Forty-Ninth Report - Regulation of private renting

Select Committee

Public Accounts Committee HC 996 13 April 2022

Report Status Government responded

Conclusions & Recommendations 26 items (15 recs)

Source View on Parliament website

Government Response (AI assessment · 26 of 26 classified)

Accepted 11

Not Addressed 3

Rejected 5

Recommendations

15 results

2 Not Addressed

Local authorities do not have the capacity and capability to ensure an appropriate level of...

Recommendation

Local authorities do not have the capacity and capability to ensure an appropriate level of protection for private renters. Compliance with legal minimum standards is inconsistent across England, and the proportion of privately rented properties with category 1 hazards ranges … Read more

Government Response Summary

The government's response discusses Électricité de France’s (EDF) strategies, plans and the estimated costs, which is irrelevant to the recommendation about local authority resources for regulating private renting.

HM Treasury

3 Accepted

The Department is not doing enough to support local authorities to regulate effectively.

Recommendation

The Department is not doing enough to support local authorities to regulate effectively. The dozens of legislative powers used by local authorities are complex and spread across multiple enforcement bodies, creating a fragmented and disempowered regulatory system. Local authorities say … Read more

Government Response Summary

The government will run pilot schemes, strengthen LAs' ability to tackle criminal landlords, explore bolstering national oversight of LAs' enforcement, seek to introduce a national framework for setting fines, and continue to fund the National Trading Standards Estates and Lettings Agency Team.

HM Treasury

4 Rejected

Local Authorities are constrained by the Department’s approach to licensing landlords.

Recommendation

Local Authorities are constrained by the Department’s approach to licensing landlords. In 2010, the Department introduced legislation allowing local authorities to require licences from landlords for more properties that the minimum requirements (the only properties that need licenses are larger … Read more

Government Response Summary

The government considers current arrangements for licensing schemes strike the right balance, allowing local authorities to use selective licensing effectively without placing undue burdens on landlords where additional licensing schemes are not needed.

HM Treasury

5 Acknowledged

The Department lacks good enough data to understand the nature and extent of problems renters...

Recommendation

The Department lacks good enough data to understand the nature and extent of problems renters face. The Department lacks sufficient data on the challenges facing landlords, tenants, and local authorities within the sector. For example, it lacks robust data on … Read more

Government Response Summary

The government agrees with the recommendation to develop a coherent data strategy and states they utilize a range of data from various sources to inform policy decisions, and are working to further develop its approach to data to support its renters reform program.

HM Treasury

6 Accepted

The Department’s forthcoming White Paper offers an opportunity for significant improvement to the private rented...

Recommendation

The Department’s forthcoming White Paper offers an opportunity for significant improvement to the private rented sector. In the past ten years, the Department has made several positive legislative changes in the private rented sector, such as providing tenants with protection … Read more

Government Response Summary

The government agrees to fully understand the cumulative impact of proposed changes on tenants, landlords, and the housing market, working with other departments and completing an impact assessment by Spring 2023, as well as developing its approach to data collection to monitor the impact of reforms.

HM Treasury

8 Accepted

The Department has introduced various pieces of legislation which give local authorities a range of...

Recommendation

The Department has introduced various pieces of legislation which give local authorities a range of tools and powers to enforce compliance in the private rented sector, such as civil penalties and banning orders.19 However, over time this has resulted in … Read more

Government Response Summary

The government will run pilot schemes trialling improvements to enforcement of existing standards, strengthen LAs’ ability to tackle criminal landlords, bolster national oversight of LAs’ enforcement by requiring them to report on their enforcement activity, and explore seeking to introduce a national framework for setting fines.

HM Treasury

9 Accepted

The Department therefore has an important role to play in using its national perspective to...

Recommendation

The Department therefore has an important role to play in using its national perspective to identify and disseminate good practice among local authorities and help them regulate effectively.22 While it has provided some grant funding for project work (£6.7 million … Read more

Government Response Summary

The government will run pilot schemes, strengthen LAs' ability to tackle criminal landlords, explore bolstering national oversight of LAs' enforcement, seek to introduce a national framework for setting fines, and continue to fund the National Trading Standards Estates and Lettings Agency Team.

HM Treasury

10 Accepted

The Department does not have a good enough understanding of what regulatory approaches work at...

Recommendation

The Department does not have a good enough understanding of what regulatory approaches work at local level to help local authorities ensure that landlords comply with their obligations. It has limited data on what tools and approaches are even used … Read more

Government Response Summary

The government will run pilot schemes, strengthen LAs' ability to tackle criminal landlords, explore bolstering national oversight of LAs' enforcement, seek to introduce a national framework for setting fines, and continue to fund the National Trading Standards Estates and Lettings Agency Team.

HM Treasury

11 Accepted

The Department also does not know in detail what challenges local authorities are facing, and...

Recommendation

The Department also does not know in detail what challenges local authorities are facing, and lacks an early warning system to identify where local regulation is failing private renters. It does not collect data, for example, on the number of … Read more

Government Response Summary

The government will run pilot schemes, strengthen LAs' ability to tackle criminal landlords, explore bolstering national oversight of LAs' enforcement, seek to introduce a national framework for setting fines, and continue to fund the National Trading Standards Estates and Lettings Agency Team.

HM Treasury

13 Rejected

In 2015, the Department added a requirement that selective licensing schemes covering over 20% of...

Recommendation

In 2015, the Department added a requirement that selective licensing schemes covering over 20% of a council’s local area or rented housing stock must be approved by the Secretary of State. It told us it introduced this requirement to ensure … Read more

Government Response Summary

The government disagrees with the recommendation to assess the current arrangements for licensing schemes, stating that the current balance allows effective use of selective licensing without undue burdens on landlords. However, they will work with local authorities and the Local Government Association to develop a selective licensing best practice sharing support for LAs and simplified the selective licensing application form.

HM Treasury

15 Rejected

Long wait times, made worse during the COVID-19 pandemic, are also a barrier to local...

Recommendation

Long wait times, made worse during the COVID-19 pandemic, are also a barrier to local regulation.33 For example, Liverpool City Council had a city-wide scheme from 2015 to 2020 that was popular locally, which lapsed while the Department was considering … Read more

Government Response Summary

The government disagrees with the recommendation to assess current arrangements for licensing schemes, stating that the current system strikes the right balance.

HM Treasury

16 Accepted

Tenants have a legal right to a safe and secure home that is free from...

Recommendation

Tenants have a legal right to a safe and secure home that is free from serious health hazards. However, they face significant barriers to realising this right, and many experience significant issues which can result, for example, in serious illness, … Read more

Government Response Summary

The government will introduce a property portal requiring all private landlords to join, giving private tenants a free redress service, and will learn from a recent mediation pilot to improve alternative dispute resolution.

HM Treasury

17 Accepted

The current system for renters to resolve problems relies on them being aware of, and...

Recommendation

The current system for renters to resolve problems relies on them being aware of, and enforcing, their own rights. However, tenants often do not know how to complain or do not have the confidence to do so. Charities such as … Read more

Government Response Summary

The government agrees to improve renters’ ability to exercise their rights by bringing forward a landmark Renters Reform Bill, introducing a new property portal that all landlords will be required to join, and learn from the recent mediation pilot.

HM Treasury

18 Accepted

The complaints and redress mechanisms available to renters are also limited and complex.

Recommendation

The complaints and redress mechanisms available to renters are also limited and complex. While there are mandatory redress schemes for social housing and for letting agency work, these are voluntary for private landlords and so most tenants must use the … Read more

Government Response Summary

The government will introduce a property portal requiring all private landlords to join, giving private tenants a free redress service, and will learn from a recent mediation pilot to improve alternative dispute resolution.

HM Treasury

23 Accepted

Many issues facing both landlords and tenants relate to other policy areas, such as housing...

Recommendation

Many issues facing both landlords and tenants relate to other policy areas, such as housing benefits, tax laws and courts systems. There is therefore a need for cross-government working and data-sharing to understand the wider impacts of planned legislative changes … Read more

Government Response Summary

The government agrees to fully understand the cumulative impact of proposed changes on tenants, landlords, and the housing market, working with other departments and completing an impact assessment by Spring 2023, as well as developing its approach to data collection to monitor the impact of reforms.

HM Treasury

Conclusions (11) Observations and findings — click to expand

1 Conclusion Not Addressed

On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Levelling up, Housing and Communities (the Department).3

Government Response Summary

Acknowledgement of the report and the date evidence was taken.

7 Conclusion Not Addressed

Lack of capacity constrains local authorities’ support to renters and use of enforcement powers. Many local authorities take a light touch or “fire-fighting” approach, as they do not have the capacity to protect tenants and ensure landlords comply with regulations.14 For example, tenancy relations officers provide valuable support to tenants …

Government Response Summary

The Clerk of the Houses will commit to meet the indicative timeframe and set out how they will recruit and retain the skills and expertise needed to deliver the Programme.

12 Conclusion Rejected

In 2010, the Department introduced legislation allowing local authorities to require licences from landlords for more properties than the minimum requirements (the only properties that need licenses are larger houses in multiple occupation—those with at least five people from more than one household).26 The Department told us that local authorities …

Government Response Summary

The government considers current arrangements for licensing schemes strike the right balance, allowing local authorities to use selective licensing effectively without placing undue burdens on landlords where additional licensing schemes are not needed.

14 Conclusion Rejected

To apply for approval for a selective licensing scheme, local authorities need a good understanding of their local private rental market, which is hard to gather without already having a scheme in place.30 The time and resource needed to produce an application, and the requirement that schemes last only five …

Government Response Summary

The government disagrees with the recommendation to assess current arrangements for licensing schemes, stating that the current system strikes the right balance.

19 Conclusion Accepted

The Department told us that as part of its reform agenda, it plans to end Section 21 work and introduce a mandatory redress scheme for landlords, with which it intends to empower tenants and improve landlord compliance.42 However, the Department is yet to assess the success of its existing redress …

Government Response Summary

The government agrees to improve renters’ ability to exercise their rights by bringing forward a landmark Renters Reform Bill, introducing a new property portal that all landlords will be required to join, and learn from the recent mediation pilot.

20 Conclusion Acknowledged

To ensure that regulation and other forms of support are effective in protecting renters, the Department needs good data and insight into their experiences and the challenges they face. The Department told us that as part of its upcoming White Paper proposals, it is committed to understanding tenants’ perspectives and …

Government Response Summary

The government agrees with the recommendation to develop a coherent data strategy and states they utilize a range of data from various sources to inform policy decisions.

21 Conclusion Acknowledged

However, the Department acknowledged gaps and limitations in its current data, and it is reliant on tenant representatives such as Shelter and Citizens Advice to understand tenant experiences.47 For example, it estimates that during the COVID-19 pandemic, over-crowding peaked at 15% of rented homes, double what it was in 2019–20. …

Government Response Summary

The government agrees with the recommendation to develop a coherent data strategy and states they utilize a range of data from various sources to inform policy decisions.

22 Conclusion Acknowledged

Data gaps also mean the Department does not collect the information it needs to evaluate the impact of recent legislative changes. For example, in 2015 it introduced changes in the Deregulation Act to protect tenants from retaliatory eviction after raising complaints with their local authority.51 However, we heard from tenant …

Government Response Summary

The government agrees with the recommendation to develop a coherent data strategy and states they utilize a range of data from various sources to inform policy decisions.

24 Conclusion Acknowledged

The Department has made some improvements to the private rented sector in the past ten years. This includes banning unnecessary charges through the Tenant Fees Act 46 Q 90 47 Qq 91, 93 48 Q 65 49 Qq 92, 93; C&AG’s Report, para 2.14 50 C&AG’s Report, para 19 51 …

Government Response Summary

The government recognizes the improvements made to the private rented sector in the past ten years, including banning unnecessary charges through the Tenant Fees Act and deposit protection schemes.

25 Conclusion Acknowledged

The Department highlighted that its recent work has rightly focused on responding to the COVID-19 pandemic, during which it introduced protections through a temporary restriction on eviction proceedings. The Department told us it continues to monitor the situation as restrictions are lifted. Landlords have also suffered during the pandemic, for …

Government Response Summary

The government recognises the challenges of the COVID-19 pandemic and pressures faced by both landlords and tenants.

26 Conclusion Acknowledged

The Department told us it is now returning to the strategic reform agenda and intends to publish a White Paper later in 2022.59 It has highlighted specific issues it plans to address as part of its reforms, including security of tenure, enforcement, and redress.60 However, it has not set out …

Government Response Summary

The government recognizes the need for greater fairness in the system to allow renters to realize their right to a safe and secure home and published a white paper on 16 June 2022 setting out details of the planned reforms.