Baroness Janke (LD)

My Lords, as colleagues have already said, the Liberal Democrats have long campaigned to abolish no-fault evictions. We support the measures in this Bill, particularly the provisions by which tenants can challenge rent increases. We support amendments in this group that seek to establish a fairer basis for rent increases and would prevent excessive and unpredictable increases, the severe impact of which may cause eviction and homelessness. We also support the amendments in this group that will reduce the need for tribunals to hear challenges from tenants. We feel that there is a fundamental problem with the concept of market rents, which are currently calculated by looking at a range of advertisements. This does not provide an accurate assessment of the actual rents that people are paying. One-third of private renters are already paying half or more of their income on rent, well above the commonly accepted affordability threshold of 30%. Measures to stabilise rents within tenancies are essential to ensure that the Bill delivers the secure, stable system it promises, as well as empowering tenants to challenge unfair rent increases that result in unwanted moves. For many renters, though, a rent increase is as good as an eviction notice. Without an established index that outlines what a fair increase looks like, the First-tier Tribunal will remain effective in supporting renters. Rent increases must not become the new no-fault eviction. Over 300,000 renters moved last year because of a rent increase they could not afford; that is more than 900 renters a day. Market rent is an artificially high indicator for judging what an appropriate rent should be. The database proposed in the Bill, once established, would be able to capture what rents are actually being paid. This could then establish benchmarking for an appropriate rent, rather than having the traditional understanding of market rent. Amendment 77 in my name reflects Liberal Democrat policy, which would limit any in-tenancy increase in rent to a percentage of the Bank of England base rate. This is different from inflation and other indicators that are often used. Landlords do face increasing costs from time to time, but the increases they face and want to pass on to tenants are generally more likely to be related to the cost of interest on their borrowing. Therefore, that is the appropriate measure for landlords to look to and should be considered appropriate for a rental increase. It is also often much less than the much more volatile changes in the market rent that are related to inflation. We would relate rent increases to much more realistic, modest and accurate reflection of what landlords’ expenses are and use the Bank of England base rate as an appropriate limit on the amount of rent increase and any in-tenancy rent increase. That is the rationale behind this amendment.