Meeting of the Parliament 04 October 2022
I am not sure that the minister understands his own bill, because it is backdated to September and the extensions that he has outlined mean that there is the potential for the provisions to last up to 18 months. The minister probably needs to rethink that.
The Scottish housing market is complex, especially in the capital. We all rely on the mixed housing market to provide the homes that Scotland needs now and in the future. The decision by SNP-Green ministers has been made without any consultation with the sector, and it will have consequences.
In Scotland, we have never had Government rent controls in the social housing sector. Rightly, housing associations are independent organisations that have been able to set rents each year, taking into account tenant feedback, affordability and the resources that are required to invest in maintaining properties and buildings, as well as building much-needed homes, which the Government has also failed to achieve.
The bill’s impact is, therefore, worrying, as the bill goes against the historical position and brings in the possibility of wider rent controls for the sector, the shattering of confidence to invest in new affordable homebuilding programmes and the real prospect of private landlords removing private rented properties from the market in the coming years.
For housing associations and private landlords, the bill presents a risk of hundreds of millions of pounds of lost income. It might require them to rewrite their future business plans and scrap investment in new affordable home builds, and it will undermine budget simulations for energy efficiency and decarbonisation for net zero—both key Government targets and the minister’s specific responsibility—which will be impacted.
The bill has already significantly impacted the potential delivery of new homes in Scotland; it will be much harder for housing associations to plan, if they are able to do so. Lenders might be nervous about lending, or they might lend at higher margins as confidence over future rental income decreases.
The bill introduces a risk that has not previously existed in Scotland—historically, we have had lower rents. It will undoubtedly trigger a slowing down of the building and construction of affordable homes and it could trigger a wider downturn in the construction industry at the worst possible time for our economy.