Renters (Reform) Bill – in a Public Bill Committee am 10:30 am ar 21 Tachwedd 2023.
I beg to move amendment 145, in clause 3, page 2, line 32, at end insert—
“(aa) after subsection (5) insert—
‘(5ZA) The court shall not make an order for possession under Ground 1 if the court is satisfied that, having regard to all the circumstances of the case, greater hardship would be caused by granting the order than by refusing to grant it.’”
This amendment would extend the greater hardship provisions to new Ground 1 (occupation by landlord or family).
With this it will be convenient to discuss the following:
Amendment 146, in clause 3, page 2, line 32, at end insert—
“(aa) after subsection (5) insert—
‘(5ZA) The court shall not make an order for possession under Ground 1A if the court is satisfied that, having regard to all the circumstances of the case, greater hardship would be caused by granting the order than by refusing to grant it.’”
This amendment would extend the greater hardship provisions to new Ground 1A (new grounds for sale of a dwelling-house).
Amendment 150, in clause 3, page 2, line 32, at end insert—
“(aa) After subsection (5) insert—
‘(5ZA) The court shall not make an order for possession under Ground 6A if the court is satisfied that, having regard to all the circumstances of the case, greater hardship would be caused by granting the order than by refusing to grant it.’”
This amendment would extend the greater hardship provisions to Ground 6A (ground for possession to allow compliance with enforcement action).
Clause 3 amends the grounds for possession in schedule 2 to the 1988 Act, by means of the changes set out in schedule 1 to the Bill, which we will debate separately later today. Taken together, amendments 145, 146 and 150 would extend “greater hardship” provisions to three of the mandatory grounds set out in amended schedule 2 to the 1988 Act, namely grounds 1, 1A and 6A.
Ideally, we would have debated these amendments as the last amendments to clause 3, because they are very much our fall-back position if we cannot convince the Government to accept the other changes that we propose to the clause. In due course, we will debate our concerns about several of the revised or new possession grounds provided for by the Bill that can still be fairly categorised as de facto “no fault”. These include grounds 1, 1A and 6A.
In cases where a landlord has proved a discretionary possession ground, a judge must decide whether it is reasonable to make the possession order. In reaching their decision, a judge can consider not just the reason for the possession claim, but anything relevant to the case, including the tenant’s conduct and the likely consequences of eviction for the individual or individuals in question. They can also consider whether the tenant has tried to put things right since the claim was issued. If the judge is not satisfied that it is reasonable to award possession in these discretionary cases, they can dismiss the claim all together. In contrast, if a landlord proceeds on a mandatory ground—I remind the Committee again that proposed new grounds 1, 1A and 6A are mandatory—the judge must make an order, if the landlord has proved their case.
The amendments would give the court very limited discretion, in relation to mandatory grounds 1, 1A and 6A, to consider whether the tenant would suffer greater hardship as a result of the possession order being granted.
I appreciate that the hon. Gentleman has tabled further amendments on the evidential burden, but does he not appreciate my concern that there is perhaps a little bit of a floodgate situation around appeals on this issue? Notwithstanding his comments about the judicial system and the court system, I am conscious that we may have a scenario where judges’ decisions are challenged and we end up with a backlog. As a result, what the amendment tries to do would either be delayed, or would end up in a system of appeal after appeal, because clearly the result would be down to a judge’s subjective decision, based on the evidence in front of them at the time.
I thank the hon. Member for his intervention. Perhaps I have not explained myself clearly. These amendments do not provide for an appeals process. As I have tried to make clear, when it comes to a discretionary possession ground, judges can weigh up the evidence. That is not the case for a mandatory ground. The amendment provides for not an appeal process, but discretion for the court and the judge to consider whether their decision would cause greater hardship to the tenant. I will come on to explain how that would work.
To clarify my point, I am aware that the amendment is not about an appeals process. However, as the hon. Gentleman will know, an application for appeal can be made against any judge’s decision, and that application can be granted by the superior courts, so the process is not immune from appeal; decisions can be taken to appeal. That is a right, which would be granted, and it could be achieved through another part of the system. I just wanted to clarify my position on that point.
It is an interesting debate, but not particularly pertinent to the amendments. It is not my understanding that a mandatory possession ground order can be appealed. If it can, then I think that the instances in which it can are vanishingly small. However, that is not what these amendments seek to do. They purely seek to protect very vulnerable tenants who might suffer great hardship as a result of the court’s decision.
The starting point for the court would remain that the landlord in question has proved his or her intention to either occupy the property under ground 1 or sell it under ground 1A, or the need to respond to enforcement action under ground 6A. In other words, the presumption would be that a possession order will be made, and in most cases it would be. However, the amendments would provide tenants with the opportunity to demonstrate to the court—not at appeal, but at a hearing of the court—that their eviction on any of the three grounds in question would lead to hardship greater than that of the landlord or, in the case of amended ground 1, potentially the landlord’s family. If the judge determined that the hardships each party is likely to experience were the same, under these amendments, the tenants would not succeed, and the possession order would still be made. However, if the tenant could prove to a court that they or a member of their household would suffer greater hardship than the landlord or the landlord’s family if a possession order were made, the court could refuse to make the possession order.
It might be helpful to give the Committee three brief examples of how these greater hardship provisions might operate in practice, if the Government were to accept them. In hypothetical case 1, a tenant with terminal cancer argues before the court that their compelling personal circumstances will mean that they suffer great hardship if evicted under ground 1A, while the landlord, who wishes to sell their property, does not need to, financially; in those circumstances, the court could refuse to make a possession order. In hypothetical case 2, a tenant argues that they will lose their job if they are evicted, but the landlord will have no room to house a member of their close family who will be made homeless if they cannot recover their property under ground 1; in those circumstances, the court would still make the possession order. In hypothetical case 3, a tenant argues that they will be made homeless if they are evicted, but the landlord would also become homeless if they do not occupy the property themselves under ground 1; again, the court would make the possession order in those circumstances because the tenant is unlikely to suffer greater hardship than the landlord.
The process behind these amendments is modelled on case 9 of the Rent Act 1977, but with a key difference. This is important: in that instance, the burden of proof was on the landlord to show that he or she would suffer greater hardship, and the default was against the possession order; in this instance, the burden of proof would be on the tenant, with a possession order being the default. We believe that these reasonable and proportionate amendments would enable mandatory grounds 1, 1A and 6A, about which we have particular concerns, to function as the Government intend, while providing tenants with a modicum of additional security in circumstances where their eviction on those grounds would cause genuine and real hardship. I hope the Minister will consider accepting our amendments, and look forward to his response.
I rise to support these three amendments. Amendment 150 is, of course, inextricably linked to amendment 149, which we will come on to shortly. I want to talk about the protections, particularly against ground 6A, which is a ground for possession to allow compliance with an enforcement action, fundamentally so that conditions for the tenants can be improved. Enforcement action is almost impossible unless tenants co-operate with it. There is a real danger that ground 6A will be used as a quasi-punishment for tenants who have co-operated—tenants who have said, “This house has a massive hole in the ceiling”—
Order. I think the hon. Gentleman is speaking to the next group.
I am speaking to amendment 150, which relates to ground 6A, about greater hardship. The next group is about the court having mitigating measures other than eviction. They could have been clustered differently—
Quite right. I apologise for interrupting the hon. Gentleman; he knows much more about it than I do.
Thank you, Mr Gray.
We have a problem here. It is important that the court is able to weigh up where the greater hardship is. Is it a greater hardship to evict a tenant who has complained to the council so that the property can be fixed? Or is the ground being used to get rid of a tenant who is constantly complaining about enforcement action? Without an element of discretion—other amendments would afford wider discretion—and without this particular measure on greater hardship, there is a danger that ground 6A could be misused. That is why it would be good to hear reassurance from the Minister, particularly on amendment 150, that advice and guidance will be provided to the courts to ensure that the ground is not manipulated or abused, and that the Government are considering other changes to prevent that.
I thank hon. Members for their contributions. I thank the hon. Member for Greenwich and Woolwich for his amendments 145, 146 and 150. As has been discussed, the amendments look to make grounds 1, 1A and 6A discretionary.
To clarify, the amendments do not seek to make those grounds discretionary in any case. We accept that they are mandatory. We believe that the amendments would allow those mandatory grounds to be used in almost every case, unless great hardship would result from them. They do not make those three possession grounds discretionary.
However, judges would be required to assess whether possession would cause greater hardship than not. We think that would count as making the grounds discretionary.
The changes would add significant uncertainty to the system. It is right that landlords should have confidence in the process, and can manage their properties, including when they want to move into or sell a property. The uncertainty that the amendments would cause means that landlords may simply choose not to rent their properties in the first place if they know that they may want to move into or sell a property in future. That would reduce the vital supply of homes in the private rented sector. In the case of ground 6A, on enforcement compliance, if possession is not granted, the landlord would continue to be in breach of their obligations, and could face fines and other penalties. Given the adverse consequences that the amendments would cause, I hope that the hon. Member will withdraw them.
I am disappointed by the Minister’s response. I welcome the clarification he gave. The amendments would introduce a limited amount of discretion. We would argue that they do not make the grounds discretionary—it is a point of debate—but introduce a limited amount of discretion into the system. However, we trust judges in county courts to make these decisions in most cases. The amendments would put the burden on the tenant to prove great hardship, and make the presumption that the mandatory ground award will be issued in most cases.
I will bring the Minister back to some of the hypothetical scenarios I gave. We absolutely agree with the Government that landlords need robust possession grounds to take their properties back. In one of my hypothetical examples, the Bill would allow a terminally ill cancer patient to be evicted and put at risk of homelessness, just because the landlord wished to sell. They may have no need to sell; they might own eight properties and wish to sell one or two of them. In limited circumstances and cases, we should give the judges a bit of discretion. Otherwise, some very vulnerable and in-need tenants will evicted through these means.
I am disappointed that the Government have not accepted the amendments. I hope that they go away and think about them, but I will not push them to a vote. I beg to ask leave to withdraw the amendment.
I beg to move amendment 149, in clause 3, page 2, line 32, at end insert—
“(aa) After subsection (5) insert—
‘(5ZA) The court shall not make an order for possession under Ground 6A if the court considers that it is not just and equitable to do so, having regard to alternative courses of action available to the landlord or the local housing authority, which may include—
(a) a management order under Part 4 of the Housing Act 2004;
(b) in relation to paragraphs (b) and (f) of Ground 6A, other measures which are more appropriate for reducing the extent of overcrowding or the number of households in the dwelling-house, as the case may be;
(c) in relation to paragraph (c) of Ground 6A, the provision of suitable alternative accommodation for the tenant, whether under section 39 of the Land Compensation Act 1973 or otherwise; and
(d) in relation to paragraphs (d) and (e), other means of enforcement available to the local housing authority in respect of the landlord’s default; and having regard to all the circumstances, including whether the situation has occurred as a result of an act or default of the landlord.’”
This amendment would permit a court to refuse to make a possession order under Ground 6A where a more appropriate course of action exists.
One of the changes made to schedule 2 to the 1988 Act by the clause, as we briefly discussed, is the introduction of a new ground for possession to allow compliance with an enforcement action. The new mandatory ground 6A will require the court to award possession if a landlord seeking possession needs to end a tenancy because enforcement action has been taken against the landlord, and it would be unlawful for them to maintain the tenancy.
The relevant enforcement actions (a) to (f) are set out on page 73 of the Bill. They include situations where a landlord has been issued with
“a banning order under section 16 of the Housing and Planning Act 2016…an improvement notice under section 11 or 12 of the Housing Act 2004” and
“a prohibition order under section 20 or 21 of the Housing Act 2004”.
We take no issue with the fact that the Bill introduces the new mandatory power. Clearly there are circumstances in which landlords will require possession of a property in order to comply with enforcement action.
We wrestled with what should be the minimum notice period that applies to the new ground, given that it feels somewhat perverse to provide for a mechanism by which possession can be gained quickly when the reason for the possession being granted is that the landlord has fallen foul of an obligation under housing health and safety legislation, particularly if it resulted in a banning or prohibition order. As we will come to discuss, we ultimately determined to argue in amendment 136 for a four-month minimum notice period in relation to ground 6A, because in all the situations set out on page 73 of the Bill, the tenant will be evicted because of neglect or default on the part of the landlord. In other words, it is a de facto no-fault ground for eviction that will punish tenants and put them at risk of homelessness because of bad practice on the part of a landlord, particularly as there is no requirement for the landlord to provide suitable alternative accommodation.
Amendment 149 seeks to provide tenants with a measure of protection in such circumstances—this touches directly on the point the Minister made on the previous group of amendments—by giving the court the power to consider whether the relevant enforcement can be met by means other than the eviction of the sitting tenant or tenants, including through a management order under the Housing Act 2004 or the provision of alternative accommodation. If the court judges that the enforcement objectives can be met by other means, the amendment would give the court the power to refuse to make a possession order on the grounds that it is not just and equitable to do so in the circumstances, given that there are other means of ensuring that the enforcement action is complied with.
We believe that the amendment would provide tenants with stronger protection in circumstances where they are victims of poor practice on the part of a landlord. Importantly, it would also ensure that tenants have an incentive to seek enforcement action through their local authority if their home is in a very poor condition or is non-compliant with HMO licensing schemes. That would address the fact that, as things stand, the introduction of the new mandatory no-fault ground with only two months’ notice is likely to actively discourage tenants from doing so. I hope the Minister will give the amendment serious consideration.
Following on from the debate on the last group of amendments, I want to add my concern about ground 6A. Where there are issues with fire or flood, landlords are often expected to find alternative accommodation before a house is vacated, but there is no such provision when enforcement action has to be taken. There is a real worry that a landlord who has multiple properties that are perfectly fit for habitation might seek to punish tenants who have pushed for enforcement, rather than moving them into those properties. That seems wrong, so it is important to require the courts to go through a checklist of other options that the landlord has to consider before they get to ground 6A.
The amendment also provides a checklist for landlords. They can go down it and say, “Okay, I need to comply with enforcement action. Have I considered these things?” It also allows the local authority to consider other courses that they could pursue, such as management orders. We do not want tenants punished. Although revenge evictions are illegal, we know that they happen time and again, because there are loopholes in the law. Closing those loopholes is important, and a statement from the Minister on the matter might suffice.
I thank hon. Members for their comments. Amendment 149 would require judges to consider whether there are suitable alternative courses of action available before granting possession under ground 6A, which permits a landlord to evict if evicting a tenant is the only way that they can comply with enforcement action taken by a local authority. That includes cases in which, disgracefully, a landlord has received a banning order, meaning they are unable to continue operating as a landlord. It also includes situations in which a prohibition order is incompatible with the tenant’s continuing to occupy the property. The ground is mandatory, so there is certainty that possession will be granted to the landlord and they can comply with enforcement action taken against them. That means that tenants will not be left living in unsafe situations and gives local authorities confidence that their enforcement action demands can be adhered to.
The amendment would add uncertainty into the system. If possession was not granted, the landlord would continue to be in breach of their obligations and could face fines and other penalties. Clearly, it is in the best interests of both landlords and local authorities to explore alternative actions in such cases, and we encourage them to do so, but it is also in everyone’s interests to ensure that rogue landlords leave the market, and the ground will help ensure that that happens when necessary.
Will the Minister clarify that when courts grant possession under ground 6A, they will have to take into consideration whether that is the only option, and whether other options might be on the table? Confirmation of that would help courts’ deliberations in future.
I should be clear that the landlords who are subject to enforcement action are the rogues; they are the people we are trying to root out of the system through the Bill. They are unlikely to be able to provide the suitable alternative accommodation that the hon. Member mentioned. If things get to this stage, they are that bad. We therefore do not feel that we can accept amendment 149, and I hope that the hon. Member for Greenwich and Woolwich will withdraw it.
I have been on enough Bill Committees to know that the Minister has been sent out with explicit instructions to resist amendments—we all understand that—but the Government will have to grapple with the Bill’s weaknesses regarding how the new possession grounds will affect tenants who are not at fault. They could clearly be affected by a landlord’s using ground 6A—a ground that I find perverse, because it allows for possession where the landlord is at fault.
The Minister gave the game away when he said that 6A can be used only when it is the only way that the landlord can comply with an enforcement order. Well, we could leave it to the court to make that determination under the amendment. If possession is the only way that the landlord can comply with an enforcement order, the court will grant the possession order, but there will be cases in which it is not the only way, and the Minister said that he encourages local authorities to explore those other means. I would say that, in those circumstances, encouragement is not enough. We need some provision to ensure that all alternatives are completely exhausted before this very severe mandatory ground—we are talking about eviction and potential homelessness—is brought into force.
I take the hon. Gentleman’s point on board, but as I have outlined, these are landlords who are subject to enforcement action. Does he accept that such landlords should not be operating in the private rented sector anyway, and that this ground allows us to root out those bad landlords?
I think the Minister has to be very careful on that point. It depends on what the enforcement action is, and on the degree to which the landlord is at fault. The enforcement action could relate to a breach under the housing health and safety rating system that merely needs to be rectified before the landlord can continue to rent as an appropriate and good-faith landlord; or it could relate to a very severe enforcement ground, as the Minister described. I come back to the point I made when moving the amendment: there are other enforcement powers that could deal with those types of landlords. I gave the example of a management order under the 2004 Act. There are ways that local authorities could enforce that do not require a mandatory possession ground order to be awarded. All we are saying is: give the courts the discretion to decide that.
If the Government are not minded to give the courts that discretion, there are other ways that the clause might be changed. The local authority might be required to have first exhausted other grounds before the landlord can issue a 6A notice. Let us find a way of protecting tenants who are not at fault from being evicted by landlords. In this situation, landlords, not tenants, are to blame, and they could abuse this new mandatory ground in ways that will have detrimental consequences for tenants.
I hope that the Minister has taken that point on board. I beg to ask leave to withdraw the amendment.
I beg to move amendments 138, 139, 143 and 144—
Order. Technically, the hon. Gentleman is moving only amendment 138; the other amendments are merely being debated.
I welcome that clarification, Mr Gray.
I am a stickler. I told you I was a stickler.
I like having a stickler in the Chair. I prefer it to having a non-stickler.
I beg to move amendment 138, in clause 3, page 3, line 3, at end insert—
“(5C) (a) Where the court makes an order for possession on Grounds 1 or 1A in Schedule 2 to this Act (whether with or without other grounds), the order shall include a provision requiring the landlord to file evidence at court and to serve the same on the tenant, any other defendant, and the local housing authority for the district where the dwelling is located no later than sixteen weeks from the date of the order.
(b) The evidence referred to in paragraph (a) must—
(i) give details of the state of occupation of the dwelling-house since the date of the order,
(ii) give details of the progress of any sale of the dwelling-house, and
(iii) be verified by a statement of truth signed by the landlord.”
This amendment would require a landlord to evidence the progress toward occupation or sale of a property obtained under grounds of possession 1 or 1A no later than 16 weeks after the date of the order and to verify this by a statement of truth.
With this it will be convenient to discuss the following:
Amendment 139, in clause 3, page 3, line 4, at end insert—
“(2A) After section 7 of the 1988 Act insert—
‘7A Evidential requirements for Grounds 1 and 1A
(1) The court shall not make an order for possession on Grounds 1 or 1A in Schedule 2 to this Act unless the landlord has complied with the relevant provisions of subsections (2) to (4).
(2) Where the landlord relies on Grounds 1 or 1A, the claim must be supported by evidence which is verified by a statement of truth signed by the landlord.
(3) Where the landlord relies on Ground 1 and the dwelling-house is required by a member of the landlord’s family as defined in paragraphs 2(b) to (d) of that Ground, the claim must also be supported by evidence which is verified by a statement of truth signed by that family member.
(4) Where the landlord relies on Ground 1A, the evidence referred to in subsection (2) must include a letter of engagement from a solicitor or estate agent concerning the sale of the dwelling-house.’”
This amendment would require a landlord seeking possession of a property on the Grounds of occupation or selling to evidence and verify in advance via a statement of truth.
Amendment 143, in schedule 1, page 65, line 10, leave out “6 months” and insert “2 years”.
Amendments 143 and 144 would prohibit evictions under grounds 1 and 1A within two years of the beginning of a tenancy.
Amendment 192, in schedule 1, page 65, line 10, after “6 months” insert
“or 6 months have elapsed since rent was last increased”.
This amendment would prohibit evictions under Ground 1 within 6 months of each rent increase giving periodic protection at each rent renewal.
Amendment 203, in schedule 1, page 65, line 29, at end insert new unnumbered paragraph—
“Where this ground is used no rent will be due in the final two months of the tenancy.”
This amendment would ensure when a no-fault eviction on Ground 1 is used tenants would not pay rent for the final two months of the tenancy.
Government amendments 2 to 3.
Amendment 144, in schedule 1, page 66, line 6, leave out “6 months” and insert “2 years”.
Amendments 143 and 144 would prohibit evictions under grounds 1 and 1A within two years of the beginning of a tenancy.
Amendment 193, in schedule 1, page 66, line 6, after “6 months” insert
“or 6 months have elapsed since rent was last increased”.
This amendment would prohibit evictions under Ground 1A within 6 months of each rent increase giving periodic protection at each rent renewal.
Government amendments 4 and 5.
Amendment 194, in schedule 1, page 66, line 23, at end insert—
“(e) the landlord has offered to sell the property to the current tenant at the same value at which the landlord intends to list the property for public sale and the tenant has informed the landlord within four weeks of receiving the offer from the landlord that the tenant does not intend to buy the property at this value.”
This amendment would require landlords wishing to issue a notice for possession on the basis of Ground 1A to offer the current tenants the right to buy the property at the intended listing value before it goes onto the market.
Amendment 204, in schedule 1, page 66, line 24, at end insert new unnumbered paragraph—
“Where this ground is used no rent will be due in the final two months of the tenancy.”
This amendment would ensure when a no-fault eviction on Ground 1A is used tenants would not pay rent for the final two months of the tenancy.
As we have already discussed, clause 3 amends the grounds for possession in schedule 2 to the Housing Act 1988, by means of the changes set out in schedule 1 to the Bill. Paragraph 2 of schedule 1 sets out revisions to the existing mandatory ground 1. Under the existing ground 1, a court is required to award possession of a property if the landlord requires it to live in as their “only or principal home” or if they have previously lived in it on either basis. Under ground 1 as amended by the Bill, a court is required to award possession if the landlord requires the property for use as their only or principal home, but also if they require it for such use for members of their immediate family, for their spouse or civil partner or for a person with whom they live
“as if they were married or in a civil partnership”,
or for that person’s immediate family, such as the child or parent of a partner in those terms. Under the existing ground 1, landlords are required to provide tenants with prior notice that the ground may be used. This requirement is absent from ground 1 as amended by the Bill.
In turn, paragraph 3 of schedule 1 inserts a new mandatory ground 1A into schedule 2 to the 1988 Housing Act. Under this new ground, a court would be required to award possession, with limited exceptions, if the landlord intends to sell the property. We believe very strongly that there is a clear risk that both of these de facto no-fault grounds for eviction could be abused in several ways by unscrupulous landlords. I want to be very clear that we believe that only a minority of landlords are unscrupulous and may act in these terms.
In her evidence last week, Samantha Stewart, chief executive of the Nationwide Foundation, provided us with the example of just how these grounds are being abused in the Scottish context. She gave an example of a renter named Luke, who lived in a property with rats and maggots falling out of the ceiling. The landlord refused to act on the complaint but was eventually forced to do so by the Scottish tribunal. Shortly afterward, however, Luke was served an eviction notice using the new landlord circumstance possession grounds. As soon as the prohibited re-let period was up, they moved a new tenant in.
The risk of these grounds being abused is clearly not a point of difference between us and the Government. Ministers clearly accept that amended ground 1 and new ground 1A could be used as a form of section 21 by the backdoor, because the Bill contains provision to attempt to prohibit their misuse by preventing landlords from re-letting or re-marketing a property, or authorising an agent to do so on their behalf, within three months of obtaining possession on either ground. We will debate the adequacy of those no-let provisions when we get to clause 10 and press our amendment 140 to extend the proposed period, but it is enough to know at this stage that the Government felt it necessary to include such safeguards in the Bill. We can take it as given that their decision to do so is evidence of a clear understanding that there is potential risk of abuse along the lines I described.
In addition to strengthening the no-let provisions in the Bill, we believe tenants require protection from the misuse of grounds 1 and 1A in two other important respects. First, we believe there needs to be a greater burden of proof placed on landlords who issue their tenants notices seeking possession on either of these grounds. As the Bill is drafted, at any point after the protected period is ended a landlord can simply issue their tenant with a mandatory ground 1 or 1A notice, and a county court would be required to award them possession. When it comes to expanded ground 1, there is no requirement for the landlord to evidence whether they actually require the use of the property for themselves; or, if they do not, which family member or members or person connected to them does.
Similarly, when it comes to new ground 1A, there is no requirement for the landlord to evidence that they are trying in good faith to sell a property after possession has been awarded. The risk to tenants should be obvious: six months after the start of a tenancy, when the protected period ends, a model tenant who is not at fault in any way—but who, for example, complains about damp and mould in a property—could be evicted with just two months’ notice using these grounds, without any need for the landlord to verify through evidence that they are using these landlord circumstances legitimately.
As the chief executive of the Legal Action Group and chair of the Renters’ Reform Coalition, Sue James, argued in her evidence last week, there is no indication at present that landlords will have to provide much, if anything, in the way of evidence. Although the Government have made noises to that effect, as things stand we do not know what that evidence might consist of.
The case for requiring landlords to provide evidence is obvious. As Samantha Stewart argued in her evidence,
“landlords using grounds 1 and 1A—moving in and selling—should be required to provide adequate and appropriate evidence”.––[Official Report, Renters (Reform) Public Bill Committee,
Amendments 138 and 139 are designed to address that deficiency by requiring relevant evidence to be submitted both prior to an eviction and after one has taken place. Amendment 139 would require a landlord seeking possession on the grounds of occupation or selling to evidence and verify that they are doing so in advance of a possession order via a statement of truth or, in the case of sale, by means of a letter of engagement from a solicitor or estate agent. That mirrors provisions in the Private Housing (Tenancies) (Scotland) Act 2016, which require the landlord to provide specific evidence proving his or her intention to sell.
Amendment 138 would require a landlord to evidence progress towards occupation or sale of a property obtained under grounds 1 and 1A no later than 16 weeks after the date of the order, and to submit that to the court and—most importantly, because they will be the enforcement bodies under the Bill—local authorities.
The clear benefit of amending the Bill to include those evidential requirements in respect of grounds 1 and 1A would be their deterrent effect—the consequences to any landlord of being found guilty of lying to a court, in terms of litigation and potential liability for damages. At present, after an eviction takes place on either of those grounds, either because of the tenant leaving voluntarily or the court issuing a possession award, the Government are proposing only two means of redress: local authority enforcement action or a compensation award, issued by the new ombudsman. The Bill provides only a framework for the new landlord redress scheme, so the ombudsman is still largely an unknown quantity, and there are well-known issues, attested to in the evidence that several witnesses gave last week, about the efficacy of local authority enforcement.
We believe that rent repayment orders have a role to play, but those evidential requirements and the deterrent effect they would have on unscrupulous landlords seeking to abuse grounds 1 and 1A would strengthen the Bill and ensure that tenants are better protected. We urge the Government to give them due consideration.
Secondly, we believe that the proposed protected period of six months during which a tenant cannot be evicted under either of these grounds is insufficient. The explanatory notes accompanying the Bill state that the protections mirror those that tenants currently receive. That is true, but the current protections, as Liz Davies KC made clear in her evidence to the Committee, reflect the assured shorthold tenancy regime, which the Bill is abolishing. The decision to mirror the current protected period also fails to take into account the fact that ground 1A is a new mandatory ground, and that ground 1 has been amended such that the previous requirement to serve a notice that it may be relied upon prior to the start of the tenancy has been removed. As the Bill is drafted, a landlord can let a property to a tenant, provide them with no prior notice whatsoever that they may in future wish to rely on either ground 1 or 1A, and then serve them with a notice at four months.
We believe that any landlord likely to use ground 1 or 1A in good faith will have some prior awareness that they or a family member may need the property for use at some point in the coming years, or that they may wish to sell it in the near future. As such, and because the Government have chosen to remove the prior notice requirement that currently applies to ground 1, we believe that there is a strong case for extending the protected period with respect to grounds 1 and 1A from six months to two years, allowing landlords to first serve notice under either of them 22 months after a tenancy begins. Taken together, amendments 143 and 144 would extend the proposed protected periods accordingly.
These four amendments, while retaining mandatory grounds 1 and 1A as the Bill proposes, would go a long way to preventing and deterring abuse of the kind that we fear will occur fairly regularly if these possession grounds remain unchanged. I look forward to hearing the Minister’s response to them as well as further information about the four Government clauses.
I rise briefly to speak in support of the amendments, which seek to address two key themes. One is that tenants start disproportionately from a position of lack of power, and a large minority of tenants are in a position where they are limited by their access to advice and representation and a lack of alternative accommodation. They are frequently unable, without stronger legislative protection, to exercise their rights against the landlords who abuse their role.
The second theme is that it does not need all landlords, or even most landlords, to be in this position for such abuses to become a major problem—one that, as my hon. Friend the Member for Greenwich and Woolwich alluded to, is already a significant driver of evictions. As we have touched on this morning, we know that a substantial minority of private rented properties are in a very poor condition indeed. We also know that it is disproportionately the most disadvantaged tenants who concentrated in the worst accommodation. When those tenants, already disadvantaged by their lack of power vis-à-vis the landlord, seek to take action against that landlord—even in the simple form of raising a complaint about the conditions in their property—those landlords are particularly likely to take action against them, currently under section 21, and the statistics reinforce that message. Private rented tenants who complain about conditions or disrepair are two and a half times more likely to receive a no-fault eviction order than those who do not.
The trouble with the Government’s proposals for grounds 1 and 1A is that they could simply replicate those loopholes. That is a real worry. As we know, most landlords will not behave in this way. However, without a stronger burden of proof, which falls on the landlords in this case—not the tenants or on already exceptionally overstretched authorities, which have to be called on to take enforcement action—thousands of vulnerable people could be evicted under grounds 1 and 1A, rather than section 21.
I urge the Minister to think very seriously about ensuring stronger safeguards. We already have some experience of this in the Scottish system to draw upon. My hon. Friend’s amendments will close those loopholes and help to ensure that the positive developments from abolishing no-fault eviction are not inadvertently undermined by the weak protections in these clauses.
I support amendments 138, 139, 143 and 144, which would require evidence to be given when using grounds 1 and 1A. While that is important, I again think—I always live in hope—that some clarity from the Minister about the courts being required to obtain at least the first part of that evidence could achieve this without that necessarily being written in the Bill. I believe that the second part would need some legislative clarity, which is why the amendment is useful.
However, let us be clear: it is a crime to knowingly make a false statement to the court. We need to make it clear to landlords that that crime will be followed up. It can only be followed up if we then determine that the property was not then taken into possession and that there was no malicious element to it—there can be other reasons, of course. Without that element of enforcement, and therefore knowing what has happened in a number of months’ time, that will never happen. This could quite easily be implemented through the property portal sending automatic messages to the court, which would not overburden our court process. I again ask for some clarity from the Minister that this is how the property portal and court reform is intended to work. That would probably alleviate some of these issues.
I have tabled a number of other amendments in this group, which I would also like to speak to. The first one would provide for the six-month protection to be renewed on the basis of rent renewals. At the moment, a lot of assured shorthold tenancies—not all of them, Mr Gray, I grant you, but probably the majority of them—have rent renewal clauses, such that that when the rent is increased, there is a new tenancy. The landlord will say, “I’m increasing your rent. Please sign the new tenancy for the year ahead.” Every year, the landlord says, “Well, you’re moving on to the periodic. I would quite like you to sign the new tenancy with the new rent.” That is what happens for most of my constituents who are in the most precarious part of the market, which we are trying to address. That gives them six months’ protection every year, on an ongoing basis, every time their rent is increased.
I know that the National Residential Landlords Association has described this idea as bonkers, but I think that is because it does not quite understand what I am trying to get at here, which is to retain what we already have currently. Although it seems that the Bill is increasing the protection of tenants—and the security of landlords, by knowing that the tenant will be there for a period—the danger is that it will reduce it because, de facto, most tenants currently have six months protection in every 12. The proposed change would provide six months’ protection over an indefinite period, which is clearly far less. Six divided by infinity is an impossible mathematical equation, but it is clearly less than six months divided by 12.
It is zero.
Quite right: zero protection—well, it is mathematically zero, but I think we all know that six months’ protection is a bit more than that—so there needs to be something.
When a landlord comes along on that annual date, the landlord might say, “I don’t want to make any changes. I don’t want to increase the rent.” Then, to some extent, the question is: why should any further protection be afforded? But if the landlord comes along and says, “I want to increase your rent,” and the tenant agrees that they are going to increase the rent—it does not go to a tribunal; it is all agreed—it seems quite reasonable to ensure protection on both sides, for example to provide for a new six-month protection period, just as happens at the moment.
That is why I have tabled these amendments, because I do not think it is in anyone’s interest for tenants suddenly to be leaving. Although the six-month protection does not prevent tenants from leaving, it does produce a mindset that the tenancy is now at least fixed for six months, based on what the landlord is offering and the higher amount that the tenant is now offering to pay. I do not think that is unreasonable, and I would love to see the Government accept the principle of it. If not—of course, I am not foolish, but there is always wishful thinking—it would be useful to hear an indication from the Government of which measures they think might be put in place to ensure that rolling protection.
The other amendment that I wish to speak to concerns the ability for a tenant to be offered the property before it is for sale. If it is a genuine sale, on the open market—the amendments would require a solicitor’s letter or an estate agent’s letter; I think that is reasonable and fair enough—no landlord would have any problem with making this offer for a short period. In my experience of selling houses, it takes more than four weeks between interest and getting it on the market anyway. I am talking about the landlord offering it to the tenant at the rate at which they are going to initially list it on the market. The landlord might reduce what it is on the market for later, because of market factors. I am not saying that that needs to be taken into account. All I am saying is that the initial listing should be offered to the tenant—a right of first refusal—in those four weeks. Again, I do not think this is unreasonable. Of course, in the majority of cases, the tenant will not be in a position to buy; but if, in a small number of cases, we can prevent turmoil and give the landlord a quick sale, it is in everyone’s interest to do so.
Again, I am not delusional and do not think that the Minister will accept this proposal, but I hope that the Minister might indicate how he will be encouraging, through court papers, potentially, and court reform, all those questions to be asked, just as we saw during covid, when court papers required the landlord to ask whether the tenant had been affected by covid. That was not a Bill change—a law change—but it was in the court papers. I am talking about how the question could be asked in court papers. There does not necessarily need to be a change in the discretionary grounds, but the very fact of asking the question could change the mindsets of landlords and, I think, is important.
Finally, under amendments 204 and 203, which I have also tabled, no rent would be required for two months—