Renters’ Rights Bill
Public Bill Committee, 22 October 2024.
Clive Betts (Labour, Sheffield South East)
I welcome everyone to the first sitting of the Renters’ Rights Bill Committee. We will discuss some procedural matters first. We are now sitting in public and being broadcast. I have a few reminders for Members. Hansard asks you to email your speaking notes please, particularly if you speak according to them—that is even more helpful. Please make sure that electronic devices are on silent. Tea and coffee are not allowed in proceedings; please ensure that all evidence of them is removed from the tables.
Clive Betts (Labour, Sheffield South East)
We now have to sit in private simply to discuss the arrangements for this morning—nothing more—and we will then shortly be back in public with our witnesses.
Examination of Witnesses
Clive Betts (Labour, Sheffield South East)
We are now sitting in public and will move on to declarations of interest. I am a vice-president of the Local Government Association.
Jerome Mayhew (Conservative, Broadland and Fakenham)
I declare an interest as a private landlord.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
I am a landlord but only of registered social housing.
Carla Denyer (Green, Bristol Central)
I am a member of the Acorn community union, which is giving evidence today.
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
I am a vice-president of the Local Government Association and my husband works for an organisation that has funded the Renters’ Reform Coalition.
Claire Hazelgrove (Labour, Filton and Bradley Stoke)
I used to work at Shelter, which is giving evidence today.
Lola McEvoy (Labour, Darlington)
My husband works for Shelter, which is giving evidence today.
Clive Betts (Labour, Sheffield South East)
I welcome both our witnesses to our session to answer questions following their evidence to the Committee on the Renters’ Rights Bill. Please introduce yourself briefly. Members will then ask questions about your evidence.
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Welcome, and thank you very much for attending today. To kick proceedings off, I am interested in hearing your first impressions of the Bill in respect of whether you think there should be a balance between landlords and tenants and whether the current drafting gets that balance right. I would be grateful if you could identify any differences in opinion between professional landlords and those who are sometimes described as accidental landlords—amateur landlords with one or two buy-to-let properties, perhaps for a pension.
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Can I bring you back to your opening statement? You said that there were likely unintended consequences from the Bill in its current form, and that one of those unintended consequences would be an increase in homelessness. Could you expand on why you said that?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q I am butting in again—I apologise. You say that private landlords are exiting the market already; what evidence do you have to support that statement?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q What impact, if any, is that having on rental asks? If supply is being reduced, what is happening to demand?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Ben, you have been patient. Perhaps you could do your best to answer the same question.
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q You have mentioned confidence twice. In anticipation of the Bill, and now that it has been published, are you able to say what has happened to confidence in the real market for both accidental and commercial landlords?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Thank you both very much.
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q I have three questions, starting with court improvements. There is a shared understanding between the sector and the Government that ensuring that the Courts and Tribunals Service is prepared for the implementation of the new tenancy regime is essential. You all know that we took issue with the previous Government’s legislation, which made the tenancy regime hostage to unspecified court reforms.
You mentioned investment, and I wanted to press you on precisely the type of improvements you want to see. You know that, together with colleagues in the Ministry of Justice, we are already taking forward improvements towards digitising the court possession process. What are the metrics you want to see in that process as improvements? On the understanding that —I think you will accept this—not every section 21 notice will read across to a section 8, so there will potentially be a bit of an increase, what do we need to see on the section 8 side and the tribunal side to ensure that the system is fit for purpose at the point that we switch it on?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Your point about sifting is well made. We want to see only cases that require a judgment coming to court.
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q What do you think we should look at for options around improved alternative dispute resolution mechanisms?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Would you accept the corresponding argument from the other side that there are already very low numbers of tenants taking their cases to tribunal, and that if each of those tenants is looking at potentially one, two or three months’ worth of arrears if they challenge a rent increase and fail, that will act as a powerful disincentive against anyone going to tribunal at all?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q That is useful. So you accept the “not backdating” point. I thought you took issue with the backdating and wanted it at the point of—
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Understood. By the way, there is no dispute on the Government side of the Committee as to the fact that the court system is on its knees after the past 14 years.
I have one last general question, which maybe you could come in on, Theresa. There are broad framework powers in the Bill for both the database and the ombudsman. The database will be critical for landlords in understanding their obligations and demonstrating compliance, and the ombudsman will potentially provide routes to landlord-initiated mediation. As we come to flesh out the detail in secondary legislation, what do you want the database and the ombudsman to do? What is the most critical thing, from a landlord point of view?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Thank you.
Clive Betts (Labour, Sheffield South East)
Three other Members are indicating that they want to come in. If we bear that in mind, with the time, we can get everybody in.
Carla Denyer (Green, Bristol Central)
Q My question is a really simple one. Do you think that rents in the private rented sector are currently fair and affordable?
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
Q Theresa, I was struck by your remarks about rising homelessness. You will be aware from the public P1E data about causes of homelessness that the end of a tenancy is the leading cause of homelessness at the moment. I would be interested to know more about why you think any changes to that would actually increase homelessness.
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
Q Just so I understand, your argument is that there will be a reduction in supply, and that will cause more homelessness.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q You said the Bill will increase or reduce confidence, and you talked about the courts. You have not said much about the change to periodic tenancies. In your evidence, you talk about keeping fixed-term tenancies where tenant and landlord agree. What would stop landlords putting every tenancy on a fixed term, and what would be the practical difference of still being able to give two months’ notice yet being in a fixed-term tenancy? How would that be practically different?
Clive Betts (Labour, Sheffield South East)
For the very last question—a short question and short answer—I call David Simmonds.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Mr Beadle, reflecting on what you said in respect of the right of the tenant to challenge rent increases, it seems to me, as drafted, that the consequence is that a tenant will always challenge the rent increase, because the worst possible outcome is that they defer having to pay the higher rent until they get the hearingQ , and the best outcome is that there is no increase. Is that the view of your members?
Clive Betts (Labour, Sheffield South East)
We have to bring things to a close now as the next witnesses are due in. I thank both our witnesses very much for coming and giving evidence this morning.
Clive Betts (Labour, Sheffield South East)
Good morning to both our new witnesses. Could you begin by introducing yourselves? Then I will go to Members to ask questions.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q This is the second time that Parliament has had a go at reforming renters’ rights. Could you tell us how you feel this Bill is different in what it means for tenants, compared to the previous attempt to reform the rented sector?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q May I pursue a couple of points, Mr Bhakta, on the difference between things set out in legislation and the use of guidance? I know that you gave evidence previously on this issue, which has come up not just in the context of this Bill. Could you draw the Committee’s attention to your views about how that has an impact in the real world and how it would most effectively be addressed, given the complexity and, sometimes, the timing and flexibility of some of the issues that that is designed to address?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
indicated assent.
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Thank you both for coming to give evidence to the Committee. Can I pick up on two points? The first is on rent increases. The Government have been very open that we have no plans to implement rent controls, and we have been clear about our reasons why. I take the point that you might have a different view, but we will set that to one side for the moment. What are your concerns around how the process in the Bill could be used by landlords as an effective section 21 by the back door? Perhaps we can have a bit of an exchange about this, but why do you think it does not provide that protection against unreasonable, within-tenancy rent increases?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q But how would you improve the provisions in the Bill?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q To be clear, that is because the tribunal is saying that the previous rent is so far below what it judges to be the market rent?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q To pick up the point made by the previous witnesses, we took the view, which is quite finely balanced, that the potential disincentives to landlords of losing potentially up to three months’ rent increase—though we want to bring the tribunal process timelines down—could be accommodated by the sector, as opposed to tenants being disincentivised to take the case to tribunal in the first case by having the rent increase kick in from the point that the section 13 notice was served.
You heard the concerns from the previous witnesses about how that would operate and the unfairness of that. With your experience, how would you say the new system would operate? We have been very clear that we want more tenants to take challenges to tribunal, though we do not want the tribunal overwhelmed. What would you say to the charge that the decision the Government have made, to put the point of payment when the tribunal makes its determination, will see a flood of cases come in and all advice groups will tell tenants to take every single rent increase to tribunal?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Could you quickly set out to the Committee the process of going to tribunal, for those who are not aware of it? There is sometimes in the commentary this idea that it is incredibly easy, which is put paid to by the very low numbers that go. What is the process? It is onerous in many ways, so am I right that it is a significant jump for tenants to take a case to the tribunal in the first place?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q One final question, just so that I have understood your concern. Do you question whether the tribunal has the expertise to look at all of the sources of data and evidence that are out there in relation to rents, and to make a fair assessment about market rent?
Clive Betts (Labour, Sheffield South East)
Quite a number of Members want to come in, so it would be helpful to have quick questions and answers.
Carla Denyer (Green, Bristol Central)
Q When I met your Citizens Advice colleagues in my constituency, they said, “We can give all the advice that you like, but ultimately, the problem is that money out is more than money in.” I have that ringing in my ears, and that inspires this question.
We all know that rents have been increasing out of proportion to incomes over the last few years, creating this growing gap where one or, at this rate, two generations of people risk never being able to afford to get out of the private rented sector. I am really worried about that, especially as that group ages. Do you think the Bill does enough to address the issue of affordability of rents and the long-term and growing problem of those generations of people, moving into old age, permanently trapped in the private rented sector?
Carla Denyer (Green, Bristol Central)
Q As far as I am concerned, you can talk about rent controls.
Michael Wheeler (Labour, Worsley and Eccles)
The previous panellists believe that the Bill will increase homelessness. My simple question is: do you agree with that assessment of the Bill?Q
Clive Betts (Labour, Sheffield South East)
Gideon Amos and then Jacob Collier—if you both ask quick questions, we can get you both in.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q I have two very brief questions. You will have heard the previous witnesses. Have you seen any evidence of an increase in section 21 evictions since the introduction of the Bill? You will have heard the discussion about fixed-term tenancies and whether they should still be available by agreement between landlord and tenant. Do you have concerns about that? What are your views?
Gideon Amos (Liberal Democrat, Taunton and Wellington)
It was about retaining the option of fixed-term tenancies to two or three years if it were agreed between landlord and tenant.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
rose—
Clive Betts (Labour, Sheffield South East)
Jacob Collier is next.
Jacob Collier (Labour, Burton and Uttoxeter)
How far do you think the Bill will go to give renters greater security and stabilityQ ?
Clive Betts (Labour, Sheffield South East)
That brings us to the end of that session. Thank you very much indeed. We will move on to our next witnesses.
Clive Betts (Labour, Sheffield South East)
Could the panel begin by introducing themselves?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q I have two questions, the first of which concerns the role of the insurance industry in the sector. I am sure that many of us have heard from constituents that most landlords’ insurance requires a prospective tenant to pass a credit check. If the tenant fails, the insurance company will not insure that property if it is rented to that individual. I am interested in the view of your members or participants in your organisations about how that issue impacts the availability of rented properties.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q It is not so much about the affordability assessments. When a tenant applies for a property, the agent will usually, as part of the requirements of the landlord’s insurer, put them through a credit check, and if they do not meet the standard that that insurer requires, the insurer will say, “You won’t get insurance if this tenant is occupying the property.” Therefore, that is the end of that discussion. I am interested in the extent to which you have come across that as an issue.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q I want to ask you briefly about the enforcement regime. It is envisaged that local authorities will be the key enforcers of new rules and regulations. What is your view about the capacity for that and how it should be resourced?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q If I may pursue that final point, do you have any financial modelling about the impact on the homelessness budget that would derive from the Bill?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Thank you, gentlemen, for coming to speak to us this morning.
It would not be a Bill Committee evidence session if every interest group was not telling us that it had a way to improve the Bill in some way and from different perspectives. We have heard a lot this morning about the various concerns and how they are being addressed. In general terms, however, particularly given your concerns about the previous Government’s Renters (Reform) Bill, do you think this Bill strikes the right balance and levels the playing field between landlord and tenant?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Let us come on to that, because the Government obviously will argue that the provisions in the Bill, and how we have overhauled and strengthened it from the perspective of tenants, are designed precisely to help people like Ayesha, who are struggling with the insecure and unfair system that exists. We take no issue with Tom’s analysis of the problem; that is why we designed the Bill in the way that we have.
On rent increases, Ben, I understood that you were effectively talking about a cap—to the level of inflation or wage growth. A previous witness rightly drew our attention to the nuances around different forms of rent control. Given the evidence out there across the world, which I have looked at in great detail, do you not have any concerns about the potential negative impact on supply discouraging investment into the sector? We have heard about the supply challenges, impact on property standards and the very practical concern that if we implement an inflation-linked or wage growth cap, every single landlord in the country will raise rents every year to that cap, whether they would have done so under the current system or the system we propose or not. You must engage with the challenges on the other side from the measures you propose.
Matthew Pennycook (Labour, Greenwich and Woolwich)
That was under the old system, and we want to transform the system, but I take your point.
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Given the time we have left, can I move us on? An important element of the Bill that often gets overlooked is rent repayment orders. We had quite a sensitive discussion on this matter under the previous Government’s Renters (Reform) Bill, but my experience has been that enforcement is particularly effective where you have local authorities geared up and tenants able to exercise their rights through rent repayment orders. Can you offer a general comment on whether you think we have gone far enough in trying to expand and strengthen the rent repayment order arrangements under the Bill?
Clive Betts (Labour, Sheffield South East)
A large number of Members want to come in, so brevity would be helpful.
Lola McEvoy (Labour, Darlington)
Q It is really interesting to hear your evidence. Thank you for raising Ayesha’s story, because it makes a real difference to us as Committee members. Good landlords and good tenants are welcome in this. What do you see as an opportunity for the people you represent to support the work of the landlord database? What is the best way that we can ensure it affects people such as Ayesha?
Sam Carling (Labour, North West Cambridgeshire)
I have a couple of things to ask. First, I would like to hear your views on the arguments that the first panel of witnesses made that assured shorthold tenancy abolitions would remove some security from tenants, particularly students but also people who have longer tenancies.Q
On your point about the idea of limiting rent increases to wage growth or inflation, how would you respond to the counter-argument that it might lead to landlords setting a much higher baseline rent between tenancies, knowing that they would not necessarily be able to increase the rent as much within a tenancy?
Claire Hazelgrove (Labour, Filton and Bradley Stoke)
Q Thank you both for joining us today. It is so important to hear renters’ voices here in Parliament as we discuss this crucial Bill. A simple question from me: do you believe that, as drafted, the Bill will improve the lives of, and make things fairer for, the millions of renters across our country?
Carla Denyer (Green, Bristol Central)
Q You will notice that I have a rent-affordability theme, but this is probably my last question on that theme. I am aware that the Renters’ Reform Coalition would like to see a national rental affordability commission that looks into options for rent controls. If we reflect on what a previous panellist said about rent controls being not a single thing but an umbrella term for a wide spectrum of possible interventions, Tom, or Ben if you have anything to add, would you like to expand on how a national rental affordability commission might work to figure out what the best solutions would be?
Clive Betts (Labour, Sheffield South East)
The Minister will ask the final questions.
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q To continue the theme around rent controls and rent stabilisation, the reforms introduced in Scotland have had lots of benefits, but they introduced rent controls in a way that we are not proposing to through this Bill. Given that you have said we should not worry in any way about rent controls of any form—if I have summarised you correctly—what would your explanation be for the fact that rents have risen faster in Scotland than anywhere else in the UK, including London, since those reforms were introduced?
Matthew Pennycook (Labour, Greenwich and Woolwich)
That issue is highlighted in the report.
Matthew Pennycook (Labour, Greenwich and Woolwich)
But you do not dispute that rents have risen faster in Scotland than anywhere else in the UK since those rent controls were introduced—
Clive Betts (Labour, Sheffield South East)
Order. Sorry, but we have hit the deadline for this session. I thank the witnesses very much for coming. We now move on to our final witness.
Examination of Witness
Clive Betts (Labour, Sheffield South East)
This is our final witness; please introduce yourself for the benefit of Members.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q May I ask about the role that the landlord insurance industry plays, particularly in the context of people being able or unable to access accommodation? Reflecting a question put to an earlier witness—if a landlord is insured and the insurer says that to rent the property to the tenant they have to meet a certain standard of credit check, and that that has to be done or they will not insure them if the property is rented to that tenant—do you have a view on how the Bill might address that issue?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q That is helpful, and it leads me to my next point, which is about the evidence you gave to the Levelling Up, Housing and Communities Committee stressing the need for there to be clarity of jurisdiction. Does this Bill provide that clarity? If not, what improvements need to be made to ensure that clarity is there?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Thank you. May I pursue that last point a little further? One of the issues that has been raised in the evidence so far is about the tenant’s right to challenge rent increases. It is helpful that you have introduced the point about service charges. Clearly, one of the options for a landlord who cannot get the money through a rent increase is to look to secure it through a service charge increase instead. How would you see the current set-up and the set-up proposed by the Bill addressing that kind of issue?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Richard, thank you for your time this morning. I have put it to other witnesses that, in general, the potential of the database and the ombudsman to make a real difference as part of the new system is often underplayed and I do not think it gets enough attention. You rightly made the point that there is a spectrum between “must” and “could”, but the intention is very clear, on the tenant side, to provide access to services to deal with complaints, and there is potential on the landlord side around landlord-initiated mediation and the role the ombudsman could play there. Can you give us your best sense of how much the new PRS ombudsman could alleviate pressures on other parts of the system, including the courts?
I have a follow-up question; I will ask them in one go, Mr Betts, and leave more time for others. We have been very clear already that the new ombudsman will need to work collaboratively with others to resolve complaints and that will be set out in statutory guidance. What do you think needs to be included in that guidance to ensure, in particular, that the ombudsman is working effectively with local authorities?
Harpreet Uppal (Labour, Huddersfield)
I have a really quick question. I just want to get more information on how you see your role in terms of how you interface with the public, as you will potentially be taking on this additional role for private rented sector tenants. What more do we need to do to make sure that tenants are very clear about their rights and how they can access your serviceQ ?
Claire Hazelgrove (Labour, Filton and Bradley Stoke)
Q Thank you for joining us today. I am looking at your impressive background: you have clearly done a lot of great work on homelessness and in other areas, whether at City Hall addressing rough sleeping, or on the social impact bond on homelessness. With that lens in mind, do you feel that the Bill will deliver on the Government’s aims to give renters greater security and stability and to reduce the risk of homelessness? Is there anything you want to add along those lines?
Carla Denyer (Green, Bristol Central)
Q I have three questions, but they are all yes/no, so you can be as brief as you like. First, do you agree with a previous panellist that the landlord licensing rules need to be loosened so that councils can have more discretion and flexibility to apply, for example, landlord licensing across their whole area rather than just bits of it? Secondly, do you think that the potential penalty of £7,000 that local authorities can apply is sufficient to act as a deterrent? Thirdly, do you think that the Bill goes far enough on housing quality, and especially energy efficiency, given that, as we have heard from previous panellists, homes in the UK are some of the worst in Europe on energy efficiency, and the private rented sector is the worst within that?
Clive Betts (Labour, Sheffield South East)
I have no Members indicating to me that they have further questions, so that brings us to the end of the morning session. The Committee will meet again at 2 pm this afternoon in this room.
Examination of Witnesses
Christopher Chope (Conservative, Christchurch)
Good afternoon and thank you for coming along. As this session has to end at 2.40 pm, with no Chair’s discretion in relation to that, I suggest that we get started straight away. May I ask you to introduce yourselves briefly?
Christopher Chope (Conservative, Christchurch)
Thank you very much. David Simmonds will ask the first question.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
I would like to ask you about the impact that the Bill will have on first-tier tribunals and whether they are ready for the potential consequences. Perhaps we can develop that to ask about the interactions with ombudsman services as well, with one of the issues being how renters whose rights are infringed, or where there is a dispute, can achieve reasonable restitution, whether that involves going to court, a tribunal or the ombudsman serviceQ49.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Thank you. That is a really helpful point. Are the terms of the new possession grounds introduced by the Bill reasonable for both tenants and landlords? In summary, do you feel that the Bill gets the balance right?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Thank you all for coming to give us your expert opinion. I have two questions, one specific and one general. First, to follow up on grounds 1 and 1A, I understand the general push for all grounds to be discretionary, but we took a view that these should be mandatory, in terms of getting that balance right. But I very much hear the points being made about evidential requirements.
Could I ask you to draw out a bit further how you expect this to work? In a sense, when we talk about discretionary grounds, we are always told, “Let’s trust judges”—that was certainly the case with the previous Bill. In a sense, what we intend to do here is trust judges’ judgment on whether those grounds have been used appropriately, and we would expect the type of evidence that they look at to include things like a letter instructing solicitors or an affidavit. But do you not expect the courts to operate in that way on the basis of the Bill? Do you expect them to act in a more light-touch way, as you have suggested? It is not usual practice for Governments to force the courts to consider certain types of evidence, and if that is the case—if you accept that—where do we go to try to influence the courts to look at certain categories of evidence, to ensure that these grounds are being used appropriately?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Would you accept that this is less of a problem if we are confident that the 12-month no re-let period is enforceable? Then, in a sense, there is a serious disincentive for landlords to act spuriously.
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q That is very helpful. My second question is more general, which will give each of you the chance to range a bit more freely. I know that you were engaged with the previous Bill, so you will know the debates that took place. It was very much our intention with this Bill to address the various deficiencies, omissions and, critically, the loopholes that existed. It would be good to get your views on whether you think we have broadly done that, and if not, whether there are any remaining loopholes in the Bill that you can see more disreputable landlords trying to exploit.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
YouQ said earlier that the first-tier tribunal is working better, but did you really answer the question of whether you feel the Bill will increase pressure on the tribunal and the courts, and whether they are ready for it? Have you seen any evidence of an increase in funding, given this impending legislation?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Just to follow up on that point, none of us knows what the increase in tribunal work will be, but there will be an active incentive not to agree a rent increase because you have your rent, it is going to go up, there is the delay of the process, and then at the end, the worst that can happen is that you get the rent increase that you were going to get anyway. Why would not tenants always, as a matter of course, put off the evil hour? They would get six, eight, 12 or 15 months free.Q
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q But even on that basis, you are loading on to the landlord a requirement to create the papers and a period in which the tenant has to respond —I am guessing 14 or 28 days, but we do not know yet. Then there is a period of consideration. What is it currently? Even if it is dealt with on the papers, what is an average period of deliberation?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q But what it is actually doing?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Okay, so three months of avoiding a 20% rent increase. Everyone will do it, will they not? Why would they not?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Okay, I accept that answer. Am I right in thinking that there are about 4.6 million private tenancies out there?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q So if everyone does it, that is quite a lot of extra work. Even if 25% do it, it is 1 million papers-only cases a year.
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Just on that, every landlord—or the vast majority of landlords—increases the rent annually to take account of inflation and other issues. Is that not right?
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
I want to ask about condition and the decent homes standard. Will you elaborate on how you think that bringing the decent homes standard into the private rented sector can most effectively be enforced? What might you anticipate going forward from the way that the Bill is draftedQ ?
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
Q You rightly highlighted that tenants will rely on local authorities to pursue enforcement and that there is a very variable standard among local authorities for doing so, although you mentioned that tenants would not be able to take enforcement action themselves. You have alluded to a possible duty—that is a question that you have thrown out there—but what other alternatives might there be?
Carla Denyer (Green, Bristol Central)
This is my first time on a Public Bill Committee, Sir Christopher, so I might make a mistake with process. May I briefly point Jerome at the answers provided in written evidence and in earlier verbal evidence, which I felt answered the question already? In terms of, “Surely, won’t all tenants do it?”, I think we heard a clear answer that, for the vast majority of the population, anything to do with courts is a terrifying and bureaucratically faffy process that they will not want to engage with. On “Won’t landlords just max it out”—
Christopher Chope (Conservative, Christchurch)
Order. I am going to stop you there, because this is an opportunity for Committee members to ask questions of the people who have come along as witnesses. We have limited time and once we start opening up a debate with other Committee members, it will be at the expense of being able to hear what we hope is, and is likely to be, very valuable evidence. If you have a question for any of the members of the panel, I shall be happy to take it, but if not, I suggest that you have your arguments with other Members when we get into full line-by-line consideration, when there will be plenty of opportunity for you to intervene on another Member with whom you disagree.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q I would like to ask the panel for their views on issues around insurance. You can get different kinds of landlord insurance; some are optional and some are not. Some provide you with a guarantee to pay the rent if the tenant fails to pay in time. Some insure against damage caused to your property by a tenant while they are occupying it. Others may be insurances that are required as a condition of a mortgage, such as buildings insurance. There may also be contents insurance, which is normal but not strictly legally required.
I know there is some pressure around issues such as tenants with pets and making sure that they have a right to occupy. A landlord may discover that the cost of insurance is significantly higher because of the pet or because of some other circumstance relating to the tenant —for example, they might have a poor credit history and are therefore not insurable for failing to pay the rent via the landlord’s normal insurance company. I am interested in how you see the Bill dealing with that issue and ensuring that tenants are not effectively barred from applying to rent particular properties because of those insurance issues and also that landlords do not find that the insurance they must have is so expensive as to effectively make their business as a landlord impossible.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q The question is about the impact on supply. A prospective landlord may decide from the outset to insure their rental income from the property, but after the required credit check on a tenant, the insurer may say, “We won’t insure this tenant. If you put that person in the property, we won’t cover it”—for instance, if they had a bad credit history. At the moment, the tenant and landlord can negotiate a higher deposit or a similar way to deal with that, but if that is precluded and you cannot go for a higher deposit or rent in advance or different arrangements fixed in the contracts of guarantors, the result may be that that person cannot rent a property because they cannot achieve the relevant credit check. I am keen to ensure that people who are in that situation—I have had constituency examples—do not find themselves effectively excluded from the private rented sector because they become uninsurable as tenants.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q What I am hearing from constituents affected by it is that rent in advance is the method by which they get around this, as well as guarantors potentially, but if the Bill removes that scope, then the one route they have to negotiate—because of their bad credit history—is effectively removed and they are potentially excluded from that market. I am just trying to understand whether this is genuinely a problem.
Lola McEvoy (Labour, Darlington)
I want to interrogate further what opportunities you see the landlord database providing for private renters and good landlords as a result of the Bill. Your area of expertise is vast and it is a joy to listen to you contribute, so I would like you to elaborate on any positive outcomes you think could come from the Bill—we want to make sure those can happen.Q
Christopher Chope (Conservative, Christchurch)
We have time for one quick question, if anyone has one.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q We have the decent homes standard for social housing, and the Bill would introduce it for private housing. That seems to me to leave Ministry of Defence housing in the middle. Can you think of any other categories of housing that would not be covered by the decent homes standard?
Christopher Chope (Conservative, Christchurch)
That brings to an end this evidence session. I thank the witnesses for their contributions.
Examination of Witness
Christopher Chope (Conservative, Christchurch)
Welcome; please introduce yourself.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Your organisation previously warned that young people could be forced out of rural communities due to a lack of affordable and available homes. How do you feel this Bill will affect that situation?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Thank you very much indeed; that is helpfully clear on the point about supply. In written evidence you have warned that some proposals to reform the private rented sector could risk overcorrecting in favour of tenants. Do you still have those concerns about the Bill in its current form?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q I have one final question. I would like to explore the specifically rural and agricultural aspect of this. I know it is common in rural areas for properties to have things like agricultural worker conditions on their occupation and for properties to be provided with a licence to occupy rather than through a tenancy in the traditional sense, because the accommodation is connected with the work that the person does at that specific location. What is your view of how the Bill will impact or deal with those types of situations?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q In response to the previous Government’s White Paper, “A fairer private rented sector”, you questioned whether we should look to introduce a decent homes standard to the private rented sector. Is that still your view and, if so, could you elaborate on why?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Sorry to pull you up, but we have not consulted on it yet. We have not told you what it consists of yet; you are pre-empting it. Is it the principle?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Thank you.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q You mentioned the planning system earlier. Do you see any risk, because of the perceived unattractiveness of the new system, that there will be an increase in short-term holiday letting? The Liberal Democrats want to see the use class brought forward for holiday lets. Would you support that in terms of controlling it in rural areas, so that councils and communities can control the amount of Airbnb-type short-term holiday lets in their areas?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q Building on that, we heard from a few of the witnesses this morning that one of the key concerns of the private rented sector is the delay associated with the recovery of property through the Courts and Tribunals Service. A moment ago, you said that some of your members are waiting 12 to 18 months, during which time they do not get any rent and it is an asset that is not working for them. I would like to drill into that a little further to understand fully why it is that landowners are already leaving the market and why that might happen in the future, and what impact you assess that will have on future rents.
On one side of the argument you could say, “Rents will go up as supply decreases.” Do you think that will be an unintended consequence of the proposed legislation? On the other side, which I invite you also to consider, is the question of whether, if you increase foregone earnings—that is, increase the losses associated with being a tenant—because the time required by court processes will be extended because of increased demand, that increased loss will filter into increased rents in the long run.
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q I am straying into my memory now, but I think the financial exemption was set at £9,000 for the costs of an upgrade, above which you are exempted as a landlord.
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q What has happened with that? If the level is £10,000, does that feel about right to you? Should it be higher or lower, or should there be an improvement in another way?
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
Q I want to come back to what the Minister said about condition and the introduction of the decent homes standard into the private rented sector. I want to understand this. I think you were saying there is an in-principle objection to the standard but a recognition that the actual standard has not been published. At the moment, the position you would take is to rely on the housing health and safety rating system and the homes fit for human habitation provision. My experience, and I am sure that of many representatives, is that it is difficult to drive up the quality of homes with the HHSRS due to how long it takes to force landlords to acknowledge where they are failing on a particular hazard. Could you elaborate on why you think relying on HHSRS, or even the homes fit for human habitation provision, would be more effective than the decent homes standard both for consumers—tenants—and for landlords in terms of the condition of their assets?
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
Q Let us take heating—
Christopher Chope (Conservative, Christchurch)
Order. I am going to bring in Jacob Collier because we are running out of time.
Jacob Collier (Labour, Burton and Uttoxeter)
You have spoken about your members being responsible landlords, and a previous witness said the Bill would raise the bar for good landlords. What are your thoughts on the national landlord database and how that will raise the standards?Q
Christopher Chope (Conservative, Christchurch)
Rachel, you have half a minute for a quick question.
Rachel Blake (Labour/Co-operative, Cities of London and Westminster)
Q Let us take heating as a hazard. What do you think the effective enforcement of heating, or cold, as a hazard would be?
Christopher Chope (Conservative, Christchurch)
Thank you, everybody. Thank you for coming along and giving us a bit of your experience and knowledge. We will move on to the next panel.
Christopher Chope (Conservative, Christchurch)
Straighten your ties, because we are now going to be on Zoom. We have until 3.20 pm. Please can you introduce yourself?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Particularly given your experience in Scotland, it is valuable to have you as a witness. Your organisation talks about wanting to improve the effectiveness and affordability of the housing market. To what extent do you think the Bill will contribute to achieving those goals?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q That is enormously helpful, because clearly, the Bill is very similar to the legislative underpinning of what is going on in Scotland. We are also interested in how it will impact on regeneration projects and the ambition to deliver more housing—we know, for example, that the build-to-rent sector is interested in that. So we are interested in your perspective on how the Bill will impact the ability to deliver regeneration projects, or how the similar situation in Scotland has done so.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Final question: what are the main consequences you expect from the Bill for residential landlords and tenants in the private rented sector?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Perhaps I can just check this, because I am not entirely clear: did your organisation author the Nationwide Foundation report?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q So I think it would be worth teasing something out, because it was an interesting report. To touch on what you just said, I took from the report that the tenancy reform in Scotland seven years ago had a number of benefits for tenants, but it has not adversely affected landlords. As you say, the system has bedded in and they have adapted to it. The shadow Minister said that this is largely the same set of reforms that happened in Scotland, so could I encourage you to touch on any differences between the approach we are taking in this Bill and the Scottish experience? Could you then perhaps touch a bit more on the specific impact of the rent control measures in Scotland—which we are not proposing—on that supply issue? I recognise that there is a wider supply question about the housing market in Scotland more generally, but what did your research suggest was the impact of the rent control measures that were introduced in Scotland?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Yes, that is very useful. Thank you.
Carla Denyer (Green, Bristol Central)
Q Since you are an expert on the Scottish system, I will make use of your expertise; I want to ask more about rent controls. In my understanding, when the Scottish Government initially brought in rent controls in tenancy, that was because that was all they had the power to do at the time—they brought it in using existing legislation, initially during the cost of living crisis triggered by the pandemic—and ultimately, that they might do something different. You mentioned the Bill going through at the moment. In your view, is there an inherent problem with rent controls, or could the problems that you described be remedied by having some kind of controls between, as well as within, tenancies?
Jerome Mayhew (Conservative, Broadland and Fakenham)
Q You mentioned unintended consequences, a topic that I have come back to repeatedly today. We heard evidence earlier that rents in Scotland have outpaced those in the rest of the United Kingdom quite considerably in, I think, the last five years. You mentioned the 2022 rent control legislation and the impact that that has had on rents. If you can strip that out in your own mind and give us an assessment of what impact rent reform has had on rents over the past seven years, can you give the Committee a flavour of whether rents have gone up as a result, stayed the same, or reduced?
Lola McEvoy (Labour, Darlington)
Q Just for the eradication of any doubt, are you under the impression that the introduction of rent controls has led to an increase in rents?
Lola McEvoy (Labour, Darlington)
Q So you cannot say that all average rents have increased because of in-tenancy rents, and you do not have the data on that, but in terms of advertised rents, since the introduction of rent controls, you have seen an increase in Scotland?
Lola McEvoy (Labour, Darlington)
Thank you.
Christopher Chope (Conservative, Christchurch)
Would anybody else like to ask a question, very quickly?
Rebecca Smith (Conservative, South West Devon)
I am interested in the experience you have on regeneration. Social housing ends up with quite a lot of funding going towards regeneration in a way that the private rented sector would not necessarily automatically qualify for, in my understanding. What do you think the provisions of the Bill would be on regeneration—Q [Interruption.] Oh, we have covered regeneration. I am interested specifically in enhancements that you might have in a social housing setting that would not automatically be available for private rented housing. Have you seen anything that the Bill might have an impact on in relation to that?
Rebecca Smith (Conservative, South West Devon)
That is fine; thank you.
Christopher Chope (Conservative, Christchurch)
Thank you very much indeed for your evidence, and I hope the weather is good in Scotland.
Christopher Chope (Conservative, Christchurch)
Good afternoon. Thank you very much for coming along. Would you like to introduce yourself, please?
Christopher Chope (Conservative, Christchurch)
The acoustics in this room are notoriously bad, so it would help us all if you were able to keep your voice up, please.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q The situation with student rentals has been a much aired part of this process so far. Can I ask a couple of questions about the way in which the Bill interacts with students? The first is around the Bill exempting purpose-built student accommodation from the move to periodic tenancies. We have heard mixed feedback about the impact of that on students, particularly on those who may know they will be in a particular place for two years, let us say, and might wish to secure a property for that period. Do you agree with that exemption, or do you have other views that you can share?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Do you have a view of how that impacts on, or relates to, property that has been converted to be student accommodation, as opposed to that which is purpose built? Many of us have universities in near proximity to our constituencies, where often a large number of houses have been turned into student accommodation. The university would not wish to see that accommodation lost to the student market, although the accommodation is not purpose built.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Propertymark called for new grounds that would allow landlords who rent houses—HMOs, or houses in multiple occupation—to students to seek possession in advance of the academic year. Do you agree with that suggestion, or do you have an alternative way to address the concerns that you outlined?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q I would argue that we are giving students special treatment. To be entirely candid, I took some time to come to a view on what we should do in this area. We want students to benefit from the new system, but it has unique characteristics and we want to protect the supply of student accommodation. I do not know whether you are familiar with the previous Government’s Bill, but we have narrowed the grounds for possession in an attempt to capture a typical student and not a non-typical student—say, an adult learner with children who is living in a more non-typical student property. Do you think we have that right? Are there any ways in which you would tweak it?
If we were looking to take action on sign-ups in advance, what is a reasonable period when landlords should be able to ask students to sign up in advance that does not, as you say, force them all to sign up far too early and in ways they may regret or have to re-examine? What is an appropriate period in which a sign-up would be reasonable? Lastly, do you understand why the sign-up arms race, as I might put it, has developed? It is hard to find an explanation for why all landlords are locked into a cycle of earlier and earlier sign-ups; it seems to have developed organically. Could you outline why you think that problem has arisen in the first place?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q That is very useful. I have one final question. The previous Government did this as well, but the case for a specific ground for possession to ensure that the cyclical nature of the student market continues arose from engagement that said that we had to treat this differently. We do not have much data, and I wonder if you have any from your experience or what you pick up on anecdotally. How often do you think the ground for possession would actually be used? If I am being entirely candid, in my mind I can imagine it sitting there and maybe being of use on the odd occasion, but broadly I do not think that students overstay. Am I right in thinking that?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Their yields are quite generous as they are, compared with what is normal.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q I have raised this already, but you seem to be suggesting that to extend the exemption you would have a special student tenancy. Is that right? Could you clarify if you would like to see that in the Bill? If not, if the Government were not willing to create a new tenancy, how would you draw the line in terms of bringing in all student accommodation?
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q On that point, how would you define “all student properties” in the Bill?
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q So would it be any property where one of the tenants was a full-time student? How would you define that?
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q So that would be the control?
Sam Carling (Labour, North West Cambridgeshire)
I wanted to pick up on a couple of points from your written evidence on joint tenancies. Under the new Bill, if one student leaves, you have the problem where the whole tenancy might end up collapsing. Do you have any thoughts about what the Bill could do to address those concerns, save the arguments that you have already made about having a specialist student tenancy? Also, on that point about the student tenancy, would you agree that there is a bit of an issue at the moment Q wherein quite a lot of students drop out of university, which is an issue in and of itself, but are locked into tenancies? Would this Bill address that situation?
Sam Carling (Labour, North West Cambridgeshire)
Q It was about the point that quite a lot of students drop out of university, so there is an issue, on the flipside of some of the points you made before, about those students being locked in. Would you agree that this Bill addresses that?
Carla Denyer (Green, Bristol Central)
Q I have a specific question on the new grounds for possession that we were just talking about. I interpreted the wording of the new ground that specifically gives the power to recover possession between June and September as potentially an oversight. One of the written statements we received—RRB 04, for Committee members—highlights that as well. The ground seems to fail to consider other kinds of students, such as people on a one-year Masters that starts in January, or nursing students who are often studying over the summer. I know, as I am friends with some of those people, that they found it hard enough to get housing on a non-traditional term as it was, without giving landlords a particular power to kick them out halfway through the summer when they are halfway through their course. Do you share that concern, and do you have suggestions for whether that should be changed?
Christopher Chope (Conservative, Christchurch)
I am afraid we do not have the flexibility to allow this question session to go on any further. Thank you very much for your attendance.
Examination of Witnesses
Christopher Chope (Conservative, Christchurch)
Q This panel can go on until 4.20 pm. Perhaps we could start off with Timothy Douglas introducing himself.
Christopher Chope (Conservative, Christchurch)
And Suzannah Young, who is joining us on Zoom.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q This is a very broad-based panel with different perspectives. My first question is about the impact on housing associations. Could you each give us a brief introduction from the perspective of your organisations on what you think the impact of the Bill will be, in particular on the supply of private rented sector homes in the UK?
Christopher Chope (Conservative, Christchurch)
Suzannah Young, do you wish to add to your initial remarks?
Christopher Chope (Conservative, Christchurch)
I think we will stop there for the moment and hear some further questions.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q I have two related questions. First, as has been said by all three of you, there will be an ombudsman, a tribunal and a court, all of which will have a slightly different role. I am interested in how you think the Bill can provide clarity for both tenants and landlords on where to go with different issues, thereby ensuring that they can enforce their rights and deal with things appropriately.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Briefly, there is another subset of a broader issue around things like the decent homes standard. We have heard from various sources of evidence that there is a need to ensure that property owners have the time and necessary support to achieve that. We know in the rest of the UK housing stock that that can be a challenge due to the physical nature of it. What are your views as to how the Bill addresses that issue?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Melanie, can I address a specific question to you about suppliers? There has been a lot of discussion today about the mismatch between supply and demand. We have touched on the provisions in the Bill about how tenants can challenge within-tenancy rent increases and so on. In terms of overhauling the private rented sector, the Bill is part of a wider transformation of the housing system that we want to carry out. There is absolutely a chunk of private renters, particularly in the bottom half of the market, who should be in social rented housing, and we want to build more of that, but we also want to grow future supply in the PRS. What do you think the Bill will do specifically to build-to-rent providers? Do you think they will accommodate themselves to these changes? Are there lingering concerns that you think will impact on investment in that future supply and professionalising the private rented sector as we grow it?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q While I have got you on that point, we heard from Ben Beadle earlier a view that landlords would adapt to the date payable of a rent when challenged—I think this is what he implied—by changing the point at which they serve their section 13 notices to perhaps account for that lead-in time. What would you expect to see? Would annual increases be standard or given at a particular time? How do you think that the sector, build-to-rent and the more typical cottage landlords would adapt to that change?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Can I challenge you on that point, because I have never understood it? Under the rolling, periodic tenancy system that we are introducing, a family that moves into a property can determine when they leave. As long as there is no antisocial behaviour, for example, they can decide when they leave, so they have all the advantages of a fixed-term tenancy. I am not picking up on this cry among tenants for fixed-term tenancies. Perhaps you can elaborate on where you are coming from on that point? What are the additional advantages that are not provided by this rolling, periodic system?
Matthew Pennycook (Labour, Greenwich and Woolwich)
No, not investors. You made a point about tenants.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q We covered extending the grounds to more than three sharers in the previous evidence session, and I think everyone knows where I stand on that. If you are right that the biggest effect of the move away from fixed-term tenancies is on investment into the build-to-rent, or corporate, sector that you are talking about, and if the Bill were to allow fixed-term tenancies—perhaps the first tenancy of a build-to-rent new build—would that help the sector up from delivering 15,000 units to 30,000 more units?
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q In response to the Minister, you did also mention the corporate sector—but it does not matter. My point is, can you comment on retaining that fixed-term option for the first tenancy in new build premises? Would that deliver some of the incentives that you want to see?
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q Of what length?
Connor Naismith (Labour, Crewe and Nantwich)
My question goes back to the decent homes standard, and the first part of the question is potentially more for Suzannah. What insights do you have into the impact of the application of the decent homes standard in the social rented sector and then, potentially, on everyone else? How do you see it translating across to the private sector, in terms of the impact on the standard of homes thereQ ?
Rebecca Smith (Conservative, South West Devon)
Q This is a question mostly for Timothy. At the beginning of your contribution, you mentioned the unintended consequences we see from the Bill, and you gave the example of landlords departing the market. I know there is often the argument that they are still providing a home somewhere else if those properties get purchased. I am interested in the statistics you might have—representing both estate agents and landlords—on the impact on the housing market in full. How many properties stay in the private rented sector? Do they move from one landlord to another, or is that ultimately a property that is then lost permanently from the private rented sector?
Christopher Chope (Conservative, Christchurch)
We are going to have to go on to the next question, because we are running short of time. I call Michael Wheeler, who has been waiting.
Michael Wheeler (Labour, Worsley and Eccles)
Thank you, Sir Christopher. I appreciate that Suzannah was asking to come in, and my question is actually for her, so this might give her an opportunity to respond. It is a slightly broad question: what concerns might housing associations have around the Bill? Could any aspects of it be constructively improved to address those concernsQ ?
Christopher Chope (Conservative, Christchurch)
Thank you very much, and I thank all the panel for the evidence that they have provided to us. I am sorry that we do not have any discretion, but we now have to move on to the next panel.
Christopher Chope (Conservative, Christchurch)
We have Dr Dawson here physically and Councillor Hug on Zoom. Could you please introduce yourselves briefly?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q I have two questions, and perhaps we can start with the one that is relevant to both organisations. Both of you have expressed concerns about the enforcement burden that provisions of the Bill would place on local authorities. Although there is a new burdens protocol out there, could you share your views about the level of funding that would be required to enforce correctly and how that would best be financed?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Councillor Hug, do you have anything to add to that point?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q That is a point I made on Second Reading, so I entirely agree.
Under the Homelessness Reduction Act 2017, local authorities are significant users of the private rented sector for people who would otherwise be at risk of homelessness. It is common for local authorities to pay rent-in-advance deposits and use various other guarantee schemes to secure private rented sector homes for people who would otherwise not be able to access a home. Councillor Hug, I am interested in how you think the Bill would impact on the performance of that duty.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q You froze for a moment there. We missed about the last 20 seconds.
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Could we address the Homelessness Reduction Act 2017 element? It is common for local authorities to engage with private rented sector landlords and act as guarantor to secure a property for someone who would not otherwise be able to access that property but would be put into temporary accommodation by the local authority. It is a better solution for the tenant and less costly for taxpayers. If the Bill were to prohibit local authorities from acting as guarantor in that situation, would that have an impact on their ability to secure those properties?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Can we move on to licensing schemes? I know there has been much debate in the local government world about them, and I have seen at first hand their operation in London. Would you be able to say a bit about the barriers that exist at the moment to the implementation of licensing schemes? Do you think the Bill sufficiently addresses those barriers?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Could I follow up on the point about local authority enforcement? The Bill introduces an effective, consistent and proportionate framework for enforcement, but we have to ensure that local authorities can enforce in practice, and we know that there is variation across the country in their ability to do so. There is also the wider context about resourcing of local government over the recent period. We are clear that we want to primarily target along the “polluter pays” principle, with bad landlords covering the cost of their own enforcement.
You mentioned the fines—£7,000 for first or minor compliance issues, and £40,000 for more serious ones— and they can be levied repeatedly. I just want to get a sense of how much of the cost of enforcement you think those fines can account for. We recognise that it will not be enough, and that the new burdens principle will have to operate, but have you got a sense of it in terms of, as you say, how many cases are resolved before it reaches that point? What will be the willingness under the new system to levy these kinds of fines, and what proportion of the enforcement costs do you think, on average, local authorities might see those fines account for?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q I want to pick up on a specific point about the antisocial behaviour grounds for possession. Adam, the Local Government Association has expressed concerns about the definition of antisocial behaviour. I wondered whether that was linked to the previous definition, which we have amended.
Matthew Pennycook (Labour, Greenwich and Woolwich)
You are nodding vigorously, which is a good indicator, but have you got views more widely about the changes that we have made on antisocial behaviour—about being able to take action immediately, for example, or considering the implications on other people in a household, as well as that switch back to “likely”, rather than “capable of”, which we felt was too broad under the previous legislation?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q We have spoken about the database before. I think it has the potential to be an incredibly powerful tool on a number of fronts to the benefit of tenants but also local authorities in bearing down on more disreputable landlords, including criminal landlords. Can you give us a sense of what you think the sector needs in terms of detail coming through in secondary legislation for that database to be able to operate most effectively for local authorities?
Rebecca Smith (Conservative, South West Devon)
Q My question slightly expands on what David said earlier about the burden on local authorities. The new building safety legislation, for example, was really good news, but it had an impact on the level of staffing available to carry out roles, because of the conflict with the private sector, which might offer people higher salaries. Do either or both of you think that there is a similar risk with this Bill? What could we be doing to ensure that we have the right lead-in time and adequate staffing? Is there an immediate solution that we could learn from that previous example?
Naushabah Khan (Labour, Gillingham and Rainham)
I have a question about the wider implications of the Bill and the impact on local authorities. For example, it would be helpful to understand whether you feel the abolishment of section 21 will have a wider implication, and how it might help to tackle some of the bigger homelessness challenges that local authorities are currently seeing—or whether it will have an impact at allQ .
Christopher Chope (Conservative, Christchurch)
I call Harpreet Uppal.
Harpreet Uppal (Labour, Huddersfield)
My question has been answered already.
Christopher Chope (Conservative, Christchurch)
All right. In that case, I call Claire Hazelgrove.
Claire Hazelgrove (Labour, Filton and Bradley Stoke)
Dr Dawson, I was thrilled to see that you are an external examiner for the University of the West of England, particularly focusing on environmental health. That university sits in my constituency, so thank you for the work you do to support students in our community.Q
You both have a wealth of experience and expertise; thank you for what you have shared already. I want to follow on from the last question and open the floor a bit more to see whether you had any additional thoughts about the Bill’s strengths or any areas where you feel it could be further strengthened—points that our questions so far have not let you speak to.
Christopher Chope (Conservative, Christchurch)
That brings us perfectly to our finishing time. May I thank both witnesses for their evidence? We will move on to the next panel.
Examination of Witness
Christopher Chope (Conservative, Christchurch)
Anny Cullum, would you like to introduce yourself?
David Simmonds (Conservative, Ruislip, Northwood and Pinner)
Q Anny, I would like to ask about your view on the enforcement regime. Do you feel that what has been outlined in the Bill and how it is likely to be reflected in the real world will be sufficiently robust both to deter rogue landlords from bad practices and to ensure that tenants are able to both enforce their rights and act in accordance with the law?
Matthew Pennycook (Labour, Greenwich and Woolwich)
Q Given the time, I will ask you a more general question. Do you think—it sounds like you do—that the Bill broadly strikes the right balance and properly delivers for renters? Are there any omissions, things you would like us to address or parts of the Bill you think we need to look at more carefully?
Christopher Chope (Conservative, Christchurch)
Let some other people ask questions and perhaps you will have the opportunity to include those points in your answers.
Gideon Amos (Liberal Democrat, Taunton and Wellington)
Q I was interested to hear the rest of your points. One area that is not regulated in the Act is the regulation of letting agents. Is that something that Acorn would like to see happen? Feel free to expand on your points.
Sam Carling (Labour, North West Cambridgeshire)
Q Picking up on the point you made about illegal evictions, is there anything we can do with the landlord database to help with that and some of the other issues you raise?