Baroness Scott of Bybrook (Con)

My Lords, we think that the amendment from the noble Lord, Lord Carrington, is sensible and measured. The amendment provides for a minimum of three months’ notice before new tenancies are treated as Section 4A assured tenancies and a further three months before existing tenancies are reclassified in the same way. This introduces a clear and reasonable transitional period, giving landlords and tenants time to prepare for the significant legal and practical implications of these changes. Crucially, it gives banks time too. As the noble Lord, Lord Carrington, noted, Amendment 122 is supported by UK Finance, including lenders such as Nationwide and Paragon. Banks need time to adjust. Any change to how a landlord can evict a tenant makes lenders more cautious about the security of their investments. These lenders will want to have seen it in writing before they start to make too many changes. Additionally, lenders will need to reassess their understanding of rental income flows. Lenders will have to adjust their risk models, and potentially their loan terms, to accommodate the risks under the new regime, not only in relation to individual properties but with regard to the broader market stability. It is vital to understand how the regime affects overall demand in the rental market. I take this opportunity to raise the specifics of buy-to-let mortgages. Flexibility in increasing rents in these cases is especially important and an area where sufficient time for adjustment will be needed. Lenders must evaluate the continued attractiveness of buy-to-let properties as collateral for loans. Operational readiness matters too. Quite simply, new systems and processes will need to be adapted to the framework. Earlier today, we discussed systems such as the database and the pensions dashboard. Of course, many private companies are often more agile when responding to challenge and change, but even they need time. This is a complex Bill, and I have said several times that its implementation will require careful communication and a phased approach. I see this amendment as a practical way of helping the Government ensure that no stakeholder is caught off guard by the shift to the assured tenancy regime. I would welcome clarity from the Minister on the Government’s plans for commencement—so, I am sure, would landlords and tenants—and all stakeholders will need time.