Meeting of the Parliament 17 March 2016
I thank everyone who contributed to the development of the Private Housing (Tenancies) (Scotland) Bill, including members of all parties and all stakeholders. I am grateful to those stakeholders for their considered thoughts on the bill, while the Government was shaping its policy and during the Parliament’s consideration of the bill.
I also recognise the Infrastructure and Capital Investment Committee for its detailed scrutiny of the bill as well as the Finance Committee and the Delegated Powers and Law Reform Committee for their considerations.
This afternoon’s debate on stage 3 amendments has highlighted where we have disagreed on some of the detail of the bill. However, I have been encouraged by the extent to which most Opposition members of the Infrastructure and Capital Investment Committee have been generally supportive of what the Government wants to achieve in the bill. I have been happy to work with members who have made constructive criticisms to improve the bill and I have been glad to support amendments from them and from other members who were not on the committee, such as Patrick Harvie, where that would strengthen the bill.
The position that we have reached on the grounds for repossession is a good example of the collaborative approach that we have taken. When the bill was introduced, it contained 16 grounds, 12 of which were mandatory; the bill now has 18 grounds, of which eight are mandatory, eight are discretionary and two contain elements of both. I am pleased to be able to acknowledge the committee’s contribution to the bill, which I hope will be passed at the end of this debate.
The Government published its first strategy for the private rented sector, “A Place to Stay, A Place to Call Home”, in May 2013. The strategy aims to improve and grow the private rented sector by enabling a more effective regulatory system, targeting tougher enforcement action and attracting new investment.
As part of our work around the strategy, the Scottish Government has undertaken a range of actions to improve private renting. Those include: clarifying the existing law on the charging of premium fees, so that tenants cannot be charged for getting a tenancy; setting up the tenancy deposit schemes in Scotland, to protect tenants’ deposits; legislating to create a new tribunal for private renting; legislating to regulate the letting agent industry; and providing local authorities with additional powers to tackle bad practice, where it occurs.
However, to deliver the better quality, more professional sector that we want to achieve, we recognised that we needed to legislate to rebalance the relationship between landlords and tenants, to one that is fairer and that works in today’s private rented sector.
The bill introduces an open-ended private residential tenancy, which will improve security of tenure for tenants and provide appropriate safeguards for landlords, lenders and investors. It also makes rents more predictable for tenants, with adjudication provided where rent increases take rent beyond the market rate for comparable properties. It also enables local authorities to apply for rent pressure zone designation, where rent increases in a local area are having a detrimental impact on tenants and housing.
The bill will enable tenants to feel more secure and settled in their homes and communities. One benefit of greater security for tenants is that it will enable them to assert their rights, such as being able to ask their landlord to carry out necessary repairs, without fear of arbitrary eviction. That will provide a step-change in improving the quality of private renting.
As part of striking the right balance, the bill recognises that landlords must also have confidence in their ability to effectively manage and regain possession of their property. That is why we have devoted so much time to getting the repossession grounds right.
The first-tier tribunal will play a key role in dealing with disputes under the new tenancy, providing a more accessible, specialist form of redress. During the earlier stages of the bill, I was asked about our approach to tribunal fees. I want to reassure members that we are committed to making the Scottish tribunals as accessible as possible. I am therefore pleased to announce that if this Government forms the next Administration, fees will not be charged for tenants or landlords who take a case to the housing and property chamber of the first-tier tribunal. No fees will mean improved access to justice in the private rented sector. The provision will enable tenants in particular to fully exercise their rights.
When reflecting on the changes that we expect the bill to achieve, it is worth noting that under the current tenancy, in most cases it is tenants, not landlords who end the tenancy. I expect that to continue to be the case. However, where a landlord brings a tenancy to an end, and it is disputed, the landlord will need to make an application to the tribunal to establish that they are entitled to regain possession. Landlords will need to provide evidence in support of an application. Even where a ground is mandatory, the tribunal will still need to establish whether it has been met before it can grant an order for eviction.
During stage 1, much was said about the repossession grounds, in particular those grounds that include an intention by the landlord—for example, that the landlord intends to sell the property or to live in it. Some stakeholders were concerned that those grounds might be open to misuse.
As I said earlier, it is important that we get the repossession grounds right. To address the concerns that were raised, I introduced a number of amendments at stage 2 that outlined the types of evidence that could be used to demonstrate some of the eviction grounds.
Sanctions will apply should a landlord mislead a tenant into leaving their home or mislead the first-tier tribunal into issuing an eviction order. Some of those sanctions are set out in the bill as they are specific to the new tenancy, but criminal sanctions, such as for illegal eviction, will also continue to apply.
During stage 2, Clare Adamson introduced an amendment to increase the maximum amount payable to a tenant who has been wrongfully evicted from three months’ rent to six months’ rent. I was more than happy to support her on that.
I want to ensure that tenants are made fully aware of their rights. For instance, we will include information about tenants’ rights—where to get advice, how to apply to the tribunal in disputes with the rent service and information about rent adjudication, where to go and how to get assistance—in the notices that are prescribed under the new tenancy. That is important; this bill is also about informing tenants.
The student sector also featured heavily during stages 1 and 2 of the bill. I listened to all the concerns of the stakeholders and at stage 2 I introduced an amendment to exempt purpose-built student accommodation from the provisions of the bill. I recognise that the growth of purpose-built student accommodation provides much-needed new accommodation for students and has been developed for the specific purpose of providing that bespoke accommodation, which is similar in character to the accommodation that colleges and universities provide. However, I remain of the view that in the mainstream private rented sector, all tenants should be treated the same. That is why I have resisted calls to include a specific student tenancy or ground in the bill.
The basic principle of the new tenancy is that if a person rents property to someone in the private rented sector, they need to recognise that that property is someone’s home.
Overall, we have sought to strike a fair balance in what is being proposed in the bill to ensure that the new tenancy will support a well-functioning, modern sector that works for both tenants and landlords. The Government has undertaken extensive consultation and worked constructively with members in developing the policy that underpins the bill to make sure that we have got the balance right.
We want to create a better, more professional private rented sector. The new private residential tenancy that is the centrepiece of the bill is absolutely key to achieving that.
I move,
That the Parliament agrees that the Private Housing (Tenancies) (Scotland) Bill be passed.
17:28