The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)

My Lords, I extend my thanks to the many noble Lords with whom I have spoken about this Bill, and to Members of this House and people outside it who have worked so hard to improve the private rented sector over many years. I am looking forward to the maiden speeches of my noble friends Lady Brown and Lord Wilson. The private rental system needs to change. It currently provides the least affordable, poorest quality and most insecure housing of all tenures. The insecurity it engenders creates uncertainty in the lives of tenants and allows good landlords to be undercut by the minority of rogues and chancers. In short, the 11 million private renters and the 2.3 million landlords across England are being failed. The Renters’ Rights Bill brings forward the most significant changes to the sector for nearly 40 years. The Bill will strengthen the security of tenure for tenants; ensure that they are paying a fair rent; guarantee a minimum standard that they can expect from a property; provide new robust avenues to redress; and more. The Government have worked closely with those across the sector to ensure that the Bill’s measures strike the right balance. I will set out some of these key measures. As many noble Lords will be aware, the Bill will deliver the Government’s manifesto commitment to abolish Section 21 no-fault evictions as soon as possible, removing the threat of arbitrary eviction and granting renters the security and stability they deserve. Section 21 evictions can wreak havoc with tenants’ employment, schooling and lives in general. As leader of Stevenage Council, I saw at first hand the knock-on effects that arbitrary evictions can have on families’ physical and mental health, with more people pushed into inadequate temporary accommodation. The case that always sticks with me is that of the parents of a child with special educational needs, who fought and fought to get their child into a school near where they lived but were then evicted from the very property that was near to that school. It is unacceptable that over 123,000 households in England are currently living in temporary accommodation. This includes 159,380 children—the highest number of children in temporary accommodation on record. Removing this threat will immediately improve the lives of millions. The Government also recognise that the vast majority of landlords provide an excellent service, and it is vital to ensure landlords can reclaim their properties when they need to. To this end, new, clear and expanded possession grounds will be introduced. We will ensure these are as watertight as possible, so that they cannot be abused by landlords seeking possession for the wrong reasons. These robust grounds will ensure that there is no room for loopholes in the system, and tenants will benefit from longer notice and protected periods. The new tenancy system will operate on the basis of periodic tenancies. This will support tenants who want to leave poor-quality homes or face circumstances such as domestic abuse. Tenants will be able to give two months’ notice at any point. I know several noble Lords have raised concerns about the removal of fixed-term tenancies. To be clear, it is a core principle of this Bill, and this Government’s firm belief, that there is no place for fixed terms in the future assured tenancy system. Both landlords and tenants will benefit from a simpler system, with a single set of rights and responsibilities. Neither group should be locked into a fixed term if their circumstances change. In designing the grounds, the Government took time to ensure the Bill works for everyone, including students. To meet this goal, a new possession ground has been created to allow landlords renting to students in HMOs to seek possession ahead of each new academic year, facilitating the yearly cycle of short-term student tenancies. To further protect the student market, private purpose-built student accommodation will be removed from the assured tenancy system in recognition of the limited market such accommodation focuses on, and the differences between purpose-built accommodation and “off-street” private housing rented to students. Providers must sign up to government-approved codes of practice, which will ensure homes are safe and good quality, to be removed from the assured tenancy system. The Bill also makes changes to the system by which rent can be increased, preventing unscrupulous landlords from using unfair rent increases to evict tenants by the back door. Landlords will now be able to increase rents only once per year and they must do so through the Section 13 process. Tenants will be empowered to challenge egregious increases at the First-tier Tribunal, without fear of receiving a higher rent than the landlord initially intended. To further support tenants trying to do the right thing, a mandatory repeated rent arrears ground will not be included in the Bill. We will also increase the mandatory threshold for eviction under the mandatory rent arrears ground from two to three months. The Bill proposes new laws to end the cruel practice of rental bidding wars by landlords and letting agents. For too many tenants, rental bidding restricts their ability to make an informed choice about one of the most financially significant decisions they face. They are led to think they have found a property they can afford to rent, only to discover they would need to pay way over the asking price to secure it. Our reforms will end this practice for good. Landlords and letting agents will be required to publish an asking rent for their property and will then be prohibited from asking for, encouraging or accepting a higher offer. Following amendment on Report in the Commons, the Bill will also limit the amount of rent in advance that a landlord can require after the tenancy has been signed but before the tenant has taken possession to a maximum of one month. That aside, landlords will no longer be able to include any terms in the tenancy agreement that have the effect of requiring rent to be paid prior to the rent due date. Tenants will retain the flexibility to make payments of rent in advance during the tenancy should they wish to do so. Taken together, these measures will prevent the small number of unscrupulous landlords setting tenants against each other or excluding altogether renters who are perfectly able to afford the monthly rent on a property. Everyone in the private rented sector is entitled to a safe and decent home. This Bill will make it illegal for landlords and letting agents in England, Scotland and Wales to discriminate against tenants in receipt of benefits or because they have children. Local councils will have strong enforcement powers to tackle unlawful practices related to rental discrimination. Mortgage lenders and insurers will also no longer be able to impose restrictive discriminatory terms. Pets can bring a huge amount of joy to people’s lives, and this cannot be restricted to those lucky enough to own their own home. We are committed to supporting responsible pet ownership in the private rented sector. The Bill will ensure that landlords do not unreasonably withhold consent when a tenant requests to have a pet in their home, with the tenant able to challenge unfair decisions. We know that some landlords are concerned about potential damage caused by pets. That is why the Bill will allow landlords to require insurance covering pet damage. I thank the noble Earl, Lord Kinnoull, and the noble Lords, Lord Trees and Lord de Clifford, for their fantastic expertise, which they have shared with us to ensure that these reforms will work as intended. We continue to work with them. The decent homes standard, which applies only to the social rented sector, will apply to the private rented sector and be enforceable for the first time. This will ensure that privately rented homes are safe, secure and hazard free, tackling the blight of poor-quality homes. The Bill will also extend the application of Awaab’s law to the private rented sector, enabling the setting of clear legal expectations about the timeframes within which landlords must make homes safe when they contain serious hazards. We will launch a consultation on the content of the decent homes standard for social and privately rented homes in the coming months. We will also set out further information about the timescales for implementation in due course. The Bill provides for the introduction of a new PRS landlord ombudsman service that will deliver quick, fair, impartial and binding resolutions for tenants whose landlords fail to resolve legitimate complaints. The ombudsman will support a number of the new measures the Bill introduces—for example, giving tenants further opportunity to escalate issues where a landlord has encouraged a bidding war or unreasonably refused a pet. The Housing Ombudsman Service has extensive experience in tenant-landlord services and redress and is well placed to deliver streamlined redress for both private and social tenants. We said in opposition that we agreed with this approach, and we are still of that view. However, this is not a final decision. We will continue working to design the best possible service for users and, following a full value-for-money assessment, we will determine who is best placed to deliver a high- quality service. This Bill also introduces a private rented sector database, through which tenants will be able to access information to inform choices when entering new tenancies. Landlords will be able to understand their obligations and demonstrate compliance, and local authorities will be able to use the database to target enforcement activity. We will continue to consider what information is necessary to collect to support more informed rental experiences for tenants, and to provide local authorities with a dataset which will support the enforcement of health and safety standards in the private rented sector. The changes I have just mentioned have the potential to transform the experience of renting in England, but their success is contingent on effective enforcement. The Bill will strengthen local councils’ enforcement powers and introduce a new requirement for councils to report on enforcement activity. The Bill includes a staged enforcement framework for local authority enforcement. New maximum penalties of £7,000 and £40,000 will be introduced for initial or minor compliance and for serious, repeat or persistent non-compliance respectively. The Bill will also significantly strengthen rent repayment orders. This will provide a stronger deterrent against non-compliance and further empower tenants to take action against landlords when they commit offences. More offences will be brought into the scope of rent repayment orders. Further changes include making sure superior landlords and company directors can be held liable, and doubling the maximum amount a landlord can be ordered to pay from one to two years’ rent. We are also doubling the period in which tenants and local authorities can apply for a rent repayment order and requiring repeat offenders to pay the maximum amount. New investigatory powers will make it easier for councils to identify and fine unscrupulous landlords. Local authorities will be able to request information from third parties and enter business premises and—in much more limited circumstances—residential premises to gather evidence where required. The new powers contain safeguards to ensure that they are used appropriately and proportionately. It is imperative that the reforms in the Bill can be handled by the courts and tribunals system; many noble Lords have expressed concerns about this and have raised them with me. I want to reassure noble Lords that we are working closely with the Ministry of Justice to ensure that the justice system is prepared for the implementation of this Bill. Most tenancies end without court proceedings being required, and the digitisation of the court possession process will make the process easier to navigate for landlords and tenants in those cases where they are. I will be meeting very soon with a number of noble Lords who have expressed interest in this digitisation process, and I look forward to that further engagement. I know we all share a wish to see fairness and proportionality in any regulatory framework. We believe we have achieved that in our reforms, and I very much look forward to your Lordships’ scrutiny of the Bill. The Bill ensures that tenants can put down roots in their communities. They deserve to enjoy that stability, just as home owners do, and we should reward landlords who provide the excellent service that so many of them do. This will be the biggest change to the experience of renting in this country for generations. I believe the measures in the Renters’ Rights Bill are sufficiently comprehensive, robust and balanced to achieve that change, and give all tenants a better place to call home. I beg to move.