister, who has his officials with him, to provide a more substantive answer in his next comments, because it is difficult for someone like me to support the clause as drafted.
Matthew Pennycook
I will happily try to do so: I will take away the point and try to get the hon. Member some reassurance in short order. I reassure him that we have drafted the clauses carefully, following extensive dialogue with local authorities and local authority stakeholders. We do not take the power lightly. If I understand him correctly, he is putting to me the reasonable point that such a power would never be necessary. If, in the course of our ongoing exchanges, I can give him an example in which it might be necessary, perhaps he will be reassured.
Question put and agreed to.
Clause 111 accordingly ordered to stand part of the Bill.
Clauses 112 to 133 ordered to stand part of the Bill.
Clause 134
Interpretation
Question proposed, That the clause stand part of the Bill.
Renters' Rights Bill (Fifth sitting)
Jerome Mayhew ExcerptsThursday 31st October 2024
(3 weeks ago)
Public Bill CommitteesRead Full debate Renters' Rights Bill 2024-26 View all Renters' Rights Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 31 October 2024 - (31 Oct 2024)
Jerome Mayhew (Broadland and Fakenham) (Con)
The Minister identified other legislation that already make discrimination illegal, and went on to make the point that proving discrimination is very difficult, so my question is twofold. First, if we have already outlawed that kind of behaviour, why do we need further legislation to do exactly the same thing? Secondly, if we do require further legislation, how is the evidential burden going to be passed more easily under this clause than has been the experience under previous provisions?
Matthew Pennycook
I thank the hon. Gentleman for his two reasonable questions; I will come on to answer them both in my remarks. If he feels that I have not sufficiently explained the matter, I am more than happy to give way to him again, but I will address both those points. The first I have already touched on: despite it almost certainly being unlawful under the Equality Act, discriminatory conduct of the kind that we are trying to bear down on happens fairly routinely, so it is evident to the Government that the existing legislation does not allow us to bear down on the problem effectively in practice. We think the Bill’s provisions will allow us to do so. I will pick up the hon. Gentleman’s point about the evidential burden and how local authorities make that judgment in due course.
In contrast to the approach on which I challenged the then Minister in the previous Parliament, the advantage of the approach taken in the Bill is that, first, responsibility for enforcement lies with local authorities and not tenants, and secondly, breaches can be addressed relatively easily, in the English context, via a civil offence with a lower burden of proof than a criminal one.
Clauses 32 and 33 directly and expressly prohibit discriminatory bans and restrictions on the letting of private rented sector properties on the basis that children would live with or visit a person at the property, or to persons in receipt of benefits. They also prohibit any conduct that might otherwise effectively constitute such bans or restrictions. In other words, the provisions are intended to deal with both direct and more subtle forms of discrimination. It is important to note that landlords and agents will continue to have the final say on who they let their property to, and they will be able to continue to carry out referencing checks to make sure that tenancies are sustainable for both parties.
It is also the case, as clause 40 makes clear, that nothing in this chapter will prevent landlords from making a final decision based on an objective and fair assessment of whether the prospective tenant can afford the rent, nor will it force landlords into entering into unsustainable tenancies. The majority of landlords—those who already act fairly and conscientiously and treat applicants equally, assessing their suitability on a case-by-case basis—have absolutely nothing to fear as a result of the introduction of the new rental discrimination framework.
Jerome Mayhew
The Minister made reference to the burden of proof under the clause being the civil burden, and compared that to the Equality Act. I just had a quick look at that Act—I stand to be corrected because it was a very brief look—and the burden under that Act appears to be a civil burden and also one where the maxim res ipsa loquitur can be applied. If that is the case, what is the difference between the burden of proof in this clause and that of the Equality Act?
Matthew Pennycook
I appreciate and understand that point, and the shadow Minister is right to say that we need to bring the requisite level of clarity in this area. He has asked a series of questions in Committee on insurance products more generally and I will attempt to give him a more comprehensive answer in writing so that we can draw a line under some of his concerns.
The shadow Minister asked specifically about no recourse to public funds and care leavers, which again is a specific subset of issues that he is right to raise. I will come back to him on those as well.
On civil penalties and whether they can be proved, we have taken a different approach in the Bill from Scotland and Wales where the situation is different. While they seek to enforce discriminatory provisions through a criminal offence, we have deliberately taken the civil route because of the lower burden of proof required for local authorities, and the ease with which they will therefore be able to take enforcement action against cases of discrimination where they have sufficient evidence.
Matthew Pennycook
If I have answered the shadow Minister’s point, the hon. Gentleman can come in.
Jerome Mayhew
The Minister will be aware that, although there is a civil burden of proof under English and Welsh law, the level to which the courts hold that burden of proof varies substantially, depending on the nature of the tariff or the consequence of that finding. Given that councillors will be seeking to impose what looks quite like a criminal fine under clause 39—a fine of many thousands of pounds—is it the Minister’s understanding that, although the burden of proof required is civil, it will be a high hurdle when applied by the courts?
Matthew Pennycook
I do not think I would make that particular point. To expand further, we have taken this particular approach because we think there is a benefit provided by the burden of proof that local authorities are required to meet. It is also the case that making breaches of rental discrimination provisions a single civil matter in England is in line with our wider discrimination legislation, in the way that it is not in Scotland and Wales—we will come on to discuss those points.
It is worth noting that, where there is evidence, local authorities can take enforcement action against either the landlord or the letting agent, or indeed both, if the letting agent has been party to the breach, and they can face multiple fines. They are civil fines at the £7,000 level rather than the criminal fines found elsewhere in the Bill, which have a much higher threshold of £40,000. I hope that answers the point made by the hon. Member for Broadland and Fakenham. Again, if he writes to me, I am happy to give him a more detailed answer.
I hope that I have reassured the shadow Minister as to why we have taken this approach and that we have considered its impact on different cohorts. It is important that the power provided for in clause 38 is there. We will take it forward only very specifically, as I have said, after consultation and through the affirmative procedure, but we want to have it so that the system can to adapt to any new instances of discrimination that arise. To go back to the point that my hon. Friend the Member for Doncaster Central has put to me fairly frequently, if sufficient evidence is brought to us that shows that certain cohorts, be it care leavers or anyone else, are facing the type of discrimination we want to bear down on through the Bill, we can more easily add them and cover them with that power.
Renters' Rights Bill (Fourth sitting)
Jerome Mayhew ExcerptsTuesday 29th October 2024
(3 weeks, 2 days ago)
Public Bill CommitteesRead Full debate Renters' Rights Bill 2024-26 View all Renters' Rights Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 29 October 2024 - (29 Oct 2024)
David Simmonds
The amendments relate to the role of the tribunal and the tribunal process. One of the concerns that was extensively aired in debate, and about which we have heard a great deal of evidence, is the impact of a process whereby from a tenant’s point of view, going to tribunal is a no-lose situation because the only possible decision the tribunal can take is to reduce the rent they would pay. That would mean that it would essentially always be in the tenant’s interests to go to the tribunal, because it would at worst defer the point at which any higher rent took effect. We have very significant concerns about the tribunal’s capacity to absorb that level of work and about the fact that to be fair to landlords as well, we should not have a situation where a tribunal can operate in only one direction. By proposing these amendments, we seek to make it possible for changes in rent to be backdated.
Jerome Mayhew (Broadland and Fakenham) (Con)
We are talking about perverse incentives here. One way to tackle that would be through a costs regime associated with the tribunal. Is it my hon. Friend’s understanding that the current intention is that there would be no adverse costs orders awarded against a tenant, should they go through a tribunal process and not be successful in reducing the level of rent?
David Simmonds
My hon. Friend raises an extremely good point. As he outlined, this is very much about perverse incentives. We do not want to create a situation in the market where it is always in the interests of the tenant to push this to the tribunal. We need to make sure that that point is effectively addressed, and the amendments seek to do that.
Matthew Pennycook
Clause 8 amends section 14 of the Housing Act 1988, and the amended sections set out the circumstances in which a tenant can submit an application to the tribunal to challenge the rent amount either in the first six months of a tenancy or following a section 13 rent increase notice. Amendments 50 to 53 seek to alter the process for challenging initial rents and rent increases at the tribunal.
I must stress that, in the first instance, under this new system, the Government strongly encourage landlords and tenants to communicate early about what adjustments to rent are sustainable for both parties. Where an agreement cannot be reached, the Government are clear that tenants should submit an application to the tribunal only where they believe that a rent increase is above market rates. Such rises may represent an attempt by the landlord to exploit a tenant who simply wishes to remain in their home, or they may be an underhanded attempt to remove a tenant without pursuing the very clear possession grounds laid out in schedule 1. That is why we think clause 8 is so important.
Jerome Mayhew
I understand that the Government’s intention is that tenants should not go to the tribunal unless they are clear that the asked-for rent is too high, but what prevents them from gaming the system, as we discussed?
Matthew Pennycook
What I would say to the hon. Gentleman—I will expand upon my argument in due course—is that I think he underestimates how difficult it is to take a case to the tribunal. That is why we are seeing such low numbers of tenants going to the tribunal. It is an onerous process; we need to provide support and guidance about how to do it. I do not take his point that we will see a flood of tenants taking rent increase cases to tribunal.
To be very clear—I have said this on previous occasions—the Government want more tenants to take their cases to tribunal. We think the tribunal has an important role to play in setting the effective market rate for any given area, so we want to see a proportionate number of cases go through it—we obviously do not want to see it overwhelmed. However, I think the hon. Gentleman underestimates the onerous nature of taking a case to tribunal. It will not be as simple as the tenant deciding on a whim one day that they can do that, and that it is a no-lose situation, but I recognise the incentives at play on both sides. I will expand upon what I mean and why we have come to this decision in relation to this particular clause.
The shadow Minister proposes in his amendments that rent increases, where they are challenged at the tribunal, should be backdated to the date the landlord first proposed. That would mean tenants possibly facing significant arrears immediately after the tribunal hearing. That is an incentive in the other direction, which we fear would, if introduced, see no tenants taking their case to tribunal. We have just had an extensive discussion about the need to address the affordability pressures to ensure that landlords are not exploiting the system with large, completely unreasonable within-tenancy increases. We have to take that into account as well.
Tenants should not be thrust into debt simply for enforcing their rights. As such, the Bill proposes that rent increases should apply only at the beginning of the next period after the tribunal determination, or up to two months later, in limited cases of undue hardship.
Matthew Pennycook
If the hon. Gentleman would allow me to develop my argument after his intervention, I am sure I will get to his points.
Jerome Mayhew
I am grateful—I am not intervening for the sake of it; there is an important point here. The Minister says that it would be unfair on the tenant to have a significant increase in rent and a backlog after the determination of the tribunal, but that is rent that ought properly to have belonged to the landlord and has been unjustifiably denied them for the period of the process. Why is it fair for the landlord to be denied a just rent as a result of the delay in the process, yet it is for some reason not fair for the tenant?
Matthew Pennycook
Many of the 11 million people living in the private rented sector would love to own a pet but have difficulty finding a property that allows them to do so. We want tenants in the private rented sector to enjoy the joys of pet ownership, just as homeowners do. We know the benefits of pet ownership for mental and physical wellbeing. I declare an interest: I have a dog named Clem, who I referenced in the debate on the previous Government’s Bill, and he is, as I know to be the case for many pets across the country, a valued member of the family.
We have heard the calls from animal groups for more protection for pets living in rented homes. In its written evidence to the Committee, the Royal Society for the Prevention of Cruelty to Animals highlighted the plight of renters forced to give up their pets because they cannot find a home that will allow pets. I am delighted that the RSPCA, as well as the Dogs Trust, Battersea, and Cats Protection, support the action the Bill takes in this area.
On how we support pet ownership in the private rented sector, clause 10 introduces a new implied term that allows tenants to make a request to keep a pet, which landlords cannot unreasonably refuse. That stops landlords utilising a blanket “no pets” approach and ensures that each request is considered on its merits. We understand that not all properties or situations will be appropriate for pets. Landlords will not have to accept their tenant’s request where it is unreasonable, such as where housemates have allergies and might be detrimentally affected by pet ownership.
The clause makes it clear that landlords will always be justified in refusing a request if their own superior tenancy agreement prohibits pets. That will ensure that the law is consistent and that landlords will not be put in a position where they are forced to breach the terms of their own superior lease. However, to ensure that the provisions have teeth, tenants will have the right to challenge refusals they think are unreasonable via the new private rented sector landlord ombudsman or in court. The ombudsman or court will be able to take an unbiased view on whether the landlord has reasonably refused a request.
Clause 10 also gives landlords an ample 28 days to respond to requests, with an additional seven-day window if the landlord requests more information from the tenant within the initial 28-day timeframe. I make that point because the previous Government’s Renters (Reform) Bill proposed a 42-day response window. The animal welfare charities I mentioned were concerned about that duration, especially as it would mean tenants finding it hard to adopt a pet or the charities needing to keep animals for a long time while landlords made a decision. I share those concerns and I am pleased to say that we have made an improvement by bringing down the timeframe in this Bill.
Finally, clause 10 provides reassurance to landlords by allowing them to require pet damage insurance, either by charging the tenant for it or by asking the tenant to take out an appropriate insurance policy. These measures encourage responsible pet ownership in the private rented sector while providing landlords with assurance.
Turning to clause 11, although it is right that tenants can make the house they rent their home by having a pet, I understand that some landlords will be concerned by potential damage caused by pets to their property. The Committee has discussed the joys of pet ownership, but we all know that many pets can be active and at times destructive. That is one of the joys of pet ownership, but also one of the realities, particularly when it comes to some types of animals.
Clause 11 builds on changes made by clause 10 and amends the Tenant Fees Act 2019 to permit landlords to require tenants to take out an insurance policy to cover any potential damage caused by a pet or to charge the tenant the cost of such a policy. When granting consent, the landlord will be able to decide which insurance option best meets their needs. That underscores our commitment to ensuring that the private rented sector provides secure and stable housing. We recognise that pet ownership plays a crucial role in achieving that mission.
I thank the hon. Member for Ruislip, Northwood and Pinner for amendment 55, which seeks to ensure that suitable insurance products are available before landlords are allowed to mandate that their tenants purchase them to cover pet damage. We know that one of the reasons landlords are hesitant to take on tenants with pets is a fear that those pets could cause damage to their properties, which the tenants’ deposits might not be sufficient to cover.
I recognise that not a lot of insurance companies currently offer products designed to cover damage from pets. It is understandable that in the current climate, in which landlords have discretion over whether to accept or refuse pets, there is no demand for insurance and therefore the market is limited. We believe, however, that by creating an enabling environment for the industry, the Bill will cause the insurance market to adapt. I am sure that, as firm believers in the free market, the hon. Members for Ruislip, Northwood and Pinner and for Broadland and Fakenham share that view.
I hope the hon. Member for Ruislip, Northwood and Pinner will also be reassured that my Department has already had discussions with the insurance industry regarding such products. The discussions have been promising and I am aware that there are products in development to meet his concerns.
Jerome Mayhew
The Minister is quite right; I am a believer in the free market and I am sure the market will respond. Does he have an indication from his discussions with the insurance industry of the kind of price and the surcharge that will be required to fit the need?
Matthew Pennycook
We have not considered extensively the range of prices in the Department’s discussions, but I am sure the market will respond. I do not see any particular concern that companies will charge excessive rates for pet insurance, but that is something we will monitor as we bring the relevant parts of the Bill into force.
In the light of those points, I hope the shadow Minister will consider not pressing amendment 55 to a vote.
Renters' Rights Bill (Second sitting)
Jerome Mayhew ExcerptsTuesday 22nd October 2024
(1 month ago)
Public Bill CommitteesRead Full debate Renters' Rights Bill 2024-26 View all Renters' Rights Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 22 October 2024 - (22 Oct 2024)
Mr Gideon Amos (Taunton and Wellington) (LD)
Q
Justin Bates KC: I want to be careful not to speak for the first-tier tribunal judges. Parliament has provided additional funding for the FTT in anticipation, not of this Bill, but of other areas. Those of you who worked on the Building Safety Act 2022 will know that you gave new powers to the FTT over unsafe buildings. Funding came along with that, because new building safety judges have been appointed. For obvious reasons, I am not privy to all the spending decisions, but as a regular attendee of the tribunal, I can see that money must have been provided. Whether you provide more money for this Bill is, frankly, miles above my pay grade.
On the increased workload, it is very difficult to say. It is plausible that there may not be that much of an increase in workload, because people can still agree what the new rent will be. If they agree it, there is no need to go anywhere near the tribunal. If I were pushed, my informed guess would be that there will be an increase in the first few years, because there always is whenever the law changes, and that it will settle down after a while, but I cannot properly comment on the minutiae of how you fund the FTT.
Jerome Mayhew (Broadland and Fakenham) (Con)
Q
Justin Bates KC: But what I am saying is that I do not know whether it will be that long. There is an assumption in the questions, which may or may not be correct, that all these cases will need a hearing. Most of the section 13 cases that the tribunal already deals with are done on the papers. It rattles through 10 of them a day because, unless there is something specific about the property—unless you need to see it to understand the condition of disrepair, or whatever—there is no reason why you cannot do rent-based determinations on the basis of written materials: the Rightmove print-offs, the price and so on.
Jerome Mayhew
Q
Justin Bates KC: The tribunal’s KPI internal target is all decisions within six weeks.
Jerome Mayhew
Q
Justin Bates KC: It broadly keeps to that. The FTT is pretty good at keeping to its standards. You can safely assume that we are looking at three months. Those are the figures you are throwing at me, and I can see that being realistic.
Jerome Mayhew
Q
Justin Bates KC: I do not know, is the answer. That is not a cop-out; it is recognising the limits of what lawyers should safely talk about.
Jerome Mayhew
Q
Justin Bates KC: Broadly, yes.
Jerome Mayhew
Q
Justin Bates KC: Yes.
Liz Davies KC: Of those where the landlord increases the rent. You are assuming an annual increase.
Jerome Mayhew
Q
Justin Bates KC: There is a famous housing benefit case, which the Commission on Social Security likes to remind us of, that says that Rachman is not the only model of landlord. It is entirely possible not to do that, or to agree sub-ones. Remember that the private rented sector is so difficult to pin down as a single, homogeneous beast. A landlord who lets to someone who is predominantly reliant on welfare benefits to pay their rent will not hike it beyond the inflation rate of the benefit, because all they would be doing is creating a situation in which the tenant cannot pay.
I do not think you are wrong to raise that spectre; I just struggle with how we identify how likely that is to play out, and what the numbers will be in any given period. I do not think, for my part, that we can safely assume that every landlord will go as high as humanly possible, or that everyone will be defended, but on your broad point that there will be a delay, yes, that must be right.
Rachel Blake (Cities of London and Westminster) (Lab/Co-op)
Q
Giles Peaker: What is envisaged is it being enforced by local authorities, and the powers of the local authorities appear to be great. The question, as with existing powers for local authority housing enforcement, is the very variable performance—or the extremely variable performance—between local authorities. Whether one wants to impose a duty on local authorities, rather than a power, would be an interesting question; I strongly suspect that funding demands would follow on from that. But the powers are there and could be very effective; it is a question of the will to utilise them.
We do not yet know what the contents of the proposed decent homes standard will be. It would be good to see a unified standard across social and private tenancies—there is no reason why there should be any distinction between the two kinds of accommodation. The social housing side, as I understand it, will be enforced by the social housing regulator, which is a slightly different situation, but the same standard would apply. Tenants, as it stands, will not be able to enforce the specific standard except by complaint to the local authority.
Mr Amos
Q
Judicaelle Hammond: We recognise that is an issue in some areas of the country that are honeypots. If the proposals that were consulted on are implemented effectively, we see a need for them.
On your question about whether some properties would become holiday lets, I think if you had asked me a year ago, I might have said yes. There are other pressures on the holiday let market that make this increasingly unlikely. We hear from members that they are planning on selling full stop, which would probably be selling to people who want to be on the housing ladder rather than to people who want to take over their business of being private rented sector housing providers. That is a real issue and concern for us.
Jerome Mayhew
Q
On one side of the argument you could say, “Rents will go up as supply decreases.” Do you think that will be an unintended consequence of the proposed legislation? On the other side, which I invite you also to consider, is the question of whether, if you increase foregone earnings—that is, increase the losses associated with being a tenant—because the time required by court processes will be extended because of increased demand, that increased loss will filter into increased rents in the long run.
Judicaelle Hammond: I think the answer to both of your questions is that there is a risk. If demand and supply work in the way they are intended to, unless you increase the supply there is a risk that the rent would go up—to do exactly the two things you suggested.
What we see is broader than just renters’ rights reform, though: we are seeing, for example, the move towards minimum energy efficiency standards, and I totally understand why that is needed. At the same time, it is quite difficult for landlords to deal with some of the costs. Again, we are mostly talking about older properties in rural areas. The cost of maintenance and improvement, particularly since the Ukraine war and the surge in the cost of building materials, has not come down. It has stopped growing at the same rate, but the prices have not come down to where they were pre-pandemic, pre-Ukraine.
As a result of that, you will first have to wait for a void in your properties, in all likelihood, in order to do the kinds of work that will be needed. Those voids do not happen very often. Secondly, you need to get your hands on tradespeople, who might actually prefer to stick to their local areas, because they are within 30 minutes’ driving time and not an hour and a half’s driving time. That is something else that we hear quite a bit about. All that is bringing pressure on to the private tenanted sector.
Jerome Mayhew
Q
Judicaelle Hammond: It was proposed to be £10,000 in the last consultation. It is every five years.
Jerome Mayhew
Q
Judicaelle Hammond: I am afraid that the answer, which is probably for another day, is that it depends. For example, it depends where you are in the country and what kind of rents you are going to be able to charge. I was talking to a member this morning who said, “There is no way I can put the rents up. The people who are paying for it will not be able to cope with an increase in order to recoup that.” We need to look at that carefully and have either a ramp-up system or a different system for exemption, or indeed better or more suitable technology, which might well be coming. My plea on that would be: let us use the time we have before the standards are tightened to improve things like the energy performance certificate methodology and look at alternative technologies as well.
Rachel Blake
Q
Judicaelle Hammond: It is a question of finding ways quickly to improve things, and using the current regulations. Again, I am not here to ask you questions, but I am really curious about the barriers that you see. If this was enforced properly, you would find ways of doing it. For us, it is a question of asking, “Well, there is legislation already. Why don’t we use it?”
On the decent homes standard, it is less an objection in principle. It is more about taking what we have at the moment and applying it without thought or adaptation to the private rented sector, where some of the conditions might be different. For example—going back to my argument about the availability of trades, maintenance staff, and so on—if you have a large portfolio, that might be doable, but if you do not, you really are in a different position.
Carla Denyer
Q
Anna Evans: I think what we have concluded from all of the evidence is that the rent control has to be very carefully designed to avoid unintended consequences. It is above my pay grade to say what that design might be, but there could be a range of ways in which landlords try to get around rent control. We have seen examples of offers from tenants—I understand that your Bill will avoid wars between tenants, in terms of rent levels, but because of demand-supply imbalance, tenants do offer landlords higher rents to get properties. Evidence across different states shows that rent control efficacy is variable, so it has to be very carefully designed.
Jerome Mayhew
Q
Anna Evans: We show in the report that the rents increased at a similar rate to the rest of the UK until ’22. If you were trying to isolate why there was a more considerable increase since that time, you could probably fairly conclude that it was because of the 2022 legislation, but it is very difficult to isolate out. The range of legislation that has been implemented in Scotland is significant, but there was a tipping point in ’22 when rents in Scotland appear to have increased at a greater rate than in the UK. The key point was the 2022 legislation.
I should also caveat all of that—as we have in our report—by saying that the Scottish rent data is not as good. It is based on advertised rents rather than any survey of in-tenancy rents. The published data on rent levels and the hike in Scotland will be for new tenancies, and therefore, that will naturally be inflated compared with most tenancies, because we know that landlords do not tend to increase rents in tenancy. They prefer to keep them at a level that keeps tenants content and therefore they have a longer rental period. That evidence has to be considered with caution, because it is based on advertised rents.
Lola McEvoy
Q
Anna Evans: As I said, I do not think it is possible to absolutely isolate this out, but on advertised rents—new advertised rents—there was an increase post 2022 when that legislation came in. But you must remember that that does not include evidence of in-tenancy rents, which would be lower. So we cannot say that all average rents have increased as a result of that—we cannot say that at all.
Renters' Rights Bill (First sitting)
Jerome Mayhew ExcerptsTuesday 22nd October 2024
(1 month ago)
Public Bill CommitteesRead Full debate Renters' Rights Bill 2024-26 View all Renters' Rights Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 22 October 2024 - (22 Oct 2024)
The Chair
We are now sitting in public and will move on to declarations of interest. I am a vice-president of the Local Government Association.
Jerome Mayhew (Broadland and Fakenham) (Con)
I declare an interest as a private landlord.
Mr Gideon Amos (Taunton and Wellington) (LD)
I am a landlord but only of registered social housing.
The Chair
I welcome both our witnesses to our session to answer questions following their evidence to the Committee on the Renters’ Rights Bill. Please introduce yourself briefly. Members will then ask questions about your evidence.
Ben Beadle: I am Ben Beadle, the chief executive of the National Residential Landlords Association. We have 110,000 members, who provide for nearly a million homes in the private rented sector.
Theresa Wallace: My name is Theresa Wallace and I am chair of the Lettings Industry Council. I think it is the only group that is made up of stakeholders across the property redress scheme, including tenant groups, landlord groups, professional bodies, government bodies and agents large and small.
Jerome Mayhew
Q
Theresa Wallace: I think the Bill has the best intentions, and we support a lot of its changes. However, I believe that as it is currently written there will be unintended consequences, one of which would be more homelessness. It needs some changes. We know that section 21 is going, but we have to accept that it will not solve the issues in the PRS. We have—the English housing survey has quoted this—more than one million tenants in the PRS in receipt of benefit for housing. The majority of those should really be in social housing. If we had those social homes, we would not have the current supply/demand pressures and rent pressures, and we would not have properties lower down in the market that are unfit for purpose and damp and that should not be there in the first place.
One of our problems is that a lot of the Bill will help tenants—renters—once they are in a property, but we have to stop those properties that are not fit for purpose being rented in the first place. I heard a story last week about a lady who is renting further up the country. She is paying £500 a month for a two-bedroom cottage. On the market, it would be worth £750 a month, so she is saving £250. Her property has damp and mould, which she will not be reporting to anybody because that is all she can afford to pay and she has nowhere else to go.
Jerome Mayhew
Q
Theresa Wallace: There are various reasons. We need the private landlord at the moment, no matter what his property is like—a lot of them are in very good condition. Private landlords are very scared about this Bill and a lot of them are exiting. I know some of you might think that there are other places those properties can go, but we need them in the PRS—the tenants need them. We want to keep those landlords. We have institutional investment, but that is a very small percentage—I think it is 2% or 3%—for build-to-rent. Unfortunately, the build-to-rent model does not work financially in the places we need those properties, because of the way their financial model works and margins.
Jerome Mayhew
Q
Theresa Wallace: There is evidence out there. With my agent’s hat on, I can say that we have evidence in the amount of landlords we have lost and the number of people looking at properties compared with before. I gather we have a 12% increase in properties on the market now, which is the highest since 2014, per agent.
Jerome Mayhew
Q
Theresa Wallace: Demand is up and supply is down, so that obviously does have an effect. It is not just an effect on rent: it is also an effect on the tenants who can secure the properties in the first place. The Bill is there help the people who are struggling, and in some places those are the people who will be penalised.
Jerome Mayhew
Q
Ben Beadle: With pleasure. We are largely supportive of many features in the Bill. There is a lot to be welcomed, and the Minister should take great credit for bringing in these reforms so quickly. One thing the industry has suffered with is the hokey-cokey politics of when we will see the abolition of section 21. Our position has been very clear: we do not oppose the abolition of section 21, providing the alternative is workable and fair, but there are two elements that do not quite strike the balance.
The first element is court reform and the need for landlords to have confidence in it. I appreciate that others might have viewed this as a delaying tactic in the past, but the reality is that we are waiting seven months on average to get possession of our homes, and that is for a fast-track situation with almost no proof needed. When we move to a section 8 ground, that will require more resource and more scrutiny, quite rightly, but without investment in the court system we will not deliver what either renters or landlords need.
In a survey of over 1,400 of our members, 60% of landlords said they were less confident or not at all confident that they will remain a landlord without suitable court reform. That declines to 37% if suitable court reforms are enacted. Our argument has always been that this is about confidence, striking the balance and giving support to responsible landlords, as well as delivering for renters.
The other area we have seen is that landlords will be provided with robust grounds for repossession; I may have missed them, but I do not see the doubling of notice for serious rent arrears or increasing the rent arrears threshold from two to three months as sending the right message or as fair and proportionate. Those tenancies will largely fail, whether it is two months, three months or six months, quite frankly.
What we want to do is avoid rent arrears building in the first place, so we are supportive of something like a pre-action protocol where responsible landlords can help to signpost tenants to manage their arrears. We did that during the pandemic. I worry that not addressing that point will send the wrong message. We have an average of 21 people chasing every home, so whatever nip and tuck we make around here, whether landlords are leaving or not, that is only going to worsen as confidence decreases.
Jerome Mayhew
Q
Ben Beadle: If you consider yourself an accidental amateur landlord, that is arguably part of the problem —I do not think we can have amateur landlords. Having a lettings business is a business. Whether you have one or 10 properties, you need to do it properly, and we try to support all our members with that.
We have been tracking sentiment in the sector for the last 12 years, across our membership, and it is at a record low. Only about 10% of our members are looking at actively investing in the sector, and about a third are looking at disposing of one of their properties or exiting the sector completely. I appreciate that that is sentiment rather than actuals, but we also have to point to the fact that we are seeing such a significant number of section 21s being used where a landlord is selling, and that still has not percolated through to some of the statistics. An average of 21 people applying for a rental property is not going to get better.
The Minister for Housing and Planning (Matthew Pennycook)
Q
You mentioned investment, and I wanted to press you on precisely the type of improvements you want to see. You know that, together with colleagues in the Ministry of Justice, we are already taking forward improvements towards digitising the court possession process. What are the metrics you want to see in that process as improvements? On the understanding that —I think you will accept this—not every section 21 notice will read across to a section 8, so there will potentially be a bit of an increase, what do we need to see on the section 8 side and the tribunal side to ensure that the system is fit for purpose at the point that we switch it on?
Ben Beadle: I have a couple of things to say on this, Minister. I agree that court reform has been almost like the Colonel’s secret recipe—nobody quite knows what is in it or what it looks like. It is incumbent on us to define what “the courts are ready” means in practice. For us, there are two or three areas that could be improved. First, we are getting many reports of applications that are made to the court actually running out of time because they have not been processed in time. You have the admin part of the sausage factory at the beginning, because it is not so much about the number of judges. I sit as a magistrate and I often sit around waiting for cases to come to me and to be input into the new common platform. There are delays built into the administrative process that cause frustration.
The other issue we have seen is the wait for a bailiff. Once you have patiently waited for your court hearing date and you have possession, that will be what it will be, but waiting for a bailiff can take months in some areas. Sometimes there are really poor excuses—earlier this year, we saw the stab-proof vests not being available. If it is a high-risk area, you need somebody waiting out in the car and somebody on the door. London is predominantly a high-risk area, which is why we see such slow eviction timescales.
Personally, we want to prevent evictions. Landlords do not go around evicting tenants willy-nilly, but when they have a legitimate case, we do expect it to be dealt with expediently. To me, court reform looks like sifting the cases more appropriately and more speedily; digitising that process so you see the ping and the pong of the evidence going backwards and forwards; and, when you get possession, an automatic link to the bailiff, rather than having to reapply. Those are three tangible things. Ultimately, though, it is seven months at the moment, and it needs to be lower.
Budget Resolutions and Economic Situation
Jerome Mayhew Excerpts(1 year, 8 months ago)
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Jerome Mayhew (Broadland) (Con)
Thank you, Mr Deputy Speaker.
Although there are plenty of measures to help with the cost of living, which I welcome, the Budget’s real impact is much more profound. It seeks to tackle some of the structural weaknesses that have bedevilled our economy for decades, holding back growth. Page 7 of the OBR’s accompanying economic and fiscal outlook sets out a number of those factors: reduced business investment, reduced labour market participation and the conundrum of low productivity. It is through that prism that we should address this Budget.
I do not have time to address all those factors, so I will focus on business investment. Budgets do not come in isolation. They are part of a Government’s raft of sensible economic management. If we look at the reasons behind the lack of business investment, according to the OBR, one is obviously the pandemic—we hope we have put that behind us. The second is the energy crisis, and we are dealing with that, including through the continuing measures for businesses with high energy use. The third is uncertainty on EU relations, which is an area that the Government have been addressing week in, week out. Whether it is the Windsor framework, the very positive French summit a couple of weeks ago, the restarting of talks on our involvement in Horizon or increased co-operation with the French on stopping the small boats and hosting migrant detention centres in mainland France, each is slowly increasing business confidence in the future of UK trade, even as global exports expand through the Australia and New Zealand free trade agreements and, hopefully, soon the CPTPP.
Although I accept and regret that corporation tax is going up to 25% for the biggest 10% of corporations, this is more than offset by the 100% capital allowance—full expensing—within the first 12 months, which provides an incentive for businesses to invest rather than pay dividends. A host of other tech sector improvements were set out in pages 94 and 95 of the Red Book: innovation accelerators in Glasgow, Manchester and the west midlands; £900 million for the exascale supercomputer to assist with artificial intelligence research; £2.5 billion for the quantum strategy; the implementation in full of the Patrick Vallance digital tech regulations, to improve the speed at which that sector can develop; and faster approval processes for new medicines. This is the Government being on the side of fast growth and the new economy.
This is not just about tackling business investment, as we are also addressing labour market participation. We are dealing with the unexpected reduction of the workforce by some 520,000 after the pandemic. I do not have time to deal with that, but I can say that the Budget builds on what is increasingly being described to me on doorsteps in my constituency as the “Sunak effect”. It is not flashy and there are no eye-catching initiatives so beloved of the Labour party, but instead we are getting competent, serious tackling of the big issues, one after another. It is no surprise that the economics of this country are improving, as shown in the composite PMI— purchasing managers’ index—for February 2023 of 53.1; more than 50 means economic growth. This Budget was detailed, considered and responsible and it speaks to what is behind this Government; they are not flashy and they let the work do the talking.
Levelling-up Missions: East of England
Jerome Mayhew Excerpts(1 year, 9 months ago)
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Priti Patel
My hon. Friend, the chair of the GEML rail taskforce, has hit the nail on the head: this speaks to a fundamental failure in Whitehall, and my hon. Friend the Member for Waveney repeatedly highlighted that. This is the core message that has to be taken away, and that is just on rail. Of course, rail supports economic growth. The west Anglia line is another classic case. With four trains an hour to Stansted airport, it feels like “Mission Impossible” right now. Some proper work needs to be undertaken, and the Government need to support that. We have been successful in getting Emirates into Stansted. We want to get other international airlines, as my hon. Friend said, including from India.
On roads, I have again secured funding, as a Member of Parliament, for feasibility studies on the A12 and A120, but yet again we are going round the merry-go-round of not getting the commitment from central Government to proceed with those schemes. Quite frankly, that is down to inadequacies with National Highways, which fails to operate in a transparent way, to engage with local community or the county council, which has responsibility for the strategic road network, or to engage with the Department for Transport, so we are not getting the road upgrades we need in the county. Those road networks are the economic arteries of the east of England.
Jerome Mayhew (Broadland) (Con)
Integration in the planning of infrastructure goes beyond just roads and rail; there is the integration of offshore wind into the national transmission network. Only in East Anglia are there radial connections from offshore wind to the national transmission network. The rest of the country benefits from the holistic network design. Does my right hon. Friend agree that East Anglia should be included in that design and that we should move away from these radial connections?
Priti Patel
My hon. Friend is absolutely right. I will come on to energy shortly for another reason, and I will pick up on that point after I conclude on the issue of roads.
Essex is a net contributor, and the A12 and A120 are literally roads from the dark ages. They are deeply unsafe roads. If we care about road safety and the people who get up every day at the crack of dawn, such as lorry drivers and commuters, to service our public services or to come to London to provide services for major hotels and the UK’s service sector, we must upgrade these roads. It is becoming a joke right now—it really is. It is an insult to commuters and the people who use the roads who have to navigate the potholes and poor quality of the roads every single day. They feel, by the way, that they are getting an unfair deal when they fill up their cars because of the cost of fuel at the pump. This is not a criticism of the Minister’s Department, but it shows the breadth of issues that need to be grasped across Government on integration to provide those levelling-up outcomes. Otherwise, levelling up will just become a slogan.
I would like to touch on a couple of other areas, which are both linked. One is skills and education. I am proud not just to be the Member of Parliament for Witham, but to represent Essex and the east region. When I became the MP for Witham, the majority of my schools locally were in special measures or required improvement. I am pleased to say right now that we have great schools—good schools and outstanding schools—and, as a result, Witham is now a commuter town. People want to live and work there, and some schools are outstanding—that is a great thing. We need not just to give our youngsters great educational opportunities through our schools, but to ensure that they can get jobs and that they inherit skills for life. That could be skills within the region for the great energy coastline that we have developed over the past decade, which has been remarkable, and previous Ministers in Government should be thanked for their hard work on that matter.
Essex is a county of entrepreneurs, and I never tire of saying that. We are the home of small businesses and innovators, and R&D is big in Essex. However, our prosperity masks challenges when it comes to deprivation, as we have heard, but also skills, opportunity and aspiration. We need businesses to work with our schools and get their foot in the door to talk to pupils at an earlier age. I have a careers fair taking place on 24 March on Witham. I never tire of being a champion of those skills fairs, and we are bringing in businesses from former industries I have worked in to those schools. I want to see Government embrace that, because the apprenticeship levy is, quite frankly, not delivering the outcomes it was originally set up to deliver. I maintain that it needs reform. Of course, by getting those skills locally, we can create jobs with skills that focus on areas that Members have touched on already. I feel very strongly about that.
I want to touch on health, which has been raised. My hon. Friend the Member for Waveney said that we do not have a technology campus in the east of England—I agree, and we should work to achieve that—but we do have a university medical school. I was involved in the original bid to do the business case for that, and I am proud that we achieved it. However, I am afraid that our health infrastructure across the east of England is inadequate. Our patient-GP ratio is one of the highest in the country, and we are not training enough students in our medical schools. We need to do much more. When he was Health Secretary, my right hon. Friend the Member for South West Surrey (Jeremy Hunt) worked well with us to deliver some good health outcomes, but there is much more that needs to be done. We are an ageing part of the country, but we must work with our young people to grow skills in health and social care. I pay tribute to Essex County Council for the work it is doing in that area.
This is a message to central Government: we cannot have people working in silos in Government anymore. When I was Home Secretary, the Health Department said to me, “Please do much more on health and social care visas,” which I am pleased that we have done—I did that as Home Secretary. However, there is more that we need to do in that area, and we also need more home-grown talent.
Finally, planning is the biggest issue in my constituency casework. Witham has become a building site over the past decade. We are building homes, and it is right that we do that. The question is, are they affordable homes? We have already heard of the high income ratio that is required to live in our fantastic part of the country. This point is specific to the Minister’s Department. Planning is contentious, and we are not getting it right in this country; there is no doubt about that.
In Essex, and in my constituency in particular, we stopped the West Tey development, a proposal for a garden community of 45,000 new homes—which, by the way, was without any infrastructure at all. The entire concept was an absolute scandal and a disgrace. I pay tribute to campaigners such as Rosie Pearson and others in my constituency who worked together to bring that to the Planning Inspectorate and get that proposal overturned. Five-year land supply has also been a problem, along with local councils that have no neighbourhood plans. I want to put on the record the fact that I think it is deeply disappointing that the Department, in its former guise as the Ministry of Housing, Communities and Local Government, used taxpayers’ funds to boost and beef up that concept without working in a considered way with the local community on the kind of housing that was required.
I am afraid that this is not specific to the Minister’s Department. We are going through this all over again with another project: pylons. It is less about housing, but it will become a planning issue. The development of pylons across the east of England will, frankly, have a detrimental impact. We are pioneers in offshore grid wind farm development and renewables, and we must absolutely look to invest in that capability, rather than putting up more infrastructure that will bring great blight to our local communities and, I am afraid, agitate them even more.
I know I have taken up a great deal of time, Mr Davies. In conclusion, there are great things about the east of England. We are net contributors to His Majesty’s Treasury, and we cross-subsidise much of the United Kingdom through the hard graft of the great men and women of the east of England, but we are lagging behind on these key assets that are of national significance. My hon. Friend the Minister can only do so much with her remit in her Department. My wider message is about devolution and local government reorganisation, as well as about the size of the state in Whitehall; how bloated and unaccountable that has become, and how detached it is from the good men and women of the east of England who, as taxpayers, contribute to the bureaucracy of Whitehall and get very little back. That is where reform has to start. The devolution train is well under way now—certainly in our part of the country. In Essex, I back it. Quite frankly, we need reform of the core of Whitehall to start delivering for the good people of the east of England.
Carbon Emissions (Buildings) Bill
Jerome Mayhew Excerpts(1 year, 12 months ago)
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Jerome Mayhew
I beg to move, That the Bill be now read a Second time.
This Bill creates a mechanism to boost United Kingdom construction while driving down our greenhouse gas emissions, which is key to delivering UK growth in a manner aligned with the country’s net zero targets. The proposal has come from the industry, which supports the Bill wholeheartedly. The industry is working to reduce these carbon emissions voluntarily, but it needs the Government to take the lead and accelerate the work that it has started.
The Bill tackles an area of greenhouse gases called embodied carbon. Every year, our buildings and construction are responsible for the emission of more than 150 million tonnes of greenhouse gases, fully a quarter of our country’s total carbon footprint. Two thirds of those emissions are due to the lighting of buildings, their power and their water—the heating and cooling—and bear the tag “operational carbon”, and the Government have taken bold steps to reduce them as part of the net zero strategy. The building regulations, under part L, effectively address the reduction of operational carbon. As a direct consequence of the regulations and, importantly, the decarbonisation of the electricity supply, it is anticipated that by 2035 the emissions related to the services side—the operational carbon side—of buildings and construction will have fallen to an almost negligible level.
That is fantastic news, and the Government deserve our praise for gripping the issue and creating a plan, enforcing it through regulation and then implementing it with the very significant reductions in operational carbon that we are already seeing; but what about the other third of building emissions? Where do those remaining emissions come from, and what plan do we have to deal with them?
That other third comes from our use of construction materials: their production, transportation and installation on our construction sites; their maintenance, refurbishment and replacement during a building’s life; and ultimately their demolition and removal at the end of the building’s life. That is 50 million tonnes of carbon emissions each year, which are called embodied carbon. Let me put that amount into perspective: it is greater than the emissions of all the United Kingdom’s aviation and shipping industries combined.
Let us think about how much effort we put into the control and planned reduction of those emissions. We have the sustainable aviation fuels plan, we have jet zero, and we have plans for corridors for emission-free shipping based on ammonia and hydrogen. We take all those plans very seriously, but what are the Government doing, and what are we doing as a nation, to deal with embodied carbon from construction? With 50 million tonnes of embodied carbon emissions a year, we might expect that the Government would already have plans to direct a reduction in line with our legally binding net zero targets.
The truth is that embodied carbon remains completely unregulated, and it shows from the data. Operating carbon emissions are dropping rapidly because of part L and the decarbonisation of our electricity supply, but the data on embodied carbon shows no current trend towards any reduction at all. In 1995, there were 43 million tonnes of greenhouse gas-equivalent emissions; by 2018, emission levels, far from reducing, had crept up to 49 million tonnes and were approaching 50 million.
The Environmental Audit Committee, on which I sit, reported on the issue in May. Its report, which I commend to the House, concludes that
“the single most significant policy the Government could introduce is a mandatory requirement”
to assess embodied carbon in buildings. Not only do we not regulate the reduction of embodied carbon, but we currently have no idea how much a construction or design will emit, because we do not require business constructors to calculate that amount.
To be fair to the Government, their net zero strategy sets out an intention to
“support action in the construction sector by improving reporting on embodied carbon in buildings and infrastructure with a view to exploring a maximum level for new builds in the future.”
In a similar vein, the Government’s construction playbook calls for carbon assessments on all public projects. However, it provides no details as to how that should take place or what an appropriate carbon emissions level is. With every school, hospital and road we build, a different approach is therefore taken to calculating overall carbon. That is hopelessly inefficient for the industry, and it costs the taxpayer more.
As is so often the case, the real world is moving at a faster pace than the Government. Major design firms that employ tens of thousands of staff are making voluntary commitments to calculate the carbon emissions due to their designs. Construction industry bodies such as the Royal Institute of British Architects have set out voluntary embodied carbon emissions targets. The Royal Institution of Chartered Surveyors has defined a methodology for calculating embodied carbon, but its ambition is hampered by a lack of regulation.
Voluntary industry targets remain just that. Every project that businesses work on has different reporting requirements and different carbon targets, costing them time and money. Regulation is needed to speed up the processes by identifying an agreed methodology and spreading acceptable practice throughout the sector, not just among the market leaders but in the long tail that any sector has, to bring everyone up to a minimum level of best practice.
Today, nearly 200 of the country’s leading developers, clients, contractors, architects, engineers and institutions have written statements of support calling for the regulation of embodied carbon. The Royal Institute of British Architects calls on the Government
“to introduce regulations that stipulate consistent assessment and reporting of whole life carbon, including setting specific targets for embodied carbon.”
NatWest, one of the leading investors in the sector, highlights the role of regulation as
“one of the key mechanisms that drive sustainable behaviour and action amongst investors, tenants, developers and home owners.”
The UK’s largest active asset manager, abrdn—it is spelled rather strangely—believes that
“the requirements to report whole life carbon, and set informed limits on embodied carbon, would help the real estate sector to decarbonise.”
Barratt Developments, one of the big four providers of homes in the residential sector, says:
“We have been calculating the embodied carbon of our homes for over ten years now…We are also developing requirements for our supply chains to support this process”.
Similar sentiments come from corporate leaders such as Landsec, British Land, Lendlease, Willmott Dixon, Sir Robert McAlpine, Laing O’Rourke, Morgan Sindall and ISG—I could go on. Industry bodies, such as the Construction Industry Council, the Chartered Institute of Building, Timber Development UK, importantly, the Concrete Centre, and, equally importantly, the Steel Construction Institute, also support that approach. Industry already has the tools necessary to respond to the Bill; regulation would simply unlock the final door to enable existing mechanisms to run smoothly.
What are other countries in Europe doing? France, Sweden and the Netherlands already have embodied carbon regulation in force, and the Netherlands, the market leader, has had its in force since 2012. Finland, Denmark and Norway are in the process of introducing it, and the European Commission is considering proposals to roll it out across the whole of the EU. So, why are we not?
Despite the Government recognising that they need to act, and despite the industry agreeing and setting out a widely supported solution, the Government seem to be beset by hesitation. Their response to the Environmental Audit Committee stated that they intend to consult, and undertake “parallel stakeholder engagement”, some time in 2023, on what its approach to embodied carbon should be. That was to a report published in May 2022. When the cost of inaction is 50 million tonnes of carbon emissions per year, where is the dynamism of Government? Where is their sense of urgency?
My Bill would enable the Government to catch up on the issue, directly amending the building regulations. It will require the reporting of carbon on significant building work, both new projects and refurbishments, from 2023 in the large-building, non-domestic sector, and by 2025 for housing in developments of more than 10 dwellings. It will then move to introduce limits on the embodied carbon emitted through construction from 2027—something that can be ratcheted down over time, in line with our net zero targets.
That strategy, of “report first, limit later”, follows the precedents set elsewhere in Europe, and makes the transition towards zero-carbon construction easier while sending a clear signal that legislated limits are coming. Similarly, to assist small and medium-sized enterprises, the Bill introduces those requirements only for major projects—those greater than 1,000 square metres of useful internal area or responsible for the construction of 10 new dwellings.
A clear policy signal on the direction of travel is what the industry needs to accelerate its development and the large-scale use, and more efficient use, of lower-carbon products. Just as how the policy statement that vehicles will not be sold with an internal combustion engine post 2030 has transformed the car manufacturing market, the construction industry needs that kind of market signal to invest in lower-carbon alternatives and take the next step to the wider adoption of what are currently niche products. By sending a clear policy signal from Government to industry, we will enable the sector to grow ahead of time. We must signal the road map to the end of high-carbon construction in the United Kingdom to enable the building industry to take the needed steps towards zero-emission construction.
Is it really too soon to move, as the Government suggest? In their response to the EAC report, the Government identified three workstreams before they want to take a decision. First, they want to continue understanding the actions that industry is already taking and the impact. Secondly, they are watching the outcomes of the Greater London Authority’s planning policy requirement “with interest” and, thirdly, they are
“looking at international policy examples.”
I have already demonstrated that my Bill is the outcome of industry consensus and that it follows the “report first, limit later” approach adopted internationally. So the only additional consideration is an assessment of the use of the planning policy by the Greater London Authority in its London plan to require measurement of embodied carbon as part of the planning process, yet even here there is a consensus that regulation via the building regulations is the right approach.
During the Environmental Audit Committee evidence session, the principal strategic planner for the GLA’s London plan was asked in terms what role building regulations could play. Her answer was explicit. She said:
“We would agree…it is something that the Government should regulate. We think it should be part of building regulations”.
Even the GLA, whose planning policy approach the Government apparently see as a potential alternative to the use of building regulations, agrees that building regulations are the right way to go. There are of course very sound practical reasons for that. Detailed decisions on materials will not have been made at the date of a planning application, so only vague guestimates of carbon intensity and emissions could be used at that stage. It is at the point of construction that meaningful figures can be generated, which is where planning control comes in. In any event, we do not expect planning officers to assess the properties of, for example, rooftop insulation as part of a planning application. That kind of technical assessment is the job of building control and the same applies in respect of embodied carbon.
When the Government say that they want to consult on their approach on measurement and reduction of embodied carbon, we may be beginning to wonder who else is there that they are intending to consult. The sooner we start this process, the sooner we can reduce our emission of 50 million tonnes of carbon every year. My Bill will reduce the construction industry’s carbon footprint, while sending certainty to UK industry that investing in decarbonisation is economically sound. It will bring economic growth and it will save the taxpayer money by standardising the decarbonisation process. The Government have great ambition to decarbonise. We all support it, and they should be commended for their ambition and for the many actions they have already taken in this field. The construction industry has the appetite, tools and skills to match that ambition. We have here a tremendous opportunity to make a significant impact on the UK’s carbon emissions and ensure that the UK remains a global leader by regulating embodied carbon in construction. I commend this Bill to the House.
Holly Mumby-Croft (Scunthorpe) (Con)
It is a pleasure to follow my hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell). I wholeheartedly agree with his points about offshoring; he is absolutely spot on as always. My hon. Friend the Member for Darlington (Peter Gibson) has made three cracking speeches today and scored a hattrick of his own.
I thank my hon. Friend the Member for Broadland (Jerome Mayhew) for bringing forward the Bill; he knows that he has my full support, although I gently point out that we in Scunthorpe are not overly worried about the precedents set in Europe. It is right that we have a discussion about the wider impact of buildings on our carbon output, beyond their day-to-day energy consumption.
As the long title of the Bill highlights, a building does not just emit carbon when it is operational, but from the moment an architect is asked to design it to the day it is demolished. The Bill sets out two ways to advance our national mission to reduce emissions, and I want to ask some questions about the proposals in the hope that it will be helpful to my hon. Friend the Member for Broadland.
First, the Bill mandates the reporting of the whole-life carbon emissions of a building. Whole-life carbon assessments help us to put a numerical value on the impact of a development. It is also a statistic on which developers can compete with each other, hopefully driving down emissions across the sector. However, I am keen to understand how that requirement will fit in with existing criteria for buildings—something that hon. Members have raised this afternoon.
The national planning policy framework already sets out that new developments should help to reduce greenhouse gas emissions through their location, orientation and design, in line with the emissions obligations in the Climate Change Act 2008. Using those guidelines, local planning authorities then put forward a local plan, against which planning applications must be considered. Indeed, my excellent local council—probably the best council, in fact—North Lincolnshire Council, released its local plan this month, and it contained standards that encourage developers to reduce whole-life carbon emissions. The plan states that all developments should maximise the reuse or recycling of materials in new construction, and make the best possible use of existing building infrastructure. According to the plan, that should be done by minimising the use of non-renewable and unsustainable finite resources, during both construction and use. Hypothetically, if every council was as good as mine, and every planning proposal in the country was tested against standards like those, developers would already need to show that they are minimising carbon emissions through their building materials.
Mandatory reporting should only be introduced if there is a strong case for saying that local planning authorities do not put enough weight on whole-life emissions when considering applications. In short, it is important that we justify our introducing the Bill.
Jerome Mayhew
There are many ways to skin a cat; that is the nub of my hon. Friend’s speech. However, the logical time for a detailed assessment of the whole-life carbon of a building and its construction materials is when those materials have been finalised. That is not typically at the planning stage. Yes, there will be an outline of the building, but the detailed decisions on what materials will be used are not yet made. As a result, and as happens in the Greater London Authority—its planning policy takes a similar approach—guesstimates are made of the whole-life carbon impact. Later, when building control is involved, we can get accurate calculations.
Holly Mumby-Croft
My hon. Friend makes a really good point, but I think he would agree with me that the ethos behind what councils such as mine are doing is exactly in line with what he aims to achieve through the Bill. To reiterate, it is important that we justify clearly why this Bill is needed, because it will cost time and money, and it is an extra hoop that we will be asking businesses and individuals to jump through.
The Bill also rightly acknowledges that the Secretary of State would need to approve a national methodology for whole-life carbon assessments. Right now, public works projects and programmes are required to have a whole-life assessment as part of the tendering requirement, but contracting authorities are encouraged to create their own specific guidelines on how that is presented, or, as my hon. Friend the Member for Broadland mentioned, to use the guidelines released by the Greater London Authority.
If we are to ultimately pass that requirement on to private developments, the top-down direction on the appropriate methodology needs to be addressed. We need to ensure that we do a decent job of that. The industry is generally familiar with the Royal Institution of Chartered Surveyors whole-life carbon assessment, but the availability of other guidance risks creating inconsistency.
I know that the Government have plans to hold a consultation in 2023 on how best to mainstream the measurement of embodied carbon, and I would be keen to know whether my hon. Friend the Member for Broadland has explored the options available. He is an expert on this subject and could make a really valuable input to that. As he said, other countries in Europe have begun legislating for whole-life carbon assessments, and I hope that those will prove an inspiration, and will help us not to fall into any pitfalls that other countries have fallen into.
The Bill may lead to limits on embodied carbon, including carbon emitted in the acquisition, assembly, maintenance and end-of-life disposal of building materials. I know the Government are considering that, as stated in their response to the Environmental Audit Committee’s report on costing carbon in construction. If we created embodied carbon limits, we would have to consider a number of factors. First, the limits would need to be relative to not just the purpose of the building, which is obvious, but the size of the development.
However, if larger developments can reduce emissions through economies of scale but smaller ones cannot do that as easily, there may be perverse outcomes for the property market. This legislation would also favour larger developers who have the capacity to better absorb emissions reduction costs. It is important to be wary of how this could affect small and medium-sized enterprises in the industry, given that we aim to increase our housing supply.
I am curious about how the Bill would address the impact of location choice on emissions. For example, should a residential or commercial property receive relief from the embodied carbon limits if the choice is made to locate it on a public transport network—for example, near to a railway or bus station? Large employers may prevent hundreds of car journeys a day if they set up shop on an easily accessible site. To take that a step further, could we find ourselves using plans for a railway station, bus route or metro in our constituency as a lever during the planning process and the calculation of those emissions?
My hon. Friend the Member for Broadland will not be surprised to hear that I also have questions regarding the steel industry. Members understand that steel is a carbon-intensive product to make. The future of the steel industry will inevitably at some point be around decarbonisation, finding greener ways to make steel and mitigating the impact of production, but while that process takes place, the adoption of embodied carbon limits on development may affect demand for steel if they do not appropriately recognise steel’s value of recyclability.
Steel is one of our most sustainable materials due to its immense durability and the capacity to reuse it—it is almost endlessly recyclable and can be repurposed. Any definition of embodied carbon has to appropriately weight that value against the carbon emitted during the production, and has to consider the lifespan and quality of the materials that we are able to produce in this country. As my hon. Friend will know, we make the finest steel in the world.
Jerome Mayhew
I am grateful to my hon. Friend for giving way a second time. On the question of steel, she is absolutely right. If enacted, the Bill would be a great opportunity for British steel. As she will know, about 50% of all steel used for construction in this country is imported. Given the additional carbon emissions that result from the transportation of a very heavy and bulky product, British Steel and steel producers in her constituency—
Mr Deputy Speaker (Mr Nigel Evans)
Order. Could the hon. Gentleman please face the microphones when he speaks?
Jerome Mayhew
British Steel and other steel producers, including the one in my hon. Friend’s constituency, already have plans in place to reduce the carbon intensity of their products before 2035 and 2055 by as much as 80% by reusing scrap metal instead of exporting it abroad for reuse. Does she agree that the Bill gives impetus to this developing new sector in the steel industry, rather than restraining it?
Holly Mumby-Croft
I agree that we need to be extremely careful about the transportation of materials—my hon. Friend is absolutely right—but therein lies a challenge. To work through the restrictions in the Bill, we would need a level of confidence when we imported materials, be they steel or anything else. We would need confidence about how much carbon has gone into the steel; trust in the people who made it; and to know how far it has come, where the fuel for the ship has come from and how the steel in the ship was built. He is right that there are opportunities for steel, but if he is seeking to persuade me solely on the terms that he mentioned, he has not quite managed to do so.
That brings me to my next point: we need to discuss whether we have that level of assurance. Inevitably, many of the products that go into the buildings of the future will come from abroad, and we need to understand that. As always, companies in this country will play by the rules, but my hon. Friend knows that that is not always the case across the world.
Concrete is another sector that could face problems, if sustainability advantages are not weighted properly. I have a fantastic firm in my constituency, Techrete, which I am very proud of. It has contributed to a number of buildings across the country and the world. There have been 600 projects in the past 37 years, and I will draw your attention to a small number that you may have seen, Mr Deputy Speaker, because they are all quite close to where we are. The projects include King’s Cross station, the Olympic village and The Broadway on Victoria Street—if you walk out of here and look to your right, Mr Deputy Speaker, before you get to M&S, you will see that building. They also include Victoria Square, the Heathrow Express tunnel—we probably made the steel for the rails in that tunnel as well, and if we did, it will be the finest steel in the world—Wembley Park and University College London Hospital. On the South Bank, on the other side of the river, there are some buildings that we made, and there is also the Tottenham Hotspur stadium, Westfield shopping centre, the Imperial War Museum, St Bartholomew's Hospital, the V&A and the lettering at Arsenal.
Dehenna Davison
I am grateful to my hon. Friend, who I know is incredibly passionate about construction, building and all things planning and will continue to help champion the agenda in the coming months and years.
I think many in industry would agree that, as hon. Members across the House have highlighted, one of the biggest challenges in tackling embodied carbon right now is a lack of data, because consideration of embodied carbon is relatively new compared with operational carbon for both industry and Government. Without enough information at product and building level, industry cannot make decisions about design and construction, and the Government cannot establish the right benchmarks or targets, either.
Jerome Mayhew
It is generous of the Minister to give way. Given that data is what the Government need, does she not agree that the format of the Bill, which is to report now—deliver data—and decide later, in 2027, serves the purpose of providing the data that the Government need so they can make an informed decision as part of the Bill?
Dehenna Davison
I am grateful to my hon. Friend for his contribution. I know that was the intent of the design of the Bill—we have discussed that before today. The important thing to note is that we will be consulting not just on how we reduce embodied carbon but on how specifically we go about gathering that data, because that data collection will be so important in ensuring that we can decarbonise embodied carbon. I hope he will appreciate that that is one of the reasons why we are keen to consult before we take any further action.
I want to quickly highlight some of the contributions made by hon. Members across the House. My hon. Friend the Member for Darlington (Peter Gibson) raised some fantastic points about broader decarbonisation and asked some questions about decarbonisation within existing housing stock. I know that we are pressed for time, so I will write to him with some further details on that.
My hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell) was absolutely right to highlight that the Government are on the side of those who want to decarbonise. For all the rhetoric, this Conservative Government’s action on decarbonisation has been exemplary, and some of the small examples highlighted by hon. Members during this short debate have really shown that. I note that he mentioned the ever-famous “Stop the Stink” campaign, about which he is so passionate, and it would be remiss of me not to mention his incredible campaigning on that.
Finally, my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft) talked about the planning framework as being incredibly important on the decarbonisation agenda. She is absolutely right, and I congratulate her and North Lincolnshire Council on their brilliant progress on that. It would be remiss of me not to thank her for her stellar work in championing the British steel industry and, in particular, the steelworks in Scunthorpe in her own constituency, on which she has been and is an incredibly passionate campaigner.
I will conclude, in the hope that others may make a brief contribution, and in the hope that my short speech has explained some of the system’s complexity and why the Government cannot support the Bill today, even though we empathise with the sentiments and ambition underpinning it. We are concerned that passing such legislation now could bounce the industry into making changes for which it is not fully prepared. In the current context, at a time when the SMEs that depend on this industry are struggling and facing a hard time, the industry may not be able to afford these changes. We do not want to run the risk of negatively affecting the industry and the market in ways that we do not intend, which is why consulting seems like the most practical and sensible solution.
I reiterate my thanks to my hon. Friend the Member for Broadland for all his dedicated work in introducing this Bill. Again, I make it crystal clear that the Government’s opposition to the Bill is in no way a dismissal of the seriousness of the issue or of our commitment to tackling it. Officials in my Department are working with many of the supporters of this Bill to carry on the essential work of measuring and reducing embodied carbon in construction.
Together, I believe we can adopt the right approach that lets industry and markets properly prepare for change, while not letting up in our fight to tackle carbon emissions, to win the race to net zero and to build the cleaner, greener homes and buildings this country needs.
Levelling Up: East of England
Jerome Mayhew Excerpts(2 years, 10 months ago)
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Clive Lewis (Norwich South) (Lab)
It is a pleasure to serve under your chairmanship, Ms McVey. I thank my hon. Friend—I mean the hon. Member for Waveney (Peter Aldous). [Laughter.] I have often thought that the hon. Member is on the wrong side of the House; as a centrist, he would be far better over here on the Labour Benches, where I could berate him for his lack of ideological purity. None the less, he has brought this fantastic and important debate forward. Sorry—I will get him into trouble.
I want to make a few key points and observations, some of which I can pick up from the right hon. Member for West Suffolk (Matt Hancock). One of my appeals is that, when we talk about the regeneration of the east and investing in the east, we must not base that simply on 20th century infrastructure. We must recognise that we have an opportunity in the eastern region, which has been underfunded and under-resourced.
One of the reasons we are net contributors to the Treasury is probably that it spends so little on us in real terms. One of my appeals to the Minister is that we should take that weakness and use it as an opportunity so that we can jump over the failures of the 20th century—the pollution, the carbon, the ecological destruction—and move to a 21st century, sustainable, wellbeing-based economy with mass-transit systems. There may be a need at times to invest in roads, because road infrastructure is required, but let us ensure that we are not simply doing so because that is what we have always done. There is an opportunity to think about rail and public transport, and I think that is critical for the future.
I also want to talk about how devolution is done. I will quickly read an extract from an IPPR report on levelling up, which stated:
“Crucially, the competitive nature of existing devolution deals pitches areas against one another – making them race for increasingly small and centrally controlled pots of money. This has exposed disparities in terms of institutional capacity across local authorities: not all places have a history of cooperation, or indeed the resources, especially after over a decade of austerity, to enter good bids.”
Another area we need to look at is how levelling up is done. The key rule should be subsidiarity, meaning that powers to make decisions on key local political, economic and social issues should be closest to the people affected. Some Members have discussed this already. In my city of Norwich, which is obviously the cultural capital of the east, as most people will acknowledge, we have some cases where infrastructure is being done to us. The Wensum link is deeply unpopular across much of my city because of the ecological damage it will do to vast swathes of our ecosystem.
Jerome Mayhew (Broadland) (Con)
It may be unpopular in the hon. Member’s part of the city, but does he recognise that it is very popular in the county of Norfolk?
Clive Lewis
Yes, I do. The opposition to the Wensum link is more a cry for a decent public transport system instead of building yet more roads. The evidence shows that the more roads we build, the more cars and congestion we have. This has been happening for 50 years and I see no reason why that should change. We have an opportunity to make a real difference.
My city has the second worst social mobility in the country, and our city council has been the worst hit by central Government. The key thing when we are talking about devolution and levelling up is—I take this analogy from my time in the military—mission command. Basically, that means centralised intent with decentralised execution; the Government set the “what” and the local people do the “how”. If we can apply those principles and give people a real say in how they get to those objectives, we can make devolution work. In Norwich, we know what our priorities are. They often interlink with the Government’s priorities, but let us get there in our way. Give us the resources to do that. If we are given the opportunity, we will add to this country’s economic and wellbeing output, as will the rest of our region. I hope that the Minister listens to that.
Jerome Mayhew (Broadland) (Con)
I am grateful to my hon. Friend the Member for Waveney (Peter Aldous) for calling this debate. We have limited time, so, inevitably, all the high-falutin’ arguments that I was going to express have been ditched in favour of the shopping list. I apologise in advance for that.
So what are we talking about? I think levelling up is about investment. If I were to put my finger on it, I would say that it is about increasing productivity for the future so that we get the growth in the east of England that then pays for all the good stuff that everyone in the Chamber wants for our residents.
If we want to increase productivity in the east, the key element will be connectivity in all its forms. Levelling up is not really about north versus south, as it is often portrayed; really, it is about urban versus rural. In rural areas, we are under-served by the connectivity, both physical and digital, that is increasingly important in the developing economy.
That starts with mobile phone coverage. According to a relatively recent survey, 82% of calls by mobile phone in Norfolk are connected. That means that 18% failed. That is incredibly annoying and makes it much harder to undertake business as well as everyday life. I very much welcome the shared rural network project, but the 95% coverage that was promised by, I think, about 2030 is only for coverage outside buildings. That is fine if people are in the garden, but in rural areas where we have quite substantial buildings, typically of stone or brick construction, connectivity inside buildings is much worse. I invite the Government to look at that.
Superfast broadband is a huge opportunity, particularly for rural growth. Some 80% of rural businesses tell us that the single biggest thing that the Government can provide to improve their economic prospects is superfast broadband, so let us focus on that. As I said, the first priority is mobile phone coverage, and the second is superfast broadband. I welcome Project Gigabit and I celebrate the recent milestone of 50% coverage in the UK, but we need to go further, particularly in the east.
Not all connectivity is digital; we also need physical access to markets. I disagree with the hon. Member for Norwich South (Clive Lewis) about the western link road. We have created, essentially, an orbital route around Norwich, but rather like the situation with the M25 and the Thames, we have decided not to build the bridge. It is very damaging to connectivity, particularly for the north-east of the county getting access to the physical markets in the rest of the country—
Clive Lewis
The hon. Gentleman talks about a bridge over the Thames, but this is a massive road bulldozed through an ecologically sensitive area. There were options to go over the most ecologically sensitive parts, but they were a bit more expensive and were rejected. I think that point needs to be made.
Jerome Mayhew
I am grateful for the hon. Gentleman’s intervention. It is also a bridge over the River Wensum, as he knows. A consultation was undertaken and, taking that into account, the best route was reached. It deals with a huge amount of rat-running and links north Norfolk to the rest of the country.
In relation to the A47, I welcome the imminent work for the Tuddenham to Easton dualling, but what about the Acle Straight? What about linking Great Yarmouth to the rest of the country? That is overdue and much needed.
On rail, regularity of services is an issue. Norwich to London takes about two hours; London to Birmingham, which is a shorter distance, takes about 80 minutes. That has a huge impact on the economic potential of our part of the country. It is the same for the Ely junction and the Haughley narrows.
We need access to markets, and that means access to staff. We lose 50% of our graduates from Norfolk. We need to change that, and one thing that we have to look at is the quality of life in our community. That includes health and dental services. We have a real paucity of dental services in the county. It would assist the situation if we had a teaching facility at UEA. I have run out of time, so I will have to conclude at this point.
Oral Answers to Questions
Jerome Mayhew Excerpts(3 years ago)
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Cherilyn Mackrory (Truro and Falmouth) (Con)
Jerome Mayhew (Broadland) (Con)
The Minister for Levelling Up Communities (Kemi Badenoch)
The Department is investing billions in local growth funds—including the towns fund and the levelling-up fund, which I mentioned earlier—to deliver regeneration across the UK as we level up across all parts of the country. Our high streets strategy, published earlier this year, outlined our vision for supporting thriving places. We have an ambitious agenda for improving opportunity, living standards and public services, and for renewing pride for the whole of the UK. That will be set out in our upcoming levelling-up paper.
Kemi Badenoch
First of all, I congratulate my hon. Friend on the Truro town deal in her constituency and welcome her continued work as a champion of the area. I encourage her and local partners to continue to work with us on our shared ambition to level up Falmouth and towns throughout Cornwall as future opportunities emerge. She will know that as part of this work, £88.7 million of towns fund investment is driving regeneration and growth in Camborne, Penzance, St Ives and Truro, and there are real economic benefits for Falmouth, too. I am sure she and I can discuss a potential visit in due course.
Jerome Mayhew
Levelling up has sometimes been mis-described as a transfer of resources from the south to the north, but is it not a better analysis to say that it spreads the opportunities often seen in cities to the towns and villages of our communities, as part of the wider social covenant? If so, what plans does the Minister have to support towns in Broadland, including Fakenham, Acle and Aylsham?
Kemi Badenoch
I should start by saying that the levelling-up agenda is not transferring resources from cities to towns, or from south to north. Levelling up is about empowering local leaders and communities to drive real change, and restoring local pride across the UK, so I thank my hon. Friend for asking that question. The Government are investing over £17 million in Norfolk’s towns, with ambitious town deals already delivered in Norwich, Great Yarmouth and King’s Lynn. The UK shared prosperity fund will help to ensure levelling up for people in places across the UK. It will increase and spread opportunity for people no matter where they live, including in places like Fakenham.