Short-term Holiday Lets: Planning

Rachel Maclean Excerpts

Tuesday 23rd May 2023 Westminster Hall

[The Minister of State, Department for Levelling Up, Housing and Communities (Rachel Maclean)]

It is a great pleasure to see you in the Chair, Dame Caroline, and I thank my hon. Friend the Member for Torbay (Kevin Foster) for introducing this vital debate. It is a credit to him that so many Members from across our wonderful United Kingdom are here to speak on the issues he has highlighted, and I will turn to all the contributions that colleagues have made before I conclude my remarks.

However, I want first to pay particular tribute to my hon. Friend, whose efforts on behalf of his constituents have recently been recognised in the local elections. It is no surprise to me to hear that there has been a win for the Conservatives in his local council area, no doubt thanks to his assiduous work on behalf of his constituents and his communities, and I commend him and his colleagues in Torbay for that incredible effort.

My hon. Friend’s speech has done an extremely good job of reflecting the concerns involved and the issues that matter to his community. He has highlighted the importance of homes for people to live in, which enable them to take jobs in the local economy, and his desire to prevent streets that should contain homes for families from turning into holiday parks. He has called for a balance to be struck, and I hope colleagues will see that my aim is to reflect that in my remarks—indeed, it is what all hon. Members have said—but we agree with him that we must tackle the issue of constrained housing supply.

My hon. Friend is right to challenge me on how quickly such measures could be enacted, and I will definitely turn to that in the body of my speech, but let me first say that I want to be clear that we recognise the value of tourism to our country.

I feel as though I went on a wonderful virtual holiday while colleagues were contributing to the debate, reflecting on many family holidays in different parts of the UK. I think I have been to almost every constituency represented in the Chamber. I have four children, and we had a limited holiday budget when the children were little, so we often had wonderful holidays in this country. I have been to the constituency of the hon. Member for Strangford (Jim Shannon) and had lovely walks there. The hon. Gentleman mentioned sharks. We have plenty of sharks here in Westminster, so I do not need to go far to see them. It was certainly very sunny when I went to the constituency of the hon. and learned Member for Edinburgh South West (Joanna Cherry), as it was in Norfolk, Cornwall, Devon and elsewhere.

Tourism is an economic, social and cultural asset that plays a vital role in supporting our institutions and attractions across the country. It is a major contributor to UK jobs and growth, employing 1.7 million people and contributing nearly £74 billion a year pre-pandemic. I am not going to repeat everything that colleagues have said, but we all understand why we need to introduce these reforms. That is why we are in the Chamber for the debate.

Every Member from every party has highlighted the issue of the hollowing out of communities, the impact of that on schools and other services, and the fact that the growth of short-term letting might in itself be having an impact on local businesses that serve the tourism industry, such as restaurants and cafés. That is why we are consulting on changes that will provide local areas, where there is a concentration of such usage, with the necessary tools to help them to strike the right balance between supporting tourism and providing housing for local communities.

Briefly, there are two separate strands to our proposals. The first is the introduction of a new use class for short-term lets and associated PDRs. The C5 short-term let use class will capture those properties that are not someone’s main or sole home, and which are used for the purpose of providing short-term lets. When the use class comes into force, subject to consultation, all dwelling houses will be reclassified. When they meet the definition, they will fall into the C5 use class. There is no planning process attached to that, which means there is no burden on existing short-term lets.

However, short-term lets are not an issue everywhere, which is why we are introducing national permitted development rights that will allow for the change of use from dwelling house to C5 short-term let and vice versa. That will return the position to the status quo ante. Therefore, many people who live in areas where there is no local issue will see no change. Where there is a local issue, the local authority may remove that right by making an article 4 direction. That addresses the point made from the Opposition Front Bench by the hon. Member for Greenwich and Woolwich (Matthew Pennycook). A planning application will then be required with respect to any future material change of use, allowing for local consideration of where additional short-term lets would or would not be acceptable. In that way, local areas would be able to retain more homes for local people to rent or buy. Many colleagues have been calling for this change, and we expect that they will want to make that article 4 direction and will have the supporting evidence to do so.

Our second proposal relates to where people let out their main or sole home. We know that many people do so and that that helps them to manage the rising costs of living and to benefit from the sharing economy. However, there is no defined limit on how many nights someone can let out their own home, which can lead to uncertainty. We are therefore proposing some changes that will provide homeowners with confidence on how many nights in a calendar year they can let out their home—whether that is 30, 60 or 90. If, in future, homeowners wanted to let out their own main or sole home for more than that specified number of nights, planning permission would be required where there is a material change of use.

As many colleagues have said, and I hope anyone listening will note, the consultation closes on 7 June. It is generating a fair amount of interest, and we welcome this timely engagement with hon. Members on this important issue. My hon. Friend the Member for Torbay has challenged the Government, as I fully expected he would do, on when changes can be enacted and brought forward. I reassure him that, subject to the consultation, measures can be brought forward through secondary legislation, but we need to consider fully all the issues raised, not only in this Chamber but elsewhere, in past debates and in the consultation. It is right that we consider all the issues carefully so as to avoid unintended consequences, as many colleagues have said.

Separately, the Government are also introducing a register of short-term lets through the Levelling-up and Regeneration Bill. That will provide a valuable tool for local authorities; it will be a stronger evidence base of short-term let activity in their area, which could help those local authorities better manage the supply of short-term lets. That could also improve consistency and help local authorities apply health and safety regulations across the guest sector. It also gives international visitors visible assurance that we have a high-quality and safe guest accommodation offer.

My colleagues in the Department for Culture, Media and Sport are consulting separately on how the register would work in practice. We are of course working very closely with that Department and others to ensure that officials are looking across the piece at different Government measures, to make sure they are proportionate and complementary.

Those are not the only changes we are making on short-term lets. We have legislated to require from April 2023 evidence of actual letting activity, in response to very sensible concerns from colleagues. The property must have been let for at least 70 days in the previous year before it can be assessed for business rates and therefore qualify for 100% relief. That ensures that more properties contribute to local services through business rates, council tax or income tax regime changes.

Through the new Renters (Reform) Bill, introduced by the Secretary of State to Parliament just last week, we are removing no-fault evictions and will ensure that landlords will not be able to evict tenants simply to turn the property into a holiday let.

Our ambition remains to deliver the housing that communities need. We delivered 232,000 additional homes—a 10% increase on the previous year. I will not take any lectures from the hon. Member for Greenwich and Woolwich on the Opposition Front Bench. I agreed with many of his comments, but on affordable housing, we delivered over 632 affordable houses. They oversaw the worst record of housebuilding since the second world war in their time in government. In Labour-run Wales, which they often point to, they built no council houses between 2014 and 2017, and only 12 in 2019. Let us look at what they actually do, rather than what they say.

[Matthew Pennycook]

Will the Minister give way?

[Rachel Maclean]

I cannot give way; I am sorry. I need to give colleagues a fair hearing.

I thank the hon. Member for Westmorland and Lonsdale (Tim Farron). I note his support for the points made by my hon. Friend the Member for Torbay and for the Renters (Reform) Bill. I thank my hon. Friend the Member for East Devon (Simon Jupp), who highlighted the importance of these measures being in the control of locally elected councils, which they will be. That is what the changes we will introduce will seek to deliver.

The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) challenged us, and said we were not doing enough. I completely disagree with that and reject it. As I have set out, we are acting. The changes to section 21 had their First Reading in Parliament just last week.

My hon. Friend the Member for St Ives (Derek Thomas) challenged me to work closely with other Departments, including the Treasury. We work very closely with the Treasury and also the Department for Energy Security and Net Zero, on some of the measures with energy performance certificates. He was right to raise that issue, and concerns have been raised with me.

As ever, I thank the hon. Member for Strangford. It is very important that we all work together across our United Kingdom, even though these issues are devolved, and that we learn lessons and make policy that affects everybody.

I thank my hon. Friend the Member for Totnes (Anthony Mangnall), who was right to highlight the considerable work going on across Government. I reassure him and any other colleagues with concerns about the Renters (Reform) Bill; we are working closely with him and others to ensure we shape the legislation, as we always do, by listening to different views. My hon. Friend the Member for North Norfolk (Duncan Baker) made a good point about district councils. He has spoken to me about that on many occasions, and we look forward to working with him to understand those issues, and how district councils as well as higher-tier authorities can reap the benefits of the rise in council tax for second homes. My hon. Friend the Member for Truro and Falmouth (Cherilyn Mackrory) gave a fantastic speech. She highlighted how acute the problem is in Cornwall, and how much it affects her constituents not only in St Agnes but elsewhere. I thank her in particular for championing what her local council, under Conservative control, is achieving.

The SNP spokesperson, the hon. and learned Member for Edinburgh South West, highlighted the fact that the planning system is an issue across the United Kingdom. She will know that there is close working at official level to understand the implications of policies and look at evidence. It is right that we do that. The Opposition spokesperson, the hon. Member for Greenwich and Woolwich, challenged me, but he said that he supports what we are doing on balance. I thank him for that, and, of course, we will continue to be scrutinised in these debates and elsewhere. I am grateful for the opportunity to set out what the Government are doing.

[Matthew Pennycook]

Will the Minister give way?

[Rachel Maclean]

I do not believe I have time to give way, because I must allow my hon. Friend the Member for Torbay time to wind up. Unless the Opposition spokesperson can do it in 20 seconds—that may work.

[Matthew Pennycook]

I take that as a challenge. The Minister mentioned affordable housing, which I did not mention. Is she concerned that the Government are failing on their derisory target for affordable homes in rural areas?

[Rachel Maclean]

We need much more time to debate that issue, but I reject the hon. Gentleman’s contention. I suggest that he looks to his own party’s record in office in Wales, as I have already said. I thank my hon. Friend the Member for Torbay for securing today’s debate.