Private Rented Sector

Kelvin Hopkins Excerpts

Wednesday 25th June 2014 Commons Chamber

[Jack Dromey]

My hon. Friend is absolutely right, not least because the evidence shows that if a child under five has to move home three times, that will impact on their educational attainment at school.

The wish of people to live in a house that is also their home is deeply rooted in the sense of aspiration and ambition in our country. It enables them to put down roots, contribute to their community and plan ahead, including where they send their kids to school, which is simply not possible for millions of people in the private rented sector.

To clear up what Government Members have said, Labour’s focus is on homes of all tenure: homes to buy, including our ambitious objective of reaching 200,000 homes a year by 2020; homes to rent; a new generation of social homes; innovation in self-build, custom-build and co-operative build; and catering for an ageing society by helping people to downsize, rather than by using the obscene weapon of the bedroom tax, which will be one of this Government’s first casualties when our Government come to power next May. We also want to bring all homes up to standard, including those in the private rented sector, and to complete one of the Labour Government’s greatest achievements, the decent homes programme, which brought 1.6 million homes up to a decent standard, so transforming the lives of those who lived in them.

The private rented sector is growing rapidly: it covers 9 million renters and 2 million children. In my constituency, 48% of the ward of Stockton Green is now in the private rented sector. The sector has an important role to play to meet housing need. Most landlords are good landlords, but—I repeat, but—the evidence is absolutely clear that there are problems of security and affordability, with typically 41% of average earnings being spent on rent. There are also problems of quality—35% do not meet the decent homes standard—and too many rogue landlords and letting agents. We have all seen evidence of that in our constituencies. For instance, one of my constituents, Cathleen, lived in appalling accommodation before finally, with the help of the council, getting her landlord to carry out some basic repairs, only for the landlord to then serve her notice to quit.

The situation must change. We need a different vision of the private rented sector by 2020. It should be a sector of choice, more akin to the continental model, and one that enjoys a higher reputation, with flexibility and security in equal measure: flexibility for the students on one hand, and security for families who want to plan ahead, including where they send their kids to school, on the other.

Crucially, the sector needs to attract investment big and small. My experience of institutional investors is that they are very positive about Labour’s vision of the private rented sector that we want to create. The sector needs to work not just for tenants, but for landlords: longer-term tenancies with a reliable tenant paying the rent make for a better business model, because churn costs not just the tenant, but the landlord as well.

The sector needs to be no place for rogues. I pay tribute to Labour councils all over the country, particularly Newham council, that have vigorously pursued rogues, seeking to drive them out of the business. I remember going on a raid at 7 o’clock one morning with Sir Robin Wales: we saw accommodation the kind of which I did not believe existed in London.

The shadow housing Minister, my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), is absolutely right to say that we need to tackle the problems with letting agents. Most letting agents are reputable, but there are too many rogues. No letting agent should be able to charge tenants up-front fees—that should be for the landlord. My hon. Friend is right to say that we need a sector characterised by greater stability and security.

[Kelvin Hopkins (Luton North) (Lab)]

Does my hon. Friend accept that municipalisation of these rogues might be a way forward? In fact, we did that in the 1970s and it worked very well indeed.

[Jack Dromey]

Indeed. Some Labour councils have done precisely that, by using their compulsory purchase powers to renovate homes and transform the lives of those who live in them.

The shadow housing Minister is right about the need to bring all homes in the private rented sector up to a decent homes standard. She is also right to highlight the importance of a potential national register. I was surprised to hear the hon. Member for Hertford and Stortford (Mr Prisk), whose contributions to debates on housing are usually thoughtful, pooh-pooh the notion of a register, because it would tell us who the landlords are; provide information on whether they pay their taxes, which is of benefit to Her Majesty’s Revenue and Customs; and communicate to landlords their rights, entitlements and obligations. If any landlord were found guilty of serious criminal behaviour, they could be deregistered, which would result in them not being able to operate as a landlord. A national register could make a significant contribution to what we are seeking to achieve.