Source · Select Committees · Public Accounts Committee
Recommendation 4
4
Local Authorities are constrained by the Department’s approach to licensing landlords.
Conclusion
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 houses in multiple occupation—those with at least five people from more than one household). However, these licence schemes are subject to Secretary of State approval if they cover over 20% of a council’s local area or rented housing stock. The Department told us that local authorities find selective licensing to be a useful tool for proactive enforcement action and intelligence gathering. However, to apply for a 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. The time and resource needed to produce an application, and the requirement for schemes to last only five years, present further barriers to local authorities. The Department says it offers a dialogue with local authorities to help them apply for licensing schemes, but local authorities say there is poor communication and limited feedback. Given regulation is managed and delivered locally, it is not clear why the Department restricts the use of larger schemes or on what basis it rejects them. Recommendation: As part of its planned reforms, the Department should assess whether current arrangements for licensing schemes are working, and whether alternative arrangements may be more efficient and effective.
Government Response
Not Addressed
HM Government
Not Addressed
The government disagrees with the Committee’s recommendation. 4.2 Selective licensing schemes when used as part of a wider, well planned, coherent initiative, can be an effective tool for LAs to drive better outcomes for good landlords and tenants. 4.3 LAs currently have powers to introduce selective licensing of privately rented homes to address problems in their area, or any part of them. LAs are required to obtain confirmation from the Secretary of State for any selective licensing scheme which would cover more than 20% of their geographical area or would affect more than 20% of privately rented homes in the local authority area. 4.4 The government considers that this strikes the right balance, by allowing local authorities to use selective licensing effectively without placing undue burdens on landlords where additional licensing schemes are not needed. 4.5 The department has simplified the selective licencing application form and will continue to help local authorities to produce a good quality application to support their introduction of schemes. 4.6 The government will work with local authorities and the Local Government Association to develop a selective licensing best practice sharing support for LAs to learn from each other to achieve the most from their selective licensing schemes. 4.7 The Private Rented Property Portal will provide access to information about privately rented properties and tackle one of the biggest and most time-consuming barriers faced by local councils when enforcing standards: that is, identifying poor quality and non-compliant properties and who owns them.