Baroness Taylor of Stevenage (Lab)

My Lords, I shall speak also to Amendments 76 to 85 and Amendments 123 to 125, to Clause 33 and Schedule 6 respectively. These relate to the mechanism by which private purpose-built student accommodation, or PBSA, will be exempted from the assured tenancy system. They are highly technical in nature and can be broadly divided into two main groups. First, there are technical amendments to the power in the Housing Act 1988. We will use this power to make secondary legislation exempting providers from the assured tenancy framework by reference to their membership of the Unipol code of management practice. This amendment to the power will allow building managers, not just traditional landlords who own the building, to be exempted in the event those managers are members of the housing management code. The amendments are designed to reflect the diversity of commercial arrangements in the PBSA sector. Secondly, there are amendments that aim to smooth over the transition for the sector by providing access to a modified ground 4A for landlords of existing PBSA tenancies after the transition date. I am grateful to stakeholders from the sector for working with the Government to ensure that these clauses work in the way intended. I will now go briefly through the amendments one by one. Amendment 123 is a consequential amendment that updates the numbering in paragraph 13 of Schedule 6. Amendment 124 is not related to PBSA but rather corrects a pre-existing cross-reference error contained in paragraph 13 of Schedule 6. Turning to the first of the substantive amendments, the Government’s intention is to exempt private PBSA from the new assured tenancy system, in recognition of its unique operating model and the need for alignment with the academic calendar. We will do this using a delegated power in paragraph 8 of Schedule 1 to the Housing Act 1988, which we are also amending. However, the power in the Housing Act will allow for new tenancies to be exempt only if they fall within scope. As a result, tenancies entered into prior to the commencement of the Bill will fall outside the scope of the exemption and, therefore, will be subject to the full provisions of the new assured tenancy system. To apply the exemption retrospectively would carry significant risk, as it would turn one of these existing PBSA tenancies into what is known as a “common law” tenancy: that is, a tenancy almost entirely regulated by what is in the tenancy agreement. This could cause unintended consequences, such as those PBSA tenancies containing significantly fewer rights for tenants than the assured shorthold tenancies they will have signed. It could also cause problems for the landlords of those tenancies in the event that the tenancy agreement does not give them adequate forfeiture rights. We do not consider it to be the right approach, therefore, to simply exempt pre-existing PBSA tenancies from assured tenancy status. That said, it is important that PBSA landlords under these existing PBSA tenancies can still access the possession grounds, in particular ground 4A. To ensure that the exemption operates as intended, Amendment 125 modifies ground 4A when applied to pre-existing “qualifying student tenancies”. These are PBSA tenancies, in other words. The amendment ensures that the ground can be used despite those tenancies not usually being HMOs, nor does it require the landlord to serve the Section 8 notice between 1 June and 30 September, reflecting the fact that this restriction does not apply to PBSA tenancies in the old system; nor will it apply to fully exempted tenancies. This will ensure that existing PBSA landlords retain the ability to regain possession at the end of the academic year and therefore end the tenancy. This is consistent with the treatment of new PBSA tenancies established after commencement, where they will not be subject to the assured tenancy framework. I turn now to Amendments 75, 76, 77 and 78. We are seeking to make the existing exemption from assured tenancy status for student tenancies more comprehensive. This exemption is currently set out in paragraph 8 of Schedule 1 to the Housing Act 1988. Amendment 75 therefore amends the exemption to ensure that it applies where a landlord has appointed a person to manage the tenancy on their behalf or to manage the building, and that person is a member of a recognised student housing management code of practice. Amendment 77 therefore inserts a new sub-paragraph, (2CA), into paragraph 8. This will allow for regulations to make more tailored provision for particular circumstances by reference to a specified building when combined with the specified person acting on behalf of the landlord. Amendments 76 and 78 are consequential on Amendment 77. They ensure that new sub-paragraph (2CA) is cross-referred to where appropriate in the rest of paragraph 8. I turn to Amendments 80, 81, 82, 83 and 85. There is often a delay between a student tenancy being entered into and the student tenant actually taking possession. In light of this, the exemption in paragraph 8 contains provision to say that a tenancy that meets the exemption at the point at which the tenancy is granted will be exempted permanently, save for particular situations. These situations will include where at the time of grant the tenancy was exempt because the landlord or person acting on their behalf was a member of a housing management code of practice but at the point where the tenant takes possession neither the landlord nor the person managing is a member of a code. It will also include where at the time of grant there were regulations in place under paragraph 8 that did not prevent the tenancy from falling within the exemption, but at the point at which the tenant is entitled to possession, these regulations do prevent the tenancy from being caught by the exemption. This is achieved by Amendments 80, 81, 82, 83 and 85. These amendments are designed not only to ensure that the exemption is granted solely to those PBSA providers who adhere to robust standards but also to guard against any potential for the exemption to be misapplied or exploited. Amendment 79 is consequential on Amendment 75. It ensures that regulations made elsewhere in paragraph 8 can specify classes of buildings that are subject to a housing management code of practice specified for this purpose under new paragraph 8(1)(b). Amendment 84 is consequential on Amendment 125, which provides that a tenancy will be exempt if the person discharging “management functions” in relation to the building is a member of a specified housing management code. Amendment 84 defines “management functions”. It defines these functions to include services, repairs, maintenance, improvements, and insurance of the building. I beg to move.