The Convener (Alison Johnstone):
We will consider of the Cost of Living (Tenant Protection) (Scotland) Bill at stage 2. For the duration of the proceedings, I am the convener of the committee.
In dealing with amendments, members should have the marshalled list and the groupings of amendments. The division bell will sound and proceedings will be suspended for five minutes before the first division of the afternoon. The period of voting for the first division will be 45 seconds. Thereafter, I will allow a voting period of one minute for the first division after a debate. Members who wish to speak in the debate on any group of amendments should press their request-to-speak button or press R as soon as possible after I call the group.
On a point of order. I seek your guidance, convener. I attempted to lodge amendments to section 2 of the bill, but Parliament officials said that I was not allowed to lodge them. Is it the policy of Parliament that amendments that would take out certain parts of a bill are not acceptable once it has been passed at stage 1, which means that whatever Parliament thinks of a certain section of a bill it will always remain, even if we vote against it?
“it is inconsistent with the general principles of the Bill as agreed by the Parliament”.
If a bill is introduced with only one or two principal purposes, and the amendment would reverse, substantially alter or render ineffective a principal purpose of the bill, an amendment to leave out or substantially alter one of the purposes would not normally be admissible.
If amendment 21—in the group that is entitled “application of the rent cap”—is agreed to, I cannot call amendments 22 and 27, due to pre-emption.
We had a very helpful debate yesterday afternoon at stage 1. A lot of evidence was given that supports the idea that the way to control the rights of tenants is not necessarily to control the rents that landlords can charge. We all understand that financial hardship faces many people in Scotland and that landlords and tenants face difficult times. However, in my view and in the opinion of most housing associations and experts, simply saying that we are going to freeze rents and have a controlled sector, as the bill does, will cause greater damage and bring less benefit.
During the speeches yesterday, my colleagues Murdo Fraser and Stephen Kerr gave examples of what has happened in other countries, including in the cities of Dublin, Berlin and Stockholm. In those three cities, more people have become homeless, less housing is available and the situation has grown worse. That is why amendments 1 and 32 are at the heart of what this Parliament should be trying to do.
We agree that action needs to be taken, and we are disappointed that the Scottish Government has taken so long to do anything. Surely, to do a wrong thing is not the answer. Just a few months ago, the Minister for Zero Carbon Buildings, Active Travel and Tenants’ Rights and the Cabinet Secretary for Social Justice, Housing and Local Government were making exactly the same argument as I am making today: they were saying that the proposal is not the way forward and that we need action from Government.
Does the member accept that it is a temporary freeze or rent cap? It will last until the end of March and will not affect housing associations, although I accept that they are interested in what happens after April.
First, the point that I was making was that ministers, cabinet secretaries and the Government have changed their minds. If the bill is passed unamended today and tomorrow, 18 months will not seem like a long time. I know that the Scottish National Party likes to talk about generations being a few weeks, but for most of us 18 months is not a long time. In my opinion, and in the opinion of housing associations and experts—if John Mason had listened to them in emails that he has received—a rent cap will force people to give up their properties, and more people will be homeless across our country. That is why I ask members to support amendments 1 and 32 in my name.
I move amendment 1.
I will start with amendment 1, which is in the name of Jeremy Balfour. I agree with him that the Government changed its mind on the issue, and we welcome that change of mind. We called for a rent freeze in the summer, so I am absolutely delighted to see the Government following where Labour has led. Therefore, I oppose amendment 1.
The amendments in my name in this group—all the amendments in the group apart from 1 and 32—are my attempt to be helpful to the Government, in particular to the First Minister. In her programme for government statement in early September, the First Minister said that rents would be frozen from that day. However, the bill does not propose to freeze rents from that day—for tenants who live in the private rented sector, rents can increase today, tomorrow, the day after that and for weeks and weeks up until 5 December.
My amendments are an attempt to be helpful to the First Minister to ensure that the statement that she made in Parliament remains accurate. My amendments would change the date in the bill from 6 September to 6 June, which would mean that any notice that is issued by a private landlord, which has three months to take effect, after 6 June would be ruled ineligible. That would mean that the First Minister’s statement that all rents were frozen from the day on which she made her statement on the programme for government would remain valid. On that basis, I ask members to support amendments 2, 3, 7, 14, 15, 17, 22 and 27.
At the outset, I once again thank colleagues from political parties, stakeholders and, in particular, officials from the Government and the Parliament for the incredible pace at which they have worked in bringing us to this point.
As Jeremy Balfour set out, amendments 1 and 32 are very clearly intended to take away one of the principal functions of the bill. He said that we had a powerful debate at stage 1—indeed we did, and Parliament agreed to the general principles of the bill. Even if his amendments are admissible, it seems to me that, at a political level, they would fundamentally undermine the purpose of the bill. The Conservatives have the right to disagree, but there is no ambiguity about the amendments: they fundamentally oppose the reasons why we are introducing the bill. In the context of a cost of living crisis, we believe that an emergency response is necessary. Tenants are particularly exposed to that cost of living crisis, which justifies a rent freeze.
We absolutely did not, as Jeremy Balfour suggests, argue the case that he is arguing a few months ago. We opposed an amendment that we were convinced would not have been legally competent. The provisions in the bill are legally competent and will be effective at protecting tenants.
The remaining amendments in the group, as Mr Griffin said, would have the effect of retrospectively applying, to 6 June rather than to 6 September, the rent control measures that are contained in section 1. The purpose of backdating the measures to 6 September is, as I think the First Minister has made clear, to avoid the programme for government announcement resulting in landlords seeking to avoid the effect of the measures by acting before we had time to bring the legislation before Parliament. We are seeking to avoid rent increase notices being issued in response to the announcement. Ensuring that that protection is given will be accomplished by the bill. It is a necessary part of the package that will deliver protections for tenants, and it gives a level of clarity to landlords and tenants.
I am afraid that I cannot accept the amendment to backdate the freeze to June. That would run contrary to the need for the law to be fair and certain, because it would change the effect of landlords having been unaware of the intention to change the law months before the programme for government announcement was made. To do so would inevitably open up the legislation to challenge and cause significant uncertainty.
The uncertainty was caused by the First Minister announcing in her programme for Government statement that rents would be frozen from that day. That created uncertainty for tenants, who would rightly expect that rents would be frozen from the time when the First Minster made her announcement, not from well into December. If the minister will not accept my amendments, does he accept that the First Minister should change the record?
The First Minister was clear, and I regret that the member is choosing to misinterpret what she said in that way. It is very clear that the intention is to prevent rent increase notices as a response to the programme for government announcement. The bill as it stands will achieve that.
Although I thank members for their contributions to the debate on this group of amendments, I must ask Parliament to vote against all the amendments in it.
There will be a division. As this is the first division of the afternoon, I will suspend the meeting for around five minutes. That will enable members to access the digital voting system.
15:21 Meeting suspended.
15:27 On resuming—
We proceed with the division on amendment 1.
The vote is closed.
The result of the division is: For 20, Against 95, Abstentions 0.
Amendment 2 disagreed to.
Amendment 3 not moved.
We move to the group entitled “Application of the rent cap”. Amendment 4, in the name of Miles Briggs, is grouped with amendments 5, 6, 9, 10, 16, 21, 23 to 26 and 31. If amendment 21 is agreed to, I cannot call amendments 22 and 27, which were in the group entitled “Operation of the rent cap”, or amendments 23 to 26 in this group, due to pre-emption.
Amendment 4, in my name, would remove the social rented sector from the bill and exempt it from regulations. The social housing sector is already highly regulated and has taken important steps in keeping rent increases as low as possible. Furthermore, the Scottish Federation of Housing Associations has warned of unintended consequences from the bill for social housing and the development of affordable housing, as well as potential consequences for construction costs, which have increased, and for meeting net zero targets. We therefore ask members to support my amendment 4 and Willie Rennie’s amendment 5.
Amendment 23, in my name, looks towards mid-market rent properties, which are an affordable housing tenure that housing associations offer. They are homes that are for rent to households that are on low to middle incomes.
Rents for MMR homes are generally set lower than private rents but higher than housing association rents for social housing. The tenure is an important part of the housing mix to support those who may not be eligible for or who cannot access social rented homes but who struggle to afford higher rents in the private rented sector. The issue is that the tenancy type is a private residency, so it is the same as homes that are rented from private landlords. We therefore hope that members will support my amendment 23.
My amendment 26 relates to rent increase notices that are sent to tenants before the legislation expires. The bill states that any rent increase notice that is served while the rent cap is in force will have no effect. That means in effect that no rent increase notice can be served on any tenant prior to 1 April 2023, if we assume that the rent freeze expires the day before that, so the rent freeze would remain in place until the end of April—not the end of March, as ministers have outlined—given the requirement to give 28 days’ notice of any rent change in the social sector. We therefore believe that landlords should be able to provide such notices before 1 April.
I move amendment 4.
I will speak to amendments 5, 21 and 25. My amendments focus on the social sector and on mid-market rental properties in the charity sector. In short, I want to remove them from the bill’s provisions. My rationale is that their inclusion will not help. The majority of tenants in the social sector will not benefit from the cap, as their rent is paid through universal credit. There are targeted funds to help people who are struggling and finding it difficult to pay their rent, and rents in the social sector are about half of those in the private sector, so the cap will not really help people with the cost of living, but the damage could be significant.
It is the uncertainty that is most damaging. Although the rent cap might never have an effect on rents in the social sector, uncertainty about whether it might will have a massive impact on planning for the future. That will mean a cut to house building and maintenance programmes. Even though they support the universal cap, several charities and organisations have highlighted that issue in their lobbying today.
The minister recognises that there is a problem. To his credit, he has been working to reassure the sector. He has committed to working in partnership with it. He has indicated that the social and private sectors might be decoupled after March, but I suggest that it would be much easier to decouple them now by removing the social sector from the scope of the bill. Tenants would continue to be protected by the sector, the uncertainty would be removed, planning could restart, new houses that were in doubt could go ahead, and existing homes could have new bathrooms, kitchens, windows and roofs fitted.
Yesterday, we heard wise contributions from Bob Doris and John Mason, who relayed the concerns of housing associations.
Although I will not support his amendments, does Willie Rennie agree that the statutory rent consultation process that all housing associations must conduct would be a useful tool in deciding whether to use the powers from next April onwards? I state again that, in principle, we are introducing a cap, not a freeze, so the powers could—in theory—be used sparingly, although my preference would be that the powers were not used at all. Does Willie Rennie agree that the rent consultation process could inform whether the powers are ever used?
Bob Doris is right. One benefit of the social sector is that such consultations have been in place for many years, which has resulted in very low rents—half of those in the private sector. My argument is that we should use those processes now, not just after March, but I accept Bob Doris’s point that they might be a mechanism that could be used in the future.
I think that the social sector should be treated differently. Let us not fix what is not broken. My three amendments have three purposes. Amendment 21 would remove social housing from the scope of the bill. Amendment 25 would provide a longer notice period for rent cap changes, to allow the sector to consult on and prepare for any changes. I also support Miles Briggs’s amendment 4.
Amendment 23 is about mid-market rents. I support removing such rents in the charity sector from the scope of the bill. Many organisations, such as the Gannochy Trust in Perth, provide excellent housing that is of a high standard. In fact, recently, I saw its new houses, which have very high energy efficiency and mid-market rents. Such rents are, in effect, controlled now, so the bill is trying to control what is already controlled. The trust’s future planning could be interrupted, so I suggest that we remove mid-market rents in the charity sector, as well as social housing, from the scope of the bill.
I urge members to support amendments 4, 5, 21, 23 and 25.
My first set of amendments in the group—amendments 6, 16 and 24—address the matter of landlords not raising rents between tenancies. Up to 31 March 2023, the amendments would prevent a landlord from raising the rent of a property between tenancies and would apply to private rented sector short assured tenancies and Scottish secure tenancies. I want to test a couple of issues from my Fair Rents (Scotland) Bill of the previous parliamentary session in relation to this bill, and this is one of them.
I have a concern that, unless the issue is addressed, we might see a surge in illegal evictions or illegal rent increases. Third sector organisations have raised that in their briefings for members this week. Citizens Advice Scotland, the Joseph Rowntree Foundation, the Poverty Alliance and Shelter Scotland are concerned about unintended consequences of the bill for tenants and landlords; with low public awareness of the issue, they are concerned that there runs the risk of an increased number of evictions and unlawful rent increases, with unclear options for redress.
I ask ministers to consider their response to the concern that, although the framework of the legislation is clear on how things will work if landlords operate within the law, a small minority of landlords might not operate within the law. I ask them to also consider the fact that being “between tenancies” means that the tenant has already been evicted and the landlord can impose a new rent, which is not subject to a rent freeze. The joint briefing from the organisations that I named expresses sincere and widespread concerns about illegal evictions, which I ask ministers to address.
My amendments 9 and 10 relate to the statement that, under the framework of the bill, landlords will make in relation to their application to increase rents. The amendments would ensure that landlords cannot insist that their proposed increase is applied until after the rent officer or First-tier Tribunal of Scotland has approved it. Further to that, the landlord would have to make it clear in their communication to the tenant that the new rent was not payable until it had been approved.
I am exploring that because I do not believe that we have the right balance between landlords and tenants in the legislative framework beyond the bill—Richard Leonard made that point yesterday in the stage 1 debate, as did other members. Where possible, we must seek to balance the situation for what might be fearful tenants who think that, because their landlord has applied for an increase, it will automatically be approved. I would like landlords to have to explain to their tenants that they are applying for an increase and want that to be included in the statement, because the tribunal might not be satisfied that the hardship test has been met.
The problem with First-tier Tribunal arbitration is that the current wait time is eight to nine months. The financial memorandum for the bill says that there are sufficient funds for it, but obviously there are not. Will Pauline McNeill reflect on whether, to comply with her wish, the First-tier Tribunal would have to have more money so that it could sit more regularly and give satisfactory answers quickly to tenants?
It is difficult to disagree with Edward Mountain on that. In anything that I have ever said in the Parliament on the issue, I have always tried to strike the right balance between landlords and tenants, and it does not help anyone to have an inefficient tribunal system. I have no difficulty in agreeing with his comment.
I do not want tenants thinking that, because a landlord has applied for an increase, it will be approved—notwithstanding Edward Mountain’s point that the process can take some time. I totally accept that that is not fair to the landlord, but it is also unfair to the tenant. Through my amendments, I seek fairness for tenants.
I have one point to make to Willie Rennie about universal credit. It is quite important to understand that, in the housing support sector, for people who are on low pay and who do not get universal credit or other support from the Government, it is incredibly hard to access hardship funds. I have argued that many times. I ask members not to discount poor families and children—particularly those in the private rented sector, which is where poverty mainly lies—and to do more to ensure that those families have the support that they need to maintain their tenancies. I have spoken for long enough and will allow Willie Rennie to intervene.
I have no great disagreement with Pauline McNeill, especially on her point about the poverty of people who have tenancies in the private rented sector. My point about support mechanisms is simply that hardship grants are available through housing associations. Those grants are perhaps not worth as much as we would like them to be, but they are available and will help those who are struggling to pay their rent, on top of those who receive universal credit.
That is my central point, and I think that that outweighs the disadvantages of including the social rented sector in the scope of the bill.
The member makes his point very well, but I hope that my point is not overlooked. If the provision of support is based on entitlement to hardship funds, by and large many people will not meet the test. Such provision is not universal. When we are in the middle of an acute cost of living crisis, the fact that those who do not receive Government support need better ways to support their tenancies is an issue that we must address further down the line. I make that wider point.
I am pleased to speak to my amendment 31, because I feel that an opportunity has been missed to extend the proposed protections to a group that the bill has overlooked.
Care home residents are, in effect, tenants in the same manner as students are, yet while the bill offers students protection, care home residents are sidelined. Some care home charges fall under common-law tenancies in a similar manner to student residential tenancies and include, for example, accommodation, utilities, food and insurance. My amendment mirrors the wording of the provisions that relate to student residential tenancies and seeks to apply them to eligible care home charges.
Great effort has been put into ensuring that students are included in the bill’s provisions, despite the fact that more complex arrangements might be in place. The same concern has not been shown to care home residents. The Parliament’s bills team has advised that independently funded supported person contracts could be considered to be equivalent to those for student accommodation and could therefore fall within the scope of the bill.
When Mercedes Villalba lodged amendments to the Coronavirus (Recovery and Reform) (Scotland) Bill to freeze rents, the Deputy First Minister responded by saying what was wrong with those amendments and where the weaknesses lay. I intervened to ask him what the Government was going to do about the excessive rent rises that Mercedes Villalba had highlighted. I have lodged amendment 31 in order to raise the same issues. People who have to pay their own care home fees are having excessive costs piled on them.
I highlight the plight of self-funders in care homes and their families, who say to me that they are being fleeced, and no one seems to care. I have heard from care home residents who face monthly increases in the charges that they pay. Although safeguards are in place for many tenancies to stop rent increases taking place more than once a year, the same protection is not afforded to care home residents who are self-funders. People tell me that they are struggling to keep up with the continual rises in fees and that all their money is disappearing as they seek to meet those rises. Often, those people have worked hard and saved up throughout their lives. Now, that money is disappearing, as a result of ever-increasing care home fees.
It is worth restating that such people do not have major wealth; they have worked hard all their lives, saved a bit and bought their homes. They now need support and care, and they are told that they must pay for it. As costs go up but local authority fees remain stagnant, those people are the only source of additional income for private care home operators.
I say again that residents and their families feel as if they are being fleeced, and they want the same protections as all other renters have. I look forward to hearing what the minister has to say, because the situation cannot continue. Those people cannot be ignored, and neither can the fact that charges are continually being put up. It seems to those people that there is nothing that they can do and nobody cares.
I do not think that anyone can argue that housing associations and charities have not worked extremely hard to meet the needs of their tenants. They have struggled in previous years with rent caps.
One of the big issues with the cost of living crisis is that houses are incorrectly insulated, which is why we need to invest in the insulation of houses. A survey that I carried out in Wick alone suggested that, of the 850 properties that the council owns, 530 are below energy performance certificate rating C. It would cost in excess of £21 million to get those properties up to the correct level.
We need to encourage landlords to invest in their properties, and I, along with many other Highland MSPs this morning, received a disturbing email from a housing association that is going to have to review its future investment in properties as a result of the bill. It has—rightly—agreed a rent freeze, and it was looking to have a rent increase in line with inflation next year. That seems to be sensible—it was helping its tenants this year in order to invest next year. Now, it is in the position where it has helped the tenants this year but it cannot help them next year by investing in the fabric of its buildings, because it will not be allowed to address the issue of rent.
We need to remove housing associations and charities from the bill so that they can address that issue and carry on with such investment. If we do not give them certainty into the future, the supplier industry is such that any work that might be allowed if the rent freeze did not continue would not be able to be programmed, because the materials would not have been requisitioned early enough.
That is why I support amendments 5 and 23, and I believe that the Parliament should too, because to do so will not only help tenants but address the problem of insulating properties, which Scotland should be trying to achieve.
Before I turn to the amendments, I will respond to those last points on energy efficiency. The Government has given not just a clear indication but a clear commitment on investment in energy efficiency across our built environment and in social housing, in particular. Edward Mountain is quite right to draw attention to the critically important nature of that investment in reducing our emissions and tenants’ energy costs.
I would refer Edward Mountain to the recent comments of the British Energy Efficiency Federation, which, in giving advice to the UK Government, said that it should follow the Scottish Government’s lead on the support that we are giving in the area.
It will be very brief. I understand that the Scottish Government wishes to invest in housing, but insulating old housing costs a lot of money. I have been a surveyor and I have had properties that have had to be insulated, and it is my estimate that it costs £40,000 to £50,000 to get a property up even one level of the EPC ratings. That is nowhere near what the Government is promising for its social housing.
I will turn to the amendments. In response to one of the last points that was made, I remind the members who are moving amendments 4, 5, 21 and 23 that, fundamentally, the commitment to a zero per cent rent cap for the first six months has reduced the income of no social landlord in Scotland and no decision has been made about the future. We are working constructively with the sector in order to inform those decisions. Amendments 4, 5, 21 and 23 would have the effect of removing registered social landlords, their wholly owned subsidiaries and local authorities from the rent cap.
As we discussed yesterday, we propose the application of the rent cap until 31 March in the first instance and having it separately variable between the private and social rented sectors in order to take account of the sectors’ distinct nature. That date was set with the social rented sector in mind, as we are aware that rents in that sector are not generally set until 1 April and will not increase before then. We set that date specifically to ensure that those emergency measures do not immediately impact on the finances of the social rented sector without full consideration of its perspective.
The minister is right about that point. Does he not accept, however, the broader point about the huge uncertainty that exists? I know that he has had good discussions with the sector and that a good partnership is in place, so the sector will probably be given a bit of foresight about what is happening. However, it will not be given a guarantee that the cap will not extend beyond March, and the uncertainty around that will have a long-term effect on the planning of the building of new homes, maintenance and the rest of the package. Does the minister not accept that point about uncertainty?
I will come to some of the arguments around Mr Rennie’s amendments and some of the reasons why I do not think that his approach would give certainty in the way that he suggests.
We are firmly committed to working with the sector as well as supporting it to undertake meaningful consultations with tenants while that work continues. To drive that progress forward, we have established a short-life task and finish working group that brings together Government officials with leaders from across the sector to identify and consider the available options.
Every discussion in which I have taken part with the sector—I think that this is true of the cabinet secretary’s discussions with it as well—gives me great confidence that we can find a way to meet the needs of tenants in the sector, who would have the same expectation of security for themselves as other tenants, and the needs of the sector as well as the wider purposes of social housing. I am therefore not able to support amendments 4, 5, 21 and 23, and I ask the members not to press them.
Amendments 6, 16 and 24, in Pauline McNeill’s name, raise a substantive issue. The aim of the bill is to protect tenants, helping them to stay in their homes during the cost crisis by stabilising their housing costs. The average tenancy in Scotland lasts around 18 months, so the emergency measures will provide protection to the majority of tenants. The application of the rent freeze on that basis responds to the need to ensure proportionate measures.
Pauline McNeill has mentioned the risk of illegal evictions. The additional penalties that the bill will provide create a strong disincentive for landlords to pursue unlawful evictions. The member is quite right to raise the issue about raising awareness in the sector among tenants and landlords, and we will debate that point when we get to other parts of the bill.
Prospective tenants who enter into a new tenancy will do so on the basis of an agreed rent, and they will immediately have protection from any rent increase, as the provisions in the bill will apply while their tenancy is in effect.
The minister has perhaps clarified the matter with his last point, but I want to make sure. If a tenant’s lease is due to end within the six-month period of the bill, the landlord could just not renew the lease. Is the minister saying that the bill would protect tenants—that the rent would be frozen? If he is saying that, I am content; if he is not, my point that there should be a rent freeze between tenancies is valid.
I do not believe that it is a point of order, and I do not believe that that is what I said.
To return to the points raised by Pauline McNeill, end-tenancy rent increases generally do not take place in the social rented sector, and most rents have been set annually from 1 April.
There are very important longer-term arguments here about the operation of the rented sector, which we will continue to address in our longer-term work on permanent changes to legislation, but I am afraid that, in the context of this emergency bill, I am not able to support the amendment to extend the bill to inter-tenancy rent increases. I therefore ask the member not to move her amendments. If they are moved, I ask Parliament not to support them.
Turning to Pauline McNeill’s amendments 9 and 10, I again ask the member not to move the amendments. We all want to make sure that tenants are well informed, but the amendments are flawed in their references and would require to be mirrored in the provisions relating to tenancies in the Housing Act 1988. However, in considering those issues, we would be content to bring back an amendment at stage 3, tomorrow, with the correct references that addresses the points that Pauline McNeill seeks to address in amendments 9 and 10.
Willie Rennie says that amendment 25 seeks to achieve clarity, but I do not believe that it would do that. It would require a lengthy notice period to be provided by the Scottish ministers when laying regulations to modify the rent cap for social tenancies. As I said, the Scottish ministers will work closely with social landlords and tenants in social tenancies to discuss any changes to the rent cap, but amendment 25 would remove the ability of ministers to react to changing circumstances, in order to protect the interests of landlords when the cap must be increased.
Equally, any future decrease in the rent cap, if it had already been increased, could not be actioned quickly due to the amendment. There are existing procedural safeguards in the bill, as the rent cap can be increased only by regulations that are subject to the affirmative procedure.
To ensure that Scottish ministers can react quickly to changing circumstances, I cannot support the amendment, and I invite Willie Rennie not to press it. If it is pressed, I urge members to reject it.
I turn to Miles Briggs’s amendment 26. We also cannot agree with that amendment in its current form, but it raises an important issue that we agree needs to be addressed. Therefore, we will lodge a stage 3 amendment to allow rent increase notices to be issued for the social sector if the cap is lifted one month before 1 April 2023, to allow social landlords to issue rent increase notices in time for them to take effect on 1 April. That is an important issue, and, as I say, we intend to address it tomorrow at stage 3. I hope that Miles Briggs will accept that position.
I am afraid that I also cannot accept amendment 31. There is an understandable desire, as we debate emergency legislation in relation to the cost of living, to widen the debate out beyond rented housing, but I am afraid that we are not able to do that. Amendment 31 clearly widens out the debate beyond the issue of rented housing.
There are key differences between living in rented housing and living in a care home that mean that it is not appropriate to address care homes in this bill, which relates to the protection of tenants. In a care home, the purpose of the accommodation is the provision of a service, so the charges are an amalgamation of charges for services and accommodation. Charges cover food, heating, care, support and workforce costs, among other elements.
Care homes do not offer tenancies; instead, residents have a residency agreement that sets out, among other things, the services that will be provided, the payment of fees and charges, and notice and termination periods for the residency agreement. The Government recognises that care home fees can be high for independently funded supported people, which is why free personal and nursing care rates have been increased by more than the inflationary measure for the past two years.
The important point of lodging the amendment was to raise the plight of self-funders. One person who wrote to me said that their costs went up from £2,669 to £2,786, and then to £3,221, all within a six-month period. Is the Government aware of the massive pressures that are being put on self-funders and of the fact that they are the only people who seem to be being asked to pay the price? The Government and local authorities have not put up care home costs for people who receive state funding; they have put up costs only for self-funders.
The Government is aware of the impact on people in care homes and of the issues that the member raises, but I am afraid that they go significantly beyond the issue of rented housing, which is what the bill seeks to address. I suggest that the member engage in dialogue with the Minister for Mental Wellbeing and Social Care to address those issues further. I entirely respect the intention with which he has raised them, but I am afraid that the amendment goes beyond the purpose of the bill. Therefore, I urge the member not to move amendment 31. If he does, I am afraid that I must ask the chamber not to support it.
It is my intention to press amendment 4 and to ask members to support Willie Rennie’s amendment 5. This is our one opportunity to remove the social rented sector from the bill, and members across the Parliament need to take it, because the damage that including that sector and its not seeing the future investment that is vitally needed for all our communities is unacceptable. I hope that it will be removed.
I will also move amendment 23. However, given what the minister said about amendment 26 I am happy not to move that amendment and to have discussions before stage 3, tomorrow.
I will speak to amendments 8, 11, 12, 13, 18, 19 and 20. The amendments would allow the landlord to apply to a rent officer for a rent increase that would cover 100 per cent of any increased property cost. That would ensure that the tenancy remained financially viable for the landlord and that the increased costs associated with a property could be paid to ensure the on-going quality of a property. It would also have the positive effect of the tenant not having to leave a property.
As the bill stands, the Government has put in the figure of 50 per cent, but in my view, with the situation that we will have over the next few months, that will still cause problems.
That view was highlighted to me yesterday evening as I went home on the bus. I was a bit surprised that one of my constituents had engaged, listened to the debate and decided to discuss it with me on my way home. They have a property in Edinburgh that they had bought for a relation, with a mortgage. That relation has now died, so a tenant has gone into the property and is living there. However, the owner is not particularly well off and the rent covers their mortgage and other costs. Without that rent, they could not pay the mortgage and would have to take the property back and sell it. They expect that, over the next couple of months, their mortgage will go up. [
I come back to my constituent because, after all, we are here to represent our constituents—not to make cheap political points.
My constituent has informed me—[
.] Obviously, the committee does not want to hear this. My constituent has informed me that any rise in their mortgage for whatever reason will mean that they will have to use the provision in the bill on financial hardship and evict the tenant to sell the property. Having had several other emails from constituents in Lothian as the debate has been going on, I suspect that that individual will not be the only one who does that.
If the Government wants to pursue the policy, which, as we have heard from other parties, might be challenged in court—let us be honest that the Scottish Government’s record on getting bills legally right is not good—let us at least protect landlords from having to sell property because of a financial situation that they have not created. We are not asking for profit. We are not asking that anyone benefit financially from the policy. We are simply talking about covering costs. If the Scottish Government cannot see that that is a fair and reasonable thing to do—
Jeremy Balfour makes the point that a landlord should not face hardship because of costs that are outwith their control and that they should be allowed to sell the property to recover those costs. Why should a tenant be made homeless by a landlord selling the property because of costs and things that happen that are outwith their control?
With respect, I say that I do not think that Mark Griffin quite understands what we are trying to do. We are trying to stop that; we are trying to prevent the tenant from having to leave the property because the landlord simply cannot afford to pay his or her mortgage. That will happen because, if the landlord does not sell the property, the bank or building society will come and take it off them, my constituent on the bus will have a negative credit rating and the tenant will still be evicted.
It will be a lose-lose situation.
I believe that my amendment 8 is a reasonable one that will protect tenants and landlords for the next six to 18 months and will allow people to plan with the certainty that they will not lose their property. For that reason, I ask the committee to support amendment 8.
I move amendment 8.
Groups 3, 4, 5 and 6 have a number of amendments that work across the groups and are linked together. The amendments would ensure that exceptions related to substantial arrears and financial hardship on the part of landlords can apply only where a high test of financial hardship applies as a result of those financial arrears. We are saying that landlords should not just—
The Deputy Convener:
We will have a brief suspension while I check the papers.
16:21 Meeting suspended.
16:23 On resuming—
I apologise to the committee, and particularly to Mark Griffin, who tried to style it out commendably. My mistake.
That is a perfect illustration of what happens when we try to rush legislation through Parliament without proper scrutiny and consultation.
Before I come to the amendments in the group, because this is my first contribution, I remind members of my entry in the register of members’ interests, which states that I am a member of the Law Society of Scotland and that I have an interest in two properties that are let on a long-term basis.
I have three amendments in the group. Amendments 28 and 29 cover essentially the same point. The bill, as it is presented, provides that, in the private rented sector, landlords are able to increase rents to cover up to 50 per cent of increased costs, such as finance costs or insurance premiums. However, that provision applies only to the private rented sector, not to the social rented sector. Amendments 28 and 29 seek to extend the measure to cover the social rented sector.
Yesterday, in the stage 1 debate, we heard a number of members from various political parties speaking about the importance of the social rented sector. That is a view that is widely shared across the chamber, so I hope that there will be some sympathy for social landlords, who will face similar pressures to private landlords with regard to increasing costs, whether that involves finance, insurance premiums or other things. Therefore, my amendments 28 and 29 seek to give social landlords the additional protection that already applies in the private rented sector.
Amendment 29, which is my preferred amendment, provides that social landlords would have 100 per cent protection from increased costs. However, an alternative that members might find more amenable is my amendment 28, which would restrict that protection to 50 per cent, in line with what is provided for private landlords. I simply observe that the Scottish Federation of Housing Associations, in its briefing for the debate this afternoon, has expressed support for my amendment 28, and I encourage members to listen to what the federation has to say on that particular point.
Amendment 30 deals with a slightly different point. The rent freeze that is encapsulated in the bill relates to “any sums” that are paid by the tenant to the landlord. In some tenancies, the cost of utilities, such as gas or electricity, are not charged separately and will, therefore, be caught by the rent freeze. As per schedule 1 of the bill, the rent freeze would also apply to utility charges arising from the tenant’s utilities use, except where those are deemed to be “excessive”. Therefore, if a landlord sees a large increase in utility costs, they are not, as the bill stands, permitted to pass that on to the tenant, unless the tenant’s use of those utilities is excessive.
The difficulty with that is that we do not know what is meant in the bill by the word “excessive”. Perhaps the minister, in responding, can tell us what is excessive use of utilities. There is nothing in the policy memorandum that indicates what that might be. Would it be 10 per cent, 50 per cent or 100 per cent above the norm? What is the definition of “excessive”? It seems to be unreasonable that the landlord is not able to pass on any increase in utility costs, except where it is excessive, when we do not know what “excessive” means. My proposal is that we remove the word “excessive”, which is not defined. That would ensure that the tenant who is using the utilities pays for the utilities and the tenant’s use of the utilities is not billed to the landlord, which seems to be the provision in the bill, as drafted.
I am glad that I am not alone. It seems that the members on the SNP benches have more of such interests to declare. [
.] I am not pointing at anyone—for example, in the third row up, on the right.
On a serious note, I do have an interest in today’s proceedings, because my mother lives in a housing association home, and I have quite grave concerns about the state of it. My mother, many of her neighbours and many in my community need vital upgrades to their heating, windows and doors. Those necessary upgrades—which would help to insulate their homes and lower their heating costs, and would help our whole country meet our net zero targets—are all clearly at risk, because of how we have just voted on amendment 4, in the name of my colleague Miles Briggs. I commend him for lodging that amendment.
We have all had correspondence, which I hope that we have all read, from housing associations, which are on the record as being explicit about the risk to those vital upgrades and investments in current—not new—properties. Much of their stock is old, ageing and dilapidated. I know that, because I have seen the insides of many of them, as I am sure we all have.
Amendment 72 is based on the following simple assumptions. First, the Government is seeking to use the law to cap the amount of rental income that a private landlord can charge. Secondly, many landlords—although not all—will have used buy-to-let mortgages to fund the purchase of those properties. Thirdly, there is often a very direct financial correlation between the amount of rent that is received from the rental property and the mortgage. In fact, for many, there is a simple pass-through between the rental income and the outgoing mortgage payment. There is not always profit involved for many small landlords. Fourthly—and this is the point of amendment 72—if, as a result of a cap that the Government has introduced, the rental income is less than the amount of the mortgage that is payable on that property, I believe that that will cause financial issues for the property owner.
That could potentially put them at risk of defaulting on the debt and, in the worst cases, put the property itself at risk. Mortgages are big financial contracts between a borrower and a lender. A borrower runs the same risk as anyone else does of falling foul of that contract due to non-payment if they cannot afford to make the payments.
It is only fair to note that in the exact circumstances that you outlined, the real issue is section 24 of the Finance Act 2015 from Westminster, which provides that such costs cannot be offset as a legitimate business expense. Perhaps you should clarify that for everyone here. In other words, Westminster legislation has greatly contributed to that situation.
I am not sure whether the member declared her interest at the beginning of her intervention, but she is really scraping the barrel here. We are talking about her Government introducing legislation that caps the amount of revenue that can be charged for rental properties. At the same time, the same landlord, who might have only one property, also has a mortgage to pay on that property. There is a direct correlation, which is what I am pointing out—that is the point of my amendment.
If the member wants to listen carefully, I will share my philosophical view about this. If her Government introduces a policy that caps rental revenue, it—not the wider public and certainly not the people who will be affected by the policy—should pay for it.
I want to make sure that we are understanding the amendment and its purpose clearly. As we know—it has been referred to by other members—the UK Tory Government has trashed the economy. One of the results of that, as Jamie Greene knows, is a massive rise in interest rates, which is putting people’s homes at risk and putting up landlords’ mortgage costs, which is the point of his amendment. That is correct, is it not? That is the point of his amendment.
The Scottish Tories are now coming to the chamber with an amendment that would put Scotland’s public finances in place to pay for that Tory incompetence by paying for any rise in interest rates on landlords’ mortgages. That is what the amendment says. It seeks to use public money to set up a scheme to cover any increase in the interest rates on landlords’ mortgages, which is directly related to the economic folly of the Tory Government. That is an incredible amendment for the Scottish Tories to bring to the chamber. It would be good if Jamie Greene could clarify whether that is exactly what his amendment seeks to do.
We have heard quite enough, cabinet secretary.
I will answer the question directly, and then I will take another intervention. My point is that it is this Government’s policy to introduce a cap on the amount of revenue that can be gained from rent. Whatever the rights and wrongs of the policy—we can have a debate about that—if it means that the property is put at risk, which might well be the case, that is a problem. I will come to the evidence base behind that, if the cabinet secretary wants to listen. I am simply asking why the public, not the Government, should pay the price of that policy. It is the Government’s policy to introduce that cap, not the public’s.
The sad truth is that Mr Briggs is right.
If we are in a scenario in which, as a result of the cap, social housing providers cannot put vital investment into degraded housing stock, on this Government’s head be it.
We know that we could be in a situation in which landlords simply cannot afford to pay their mortgages or meet other costs.
I accept that there is provision in the bill around that, but I simply do not think that it goes far enough. We do not want to see people getting into difficulties, and we certainly do not want to see property market stock reducing as a by-product of the legislation because that would lead to real issues. I think that that point will be made throughout the debate.
Just one second.
I will close, in the interest of time—we will be here all night otherwise—by mentioning an email from a landlady in my region, who wanted me to pass on a message to the Government. She has only one rental property, which is her only source of income and being unable to put up the rent or evict non-payers could put her into a difficult situation or near bankruptcy. She said that she is already near that stage. She also said that not all landlords are big portfolio owners with lots of money, but everyday people with a little money and that the blanket policy does not fairly consider the thousands of landlords across Scotland who also are struggling. She is absolutely right. Why are we not listening to people like her?
Jamie Greene makes an important point. The point made by the landlady is the reason why the bill includes safeguards to cover that very scenario. I hope that he will reassure her about that. It is important that we all reassure our constituents when we get the opportunity to do so.
I am glad that the cabinet secretary mentioned safeguards. As far as I can see from section 33A, any increase is capped at 50 per cent of any rise in property costs and that rent can go up only by a maximum of 3 per cent. If I am wrong about that, I am happy to stand corrected. For many, that simply might not be enough, which is why I will be moving my amendment.
This is a path of the Government’s own choosing, whatever the rights and wrongs of it. People have different views on that. I am simply saying that the Government should pay for that, or at least be honest with people. If the Government disagrees with my amendment, it should be up front, honest and clear in telling landlords that it is asking—in fact, it is expecting—them to pay for that policy. That is all that I have to say on the matter.
I was not planning to speak to this group of amendments until you called me, much to my surprise, convener. However, given how the debate has gone, I feel that I must speak to amendment 72 in the name of Jamie Greene. I cannot believe that a Conservative MSP would lodge an amendment that would give public subsidy to a private landlord struggling with their mortgage, which is the direct fault of his UK Government’s actions in pushing up interest rates. [
.] I will not give way at the moment. I cannot believe that the Conservative Party’s priority is to protect landlords from rising interest rates, but that it has no plans whatsoever—it has put forward no proposals—to support the hundreds of thousands of households who are paying the price for his Government’s ineptitude as a result of skyrocketing interest and mortgage rates.
Clearly, this group of amendments has opened up the opportunity for some of the fundamental differences in approach that were debated yesterday to be heard again today. Obviously, we welcome a robust exchange of views. We have very divergent opinions, although I expect that those divergent opinions on the fundamentals are between the Conservatives and all the other parties in the chamber. Even if some colleagues might disagree on some of the details, I think that we are mostly on the same page on the fundamentals.
In addressing Mr Balfour’s amendments, I want to look at some of Mr Greene’s comments about balance. Fundamentally, in crafting the bill, we have had to ensure that there is a balance of interests between landlords and tenants. The purpose of the package of safeguards that we have built into the bill is to recognise the exact point that Mr Greene makes. Not all landlords are hugely wealthy, with hugely profitable businesses and extensive property portfolios. Some are, but some landlords are the kind of people that Mr Greene described. The package of safeguards in the bill is designed precisely to address their circumstances.
Indeed, the Scottish Association of Landlords has recognised that. On the radio this morning, John Blackwood said:
“We all support the idea that tenants do need protection.”
He went on to say:
“Certainly we do welcome the mitigations in the bill”.
On several occasions outside of that interview, Mr Blackwood has also recognised the work that the Government has done to produce a balanced package. Indeed, if we had not produced a balanced package, we would not have been able to satisfy ourselves or the Presiding Officer that the bill is within the Parliament’s competence. It has to achieve that balance in order to be within competence, and that is what it does.
I thank the minister for acknowledging that I lodged the amendment in good faith as a result of the feedback that I am getting. Does he also recognise that the same John Blackwood was explicitly clear that, because of the challenges, some landlords will soon find themselves
“in financial difficulty and, ultimately, having to take action by selling the property and exiting the sector”?—[
4 October 2022; c 22.]
Surely none of us in Parliament wants that. We do not want to see a reduction in the private stock, because it is needed—whether we like it or not.
None of us wants to see anybody in this country facing financial hardship. I only wish that both Governments were acting with due regard to that risk.
Mr Balfour once again sets out—quite fairly, as he is within his right to do—that he is fundamentally against the measures in the bill. He does not support the measures that we are taking to protect tenants. I urge him, as well as others, to recognise comments that the Scottish Association of Landlords has made about the balanced package of safeguards. He is concerned about people facing costs that are outwith their control, but he seems to be concerned only about landlords who face costs that are outwith their control. I think that Mr Griffin was quite right to pick up that we should be concerned about landlords and tenants.
Does the minister concede and accept that if the landlord cannot pay his mortgage, the tenant is very likely to face eviction? It is not just about supporting the landlord. The consequence of the landlord not being able to pay their mortgage will be that the tenant is evicted.
Without once again getting into the politics of the reasons behind the rise in interest rates, it is worth reflecting on the fact that the majority of private rented tenancies in Scotland do not have a mortgage behind them, and that many of those that do are on a fixed rate that will not be due to change in the immediate period ahead.
The approach that we have taken is, as I have said, balanced. It recognises that, where there are increased costs, there needs to be some degree of flexibility, but the approach needs to work in a way that is balanced.
I come to amendments 28, 29 and 30. Amendments 28 and 29 will cut across the work that we and the social rented sector are committed to doing collectively and collaboratively through the short-life working group that I have mentioned. As I said, I get the sense that there is a real willingness to work in that collaborative spirit to ensure that there is a way forward that protects tenants as well as the providers of social housing. Amendments 28 and 29 do not set out a way in which we think that the protections for the social rented sector would work. In fact, I think that they might undermine and pre-empt the work that we intend to take forward, which we intend to do with momentum.
On amendment 30, it is important to recognise that student tenancies are structured differently. We have the desire to offer parity of protection, but student tenancies often include energy costs. We have defined rent for this sector to make it clear that rent includes the
“Sums payable in respect of services, repairs, maintenance or insurance”.
However, where utilities are included in the rent and the student makes “excessive use” of them, it is right and fair that an accommodation provider can seek recovery—
Just a moment; I will make some progress first.
It is right and proper that the provider can seek recovery of that from the tenant where the tenancy allows it.
Mr Fraser’s amendment 30 would create a loophole. It would allow providers to circumvent the rent freeze by increasing the utility part of the rent, even if the utilities are being used normally rather than excessively.
On the questions about definition that Mr Fraser raised, the term “excessive” is part of the contracts. It would not be appropriate to have a global definition in the bill, because the matter is provided for in individual contracts that govern purpose-built student accommodation.
I am grateful to the minister for the explanation that he has just given. He said that it is a matter for the contracts. Is he saying that it is for the accommodation provider—the landlord, such as a university or a private company that has developed student flats—to specify what would be excessive use? If a provider said that it was 5 per cent above the trend, would that be acceptable?
The existing contracts stand and, generally speaking, they allow providers to charge extra fees for excessive use. The provisions would be interpreted in that context.
Finally, I turn to Jamie Greene’s amendment 72. The cabinet secretary was right to challenge the fundamentals of the amendment and the idea that the public purse should pay people’s mortgage costs. However, perhaps the cabinet secretary was a little kind in this instance, in referring to “interest”. The amendment from Jamie Greene states:
“The Scottish Ministers must make a scheme or schemes for the making of payments to landlords who are able to demonstrate that their monthly mortgage payments ... exceed the rental income”.
Amendment 72 would cover not just interest payments but the repayment element of the mortgage.
Mr Greene says that the costs should not fall on the wider public, but that is precisely who they would fall on. The Scottish Government holds the public purse and holds money on behalf of the wider public, and he is asking for that to be dipped into to repay the personal debt of landlords—not to service their interest payments but to service all of their monthly mortgage payments. The idea that we should use public funds in that way is astonishing. It would be astonishing to somebody on the right of the political spectrum, and it is certainly astonishing to the rest of us.
Mr Harvie fails to acknowledge or accept that it is his Government’s policy to cap rents and the amount that can be charged. I am simply making the point that that may be fine when the two numbers match but, when payments by the landlord are higher than the cap that his Government has introduced, it is his Government’s policy that is undermining the borrower’s ability to keep up with the payments. I am asking his Government, and not the wider public, to pay for its policy.
I might take that argument seriously if it came from the kind of tenants’ rights campaigner who argues that, at a time when mortgage payments are less than rental income, the difference should be repaid to the tenant or the public purse. However, I do not think that that is Mr Greene’s position on how private renting ought to work.
The idea that we should have public payment of people’s repayment of their mortgages in these circumstances is astonishing. We have seen unfunded tax cuts from the Conservative Party recently, but the idea of unfunded repayment of landlords’ mortgages is astonishing.
Who would end up repaying? It would be those who benefit from the services that the Government would have to cut in order to fund that uncosted measure. Who should pay for that? Should we pay for it by scrapping the Scottish child payment or free prescription charges? No. The Government has introduced a balanced bill that reflects the interests of tenants, who need protection from rising rents in these difficult times, and the interests of landlords, not all of whom are in the same circumstances. The bill is balanced already, and amendment 72 would unbalance it fatally.
I urge members to reject all the amendments in the group.
I will be brief. In the past 20 to 30 minutes, we have seen the bill simply collapse. We have seen it collapse through the minister’s speech and interventions. Did members notice how often he said that the bill is legally competent? Well, let us wait and see what happens in a few months.
I have a lot of respect for Mark Griffin, but I genuinely think that he is missing the point, because we are trying to protect tenants from being evicted from properties. As my colleagues Murdo Fraser and Jamie Greene have said, without a 100 per cent guarantee, we will end up with more people being evicted from properties.
Does the member think that reinstating funding that has been cut from universal credit and uprating benefits by inflation would do more to protect tenants from eviction than your lousy amendments?
I think that Bob Doris is better than that intervention. He might want to stand for the Westminster Parliament if he is so keen about that. We are in the Scottish Parliament and are dealing with the bill that we are discussing today. He should concentrate on the bill and, if we wants to go to Westminster, he should do that.
In the responses to my amendment 8, we have heard political dogma over pragmatism. What we have heard from the minister and the cabinet secretary shows that, frankly, their parties are happy to go with dogma even if that means more people becoming homeless. I am afraid that that is what the Government has shown today.
I press amendment 8.
The Deputy Convener:
The result of the division is: For 27, Against 87, Abstentions 0.
Amendment 8 disagreed to.
Amendments 9 to 20 not moved.
Amendment 21 moved—[Willie Rennie].
I remind members that, if amendment 21 is agreed to, I cannot call amendments 22 to 27, due to a pre-emption.
The question is, that amendment 21 be agreed to. Are we agreed?
I will just speak to amendment 33 and let other members speak to their own amendments.
Schedule 2, paragraph 1, deals with the issue of “protection from eviction”, seeking to protect those who have had an
“eviction notice served on or after 6 September 2022”.
I understand why the Government has introduced that particular measure—it is introduced as an anti-avoidance measure—and why it has been backdated to 6 September, which was the day on which the First Minister intimated that the eviction ban would come in.
Subparagraph 2(1) of schedule 2 mentions specifically that eviction notices that were
“served on or after 6 September 2022” will not be valid, in effect because they are caught by the eviction ban.
The bill infers that the ban will not catch eviction notices that are served before 6 September 2022, but it would be helpful for that to be put in the bill. My amendment 33 seeks to make explicit that any eviction notice that was served before 6 September 2022 will not be caught by the eviction ban. Such a provision would protect people who had had to take action to remove tenants for various reasons—perhaps for a long period of non-payment of rent, antisocial behaviour or other purposes—before that date.
It is clear from paragraph 42 of the policy memorandum that accompanies the bill that there is no intention that the bill should catch eviction notices that were served prior to 6 September. Therefore, I hope that the Government will support amendment 33.
I move amendment 33.
I am afraid that we are once again making bad law by rushing a bill through all its stages.
I am astonished that so few members seem to read the business pages of any decent newspapers, so that they could understand that interest rates are rising not only here but across the entire advanced global economy.
I will speak to amendments 34 and 44. Amendment 34 is based on the belief that universities should be able to evict students who have breached tenancy agreements. Tenancy agreements often contain terms and conditions to ensure that students are not disruptive to others and are not committing antisocial behaviour. Universities Scotland has made it clear that universities must retain the power to remove students from accommodation when they pose a violent or sexual risk to other students. In its briefing, it highlights that as a particular problem in university halls of residence.
I recognise that, but the briefing is nonetheless still largely relevant, in particular in relation to amendment 34, because the bill states that students can be evicted for a “relevant conviction”, which means an offence
“committed by using, or allowing the use of, the let property for an immoral or illegal purpose”, or any offence that is “punishable by prison”.
The bill defines antisocial behaviour as doing something that
“causes or is likely to cause the other person alarm, distress, nuisance or annoyance”, but that might not cover all students who pose a risk to others. I lodged amendment 34 because I believe, as does Universities Scotland, that it is necessary to give universities the power to evict students who pose a risk to others. It is a very reasonable and reasoned amendment.
Amendment 44 will allow institutions the ability to make judgments on evicting people from purpose-built student accommodation. The amendment is primarily about trust and protection of young people, some of whom can be very vulnerable as they take their first tentative steps away from home. Perhaps some members can still remember their sense of vulnerability when they first went to university; it was probably the first time that they stayed away from home on an extended basis.
I would be astonished if someone disagrees with this: Scotland’s universities take their duty of care for their students very seriously. The uniqueness of purpose-built student accommodation should be recognised by the minister in the context of amendment 44. If members think that universities do not move heaven and earth to protect their students, I suggest that they spend some time at Scottish universities.
There are members in the chamber who have had their entire political ambition shaped by their experience at university. I hope that I can say this with recognisable authenticity: we should put down our megaphones and rationally consider what amendment 44 does in relation to protecting students. The behaviours that are covered by the briefing that Universities Scotland provided go beyond the criminal antisocial behaviour that is mentioned in the bill.
I am also sure that all members will have had the experience of dealing with cases of constituents having felt threatened by someone whose actions are not criminal but nevertheless pose a risk to others. Amendment 44 is about protection from risk.
Universities in Scotland need to have the freedom to be able to evict people who pose a risk to others. That happens now, and it is handled discreetly and with great care by university accommodation managers up and down the country. It is done subtly and allows professional housing managers to take action to prevent problems before there is a criminal accusation, charge and conviction. That is sensible management and it is a sensible approach to what is often a very difficult and sensitive problem. This bill would remove the ability of those professionals to do their job in the interests of all of the students who are in their care. Amendment 34 would put a reasonable and controlled amount of ability into the hands of those who are closest to the issues that I have described, which require sensitive management.
I am very firmly of the view that the bill—which we are rushing through Parliament this week—will be a disaster because it will increase homelessness and choke off the supply of available property for accommodation to rent.
But let me put that aside for a minute. Threats, neighbourhood disputes, disruption, drug taking, loud parties and abusive behaviour are a scourge on our communities and are responsible for so much misery. There is no need for that to be tolerated within the confines of purpose-built student accommodation.
According to the community safety group Resolve, 700,000 of our fellow Scots report having been victims of antisocial behaviour in the past three years. To protect the minority of perpetrators, the Government seems to be prepared—in the context of purpose-built student accommodation—to be content to leave the majority of students in halls miserable because nothing can be done. It is imperative that we do not allow that to happen and that we trust the professionals, give them the power and flexibility to run the institutions that they know best how to run and allow them to protect the people whom they know best how to protect.
It is a common-sense based proposal that allows universities to operate without restrictive and disproportionate legislation that will restrain them and leave our young people without adequate protection.
It will not surprise members to hear that Mr Harvie and I do not agree on many things, politically, but we do agree—I think that everyone in the chamber agrees on this—that we want as many homes as possible to be available for people to live in and that we do not want homes lying empty for a number of months.
At this point, I declare that I am a member of the Church of Scotland. Amendments 35 and 40 would give property that is tied to religious settings an exemption from the legislation, for purely pragmatic reasons. The issue was raised previously by my colleague Murdo Fraser, and I hope that the Government has had time reflect on it.
Because of where Scotland is today, many religious organisations—churches, in particular—have empty properties because they do not have a minister or someone to lead their denomination. Take the example of the Church of Scotland. At the moment, it has a blanket rule that no church is able to call a minister, which means that if a church is vacant it will remain so for the foreseeable future. That means that there is an empty property that could be let out to somebody in the community.
However, when that church is allowed to call a minister, it clearly needs that property back so that the minister can live there and carry out his or her role within that community. Amendment 40 would allow the church to let out its property, but when a minister is called, that property can then go back to the church. That would seem to me to allow an opportunity for more homes to be used over the winter period without the risk of the church never getting them back. I would be interested, when the minister responds on this group of amendments, to hear whether he could tell me why that is a bad thing.
As Mr Balfour acknowledged, I raised the issue in relation to previous Covid legislation, which addressed similar points. Then, I said that the concern was that there would be an unintended consequence that churches would just refuse to rent out empty manses, which would continue to lie empty without anybody living in them. That is now happening as a consequence of that legislation. This is an opportunity to put that right and to bring those properties back into use. I hope that the Government will take that opportunity.
As always, I simply follow in the member’s footsteps and I agree absolutely—he has got this right. I say, as a former church minister, that ministers need somewhere to live when they are in that job. However, as somebody who recognises that there are empty homes at the moment, why not enable them to be let out? Why not help, particularly in areas where we need that housing?
Amendments 36 and 54, which are in my name, deal with another matter that would allow individuals to release property, particularly over the winter months, and allow it to be used by local people. As, I am sure, we are all aware, there are seasonal workers who come to agricultural and rural businesses and stay in tied housing, but they need that housing only in the spring and summer. Often, that housing lies empty over the winter because the owner needs it back for the next season. We are stopping local people within those communities being able to benefit from that housing, even on a short-term basis.
I would genuinely welcome hearing why the minister thinks that we should not be releasing those types of property on to the market. The minister is saying that we will hold him back, but it is because we know from the evidence, as Mr Fraser has said, that churches as well as businesses in rural and agricultural areas are holding properties back because they will need them at some point. The minister should move away from dogma, be pragmatic and support the amendments in the group.
I have a series of probing amendments in groups 4, 5 and 6. I understand the minister’s ambition to make sure that this legislation balances the rights of landlords and tenants, but my amendments in these three groups probe as to whether the balance has gone slightly too far in favour of the landlords as opposed to the tenants.
In particular, in this group, amendments 37, 38, 41 and 42 ensure that exceptions relating to substantial arrears and financial hardship on the part of the landlord can apply only when a high test of financial hardship applies as a direct result of those substantial arrears: the hardship reported must be as a result of the arrears experienced.
A moratorium on evictions is what we are legislating for and I feel that the exceptions for substantial arrears provide too wide an exemption from that moratorium and hence these amendments remove that exception entirely. Regarding the social sector, Shelter advises that the average arrears for evicted tenants in 2019-20 were around £9,000. In that context, the bill sets the threshold far too low to be considered substantial, at a level of just over £2,000.
Due to time constraints, the substantial rent arrears definition has been removed from the list of exemptions, but the detail is still retained in the bill. It is my intention to come back at stage 3, but I ask members to support the amendments in my name in the group.
Amendment 39 relates to landlords having the right to decant or evict tenants in the case of essential work and demolition, which has not been discussed. Essential work, such as the removal of asbestos, can be dangerous to occupants. Therefore, landlords should be able to decant tenants from properties that are undergoing essential maintenance. Furthermore, landlords should also be able to evict tenants when buildings have to be demolished. Demolition could occur because a property is too old and unsafe for occupants. Therefore, we propose the amendment to keep tenants safe as well.
My second amendment in the group, amendment 43, relates to landlords having the right to evict unlawful occupants. An unlawful occupier is a person who lives in a property without the consent of the home owner. They could include people who were not initially agreed on when the lease was signed. Therefore, landlords should have the right to evict them. A landlord is unable to charge those occupants rent, as they are not the tenant so, if the landlord is unable to evict due to the moratorium, it would represent a significant financial loss. That ground is already used commonly to evict tenants who have ended their tenancy but not notified the landlord and not moved out.
I hope that the Government considers those amendments workable.
First of all, I will address amendment 39, to which Miles Briggs spoke a moment ago and which exempts the demolition of, or substantial work on, property in the social rented sector from the moratorium on evictions.
We are keen to ensure that tenants are protected from eviction, but we recognise that being able to refurbish large accommodation will help many tenants. We would expect tenants in those circumstances to be supported through the process, including being provided with alternative accommodation. Therefore, we intend to support amendment 39. I thank Miles Briggs for lodging it and encourage members to vote for it.
Some of the other amendments in the group are attempting to reduce the protection for tenants by increasing the exemptions from the moratorium and others attempt to remove some of the safeguards that we believe are needed, particularly on substantial rent arrears. Again, we come back to the theme of balance, which has come out of several of the groups of amendments. We need a bill that achieves a level of protection that tenants need but also has safeguards within it. We believe that the bill achieves that and we will not support the other amendments in the group.
Some of the amendments that seek to increase the exemptions from the moratorium and, therefore, reduce the level of protection seem to be predicated on the idea that the Government is holding properties back from rent. That is clearly not the case. It would be possible for us to remove all tenants’ rights and protections altogether. That would work in the interests of those who want to become landlords and have complete flexibility working on their side. That would not be appropriate. All organisations that seek to become landlords have to accept that, when tenants move into a property, it becomes their home and that home and their rights and security need to be respected.
Does the minister accept that people are holding back property that could be used? I accept that he does not want that, but it is happening. It is an unforeseen circumstance, but it has been shown over the past few months that people are not putting on to the market property that could be used because of the fear that they will not get their property back. Is it not better to have somebody in a home, even for a short period, than having them homeless?
The problem of empty homes has existed for a long time, and successive Governments—not just this one but previous ones going way back to the days of the Labour-Liberal Democrat Administration—have continued to increase the effort that has been put into bringing empty homes into use. There will always be work to do—I am sure that there is more that we can do—to create the right incentives to bring empty homes into use, but I do not think that that should be achieved by reducing the protection of tenants for whom those properties would become homes.
On amendments 37, 38, 41 and 42, which attempt to remove or weaken some of the safeguards that are needed around substantial rent arrears, I recognise that the provisions on rent arrears are one of the controversial areas in the bill. As I said in the stage 1 debate, I thought long and hard about whether to present those measures as part of the package of safeguards. I believe that the support that tenants facing substantial rent arrears really need is not necessarily the same as the support that is needed in other areas. They need direct support, and that is coming through discretionary housing payments, the tenant grant fund and the work that we are doing to raise awareness of tenants’ rights and ensure that people are able to exercise those rights. I think that those particular amendments would weaken the package of safeguards to the point of not having a bill that strikes the appropriate balance.
On the level of rent arrears at which evictions could proceed, could the minister assure me that that will not undermine the other protections that exist for tenants through pre-action protocols and requirements, and that cases will still have to appear in court, where, if the case is found not to be reasonable, it will be thrown out?
Yes. The measures on pre-action protocols, which have been a requirement in the social rented sector for a long time and which Parliament earlier this year agreed to make permanent in relation to the private rented sector, will not be bypassed in any way. Indeed, if an eviction measure goes to the First-tier Tribunal , the requirement to take all circumstances into account and to apply the test of reasonableness is still important.
On amendment 44, if it was accepted, evictions could still go ahead as they do now, negating the point of including college and university halls of residence and purpose-built student accommodation in the moratorium. It would also place a new duty on the First-tier Tribunal to consider whether a student tenant has failed to comply with the tenancy agreement and determine whether that is reasonable. Not only would that have an impact on the workload and the costs of the tribunal, it would represent a new type of tenancy agreement for it to consider.
Mr Kerr quite properly and rightly says that universities have a serious responsibility and a duty of care, which they take seriously, including in situations in which one student might pose a risk to others. However, the move to eviction is a serious measure and it requires there to be a high bar of evidence around it. I am concerned about the possibility that, if we accepted Mr Kerr’s amendment, any breach in the tenancy agreement—even a minor one—could be used. Even though that test of reasonableness could be applied if the case reached the tribunal, students in that situation would not have the security of knowing that, if they breached their tenancy in any very minor way, they could not be evicted.
If the minister is concerned about the scope of the measure because of the way in which it has been written, will he work with me to ensure that the objective that I have described in my remarks in support of the amendment is satisfied? Would he be willing to work with me to achieve that? I think that this is a worthwhile thing to work together on.
I am not currently persuaded that the concerns that Mr Kerr outlined require an amendment to the bill, but I am content to have my officials contact him and explore other viable approaches to address his concerns. I do not believe that those concerns are validated at the moment in relation to the bill as we have it, but I am happy for that conversation between my office and his to take place before the amendment deadline for stage 3.
Of course, I would be happy to engage with the minister’s officials but, surely, he accepts that Universities Scotland knows what it is talking about. Its focus on this sort of amendment adds weight to its importance. It has been constantly dealing with those issues in purpose-built student accommodation, and I hope that he accepts that.
Mr FitzPatrick mentioned that the briefing came out before Universities Scotland had seen the text of the bill. As I said, at the moment, I am not persuaded that there is a serious issue that requires an amendment to the bill, but I am happy to have my office and Mr Kerr communicate about that and explore whether any change might be justified before the stage 3 amendment deadline.
I urge members to support amendment 39 but will not support the other amendments in the group.
My general comments were that some of the amendments—those that seek to weaken or undermine the protections against eviction—are not amendments that we would support. Other amendments seek to undermine the safeguards, and we do not support those amendments either.
Frankly, the minister does not seem to understand his own bill. My amendment does none of those things. It seeks simply to clarify, on the face of the bill, that the eviction ban will not apply to notices that are served before 6 September 2022. The policy memorandum is very clear that that is in line with the Government’s stated intent. I am really surprised that the minister claims that it means something else entirely. I am totally confused by that, so I will press amendment 33.
I turn briefly to other matters. I welcome the fact that the Government will support amendment 39, in the name of my colleague, Miles Briggs.
I think that Mr Balfour made a very strong case for his amendment 35. Like Mr Balfour, I am a member of the Church of Scotland. I am aware that there are Church of Scotland properties that are currently lying empty. They are not being—and will not be—offered up for rent because of the church’s concern that, if it offers them for rent, it will not be able to resume possession should they be required for the purposes of hosting a minister or pastoral worker.
In response to Mr Balfour, the minister said that properties are not being held back. That is simply not true. The minister has not done his homework, he has not engaged with stakeholders and he has not listened to those who have an interest in this particular field. If he had, he would know that he is talking balderdash in the chamber. It is not true that properties are not being held back. All that he has to do is to pick up the phone to the Church of Scotland or any other church and he will hear the truth. He needs to start doing the work as a minister and stop being so lazy. It is shocking—[