Select Committee on Regulatory Reform Sixth Report


Letter from the Office of the Deputy Prime Minister to the Committee

The Regulatory Reform (Assured Periodic Tenancies) (Rent Increases) Order 2003 Further Information

Paragraph 6.1 of the paper enclosed with my letter of 13 November 2002 ( which responded to questions from the Committee about the proposed order to change the rules on the timing of rent increases) promised to provide the Committee with two further items of information in advance of the laying of the draft order at the second stage of scrutiny. This letter:

·  Encloses 25 copies of the draft Regulations which provide for two new prescribed forms for landlords to use in England to notify rent increases under section 13 (2) of the Housing Act 1988; and

·  Responds to the two consultation comments about the current prescribed form applying in England.

Proposed new prescribed forms for use in England

We propose two new forms to replace the current form, 4A, which was prescribed for use in England in February 2002 in the Assured Tenancies and Agricultural Occupancies (Forms) (Amendment) (England) Regulations 2002; SI 2002 No. 337. The first form, 4B, will be for use by landlords in proposing a new rent for an assured periodic tenancy. It incorporates the replacement (subject to Parliamentary approval of the draft regulatory reform order) of the anniversary rule for these tenancies by a provision that rent increases take place not less than 52 weeks after the start of a tenancy or the date of the last increase, with a 53 week condition applying intermittently. The main alterations to the form to reflect the change in the timing rule are the addition of a new paragraph 3 in the form itself and note 15 which describes the new rule. The second form, 4C, will be for use by landlords or licensors proposing a new rent or licence fee for an assured agricultural occupancy. This continues to reflect the anniversary rule. The National Assembly for Wales is separately prescribing forms for use for premises in Wales. In the meantime the draft Regulations provide for Form 4 to remain the prescribed form for use in Wales. The forms enclosed with this letter are almost finalised. We are though considering including some additional wording in note 11 to Form 4B and note 10 to Form 4C to provide landlords with a definition of service charges and some further clarification of the circumstances when charges should be included in the tables in the new forms.

Consultation comments about form 4A

Bromford Carinthia Housing Association suggested that the table in the form should make provision for the inclusion of variable service charges so that tenants received one notification of the actual total rent charged. A variable service charge does not count as part of the rent for the purposes of section 13 of the Housing Act 1988. Such charges are subject to different legal rules and procedures, under the relevant provisions of the Landlord and Tenant Act 1985. These provisions include requirements about consulting tenants, and dealing with requests for information (sections 20-25 of the 1985 Act). Therefore it would be inappropriate for variable service charges to be included in the new prescribed forms which are only used to notify rent increases. In addition, a landlord may include information about charges other than rent in a covering letter or separate attachment to the prescribed form. We are not therefore adopting this suggestion.

Bedford Citizens Housing Association suggested that the table in the form should make provision for the inclusion of charges under the Supporting People programme, which is to be introduced from 1 April this year. Neither private sector tenants nor the vast majority of tenants of registered social landlords (RSLs) whose rents are increased under the section 13 statutory notice procedure will be subject to charges under the Supporting People programme. The majority of RSLs will receive grant from local authorities for the support services they will provide under the programme. Only in the few cases where an RSL tenant pays part or all of the cost of the support services and their tenancy agreement includes a condition that charges for support services are to be included in rent, will it be appropriate to include these charges on the form. In practical terms, it is preferable in these few cases for these charges to be included within the fixed service charges in the table in the form, rather than providing for a separate category of charges which will only apply to a very few tenants. The National Housing Federation will continue to encourage RSLs to provide a breakdown and explanation of the various charges which constitute the "fixed service charges" in a covering letter to accompany the form. We are not therefore adopting this suggestion.

I hope this further information is helpful to the Committee.

8 January 2003

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