Housing and Planning Act 2016 (Database of Rogue Landlords and Property Agents) Regulations 2018 - Motion to Regret

– in the House of Lords at 6:08 pm on 17th April 2018.

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Moved by Lord Kennedy of Southwark

That this House regrets that the Housing and Planning Act 2016 (Database of Rogue Landlords and Property Agents) Regulations 2018 do not allow tenants access to the database of rogue landlords and property agents, therefore severely restricting potential tenants’ ability to make informed choices and protect themselves (SI 2018/258).

Photo of Lord Kennedy of Southwark Lord Kennedy of Southwark Opposition Whip (Lords), Shadow Spokesperson (Home Affairs), Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Housing)

My Lords, first, I draw the attention of the House to my relevant interests in the register: namely that I am an elected councillor in the London Borough of Lewisham and a vice-president of the Local Government Association. I am moving this Motion in relation to a regulation under the dreaded Housing and Planning Act 2016, a fine example of how to legislate in haste and repent at leisure, a generally dreadful piece of legislation with little or no thought given to its consequences, with a number its of provisions either dropped or quietly forgotten about and never mentioned again.

One of the more promising parts of the legislation was the rogue landlords and property agents database, but even here the Government got it wrong, as I state in my regret Motion, as they do not allow tenants or anyone else other than the Government or local authorities access to it. So it is a good idea and a good initiative but, through the action of the Government, it is failing tenants—failing to help them to make informed choices and to protect themselves. This is important, as the housing market is changing before our eyes. The number of people in the social rented sector has fallen, as has the number owning their own homes. Some 4.7 million households in England currently rent privately—about 20% of all households. This includes a large number of young and single people but also includes a number of families.

The vast majority of private landlords and property agents are good and act responsibly. They, and the bodies that represent them, are as keen as anybody else to deal with the rogues who abuse their tenants. There is support in the industry for this database to be available much more widely. David Cox, the chief executive of the Association of Residential Letting Agents, said:

“We have campaigned for the Government’s database of banned letting agents to be publicly available as with no public access to the database, how will landlords or tenants know if they are using a banned agent?”

I think David Cox is absolutely right. How will you know if you cannot have access to this secret list? Carrie Kus, director of the Residential Landlords Association, said:

“We all want to see criminal landlords rooted out of the rental market altogether. Any measure … which helps tenants to distinguish between the majority of law-abiding and decent landlords and those landlords who bring the sector into disrepute is to be welcomed”.

I agree with her, but it is a shame that this regulation will not help tenants to make that choice as they are prevented from having access to the secret list.

We all want both tenants and landlords to operate within a set of rules where a clean, safe, dry property, which meets all its obligations under the law, is offered for rent and where tenants accordingly pay the rent due to the landlord. The rogue landlords and property agents database deals with the small number of landlords and property agents who flout their obligations and the rules, and who rent out substandard accommodation, often to vulnerable tenants. This is accepted in paragraph 7.1 on page 2 of the Explanatory Memorandum that accompanies these regulations. The memorandum goes on to say that the Government are,

“determined to crack down on these landlords and disrupt their business model”.

I respectfully suggest to the noble Lord, Lord Bourne of Aberystwyth, that disrupting their business model would be a lot easier to achieve if their customers knew they were on this list. However, this database is secret and only to be accessed by the Government and local authorities.

Who are we protecting with this inadequate regulation? These could be landlords who have been convicted of certain offences, or made the subject of banning orders for matters such as illegally evicting and harassing tenants; using violence to enter a property; failing to comply with improvement notices; failing to adhere to houses in multiple occupation regulations; failing to adhere to an overcrowding notice; providing false or misleading information; or other similar offences. I was interested to read the letter from the noble Lord, Lord Bourne of Aberystwyth, to all Members of this House on 6 April 2018. It gives some useful information, but for me the most interesting paragraph was the last but one and I will read part of it. It says:

“Currently, the legislation does not allow for information on the database to be shared more widely. However, I am strongly committed to supporting tenant choice and my department is exploring a range of options to make the information on the database publicly available. This would enable prospective tenants and others to check whether a landlord or agent has been subject to enforcement action. This may require primary legislation. In the meantime, we are encouraging local authorities to publish information drawn from their own records about landlords and property agents who have been banned, convicted of relevant criminal offences, or have received a civil penalty. We have also encouraged them to make this information available to tenants who request it”.

I suppose that is progress of a sort but it is a mess. Tenants are prevented in law from having access to this database but we encourage local authorities to publish a separate list about such landlords and property agents. It is a real dog’s breakfast and I can see local authorities being very wary of doing that unless they have a specific instruction to do so. It could have been so different. My noble friends Lord Beecham and Lady Hollis of Heigham, the noble Lords, Lord Best, Lord Kerslake and Lord Shipley, the noble Baronesses, Lady Grender and Lady Bakewell of Hardington Mandeville, and many other noble Lords will recall the debates in January, February, March and April 2016. The Government were not listening and there were late night sittings. On 11 April 2016, the noble Baroness, Lady Bakewell, moved an amendment to allow tenants access to this information. I also spoke in support but in her response, the noble Baroness, Lady Evans of Bowes Park—who is now the Leader of the House—said:

“Indeed, allowing such access to the database would arguably breach the landlord’s human rights by making sensitive personal information about their convictions publicly available and effectively banning them from operating without an independent tribunal determining whether they should be banned”.—[Official Report, 11/4/16; col. 82.]

This line of defence was revised when this House gave a Second Reading to the Renters’ Rights Bill, introduced by the noble Baroness, Lady Grender. It proposed, among other things, the right for tenants to have access to the database of rogue landlords and property agents. On 10 June 2016, in response to the debate, the noble Viscount, Lord Younger of Leckie, said:

“Giving tenants or potential tenants access to the database might be fine if the purpose of the database was to blacklist landlords and drive them out of business. However, that is not the purpose of the database. Where a landlord should not be in business, the local authority should apply for a banning order”.—[Official Report, 10/6/16; col. 985.]

Taking the letter written by the noble Lord, Lord Bourne; the comments of the noble Baroness, Lady Evans of Bowes Park, on 11 April 2016 when the Bill was going through Parliament; and the comments of the noble Viscount, Lord Younger of Leckie, on 10 June 2016, responding to an attempt to make this database public, it is not unreasonable to suggest that the Government are in a complete mess on this issue with contradictory positions: it is as clear as mud. I can see local authorities being very wary and wanting more clarity on the issues before publishing anything.

I have a number of questions for the noble Lord. Is he aware that the Private Rented Sector Partnership Board, which comprises the Association of Residential Letting Agents, Countrywide, the National Landlords Association, the Nationwide Building Society, the Nationwide Foundation and Shelter, believes that organisations and businesses operating in the private rented sector should have access to the Government’s rogue landlord and lettings agent database? Does he accept that, from what I have highlighted from his letter, and the comments of the noble Baroness, Lady Evans of Bowes Park, and the noble Viscount, Lord Younger of Leckie, that the Government need to get their act together and provide clarity on the situation? Will his department be following up his letter to Members of this House with a letter to all local authority leaders and chief executives, making it clear that local authorities can publish information on rogue landlords and letting agents drawn from their own information and that the Government are encouraging them to do just that? What discussions have the Government had with tenants’ bodies and tenant advice organisations about how they could use the database to help local authorities identify rogue landlords and target their enforcement work?

In conclusion, I hope I have highlighted that the situation we find ourselves in is far from ideal and that it would be right for the House to express its regret. I beg to move.

Photo of Lord Shipley Lord Shipley Liberal Democrat

My Lords, I remind the House that I am a vice-president of the Local Government Association. I support the intentions of the Motion in the name of the noble Lord, Lord Kennedy. I am grateful to the Minister for his letter of 6 April in which he updated us on the introduction of a database of rogue landlords and property agents, together with the powers being introduced to enable serious and prolific offenders to be banned from operating. I welcome these steps. They are proportionate, legitimate and in the public interest.

However, these changes have taken a while—indeed too long—to reach this stage and I remain concerned that the support from these Benches for an open register of rogue landlords has yet to bear fruit. The letter from the Minister says specifically that his department is,

“exploring a range of options to make the information on the database publicly available”.

Can he tell us what that range of options is, the nature of the consultation and when the exploration will become a decision? I also noted doubt in the Minister’s letter as to whether primary legislation was required. The noble Lord, Lord Kennedy, mentioned this; I am surprised that it is not already known. Could the Minister clarify why the department is not clear on this matter? It seems a straightforward issue to give a clear answer on.

The Government are to give local authorities the right to publish information drawn from their own records about banned or convicted landlords or property agents and those who have received a civil penalty. But the nature of that publication is not clear. It seems it can be made available to individual tenants—and presumably, therefore, to prospective tenants, although that is not actually stated. I will give the Minister an example of a problem that might well arise in the functioning of this scheme. A prospective tenant wishes to know from the local authority in which their tenancy will be held whether the landlord is a rogue landlord. It is possible that the landlord is not a rogue landlord in that local authority, but it is equally possible that they are a rogue landlord in a neighbouring authority for the reason that a landlord may own properties in more than one local authority. Will that status in a neighbouring local authority be made available to the prospective tenant and will the local authority be permitted to add to its own register and publish details of those rogue landlords who reside in another area? Or will a rogue landlord in one local authority automatically become a rogue landlord in every other local authority in the country?

The Government have an improving record in some areas of private tenant protection. I cite as an example proposals on client protection moneys and progress in the proposal to ban letting fees. However, it is extraordinarily slow, and I have not understood why. However, mandatory electrical safety checks need to be done, and nothing seems to be happening there. Despite the progress being made, rogue landlords remain a big issue. After a great deal of thought I have concluded that, to be effective, a register has to be transparent and open but it also needs to be correct. For that reason, all local authorities need to follow the same clear procedures. What is stopping the Government proceeding on that basis, creating an open register that is publicly available? That seems the only way to protect tenants and prospective tenants.

Many good landlords fully understand the importance of high standards. As the noble Lord, Lord Kennedy of Southwark, pointed out, there is huge support among residential landlords for effective policies which deliver solutions in protecting tenants to be delivered. However, although some of the improvements the Government have made are welcome, much more needs to be done to ensure that prospective tenants and tenants are properly protected.

Photo of Baroness Gardner of Parkes Baroness Gardner of Parkes Conservative

My Lords, I support the principle behind this Motion, but the issue is wider than this. The Government are extraordinarily reluctant to have dealings with local authorities. I declare my interest in the register as a landlord of two flats in a block which is absolutely under threat from holiday lets, and the local authority can do nothing because powers have been taken away from it. There is some reluctance to give power back to local authorities. They need it; they are the people who are closest on the ground. They were able to charge a fee for registration, and, under that, they were able then to check whether your property was correctly detailed as regards the certificates referred to by the noble Lord, Lord Shipley—the gas and electricity certificates and others that are required. For some reason, the Government just do not want to do this. I do not know why, when it is having such a disastrous effect on so many parts of the country.

No one wants to see things going wrong for people who are good landlords. But, when I was helping in the case of a homeless person earlier this year, I am sure that I told your Lordships’ House at the time how people were willing to offer her accommodation in houses of multiple occupation, provided she never told anyone she was there—because they were illegal and were not registered. Indeed, she was evicted because she had had the police in because her things were being stolen, and immediately the landlord had threatened her physically and she had to get out in a hurry—the police said, “You’re at risk there”.

She was then homeless and had to go wherever she could. She went to hostels, where sometimes at night she would be in such a bad way that the doctor would say, “All those marks you’ve got on you are from bed bugs. You mustn’t go back there again”. It really is a most disastrous situation for so many people. When local authorities were able to charge a fee for you to register, it just about covered their expenses in carrying out any necessary checks. Philip Hammond has announced that he wants people to pay tax on these illegal rents—and of course they should, because it is totally disproportionate for someone to collect in some cases a heap of money for an ill-used and unprepared place.

The whole principle has to be much wider. Although I welcome what the noble Lord, Lord Kennedy, said, I would not support him at this stage because I hope for much more. It is time the Government woke up to the fact that they have wonderful people available in local authorities. Some local authorities also work together, which again could cover the point made by the noble Lord, Lord Shipley, about the adjoining or some other local authority. So the structure is there; it is just that the Government are for some reason reluctant to adopt it. I support the principle behind the Motion.

Photo of Baroness Grender Baroness Grender Liberal Democrat

My Lords, I thank the noble Lord, Lord Kennedy, for bringing forward this regret Motion. We share his deep frustration that this legislation is not already in place—if indeed legislation is necessary. In every possible debate on this issue, during the passage of what became the Housing and Planning Act 2016, during the passage of my Private Member’s Bill on tenants’ rights in 2016, and in numerous other debates, the case was clearly made. Tenants should have the right to know if their landlord, or possible future landlord, is on the database of rogue landlords and property agents. But every time the argument from the Government was against, primarily on the grounds of data issues. On some of these occasions it was about economics and once, as the noble Lord, Lord Kennedy, pointed out, it was a human rights issue.

If any of the amendments on this issue in the Housing and Planning Act 2016 had been accepted by the Government, as they should have been at the time, or if they had been accepted in my Private Member’s Bill, we would not be having this debate now. So when the Minister explained in his letter dated 6 April 2018 that the Ministry of Housing, Communities and Local Government is now exploring options when there were so many chances before, it seems extraordinary.

While I welcome this change of heart, I fear that this will be another lengthy process—and, frankly, tenants have waited long enough. I have two other examples of where tenants have been waiting for too long. First, there is the lettings fee ban, which I was delighted came in in the Autumn Statement after my Private Member’s Bill—but that was in autumn 2016. The pace is so slow that it is predicted that it will not reach the statute book until the spring of 2019. The electrical safety working group finished its work in 2016 and reached the conclusion that mandatory checks should be introduced. That is another example of where tenants are having to wait so long for any results. Today’s report from the Resolution Foundation makes it clear that whether they are young or old, or with or without children, the number of people who rent and will be renting for the whole of their life is increasing. Indeed, it says that one in three millennials will never own at all.

So the time is now to treat tenants as valued consumers in society. A vast majority—nearly 80%—pay their rent in full and on time. However, as we know from the efforts being made by the noble Lord, Lord Bird, in his Private Member’s Bill on creditworthiness, they continue to be treated almost as second-class citizens in the UK. Even when it comes to a simple thing such as buying something on credit, they are given a much higher interest rate.

Therefore, as welcome as this change is, I would like to hear from the Minister today why it is being made now. The argument was made clearly and we had long debates about this. What has changed the Government’s mind, and when did they realise that they had got it wrong? We welcome the fact that they have recognised that they got it wrong, but we would like to know why they have changed their mind now rather than when there was a chance to put this into legislation, either in my Private Member’s Bill or in the Housing and Planning Act 2016. If it is down to the present Minister and he has managed to persuade his colleagues to change their mind, we would love to hear about that as well.

This is not about impatience on these Benches or on this side of the House; it is about tenants who today, two years after the Government changed their mind on banning lettings fees, are still waiting. This means that they are still being charged arbitrary amounts by agencies, as evidenced in the Government’s own research; they are still in danger of tipping into homelessness by moving to a lower rent with a high up-front fee; and they are still waiting for mandatory electrical checks. What is now the fast-track solution to the open register so that they can empower themselves and see for themselves whether or not to trust a landlord? The delay impacts on people who rent on a daily basis. So how are we going to move this forward at pace, given that it should have happened two years ago?

Photo of Lord Thurlow Lord Thurlow Crossbench 6:30 pm, 17th April 2018

I thank the noble Lord, Lord Kennedy of Southwark, for bringing forward this regret Motion, in effect completing the unfinished business of this part of the Housing and Planning Act 2016. Although they are not toothless, I feel that the proposals as they stand are somewhat pointless. There is no direct access to the rogues’ register for the public or for potential victims, and I see victims as an important part of this—those whom the register is really designed to protect.

I should declare my interests. I am the landlord of two residential flats. I am myself a tenant and I have, for 35 years, practised as a chartered surveyor in a firm that both rented out and managed properties. I feel very much in the cross-hairs of this debate, but I am pleased to report that to the best of my knowledge my firm did not deal with residential property. That said, I feel reasonably well qualified to comment.

Thinking about this regret Motion caused me to seek out reasons why one would not want to support it. I thank the House of Lords Library for its helpful and timely response to my question. I followed up its extensive leads and could find no good reasons to object to the Motion. I found not a soul arguing against transparency and openness of this data. The Act of Parliament is clearly not doing the job as intended.

There is a perceived misconception, I believe, about tenants. I am referring not to the privileged rich but to the average social or private residential tenant. There is an assumption that supply and demand applies in the usual way, but it just does not. Availability and quality do not balance the price of accommodation. There is a gross imbalance of supply, in favour of the landlord, as I am sure most of us know. Stories abound of instant queues for viewings of rented accommodation as soon as it becomes available. There is tender pricing and rental gazumping. All the cards are with the landlord and the landlord’s agent. Who is going to check with the local authority register at seven o’clock in the evening, out of hours? The potential tenant has time pressure to perform. The local authority is underresourced. Will it have an out-of-hours service? That is extremely unlikely, bearing in mind the fragile state of finances. If the bidder does not bid straightaway and make a very determined application to rent the flat concerned, the likelihood is that it will not be available in a day or two’s time.

Having managed to secure agreement on the terms, the next day the bidder might apply to the local authority. If they are lucky enough to get a quick response and discover that they are dealing with a rogue landlord, what do they do? Rightly, they withdraw. However, the next time they try to rent a property that happens to be with the same firm of agents, or conceivably with the same landlord—many are owners of very large numbers of residential properties, particularly in urban areas—they will find that they are blackballed because they are trouble-makers. No one has to say why they turn down a residential tenant. References are notoriously spurious. So perhaps there is more to it than just trying to encourage applicants to make contact with their local authority. I think that that simply makes the applicant’s predicament worse.

What about landlords? I have mentioned that some control a large number of properties, and the same applies to agents. I have also mentioned the all-powerful blacklist. We should bear in mind too that, although there are organisations such as the Residential Landlords Association, the RICS and others that try to set standards of behaviour and probity in the industry, there are no barriers to entry for those wishing to become a residential letting agent. Any one of us could start tomorrow. All you need is a telephone and, preferably, a suit. It is easily done. There is no policing and no comeback unless one breaks the law. Of course, good landlords have nothing to fear. If this measure really had teeth and really worked, and the register was transparent, they might even win more market share.

What are the solutions? The noble Lord, Lord Kennedy of Southwark, referred to the helpful letter from the Minister of 6 April, but this is unfinished business—it is not clear. What is needed is unequivocal access to the list by individuals. That is supported by ARLA, the Residential Landlords Association, the Mayor of London and the London Landlord Database, but direct government action is needed—unequivocal, impartial and expeditious transparency. We heard about expeditiousness from the noble Baroness, Lady Grender.

In conclusion, I have heard that the prosecution procedure can be long and arduous, and it is expensive for local authorities, which have limited budgets. I have heard that more escape prosecution than not—that for every prosecution, 20 more avoid it. Why? Luck, lies and leniency were the reasons given, and those come from a former practitioner in that space. At the end of the day, if people do get convicted, they receive a 12-month ban or a fine. To deter rogue landlords and agents, much longer bans and bigger fines are needed, as well as much longer exposure on the rogue landlords and agents list. I support the Motion.

Photo of Lord Beecham Lord Beecham Shadow Spokesperson (Justice), Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Housing)

My Lords, I refer to my interests as a Newcastle City councillor and as a vice-president of the Local Government Association.

I have just checked the definition of a rogue landlord, which was given by the noble Baroness, Lady Williams, during a debate on the Housing and Planning Bill. The definition she gave was:

“renting out unsafe and substandard accommodation”.—[Official Report, 9/2/16; col. 2136.]

Up to a point, that seems to be reasonable, but that definition would not, for example, extend to the mistreatment or abuse of a tenant by a landlord. I wonder whether the term “rogue landlord” is sufficiently descriptive of the kind of problems that many people face as tenants of properties that might be not just in poor disrepair but where other aspects are making their life a misery.

I have encountered aspects of this recently in the ward I represent in Newcastle. I have twice had to call on the local authority to contact the landlord owners of properties where a large accumulation of rubbish was left undisposed by the owners for some considerable time—these were rented properties. In one property—it was a tenanted property and therefore, I suppose, in a sense the tenant must also bear some responsibility—there was a significant problem of rats for the very elderly lady living in the rented property next door owned by the same landlord I have mentioned, who lived across the street. This lady paid Rentokil £900 to dispose of the vermin in the adjoining property. That is an extraordinary situation, and I am not sure that those conditions would necessarily invoke any of the sanctions that are sought to be imposed on the “rogue landlord”. This is not an offence in that sense. Therefore, we need to look at what the terminology purports to cover.

I want to take the matter a little further. There is a process under which authorities can have a great deal more influence on what happens in the private rented sector, through what are known as selective licensing schemes. But these are difficult to prepare. In my own ward, having asked for action to be taken, I am told that apparently it takes between two and three years to convince the department that a scheme is necessary. In some areas—I believe Newham is one and I think there are one or two other authorities—the concept has been extended across the whole local authority. That seems to me much the best approach in dealing with this issue. I hope that the Government will look again at the practice and authorise and then encourage local authorities to apply for schemes across the whole area if it deems that to be the right approach. At the moment, as I said, it is a cumbersome and difficult process.

If we are to tackle the variety of problems caused by bad landlords—whether they are rogue in the sense that the noble Baroness defined it or in a broader sense because of failure to look after their property and tenants in a proper manner—the matter should not be confined in the way that is implied by the definition that was given to this House during the passage of the Bill. I hope that, in replying to the debate, the Minister will give an indication that the Government will look again at selective licensing and will facilitate and encourage it where local authorities deem it appropriate to deal with all manner of problems caused by the inadequacy, or worse, of some landlords who seem intent only on extracting the maximum amount of money for the minimum provision.

Photo of Lord Palmer of Childs Hill Lord Palmer of Childs Hill Deputy Chairman of Committees, Deputy Speaker (Lords) 6:45 pm, 17th April 2018

My Lords, from these Benches I support the Motion and see it as an extension of the legislation on client money protection agreed by this House, which I and others worked on with the noble Lord, Lord Bourne, to get it through by means of an enabling amendment. The noble Lord, Lord Thurlow, talked about someone just putting on a suit and opening a shop on the high street, but the client money protection regulations, which are just being published, mean that they cannot hold a client’s money. So things have moved on and improved. We in this House managed to improve the situation around client money protection: why can we not do that for the issue before the House now?

The argument is straightforward: how are tenants’ rights to be protected if they do not know whether an agent or landlord is dodgy? How will they be protected? The word that has not been used in the debate so far is “enforcement”. Enforcement by local authorities is very weak. If every local authority was proactive on enforcement, and if they were allowed to be so by the law, perhaps this might not be such a big issue today. But in the real world, local authorities—strapped for cash, as mentioned by other noble Lords—have and will continue to have enforcement very low in their priorities. It is interesting to note that this could be done very easily. I do not know how many properties it has nowadays, but the GLA, which has already been mentioned, has started an open list that anyone can access.

Other noble Lords have talked about separate lists in different local authorities. Because they are separate, there will be many loopholes for the rogues. The good guys will be fine, but the rogues know how to get around this. When you leave it to local authorities, without the support of national legislation, they will be nervous about taking action against a rogue landlord because, as has been mentioned: what is a “rogue landlord”? As the noble Lord, Lord Beecham, said, there are many ways of describing a rogue landlord.

People worry about what will happen to the companies and individuals that end up on the list due to a mistake made by themselves or by staff. If they are on the list, they will have to demonstrate that they have addressed the issue and then they can come off the list.

The ability of a tenant to carry out an online search of a register to see whether their prospective landlord or agent is on the list is a must before they part with a month’s rent and a deposit, only to be scammed. The query is that only some local authorities will participate unless we make this national legislation, and therefore rogues will go under the radar. My question to the Minister is this. We managed to do this by co-operation for client money protection—I must admit I co-chaired a committee that lasted for six months—and the regulations have now been published. Why can we not do this now for this simple measure to protect tenants?

Photo of Lord Best Lord Best Crossbench

My Lords, I declare my interests as listed on the register. I am full of regret about this statutory instrument but I want to preface my remarks by giving some credit where it is due. We have seen the exponential growth of private renting: the PRS has gone from 9% at the beginning of the 1990s to about 20% of the stock of this country now. As mentioned by the noble Baroness, Lady Grender, the report published today by the Resolution Foundation shows that an awful lot of people will rent all their lives, even those on relatively decent incomes.

Private renting has become very important and government has woken up to this fact. We have had a plethora of measures coming down the pipeline, and I welcome each of them. Enumerating them all would take some time, but they include the letting fees ban, which has already been mentioned, and compulsory client money protection, which will make a big difference to the world of letting and managing agents. We have also had the banning orders themselves, which are very important, never mind the publicity around them. There is the promise of a tenants’ ombudsman handling complaints from tenants about their landlords. That is coming down the pipeline. Physical things such as smoke alarms are becoming compulsory on every floor and some carbon monoxide alarms are becoming compulsory. This Government have introduced a lot of important new legislative measures. When it comes to licensing, which is absolutely where we should be, local authorities should be empowered to license the landlords in their areas and collect some funds to pay for the enforcement that needs to follow.

I went on a dawn raid with Newham Council to see the things that such raids reveal—horrendous conditions. However, a licensing system could find out which properties were let in appalling conditions and who was not paying any council tax or anything to HMRC, whose representatives came on the dawn raids as well and whose teeth are sharper than anyone else’s. We now have measures in place. The Government have allowed Newham to renew its licence for almost the whole of the borough and the Government are on the right track, so I preface any remarks by saying that the Government are bringing forward a whole number of measures. We may have reached the point where a consolidating Bill to bring all these things together would be rather a good idea.

However, we depend on the local authorities enforcing all these measures. I speak as the guilty person who piloted through your Lordships’ House the Homelessness Reduction Bill, now an Act, and I know that that brings tremendous new burdens on local authorities in relation to the private rented sector. Local authorities have a lot on their plates, and adding more to that needs to be accompanied by the resources to really make things happen. Local authorities can rightly complain if the Government do not come up with the money to follow each of these new measures.

We have the banning orders, which are great, but we are unable to get a register of those who are banned publicised far and wide. I do not like to mention the Housing and Planning Act because it brings back some horrendous memories, but three questions are answered at the back of the guidance for local authorities, Banning Order Offences:

“Should local housing authorities make public banning orders for individual landlords? We would encourage local housing authorities to make successful banning orders for individual landlords public”.

The guidance continues:

“Can a local authority make public a banning order for a business? Yes. Any business (managing or lettings agency) which has been subject to a banning order can be named publicly … Should local housing authorities make information on banned landlords available on request by a tenant? Yes. We would encourage local housing authorities to make information on banned landlords available on request by a tenant”.

That all sounds good but then we get this feeble statutory instrument, which seems to negate that and make it rather difficult for local authorities, who will get legal advice to be cautious about publicising these banning orders that are so important. I think the culprit, which I have dug out today, is Publicising Sentencing Outcomes from the criminal justice system, which is guidance for public authorities on publicising information about individual sentencing outcomes. I suspect that the Minister is as frustrated as the rest of us that more cannot be done to achieve the publicity that this demands. I hope he will join the rest of us in voting in favour of this Motion of Regret.

Photo of Lord Bourne of Aberystwyth Lord Bourne of Aberystwyth The Parliamentary Under-Secretary of State for Wales, Parliamentary Under-Secretary (Housing, Communities and Local Government)

My Lords, I thank the noble Lord, Lord Kennedy of Southwark, for tabling a Motion on this important topic. I am genuinely very grateful to him for doing so because it has given us an opportunity to revisit this area and give some publicity, I hope, to where we are. I am grateful for the contributions that have been made by noble Lords. I will first try to set out our current position and then take up some of the points made by noble Lords and answer where we hope to go. I share some of the frustration that it sometimes appears that we are moving very slowly. I understand what the noble Baroness, Lady Grender, means, and I pay tribute to what she has done on letting agents. It is frustrating for Ministers too, on occasion, but of course there is a process to follow.

The Government value the private rented sector. It is an increasingly important part of our housing market, as was said by many noble Lords, most recently by the noble Lord, Lord Best. As the noble Lord, Lord Kennedy, said in setting out the case, the sector has doubled in size over the past decade and now provides a home for 20% of the population in England, which is approximately 4.7 million households. It is significant.

As has been acknowledged, the overwhelming majority of landlords in the private rented sector provide decent and well-maintained homes. Standards have improved rapidly with the proportion of tenants living in non-decent housing falling from 47% in 2006 to 27% in 2015. In addition, 82% of private renters are satisfied with their accommodation and stay in their homes for an average of just over four years. The Government want to support good landlords. That point has been widely acknowledged.

However, a number of rogue landlords knowingly rent out accommodation which is unsafe and substandard. Overcrowded and poor-quality housing has a wider impact on the local community as it can result in excess noise, increased demand on local services such as waste collection, and anti-social behaviour generally, as well as the dreadful impact that it has on the individuals who live in those premises. These landlords and property agents often do not respond to legitimate complaints made by tenants. Some would even prefer to be prosecuted rather than maintain their properties to a decent standard. These practices damage the reputation of the sector and have no place in modern Britain. We are determined to force rogue landlords out of the rental market. This Government have a strong track record in cracking down on rogues and driving up standards in the sector.

I thank the noble Lord, Lord Palmer of Childs Hill, for the cross-party working that we have had across the Floor with all noble Lords in this House and in the other place. I am happy to commit to continue that. In the plethora of measures referred to by the noble Lord, Lord Best, we have had considerable support from around the House and joint action to get us into a better position. We have introduced a package of measures to tackle rogue landlords. This includes civil penalties of up to £30,000, rent repayment orders under which a landlord can be required to repay up to 12 months’ rent, banning orders for the most serious and prolific offenders and a database of rogue landlords and property agents.

The noble Lord, Lord Beecham, asked about the definition of a rogue landlord. I will pick that up more specifically in correspondence, but I assure him that banning order offences include many of the things that he referred to. For example, the Rentokil situation would be covered by an improvement notice. If he would like to give me details of that case, I will gladly have a look at it. It also includes criminal damage and eviction. In short, I think that the definition he quoted does not cover quite a few situations that are banning order offences. I will cover that more generally in a letter to noble Lords, if I may.

Evidence on the effectiveness of these new powers is anecdotal, but we know that many local authorities have used the new powers that came in last year very effectively. Torbay Council, for example, used revenue from civil penalties to fund additional enforcement staff, which is a sensible move. We provided £12 million between 2011 and 2016 to over 60 local authorities to help them tackle acute and complex problems with rogue landlords. I have seen some of those issues myself as I have gone around the country. I know that they exist and I know that enforcement action does happen. It has been taken against over 5,000 landlords between 2011 and 2016. That represents a significant proportion of rogue landlords active in those areas.

We have also introduced protection for tenants against retaliatory eviction in the Deregulation Act 2015, and required landlords to install smoke alarms on every floor in the Energy Act 2013, as was noted by the noble Lord, Lord Best. The tough measures that we introduced through the Housing and Planning Act 2016 enable local authorities to crack down on these rogue landlords and drive up standards in the sector.

Since April 2017, local authorities have been able to impose a civil penalty of up to £30,000 as an alternative to prosecution where a landlord has failed to comply with an improvement notice in relation to the licensing of houses in multiple occupation, contravened an overcrowding notice or failed to comply with management regulations in respect of houses in multiple occupation. Crucially, local authorities have been given the ability to step up their enforcement action by allowing them to impose the civil penalties I have mentioned.

Alongside the introduction of financial penalties, we have extended rent repayment orders. Landlords can now be required to repay up to 12 months’ rent where they have illegally evicted a tenant, used violence to secure entry to a property, breached a banning order or failed to comply with an improvement notice or prohibition order. I agree very much with what was said in relation to Newham. Other authorities have licensing, such as Waltham Forest, but again perhaps I may cover in a letter the other authorities that do so. I agree that where appropriate this is a good way forward.

On 6 April this year, which has just gone, we brought banning orders into force. These orders target the most serious and prolific offenders who have been convicted of serious housing, immigration and other criminal offences connected with their role as landlords. Noble Lords will recall that we debated the banning order regulations on 22 January this year. Those regulations, which were subject to the affirmative procedure, specified which existing criminal offences should also be treated as banning order offences. A person subject to a banning order may be prevented from letting housing in England, engaging in English letting agency work, engaging in English property management work or a combination of these. The banning order must last for a minimum of 12 months. I think the noble Lord, Lord Thurlow, referred to it as the maximum, but there is no upper limit. As I say, 12 months is the minimum period. If a landlord breaches a banning order, they will face enforcement action which could include up to six months’ imprisonment. Banning orders will prevent rogue landlords and property agents from earning income by renting out properties or engaging in letting agency or property management work.

In relation to the point about letting agencies, which again was brought up by the noble Lord, Lord Thurlow, I add that we are bringing forward controls and proposing that letting agents should have professional qualifications. As noble Lords will be aware, we are introducing minimum requirements for letting agents as well.

Moving on specifically to the database of rogue landlords and property agents which has been the subject of our discussion, the database was developed as a tool to enable local housing authorities to identify rogues and target enforcement action accordingly. It is a shared resource across all local housing authorities and enables them to pool their knowledge and information. As noble Lords will appreciate, we are unable to extend that under the present legislation. It will require a fresh look and possibly, or even probably, fresh legislation. We are considering if there is any other way of achieving this; I suspect not, but it is wise to keep the possibility open that there may be other ways of tackling the issue. The legislation specifies that access to the database is limited and, as I say, we cannot go beyond that in relation to the current position.

I am grateful to the noble Lord, Lord Kennedy of Southwark, for raising this important issue. As I have indicated, I have considerable sympathy with many of the points that he and others have raised, and in doing so, to do something that may be of value to tenants. I have to say that sometimes I suspect that they get a raw deal. Some of that is attitudinal and not anything to do with this legislation, but I accept the broader point about creditworthiness and so on, which is a point well made. I hope that our approach will alleviate that position.

Perhaps I may deal with some of the points that have been raised which I have not yet covered. The noble Lord, Lord Kennedy, asked a pertinent question about whether we would be contacting local authorities and asking them to take the view that, if they have a register, they should share the information. The answer is yes, and indeed it is a relevant point. On the consultation more broadly we will of course be speaking to tenant organisations, building societies and so on. We are keen to hear from anyone who has an interest in this area.

The noble Lord, Lord Shipley, asked how local authorities might get the information across. They could publish it on their websites, provide it on request or produce regularly updated lists. There would be a range of options, but obviously we will talk to the authorities about how that might be achieved. I thank him for his qualified support, but I accept the frustration he expressed and I hope that we can move forward now.

My noble friend Lady Gardner of Parkes understands these things and is someone who is active on behalf of tenants. Perhaps I may deal with her specific point, which I hope she will be pleased about. She made the point that local authorities do not always have enforcement powers. They have them in relation to the 90-day limit on short-term letting in London but, as I think I indicated on the last occasion that my noble friend raised this issue, Airbnb has made a proposal through the Short Term Accommodation Association to set up a partnership with Westminster Council—that may be the best way to describe it—and progress has been made. I have only recently received confirmation of that, but I will share the information with her, and I think that progress has been made in that regard. Many of the matters quite rightly raised by my noble friend were illegal acts where obviously it is an issue of enforcement. The non-payment of tax is a criminal offence, so that is something that we should be able to deal with.

The noble Baroness, Lady Grender, talked about the issue of frustration. I understand that and again I can assure her that I am open to discussing how we can move forward on these matters on a consensual basis. I think that we are at our best when we do so. We have been doing that on the letting fees ban, electrical safety and many of the issues set out by the noble Lord, Lord Best. I should reiterate the point I have made that tenants are valued consumers, in the words of the noble Baroness, and we need to put that information across.

The noble Lord, Lord Thurlow, said that the overwhelming majority of tenants are good tenants, and so they are. They are honest and trustworthy. As I say, there is a broader attitudinal problem which over a period of time may change because of the growth of those who are in the tenanted sector. Perhaps we need to put over the point that this is not second best. This is the way that many people choose to organise their housing, just as they do on the continent of Europe. I have covered the point on letting agents.

The noble Lord, Lord Beecham, raised the issue of the definition of a rogue landlord. Again, I hope that I have covered the particular points he made. He also referred to the selective licensing scheme in Newham and also in place elsewhere. I will try to set out some of the details in a letter and I will ensure that all noble Lords who have participated in this debate receive a copy.

I thank the noble Lord, Lord Palmer of Childs Hill, for his approach on how we are working together. While there are sometimes delays, we have certainly moved forward on client money protection, and I pay tribute to the noble Lord for what he did on that issue, along with the noble Baroness, Lady Hayter of Kentish Town. She was also involved in that work.

I thank the noble Lord, Lord Best, for his words which I have taken down, “Credit where it is due”. I was very pleased to hear them, and I thank him for setting out the plethora of measures that we are engaged in. I know that sometimes it can be painstakingly slow, but it is as well to remind ourselves that we are doing things on letting agent fees, client money protection, electrical checks, smoke alarms, banning orders and the ombudsman. Of course the noble Lord, Lord Best, knows a great deal about the whole area. We are also doing work on leasehold, the minimum conditions for letting agents and so on. He referred to the Homelessness Reduction Act 2017. I should say that we are funding the new burdens that have come in with that Act. As he will know, that was very much a part of the great success we had with that legislation—due in no small measure to the work of the noble Lord in ensuring that it went through this House and became law.

As I say, I can understand the frustration, but I would urge the noble Lord, Lord Kennedy, to withdraw the Motion he has tabled, although I do that without any great expectation that he will do so. I know that he is someone who is willing to work on these issues, as indeed we have done. I think that he should acknowledge the progress that we have been making on many of these issues and give credit to the Government accordingly.

Photo of Lord Kennedy of Southwark Lord Kennedy of Southwark Opposition Whip (Lords), Shadow Spokesperson (Home Affairs), Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Housing) 7:00 pm, 17th April 2018

I thank all noble Lords who have spoken in this debate. We have heard a wide range of contributions from noble Lords with real expertise in this area and they have given us the benefit of their knowledge. I have heard nothing from the noble Lord, Lord Bourne of Aberystwyth, that changes my mind that the Government are in a real mess in this area and it is the tenants of rogue landlords and property agents who are paying the price.

It is also important to note that despite what the noble Lord, Lord Bourne, said in his letter to Peers and in his contribution to this debate, the chance of getting an opportunity to clear up another mess caused by the dreaded Housing and Planning Act is very small, given the pressure on parliamentary time. We have just finished dealing with the consequences of the Act in respect of secure tenancy for victims of domestic abuse and correcting the mistakes made in that regard.

I do not often move Motions to Regret in your Lordships’ House but I very much regret this inadequate Act and the inadequate regulations before the House. I hope noble Lords will join me in expressing disquiet about this. In conclusion, I want to test the opinion of the House.

Ayes 166, Noes 179.

Division number 2 Housing and Planning Act 2016 (Database of Rogue Landlords and Property Agents) Regulations 2018 - Motion to Regret

Aye: 164 Members of the House of Lords

No: 177 Members of the House of Lords

Ayes: A-Z by last name

Tellers

Nos: A-Z by last name

Tellers

Motion to Regret disagreed.