Yesterday, the Welsh Government published the Renting Homes (Wales) Bill. The Bill seeks to implement the Law Commission’s Renting Homes Bill, with some major amendments partly reflecting the devolution settlement (ie what can be done) and partly to update the Bill. There are also some rather interesting and slightly more subtle alterations in the Welsh Bill.
With the publication of this Bill, it is becoming more apparent how the devolved governments are putting the failure of the Westminster government to deal properly with renting housing in to sharp focus. The “no more red tape” nonsense that is randomly distributed by English housing ministers is intellectually and practically incoherent, when so much basic law remains up for grabs – see, for example, David Smith’s blog post about plain English.
Anyway, back to Wales. The Bill is also a little controversial – on the one hand, registered social landlords [this is Wales, where RSLs are RSLs and not PRPs] will lose Ground 8; on the other hand, private rented sector tenants will lose the six month moratorium on their landlord obtaining possession. Both are, actually, imho completely understandable but they remain controversial.
The real purpose of the Bill is to simplify, pretty dramatically, both the law and the vast array of housing tenures currently in existence. There are generally to be only two types of “occupation contract”: secure (which it is presupposed will be granted by “community landlords”, ie local authorities and RSLs), and standard (which it is presupposed will be granted by private landlords, and modelled on the AST). There are only a few exceptions to this new, much simplified regime, unlike the various types of tenancy excluded from the current statutes. Equally, the new regime extends to all occupation contracts, including licences to occupy.
Rather than the statute and common law reading terms in to the agreement, the whole purpose of Renting Homes is that the occupation contract will provide all the terms in writing (failure to provide a written statement is subject to a penalty). Certain terms are prescribed on the face of the Bill as having to be included in that written contract (fundamental terms); certain terms will be prescribed in secondary legislation (supplementary terms); and the parties are, of course, entitled to specify their own terms (additional terms). Although some of the fundamental terms and all the supplementary terms are capable of amendment, the reason for using them as they appear is that they are deemed to comply with the consumer regs.
The major innovations lie in the following provisions regarding fitness for human habitation; ending joint tenancies; abandonment; rights of review; supported housing; prohibited conduct standard tenancies; variation of terms; and retaliatory evictions.
However, the Bill will be controversial not necessarily for those innovations but because of getting rid of the six month moratorium and Ground 8 for community landlords.
As regards the latter, the decision is understandable both as a matter of theory as well as a matter of practicality. As a matter of theory, it has always struck me as being odd that a social landlord can rely on a two month arrears provision as a mandatory ground for possession. As a matter of practicality, few social landlords tend to rely on it as a ground for possession, although they may use it as an effective debt collection tool, but there are other methods available to them. Further, I have always been less convinced that, if one talks to RSL lenders, they really care too much if at all about the mandatory ground for possession, as opposed to the solvency, business planning and risk management of the RSL.
The six month moratorium appears harder to explain on the surface, and Shelter are conducting a campaign to reinstate it. My sense, though, is that reading the Bill and the previous Law Commission work, there is a rationality to dropping it as well as a significant number of quid pro quos. The rationality is that losing the six month moratorium enables the Bill to have much broader coverage across tenancy types leading to greater coherence and structure. Next, it is likely to facilitate landlords wishing to let properties for the short term, so as to contribute to the revival of the sector. Third, it is assumed, as basic economics, that most landlords are likely to retain the current length of term so as to ensure that their income stream remains in place, and that they do not lose money with a turnover of occupier. Fourth, there are the various protections in the Housing (Wales) Act, including the homelessness provisions (which are not affected by this Bill).
Then there are the quid pro quos as to the state and condition of the property, and retaliatory eviction. Here, I think that the Welsh Government has been pretty bold – effectively, section 8, Landlord and Tenant Act 1985, which is a dead letter because of the low rent levels, will be given full effect by removing the rent levels (h/t to S); the retaliatory eviction provision offers rather better protection than the one suggested by DCLG and critiqued by NL.
Actually, I think that the most interesting provisions are those relating to supported housing. These seek to provide some structure to the provision of supported housing occupancy agreements which, frankly, does not exist at the moment, and about which there is an imbalance between provider and occupier. The Bill goes some way to meeting those concerns, although not as far as the original Law Commission Bill.
The publication of the Bill represents a major h/t to Martin Partington, who led the Law Commission project, and to Richard Percival (who can be named as he is now an academic) and Helen Carr, who worked on the Law Commission project tirelessly, as well as to various Welsh civil servants (who cannot be named) and housing ministers (too numerous to mention).
- I am tempted to write “for the short term”