Lord Kennedy of Southwark
Main Page: Lord Kennedy of Southwark (Labour - Life peer)Housing and Planning Bill
Lord Kennedy of Southwark Excerpts
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)
My Lords, I thank my noble friend Lord Cathcart for explaining on behalf of my noble friend Lord Flight the reasons behind Amendments 24 and 25. If enacted, Amendment 24 would remove the requirement for a landlord to notify a “relevant person” that their tenant’s deposit has been secured in a Government-authorised tenancy deposit protection scheme.
Section 213 of the Housing Act 2004 defines a relevant person as,
“any person who, in accordance with arrangements made with the tenant, paid the deposit on behalf of the tenant”.
This can be a family member but in most cases it is a charity such as Crisis or Shelter, which offers deposit loan schemes to vulnerable people with a history of homelessness, or a local authority, which pays the deposit through housing benefit in cases where tenants are out of work or on a low income.
I welcome proposals which reduce burdens for business and I understand the spirit in which this amendment has been tabled. However, the proposals set out in Amendment 24 have the potential to adversely affect the willingness of a charity or a local authority to pay a deposit on behalf of a tenant. This could lead to vulnerable people or those on low incomes being unable to access the private rented sector, which is something we would want to avoid.
Amendment 25 would allow tenancy deposit protection information to be provided to the tenant by their landlord electronically by email. The Government welcome proposals that seek to reduce burdens on business but in this case primary legislation is not required. The aim of this amendment can be achieved through secondary legislation, using powers in the Electronic Communications Act 2000. I will be happy to look further into the proposals outside this Chamber and consider introducing secondary legislation at a later date. I hope that this explanation will reassure my noble friend and I hope that he will withdraw his amendment.
Amendments 26 and 31, which were tabled by my noble friend Lord Cathcart, seek to reduce the time taken to repay a deposit to a tenant or landlord where either party is absent or unco-operative. I accept that there is a minor cost to a landlord or tenant in arranging for a solicitor or magistrate to witness a statutory declaration, but this process is necessary for the landlord or tenant to prove beyond any doubt that they have attempted to contact the other party and that they have not been able to reach an agreement on the amount claimed from the deposit before it is repaid. The example that the noble Lord, Lord Beecham, gave just before he sat down underlines this. Removing the requirement could leave the process open to abuse, with no independent verification that the other party had been contacted to give their consent. With this explanation, and given that the vast majority of claims are settled without a problem, I hope that the noble Lord will not press his amendments.
Amendment 28, in the names of the noble Lords, Lord Kennedy and Lord Beecham, would require a review of the tenancy deposit scheme. I understand that this amendment has been tabled in order to ensure that tenants are treated fairly at the end of their tenancy, and I know that we can all agree with that aim. My department has a governance role to ensure that the schemes are working well. The performance of the schemes is monitored through monthly key performance indicators, regular governance meetings and information provided by the tenancy deposit scheme users’ group, which includes landlord and consumer representatives.
From the overall feedback received, we are satisfied that the alternative dispute resolution system generally works well. Of the 11.5 million deposits which have been protected since the launch of the scheme, less than 2% have gone to adjudication. On average, following adjudication, 27% are awarded to tenants, 17% to landlords or agents, and just over half are split between the two sides.
Looking to the future, we are satisfied that the tenancy deposit protection schemes awarded contracts for new custodial schemes from 1 April this year have the necessary alternative dispute resolution processes in place to ensure that tenants will continue to be treated fairly. This was a key evaluation criterion in our re-procurement exercise carried out last year.
In conclusion, I hope that this explanation will assure noble Lords that tenants’ deposits are and will continue to be returned to them fairly and quickly at the end of the tenancy, and I hope that they will not press their amendments.
Finally, I turn to Amendment 33B, tabled by the noble Lords, Lord Best and Lord Kennedy, which gives the Secretary of State powers to underwrite a national tenancy deposit bond guarantee scheme. In 2014-15, 220,000 households were prevented from becoming homeless. Of these, 54% were assisted to remain in their own home and 46% were helped to a new home. Statistics show that in at least 42% of cases households were assisted into private rented sector accommodation. In support of this, many local authorities, housing associations and charities in England already have a rent deposit or bond scheme.
The Government have already funded Crisis to the tune of nearly £14 million to develop a programme to help single homeless people to access the private rented sector. Nearly 9,000 single homeless people have been helped into private rented sector accommodation so far, with a 90% tenancy sustainment rate. This Government’s approach is to support a provision of resources to local authorities at a local level. This is because they can then use the funding flexibly to meet local needs. Of course, different areas have particular requirements. To divert scarce funding into a single national approach would not always be the best or most effective use of resources and to specifically underwrite a national scheme may not be the best use of resources.
I hope that this explanation will reassure noble Lords and I hope that they will not press their amendments. But before I sit down I will answer a specific question from the noble Lord, Lord Best, about the DCLG continuing to fund the private rented sector access programme. We have not made any decision on further funding, but from the start of the programme all funded schemes were required to attract funding from other sources and make plans for future sustainability. I will keep the noble Lord updated on this.
Lord Kennedy of Southwark
Before the noble Baroness sits down, I think her response to the national rent deposit guarantee scheme is quite disappointing. Will she say why? She said that a number of authorities have these schemes, but what is the objection to having a national scheme? We are talking about very modest sums of money.
Baroness Williams of Trafford
I think that the noble Lord will accept that the fact that the scheme is currently working very well and that some local authorities may actually decide to underwrite the schemes themselves in certain cases to prevent homelessness is—and we are looking after every single penny—a reason not to do something unless there is evidence to say that we would need to do it.
Lord Kennedy of Southwark
I will come back briefly to the national deposit scheme. When the noble Baroness writes to my noble friend about the amount of money and the authorities involved in such schemes, will she also say what percentage of tenants are protected by them, and about the thought processes behind how the Government decided not to go for the national scheme? I think she will say that most of it is covered, but what consultation took place to decide not to come forward with a national scheme?
“Security of tenure
(1) After section 19A of the Housing Act 1988 (assured shorthold tenancies) insert—“19B Minimum length of certain assured shorthold tenanciesAny assured shorthold tenancy (other than one where the landlord is a private registered provider of social housing) granted on or after 1 April 2018 must be for a fixed term of at least thirty-six months, and it is an implied term of such a tenancy that the tenant may terminate the tenancy by giving two months’ written notice to the landlord.”(2) In section 21 of the Housing Act 1988 (recovery of possession on expiry or termination of assured shorthold tenancy), after subsection (4) insert—“(4ZZA) In the case of a dwelling house in England, no notice under subsection (4) may be given before the end of the period of thirty-six months beginning with the first day of the tenancy.””
Lord Kennedy of Southwark
My Lords, I declare an interest as a councillor in the London Borough of Lewisham. Amendment 29 in my name and that of my noble friend Lord Beecham seeks to amend the Housing Act 1988 to make the minimum length of an assured shorthold tenancy granted on or after 1 April 2018 a fixed period of 36 months. Most assured shorthold tenancies usually last between six and 12 months at present. The contract says how much rent to pay, how long the tenancy lasts and who is responsible for the repairs. The landlord cannot increase the rent during the fixed term of the assured shorthold tenancy unless the contract sets that out. When the tenancy ends and the tenant decides they wish to sign up for a further fixed period the rent can be increased in the new agreement.
Even an assured shorthold tenancy for one year is a relatively short time and this amendment seeks to give tenants a longer period to live in a property, enjoy more security and put down some proper roots. It is a longer period than at present but not excessively long. The private rented sector is increasing all the time, and providing more stability and a longer tenure for tenants must be right. We hear of “generation rent”—people not being able to afford to buy their own home and more people living in properties they have to move round from more regularly. That is not good for them or the wider community. It is not great for landlords either.
Lord Kennedy of Southwark
My Lords, I thank all noble Lords for participating in this short debate. I say to the noble Earl, Lord Lytton, that I have great respect for him and his knowledge of this sector but there are landlords in the private rented sector who want a longer period to rent to tenants. My amendment seeks to address that issue by retaining the flexibility that both the landlord and the tenant want. It is only a probing amendment but it highlights an issue for some tenants and landlords; namely, allowing longer assured shorthold tenancies where these are wanted. There are, of course, many excellent private landlords, including, I am sure, all the noble Lords who are landlords. I beg leave to withdraw the amendment.
“(e) the local housing authority responds to a request by the landlord confirming that they suspect the property to be abandoned.”
Lord Kennedy of Southwark
My Lords, at Second Reading I and many other noble Lords expressed reservations about the proposals on abandonment. Creating a fast-track process to reclaim possession of a property that has been abandoned has a number of risks. Taking the courts out of the process leaves the tenant in a potentially very difficult position. What is also odd about this provision is that we have spent the first day and the first part of this second day in Committee talking about rogue landlords and seeking to protect tenants from their unfair and often illegal practices. But this part of the Bill could be seen as a rogue’s charter.
It creates a court-free process to get rid of your tenant if you do not like them so that you can get other people in who may pay a few more quid in rent. In 12 weeks the landlord can get possession of their property, after eight weeks of rent arrears and if the tenant has failed to respond to three notices. There do not appear to be any significant problems regarding properties being abandoned. Can the Minister point to the evidence for these proposals being necessary?
Landlords already have powerful rights to regain possession of their property. They can evict tenants through the courts using Section 8 or Section 21 notices and can also use implied surrender in cases of abandonment. Under implied surrender, a landlord may take instant possession of a property without court approval if the action of the tenant clearly implies that they have surrendered the tenancy. We should be clear that genuine cases of abandonment are rare and this is a simple protection for tenants.
Can the noble Baroness also set out how vulnerable tenants will be protected from rogue landlords seeking to make use of these clauses? People can be called away or their circumstances might change. It could take more than eight weeks to get their benefits or other matters sorted out. Vulnerable people in particular may not respond to letters or emails that are sent to them. So although the landlord is not getting any response, it does not mean that the property has been abandoned. The provision allowing tenants to challenge abandonment at the county court after they have been evicted is very weak indeed. Who is going to do that with their possessions on the pavement? Getting a roof over your head will be your overriding concern.
The whole of Clause 55 should go, as tenants seem to have very little protection under it. If the Government are not going to do that, Amendment 34, in my name and that of my noble friend Lord Beecham, would add an additional subsection (e) to the clause, which would require the local authority to respond to a request from the landlord, confirming that it believes the property is abandoned and that the landlord can serve notice on the tenant. This should cause the Government no concern whatever. It would enable the landlord to recover their property if it has been abandoned —in addition to the powers and ways that they have at present, which I have outlined already—but would add a small but significant protection for the tenant.
Amendments 35 and 36, which both come under Clause 57, concern warning notices. Amendment 35 would give the person occupying the property an additional four weeks to respond to the warning notice, while Amendment 36 increases the maximum period within which the second warning notice can be given from four to eight weeks. The purpose of these amendments is to increase the time available to resolve these matters without the abandonment procedures being invoked and for the tenants to be able to confirm they have not abandoned the property. I beg to move.
Lord Campbell-Savours
My Lords, this is a particularly important amendment, as I read it. I am sorry that I slightly misinterpreted the wording in the legislation on this whole question of abandonment. It seems to me that this provision as it stands is wide open to abuse. Clause 58 has a reinstatement principle, which I suppose is a sort of appeal, but many landlords will believe that this is an open door for them to bring a tenancy to an end by simply asserting the fact that they believe the property to be abandoned.
I cannot see how it is possible to reject the amendment that has been tabled by my noble friend Lord Kennedy of Southwark, which says that the “local housing authority” has to respond,
“to a request by the landlord confirming that they suspect the property to be abandoned”.
In other words, the local authority has to give the seal of approval before the landlord can bring the tenancy to an end.
I hope that the Minister will not simply follow what is in her brief, assuming it says, “Reject”, but will perhaps put this back to people in her department. It is a perfectly sensible and reasonable amendment. It would provide a checking arrangement to make sure that landlords do not abuse their position and I hope that it will be supported by the House.
Baroness Hollis of Heigham
Doing some quick mental arithmetic, I suspect that we are talking about four to five instances per housing authority per year; compared to the responsibilities of local authorities for fitness standards, inspection of houses in multiple occupation, electrical safety and the like, this is trivial. As an ex-local authority person myself, I absolutely understand why the noble Lord is concerned, but we are dealing with a very small number, and probably the same landlords who are already well-known to local authority housing officers or environmental health officers as being too often on the wrong side of the law.
Lord Kennedy of Southwark
I am not a leader of a local authority, but I am a member of one, so I understand the noble Lord’s point. I am not a fan of the Bill, but this part has some very good things in it on strengthening protection for private tenants. By this one provision, we are opening the back door for the rogues. Good landlords would not get involved in this, but there are always the few people who see a quick way to pull a stroke, and we seem to be opening the back door for them as we shut all the other doors. That is odd. The amendment may not be right—it is only a probing amendment—but it highlights a real issue.
Lord True
My Lords, I do not want to intervene on the Minister, but Clause 56(1)(a) states:
“The unpaid rent condition is met if … at least eight consecutive weeks’ rent is unpaid”.
I follow what the noble Lord, Lord McKenzie, said. Clause 57(6) states—perhaps officials could note this—that the,
“first warning notice may be given even if the unpaid rent condition is not yet met”,
In construing the clause, the landlord could think, “Five or six weeks have gone by and I have not had any rent, so I am going to send out a warning notice without waiting for the eight weeks”. That is how I would read the Bill.
Lord Kennedy of Southwark
The Minister explained the process for getting possession of a property believed to have been abandoned but she did not mention vulnerable tenants. Will there be any special provision for vulnerable people? I am worried that those people will not be opening their mail or looking at their emails or engaging in things and all of a sudden they will find themselves on the street.
Baroness Evans of Bowes Park
I set out the overall process but of course we will have to be mindful of people being able to access it. That is why we have put so many checks within the process to ensure that there is an opportunity for the tenant or someone else named as an occupier to respond. The final thing will be a public notice on the property to say what the situation is. We believe that this process as a whole will ensure that tenants are not disadvantaged and, of course, vulnerable tenants are on our mind.
Lord Kennedy of Southwark
The Minister also said that when the tenant of the property believed to have been abandoned has been evicted, they can go to the county court. Will legal aid be available for the county court action?
Baroness Evans of Bowes Park
I will have to get back to the noble Lord. I am afraid I do not have that information.
Lord Kennedy of Southwark
That would be very helpful. In this short debate we have highlighted a few issues with this section of the Bill so can I suggest that it might be welcome if a few noble Lords got together with the Minister to discuss some of them? There are issues which are not clear and could cause problems. The last thing we want is to get something on the statute book that causes everybody confusion.
Lord McKenzie of Luton
I have one further question. If the rent condition is initially not met but then there is a payment which starts the process again, where does that leave the warning notices that have been issued? Will they remain in place for a possible second bout of the application of these provisions?
Lord True
I do not dissent from what the noble Baroness said, nor from what the noble Lord, Lord Campbell-Savours, said—but, as I read this part of the Bill, it is also designed to address the situation where a bad tenant who does not want to pay their rent disappears and does not want to be found. That is what lies behind my concern about local authorities. If the local authority has to certify that this person has gone—is deliberately not wanting to be found and not answering letters and has actually abandoned the property —it will want to be extremely cautious, particularly if there is a court case potentially pending, or will require very clear regulatory protection before it issues such a certification. So there is a risk if it means that the bad tenant, who is the other side of the question, will not be pursued. These matters clearly need to be discussed and my noble friend on the Front Bench has offered such discussions.
Lord Kennedy of Southwark
I thank all noble Lords who have spoken in this debate and I thank the Minister for agreeing to meet noble Lords from across the House. There are clearly issues here that need addressing. This is about how vulnerable tenants are treated. Another issue is whether they are English speaking; I have just thought of that. There is a question about how people are treated in court when they have no legal aid. Before this gets on the statute book, we need to take a proper, vigorous look at it. If need be, we can seek amendments later on in the process. At this stage, I am happy to beg leave to withdraw the amendment.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, this is the first time I have spoken in Committee today, so I draw your Lordships’ attention to my entry in the register of interests. I support my noble friend Lady Grender, who set out so eloquently our opposition to Clauses 55 to 61. I agree completely with the noble Lord, Lord Kerslake, that this is badly thought-out and not needed.
As has been said, these clauses are designed to solve a problem for which there is already legislation. The Government appear extremely keen to move residents out of housing association and local authority housing into the private sector. This is all well and good if the supply and standard of accommodation on offer is adequate and meets the Government’s standards for what is required. However, as I am sure the Government will readily admit, much of this accommodation is in a very poor state of repair, sometimes not secure against the elements and, in extreme cases, not fit for human habitation.
As has already been said, there is a balance to be struck between ensuring that landlords can run their properties as a viable business and the interests of tenants looking for a secure and comfortable home. In 2015, 115,000 people approached Citizens Advice with problems in private rented homes, 2,053 of which were about illegal evictions by landlords in the private rented sector. This represented an increase in inquiries on this specific issue of 32% compared with 2014. This is part of a general upward trend over more than a year. During 2013-14, 111,960 households in England applied to their councils for homelessness assistance—a rise of 26% on 2009-10. On 30 September, 68,560 households were living in temporary accommodation—13% higher than on the same day in 2014, thus producing considerable pressure on local authority homelessness budgets, as we have already heard, with residents often put in temporary accommodation.
The abandonment proposals in the Bill lower the level of proof that landlords will have to meet to claim that their property has been abandoned. The proposal would also legitimise an illegal practice: evicting a tenant without going through a formal court procedure, even when the tenant has not engaged in any conduct that might clearly show that he has abandoned the property. This suggests that, if introduced, it would lead to higher eviction rates and a similar rise in the number of homelessness applications to local authorities, resulting in higher administrative and temporary accommodation costs. Will the Minister say whether this is the Government’s intention and what action they are prepared to take to prevent this sorry state of affairs coming to pass?
At a time when the number of households with dependent children living in the private rented sector is increasing, the added financial impact on council budgets is likely to be significant, as it is these households who will have a priority need for housing by the local authority if made homeless. Using the DCLG’s findings, Citizens Advice estimates the increased social costs to the public sector of each homelessness application at between £24,000 and £30,000 per year, producing an average of £27,000 per year per family or individual. This is not a good use of taxpayers’ money. I cannot believe that this is the Government’s intention. I look forward to their response.
Lord Kennedy of Southwark
I am grateful to the noble Baroness, Lady Grender, for proposing that this whole part should be abandoned. I support that suggestion. I will not go through the points I made in the previous debate, but I may have a few points when the Minister responds. The removal of the oversight of the courts, as referred to by the noble Baroness, is of particular concern, and the provision that the third warning notice should be fixed in a “conspicuous” place is very weak and offers very little protection to the vulnerable tenant. The Government have not made the case for these clauses, or that these changes are needed or necessary. The Government need to think again over the procedure and the risks involved, as other noble Lords said in the debate.
Lord McKenzie of Luton
My Lords, I agree with those who say that these provisions should be recast. I want to pick up on the third warning needing to be,
“given by fixing it to some conspicuous part of the premises to which the tenancy relates”.
Conspicuous to whom? Is it the tenant, the whole world, the community that passes by the front door? It seems to me that giving notice to somebody by nailing something to their front door is almost medieval. You can imagine that somebody will put the notice up, the mobile phone will come out and a photograph will be taken but half an hour later it could be ripped off and be nowhere in view—certainly nowhere in view of the tenant. It seems an incredibly archaic approach. I think the whole thing should be recast but that particular provision jars immensely.
Baroness Evans of Bowes Park
As I have said, we have heard the strength of feeling in the House on this issue and have agreed that we will meet and have a further opportunity to discuss issues. I will attempt also to ensure we have information on hand in that meeting. I reaffirm that these provisions are not a charter for landlords to carry out a do-it-yourself eviction. That is and will remain unlawful. On the basis of the strength of feeling in the House, we welcome the opportunity to discuss further details with noble Lords. On that basis, I ask that these clauses stand part of the Bill.
Lord Kennedy of Southwark
Can the Minister tell us a little about where the pressure for these changes is coming from? We hear that there is not a big issue and not a problem here. The Government are going to meet us and seem quite determined about this. What is behind all this? Where has it all come from?
Lord Kennedy of Southwark
My Lords, I am very supportive of the amendment moved by the noble Lord, Lord Greaves. Empty homes represent both waste and a missed opportunity. They also leave the property at risk of squatting and subject to vandalism, and there is the blight that brings to the wider community—to which the noble Lord referred.
Empty dwelling management orders are a legal device which enable local authorities to put an unoccupied property back into use as housing, securing its occupation and getting it back into use as a home. The amendment seeks that, within six months of the Bill becoming an Act, a review must be commissioned into their operation and effectiveness. These orders were brought into law with a lot of support but have not proved effective or to be a device that has been used very much in recent years. A review is sensible at this time as it would enable us to identify if there is a problem with them and, if there is, to identify a solution. The second part of the amendment would require a report to be published and placed before Parliament.
Lord Campbell-Savours
The noble Lord, Lord Greaves, referred specifically to properties in the north of England. In my former area of west Cumberland and Lancashire, terraced houses often fetched little more than £30,000 to £50,000 at auction. However, there is another group of properties, in the south, which I sometimes wonder what is happening with. In some of the most expensive parts of London you will see properties that have been effectively abandoned by their owners. It might well be that the local authorities are involved, but sometimes these properties remain empty for years. Only the other day I was looking, on behalf of a relative, at a property near Tooting. In the same street, there was a house which was shown on the internet as being sold at auction, but I understand it had been derelict for several years, despite the existence of EDMOs which were introduced in 2006. One wonders what is happening there. Might the review which the noble Lord, Lord Greaves, is calling for include consideration of what is happening in the more expensive parts of the country to properties which stand abandoned but which would be better brought into use?