I was interested to read on Property118, an article stating that the Renters Rights Bill is not about tenants but creating a ‘council cash windfall’.
That’s right in a way, but it’s a very landlord-centric way of looking at things.
The problem for local authorities right now
It’s well known that many, if not all, Local Authorities are finding it difficult. They have suffered massive reductions in their income through austerity, which have not yet been made up.
Further, they are suffering further financial losses by having to provide housing for all who are evicted who come within the definition of ‘priority need’.
This includes all tenants with children (or where the applicant is pregnant) who have been evicted under the no-fault section 21 procedure – however appalling their behaviour.
Indeed, this is one of the reasons why landlords use this procedure – because it means that the Council will have to find these tenants somewhere to live once the possession order has been made and (in most cases) a bailiff eviction date has been set.
In their current cash-strapped state, Councils are in the difficult position of being unable to avoid this but at the same time being unable to afford it.
The result is several councils serving section 114 notices (which is the Local Authority equivalent of being bankrupt) with many more on the brink.
Let us remind ourselves why we need Councils to be solvent:
- They provide rubbish collection/waste management services
- They provide (or are supposed to provide) social care
- They provide state schools and often also higher education institutions
- They provide leisure and cultural services (including youth clubs for young people most of which have sadly been shut down due to funding issues)
- They monitor environmental health, regulate pollution and ensure compliance with environmental regulations
- They are responsible for dealing with emergencies such as flooding, terrorist attacks and other disasters
- They provide support services for businesses
- They are responsible for improving public health
These are all massively important services that affect the lives of everyone living in their area.
Is it right that they should be put at risk by having to rehouse tenants, many of whom are being evicted for wholly legitimate reasons, which are hidden behind the ‘no fault’ eviction procedure?
In his talk to our Renters Rights Bill Conference (see the extract here) Justin Bates KC pointed out that in 2022-23, Councils spent over 1 billion pounds on temporary accommodation for homeless people. This is a huge amount of money which councils simply cannot afford long-term.
Something had to be done.
What the Renters Rights Bill will aim to do
The abolition of the no-fault section 21 evictions
This will mean that in all cases of tenant eviction, the reason why the tenants are being evicted can be seen.
- If they are being evicted through no fault of their own, then their rehousing entitlement will continue. For example, if their landlord wants the property back to sell or live in themselves – both of which will be grounds for eviction under the new law.
- If however, they are being evicted because of their poor behaviour, then I suspect that the many families patiently waiting on the local authority housing waiting list will agree that it is unfair that they should ‘jump the queue’.
The increase in Local Authority enforcement powers
There are two main reasons why people have to suffer sub standard housing:
- The fact that they can be evicted without cause under the no fault section 21 eviction procedure if they try to enforce their rights (this is known as retaliatory eviction)
- The fact that Local Authorities have signally failed to do proper enforcement work.
The first items will, the government hopes, be at least partly resolved by the abolition of section 21 and the building of new homes.
The second item will, they hope, be resolved by the enhanced powers for Local Authorities under the Renters Rights Bill.
There are a number of parts to this:
Making it mandatory for Local Authorities to enforce the legislation in their area.
At present, this is not the case, allowing Local Authorities to save money by doing no enforcement work – which at the moment mostly involves bringing costly prosecutions in the Magistrates Courts.
Expanding the number of offences for which they can serve Civil Penalty Notices.
In most cases, the fine can be up to £7,000 but for some more serious offences, it can be up to £40,000.
The CPN procedure is better for Local Authorities as it is quicker and involves less bureaucracy, plus they can keep the fine money. Fines imposed in Magistrates’ Courts go to central funds.
Improving their investigatory powers
Rogue and criminal landlords are adept at confusing the issue and evading enforcement action (see more here). These new powers will make it easier for Local Authorities to take action.
And finally
The Property118 article gives the impression that Councils are wealthy organisations, intent on racking up more wealth by unfair imposition of penalties on hapless landlords. I’m sure many Council employees will ‘roll on the floor laughing’ at this.
In fact, many Local Authorities are on the point of bankruptcy and are unable to carry out their functions due to lack of funds.
The damage done to society by rogue and criminal landlords is inculcable. Poor conditions in housing increase sickness, which increases the costs to the National Health Service, which we all pay for through our taxes.
It also has a serious effect on children and their education – which again affects us all as our children are our future.
Surely it is only fair that those who transgress the regulations should pay for any enforcement action that is brought against them?
The Renters’ Rights Bill may not be perfect, and there are certainly some aspects which could do with revision.
However, I think it is laudable that a serious attempt is being made to help Local Authorities carry out their enforcement duties.
If you are a landlord worried about all this
Remember that 100% compliance with the rules will give you 100% protection. Good landlords should have nothing to fear.
But you will need to take the trouble to learn about the new regime and take steps to comply with it. My Landlord Law service can help with this.
“The Renters’ Rights Bill may not be perfect”
It isn’t, it is for political vested interest reasons and will only make things a lot worse for renters.
“Good landlords should have nothing to fear.”
Are you quoting Goebbels?
There are 2 sides to every argument – the above is 1 side and I suspect that a few landlords may find time to put a few arguments for the other side.
Above are noted reasons why councils need to be solvent – fairly obvious ones; maybe if we had councillors who were financially aware they may be able to put the public’s rates to better use (especially where I live in Oadby, Leicester. The local council here is constantly grabby monies from the local community and frittering it away.) – councils would be substantially more solvent.
I read recently that the RRB is Not to help tenants, but to put more money into councils pockets, and that seems a very plausible reason as it will be doing exactly that, as councils go out to find ways to penalise and trip up perfectly good landlords into paying substantially large fines which go into the councils pockets; which is why I am selling up and getting out the business after 18 years
Yes, a lot of landlords take the view that Councils are out to get them. If any council workers read this maybe you could post your side of the story.
Ben Reeve Lewis who does a lot of enforcement work for Councils, told me that they are mainly concerned to get the rogues. Even if they wanted to maliciously claim against good landlords who have made an honest mistake, they have to get this through their legal department, who would probably block it.
I can’t help wondering whether many landlords are used to breaching the law with no comeback and are annoyed that this state of affairs is likely to end.
The fact remains that if you are compliant with the regs, the Council can’t claim against you even if they want to. 100% compliance = 100% protection.
I had meeting with an enforcement manager earlier this week talking about problems with their PRS stock. They estimate that if just 6% of the total PRS stock in their area was in poor enough condition to warrant legal action, it would amount to over 8,000 properties. He has 6 people in his team.
Thats not like handing out 8,000 speeding or parking tickets. You cant do it with AI. Each one of those 8,000 properties would require on-site inspections, reports, evidence bundles compiling, serving of notices plus statutory time periods for appeals and the tribunal hearings to resolve them, which would also pull in council legal teams and barristers on top of the EHOs. Often the full costs of enforcement arent even covered by an award once the tribunal have imposed reductions, often at around 45% of the possible award available.
Thats the reality of enforcement. Every person has an opinion about what councils should do and how they should do it, in the same way that all football fans have strong opinions about how their team manager should strategise a particular game but as with football, the fan isnt doing the job and shouting from the sidelines isnt going to change the way things are done.
The fella I spoke to earlier in the week isnt going to get far with 6 people in a London borough. He estimates that to really have an effect he needs 20 but his council doesnt have the money to employ them, instead his only way forward is to capitalise on the provisions in the RRB and pursue the crooks with CPNs and RROs which provides the funds and those funds wont be coming from ordinary landlords, just the crooks, who as I understand it, all normal landlords want us to do anyway.