Clause 82 - Offences in relation to licensing of houses
Housing Bill
3:30 pm
Mr Keith Hill (Minister of State (Housing and Planning), Office of the Deputy Prime Minister; Streatham, Labour)
Clause 82 provides that an offence punishable by a maximum fine of £20,000 is committed if a person has control of or manages a property required to be licensed, but which is not licensed. Clause 83 provides that no rent is payable by the occupiers, and no charge can be made in lieu of rent, during the period when a person is guilty of the offence of having control of or managing a house that should be licensed.
Amendment No. 299 seeks to exempt a lender who has taken possession of a property requiring to be licensed, but not licensed, from committing the offence, so that they would not be liable to the £20,000 fine. Amendment No. 300 goes a step further by seeking to exempt such a lender from the provision that no rent or charge is payable by the occupiers of the property, and that no charge can be made in lieu of rent during the period.
I understand the hon. Gentleman's reasons for moving the amendment. Its aim is to ensure that reputable mortgage lenders who need to repossess properties are not inadvertently caught out by the provisions, and thereby subjected to the heavy penalty. I shall explain why I believe it to be unnecessary.
First, I believe that a lender taking repossession of a property that could fall within the scope of licensing would be likely to seek to obtain vacant possession of the property. If the property was vacant, there would be no requirement for it to be licensed. Secondly, during any period when a lender had taken possession of a property and was taking steps to remove the occupiers, it would be possible to apply for a temporary exemption notice, and the local housing authority would be able to grant such a notice. However, if the lender had no lawful way of
removing the occupiers of the repossessed property, or if it decided to continue to keep the property as rented accommodation, which would require a licence, we would expect the lender to seek to obtain a licence in order to ensure that the property was managed properly.
I do not envisage any difficulty in reputable lenders being granted a licence, as we expect that they should easily be able to satisfy the licensing criteria. There is potential for opening up a huge loophole in the legislation if any person or company, however big, small or disreputable, could be exempted from the licensing provisions merely because someone to whom they had loaned money had defaulted on the loan.
I hope that the hon. Gentleman is satisfied that provisions in the Bill safeguard the interests of reputable lenders. In those circumstances, I would naturally expect him to withdraw the amendment.