Public Health (Coronavirus) (Protection from Eviction) (England) (No. 2) (Amendment) Regulations 2021

Lord Wolfson of Tredegar Excerpts

Monday 19th April 2021 Grand Committee

Moved by

[Lord Wolfson of Tredegar]

That the Grand Committee do consider the Public Health (Coronavirus) (Protection from Eviction) (England) (No. 2) (Amendment) Regulations 2021.

[The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Wolfson of Tredegar) (Con)]

My Lords, the instrument before us today prevents enforcement agents—bailiffs—from attending residential premises in England to execute a writ or warrant of possession except in the most serious circumstances. The House will be familiar with the structure and content of this statutory instrument as it is the fourth that the Government have tabled to restrict the enforcement of evictions since November last year.

The instrument applies to enforcement action in England. It amends the Public Health (Coronavirus) (Protection from Eviction) (England) (No. 2) Regulations 2021 in only one respect: by amending the expiry date of those regulations from the end of 31 March 2021 to the end of 31 May this year. On 18 March, when we debated the previous statutory instrument, a number of noble Lords expressed concerns about the short-term nature of these regulations and suggested that both landlords and tenants would benefit from greater clarity about how long the restrictions would be in force.

I explained in the last debate that the Government have to balance the need for clarity against ongoing developments in the pandemic. We believe that retaining the restrictions in this instrument until 31 May while the Covid-19 restrictions remain in place will align with the broader strategy for protecting public health and will continue to help to reduce pressure on essential public services as we move out of lockdown. Indeed, as I explained last time, the extension to 31 May, which I headlined in that debate, is broadly in line with the road map out of lockdown. Step 3 of the road map will be taken no earlier than 17 May following a review of the relevant data. That step will see a number of restrictions being lifted, including—importantly, in this context—the restrictions on domestic overnight stays.

Noble Lords might say, “Why 31 May and not a date linked to step 4, which is scheduled for no earlier than 21 June?” The short answer is that we must remember, when considering the date of 31 May, that in most cases bailiffs are required to give 14 days’ notice of an eviction. In practice, therefore, protection from the enforcement of evictions will be afforded in most cases until mid-June. We have sought to strike the right balance in the prevailing circumstances.

I am sure that noble Lords will be familiar with the content of the statutory instrument. We have put a ban in place but there are the by now familiar limited exceptions to the ban in cases where we believe the competing public interests in ensuring access to justice, preventing harm to third parties or taking action against egregious behaviour and upholding the integrity of the rental market sufficiently outweigh the public health risks. The exemptions are: first, where the claim is against trespassers who are persons unknown; secondly, where the order for possession was made wholly or partly on the grounds of anti-social behaviour or nuisance, false statements, domestic abuse in social tenancies, or substantial rent arrears equivalent to six months’ rent; or, thirdly, where the order for possession was made wholly or partly on the grounds of death of the tenant, and the enforcement agent attending the property is satisfied that the property is unoccupied. In each case the court will have to be satisfied that the exemption applies, and that will be considered on a case-by-case basis.

We therefore think it is fair and proportionate to allow for an exemption to the ban in cases where a landlord has sought a possession order on the grounds of rent arrears, and where a full six months of rent arrears has accrued. We know that private landlords, in particular, can be vulnerable to rent arrears; 45% of them let just one property, and 29% rely on rent for over half their income.

Data from sources such as the National Residential Landlords Association and the Resolution Foundation indicate that the vast majority of renters who are in arrears will not have built up the extreme level of rent arrears—six months-worth—that would allow the landlord to apply for an exemption to this public health measure. We continue to monitor the impact of the exemptions.

In cases where a court has decided that an exemption applies, bailiffs have to give tenants at least 14 days’ notice of an eviction, in most circumstances. They have been asked not to enforce evictions where a tenant has symptoms of Covid-19 or is self-isolating.

In addition to these regulations, we have also introduced a requirement, in the Coronavirus Act, that landlords, in all but the most serious circumstances, must give six months’ notice before beginning formal possession proceedings. That is another protection for tenants. That means, essentially, that most renters served notice now by their landlord would be able to stay in their homes until October 2021. This measure will remain in place until at least 31 May. We will consider the best approach for after this date, taking into account the prevailing circumstances at that time.

I have set out in previous debates on such statutory instruments the significant help that the Government have given to try to prevent people getting into financial hardship by helping businesses to pay salaries—frankly, that is the most important measure to enable people to pay their rent—through the furlough scheme, which has been extended until the end of September. The Self-employment Income Support Scheme has also been extended, and we have boosted the welfare safety net by billions of pounds. The Committee will be aware that in the Budget we announced that the universal credit top-up of £20 per week would continue for a further six months, and there is a further one-off payment of £500 for eligible working tax credit claimants.

In the Budget there was also a recovery loan scheme, which was launched to ensure that businesses, in particular SMEs, are well supported in their ability to access the finance they need throughout 2021. More than 1.5 million businesses have benefited from Government-backed support, receiving over £70 billion in total.

Ministry of Justice statistics show that the number of possession claims being made to the courts has fallen significantly. The most recent statistics show that applications to the courts for possession by private and social landlords were down 67% in the last quarter of last year, compared to the same quarter in 2019. Temporary court arrangements and rules, which have been put in place by the Master of the Rolls working group, include a review stage at least 28 days before the substantive hearing, so that tenants can get legal advice. Any cases started before August 2020 have to be reactivated by landlords before the end of this month, and we are also putting in place a free mediation service, as part of the possession action process, to support landlords and tenants to resolve disputes before a formal court hearing takes place.

Let me reiterate that I am aware that there are landlords who have been adversely affected by these regulations. As I have also said on previous occasions, we have sought to strike a balance—to enable tenants to pay their rent, but also, in egregious cases, to enable landlords to obtain possession. We remain grateful to landlords for their forbearance during this unprecedented time. We consider that these regulations strike an appropriate balance between the interests of landlords and those of tenants, and I therefore commend them to the Committee.

--- Later in debate ---

[Lord Wolfson of Tredegar (Con)]

My Lords, I am very grateful to all noble Lords who have contributed to this debate. I shall try to respond to the points in the order in which they were made but some were made by more than one contributor so, with their permission, I may lump some noble Lords together.

The noble Lord, Lord Hain, made an interesting point, if I may say so. One must distinguish the cases into two groups. The first is where contracts were entered into after the start of the pandemic. In those cases, one would have expected the parties’ lawyers to advise them not to enter a legal commitment to make a purchase unless they knew that they could complete; the government guidance on moving home during the pandemic has been in place since 26 March 2020. However, in so far as people entered into legal obligations before that date, there are principles of English contract law, such as frustration, which might be relevant in this context. That is the sort of point on which, if the noble Lord will allow me, I will write to set out in a little more detail what I understand the legal position to be.

Turning to a number of points made by noble Lords, first, I should make it clear that, on 18 March, I set out that the Government would extend the SI not just to 31 March but to 31 May, so criticism that we have been doing this on a short-term basis is not well made, certainly in that respect.

A number of noble Lords asked about the plan for when we come out of the pandemic. I reiterate that I am a humble Ministry of Justice Minister. There are cross-government conversations about what will be put in place but, so for as a specific financial package is concerned, we have already done a number of things. For example, we have increased the local housing allowance rate to the 30th percentile of local market rents in each area. We expect that to provide 1.5 million claimants with around £600 per year of housing support more than they would otherwise have received. Those increased rates will be maintained at the current levels, in cash terms, in the current financial year—even in areas where the 30th percentile of local rents has gone down.

Going forward, however, I emphasise that this ultimately becomes a housing issue, not a Ministry of Justice issue. Of course, there are conversations across government; as I said, I will specifically bring the detail of this debate to the attention of Ministers in MHCLG. Although I appreciate that this point was made by a number of noble Lords—my noble friend Lord Bourne of Aberystwyth, the noble Lord, Lord Carrington, and the noble Baroness, Lady Grender—there is nothing more substantive that I can say this afternoon, bearing in mind that, as the noble Lord, Lord Ponsonby, reminded me, in whatever I say, I commit the Government too.

The noble Lord, Lord Bilimoria, rightly emphasised the important work that the Government have done with regard to commercial evictions. In both the commercial and residential contexts, it is our intention to avoid any sort of cliff edge.

I underline the noble Lord’s point about the importance of mediation. Mediation in civil disputes is always a very good idea. It has played a part in our civil justice system over the past 20 years or so and its importance is increasingly recognised. In the context of housing, we hope the free mediation service for landlords and renters will enable many landlords and their tenants to reach an agreement about the way forward without a formal court process, which must be to everyone’s benefit.

When I mentioned my noble friend Lord Bourne of Aberystwyth, I should also have picked up the beautifully double-edged compliment that he paid me, which started so well and ended so badly.

The noble Baroness, Lady Ritchie of Downpatrick, asked a couple of questions about speeding up the operation of the courts. There are a number of things that I should say in this context. First, as I say, landlords are obliged to reactivate old cases in order to make sure that the courts are not faced with cases that have become moot—for example, where the tenants have already moved out. Secondly, the introduction of mediation also speeds up the court process because it takes some cases out of the system.

Further, and in response to the noble Baroness, Lady Grender, one has to remember that parts of the court process lie outside government purview. For example, listing is a judicial function, and the order in which the judiciary prioritises cases is and remains a matter for the judiciary. However, the Master of the Rolls’ working group has put in place temporary court rules and arrangements to ensure that cases proceed through the courts as quickly as possible and that delays are kept to a minimum.

I respectfully agree with the point made by the noble Lord, Lord Carrington, that private landlords are not a bank. I have already said that there will be discussions across government about the position that is put in place when these regulations come to an end.

The noble Lord asked specifically about video technology to speed up the court process. That is already being used throughout civil courts. In this as in many areas of life, the Covid-19 pandemic has forced or perhaps encouraged us to do things that we probably would have done anyway but over a longer period. Video technology in court is certainly one of those things; it is now part of our civil justice system and I am sure it will remain so in future. The noble Lord is certainly right that video technology has the potential to speed up cases and enable them to be heard more quickly, and indeed to enable more cases to be heard at once.

The noble Lord, Lord Bhatia, emphasised in his remarks that what is sought to be achieved here is ultimately a balance between the various interests, and I respectfully agree with him.

I hope I have responded to the points made by my noble friend Lady Gardner of Parkes. I have dealt with the date point. We believe that 31 May is now the appropriate deadline for these regulations. We hope that the position will improve as per the road map and that we will not need to extend them thereafter, but obviously we have to keep that under constant review.

In the time that I have left, I turn to the points made by the Front-Bench speakers. I have already dealt with one of the points made by the noble Baroness, Lady Grender, but in response to her important point on Section 21, the Government are committed to bringing forward legislation to deliver a better deal for renters, including repealing Section 21 of the Housing Act 1988, once the urgencies of the pandemic have passed. That would represent a generational change to tenancy law in England, so we have to make sure that we get it right and that we balance the interests of landlords and tenants appropriately. If we are giving tenants more security of tenure, we must also ensure that landlords can recover properties where they have valid grounds to do so.

As far as the noble Baroness’s other point about giving judges more discretion in possession cases is concerned, we do not intend to bring forward such legislation. We believe that the current support package strikes a fair balance and that the rights of both tenants and landlords are appropriately balanced in this area. However, as I said, we plan to bring forward a renters’ reform Bill in due course, once the urgencies of the pandemic have passed. Respectfully, I therefore do not accept that promises have been broken. We made a promise to do the best we can in these difficult circumstances, and we have certainly fulfilled it, as I have explained on several occasions.

The noble Lord, Lord Ponsonby of Shulbrede, asked about the package going forward. I have said what I am able to say about that today. Like me, he found the point made by the noble Lord, Lord Hain, about home buying interesting. I will ensure that he is copied into my letter to the noble Lord, Lord Hain, on that matter.

I am grateful to the noble Lord, Lord Ponsonby, for outlining the Labour Party plan in this area. I do not want to introduce too much of a political element to these exchanges, but the plan highlights the point about where you draw the line. For example, we were told that the £20-per-week universal credit increase would remain beyond six months, but until when?

Ultimately, we must strike a balance in this area. I submit that these regulations strike the correct balance in difficult circumstances. I hope that we will not have to extend them further and that life will return to something approaching normal, so, although I have some regrets that this may be the last outing for these regulations, I commend them to the Committee.

Motion agreed.