Question proposed, That the clause stand part of the Bill.

With this it will be convenient to discuss new Clause 6—Limit on rent to be requested in advance of tenancy—

“In the 1988 Act, after section 14ZB (inserted by section 8 of this Act) insert—

‘14ZBA Maximum rent to be paid in advance

No rent may be requested or received in advance of any period of the tenancy which exceeds the rent for one month of the tenancy.’”

This Amendment would impose a limit of one month’s rent on the amount of rent which can be asked for or paid in advance of a tenancy.

I will be relatively brief because this Clause serves a specific function, but I will focus on what it achieves. I am aware that the wider issue of rent in advance concerns a number of hon. Members—indeed, it featured in our discussions during the oral evidence sessions last week, on which I will say more shortly.

The clause will require landlords to refund a tenant for any rent they have paid in advance, where the tenancy has ended earlier than the period for which a tenant has paid. That serves a practical purpose—for example, if the tenant has paid for the month that they are in occupation and the tenancy is ended by the landlord two weeks into that month, the clause allows the tenant to reclaim the additional two weeks’ rent.

On the issue of rent in advance more broadly—which also pertains to new clause 6, to which I think the hon. Member for Taunton and Wellington will speak shortly—as I stated when I gave evidence to the Committee on Tuesday, Government Members have long recognised that demands for extortionate amounts of rent in advance put financial strain on tenants and can exclude certain groups from renting altogether. We are clear that the practice of landlords requesting large amounts of rent in advance must be prohibited.

Although it might be argued that the interaction of the new rent periods provided for by clause 1 and the existing provisions of the Tenant Fees Act 2019 relating to prohibited payments provide a measure of protection against requests for large amounts of advance rent, I accept that there is a strong case for putting the matter beyond doubt. As I made clear to the Committee, I am giving careful consideration as to how best that might be achieved.

Let me briefly address new clause 6, which seeks to limit the amount of rent in advance that can be paid prior to a tenancy period to no more than one month’s rent. Many of us will have heard anecdotal stories of the pressures placed on renters through demands for rent in advance, and it is for similar reasons that we have taken steps in the Bill to tackle rental bidding. I heard the evidence from last week, and we are looking at the matter carefully to ensure that we put the matter beyond doubt on the face of the Bill.

I am grateful to the Minister for what he said about looking at this area in detail. We raised, and discussed in some detail, the issue of how those with a poor credit history, or people who wish to secure a property for a fixed period—for example, international students—would be dealt with under the measures. We know that there are already limitations on the level of deposit that can be requested, but, particularly for those with a poor credit history, the ability to offer a larger sum of rent in advance can be a means of accessing a home in the private rented sector when they would otherwise not be able to access a home at all.

I am grateful to the Government for considering that particular group of people, who are in many cases extremely vulnerable tenants and often fall outside eligibility for support from the local authority under homeless duties, particularly if they have a job and an income. We need to make sure that we do not create a situation in which, inadvertently, a particular group of prospective tenants is effectively pushed out of the market. I am glad that the Government are taking that issue on board and considering how best it can work.

Does the hon. Member for Taunton and Wellington wish to comment on new Clause 6?

Briefly, Dame Caroline. I am still getting used to the intricacies of the order of the agenda.

The new Clause would limit rent in advance to sums of one month’s rent. The argument was well made in the oral evidence session, when we heard about the importance of rent-in-advance bidding and the need to reduce the risk of bidding up the amount that needs to be deposited in advance. One month’s rent is quite often the norm as a reasonable amount of rent to be provided in advance. Many years ago, when I was a student and renting, one month in advance was a reasonable amount. Bidding up that amount has a detrimental effect on tenants; hence the rationale for new clause 6.

Question put and agreed to.

Clause 9 accordingly ordered to stand part of the Bill.

On a point of order, Dame Caroline. I thought we were going to vote on new Clause 6.

That will come later, when we reach that point.