Property Guardians

Lord Shipley Excerpts

Monday 15th October 2018 Lords Chamber

[Lord Shipley (LD)]

My Lords, I remind the House that I am a vice-president of the Local Government Association. I welcome this debate and thank the noble Baroness, Lady Jones of Moulsecoomb, for bringing this important issue before the House.

During the passage of the then Housing and Planning Bill in April 2016, the noble Lord, Lord Beecham, moved an amendment on this matter. He expressed a number of concerns which I thought were justified, and we on these Benches were strongly supportive of them. Despite the Government winning that vote, I think it is time for them to look again at the issues underlying the guardianship schemes. While there are only around 5,000 to 7,000 property guardians in the UK, the number is likely to rise significantly. In the Netherlands there are some 50,000 property guardians, and we have a much higher population here so a rise seems likely. Yet in the debate on the Bill the Government refused to acknowledge that they had a role, as the noble Baroness, Lady Jones, has mentioned. The noble Baroness the Leader of the House said on 11 April 2016:

“We as a Government do not endorse these schemes and do not have any plans to introduce new regulation in this area as we believe that doing so could be regarded as tacitly endorsing the use of property guardianship schemes as a legitimate housing option”.—[Official Report, 11/4/16; col. 111.]


The Government’s subsequent factsheet for current and potential property guardians confirms this in paragraph 3, which says:

“The government does not endorse or encourage the use of property guardianship schemes as a form of housing tenure”.


I have come to the conclusion that that is insufficient in the circumstances. It may be true that a number of protections exist in law already for licensees acting as property guardians but they do not cover everything, and it is surely the role of the Government to regulate when regulation is needed. In the Netherlands the property guardianship sector has created an independent property regulator to set standards and monitor compliance. It also has a complaints board. Even though membership is not mandatory, it means that standards are clearly defined. I understand that in this country there is to be a property guardian providers association, and I welcome the fact that seven providers covering 80% of the sector are involved, although that of course raises questions about the other 20%. It will be interesting to see how its powers and effectiveness compare with the Netherlands, but I nevertheless welcome the efforts being made by the sector itself.

I acknowledge the work of the London Assembly and the 11 recommendations in its report published earlier this year. For the time being this is primarily a London issue, but there are signs of growth across the country so what is done in terms of property guardians in London will be relevant elsewhere. There would be merit in taking the London Assembly’s 11 recommendations and the mayor’s response and using it as the basis for consultation. Issues needing clarification concern redress schemes, deposit schemes, the role of the planning system, financial issues around business rates and council tax and the absence of property guardianship as a form of tenure from any existing legislation.

In principle I agree with the noble Baroness, Lady Jones, that, properly run, property guardianship can be beneficial to both landlord and licensee. It gets empty property into use and gets it looked after, and for many people the system works well. For the landlord, they have someone helping to protect the property. For the licensee, it is usually much cheaper than a conventional tenancy; it means that they can save more for a deposit to purchase a home; it means they can leave at a month’s notice; in most cases they have the benefit of being with other people; and it can be more conveniently located for them in terms of work. It gives opportunities too for social enterprise and, through social enterprise, for volunteering. I noticed that one of the companies involved, Dot Dot Dot, has a requirement for 16 hours of volunteering a month. This approach is to be commended.

The problem is that there is also a downside. As we have heard, it is usually not residential accommodation that is used, and some licensees can be exploited simply because they urgently need somewhere to live that they can afford in the absence of sufficient social housing. As a consequence they can end up in poor accommodation, and there have been numerous reports of poor plumbing, poor lighting, dirty conditions, a lack of adequate fire protection—that is, conditions that do not meet the standards required for residential accommodation. Indeed, in their factsheet the Government seem to admit this. Paragraph 8 says that the properties may be,

“in poor, unsafe and unclean condition with poor physical security and limited access to facilities”.

The key question is whether the properties are meeting regulatory standards that would apply to residential accommodation. I am afraid I do not think it is enough simply to advise licensees that they should approach their local housing authority or citizens advice bureau. It takes a lot of time, knowledge and effort to complain in that way. Clearer, publicly understood regulation would be so much better.

There is a remaining issue that I hope the Minister may be able to comment on: the implications of the Bristol judgment, where a property guardian was confirmed in his view that he was actually an assured shorthold tenant, not a licensee. The reaction to that judgment seems to be that you simply have to reword the licence to turn a tenancy into a licence, but I would appreciate the Government’s view on that because it seems to me to be a very important judgment. Indeed, the question sums up the need for clarification on the rights of property guardians as a whole.

The noble Baroness, Lady Jones, said she wants this issue to be on the Government’s radar. She also said there was a massive opportunity to use empty properties. I concur with both views: there is a massive opportunity here but, because of that and because many more properties might become used under licensee terms as property guardianship, there is a need for the Government to ensure not just that the issue is on their radar but that they have regulated when regulation is needed.