Source · Select Committees · Public Accounts Committee
Forty-Ninth Report - Regulation of private renting
Public Accounts Committee
HC 996
Published 13 April 2022
Conclusions (26)
2
Conclusion
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 from 9% in London to 21% in Yorkshire and the …
3
Conclusion
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 that they could regulate better with more support and sharing …
4
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 …
5
Conclusion
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 complaints, overcrowding, harassment and evictions, and has a limited understanding …
6
Conclusion
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 from eviction during the COVID-19 pandemic and banning unnecessary charges …
1
Conclusion
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
7
Conclusion
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 …
8
Conclusion
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 dozens of legislative powers used by local authorities, which are …
9
Conclusion
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 since 2019) and held roadshows across England, much of this …
10
Conclusion
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 by local authorities, as there is no requirement for councils …
11
Conclusion
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 complaints, the number of inspections, or the number of staff …
12
Conclusion
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 …
13
Conclusion
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 robustness and consistency in the way licensing schemes are used.28 …
14
Conclusion
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 …
15
Conclusion
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 the Council’s application to renew the scheme for another five …
16
Conclusion
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, harassment or homelessness. Some 13% of privately rented homes in …
17
Conclusion
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 Shelter and Citizens Advice try to plug the gaps where …
18
Conclusion
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 courts system to resolve disputes.40 We heard from tenant representatives …
19
Conclusion
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 …
20
Conclusion
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 …
21
Conclusion
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. …
22
Conclusion
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 …
23
Conclusion
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 on landlords and tenants.54 The Department told us that it …
24
Conclusion
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 …
25
Conclusion
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 …
26
Conclusion
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 …