Private rented sector Contents

2Legislative powers

49.During this inquiry, we wanted to establish whether local authorities had sufficient powers to address poor standards in the private rented sector. In this Chapter, we explore whether the legislative framework—through which local authorities derive their powers to intervene in the sector—is fit for purpose. In particular, we consider whether the HHSRS merely requires an update to its baseline assumptions or needs a more comprehensive overhaul. Finally, we voice our support for Karen Buck MP’s Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill, while making some recommendations to try to ensure that it is effective once it becomes law.

The legislative framework

50.The Government highlighted the “extensive legislative framework” established under the Housing Act 2004, which gives local authorities the powers they need to tackle poor property conditions and management standards in the private rented sector.93 This included the HHSRS, licensing, management orders, and rent repayment orders. The Government also pointed to the range of legislation it had introduced over the past three years, which, it said, was intended to professionalise the sector, strengthen consumer protection and tackle ‘rogue’ landlords, including:

51.The Government also committed to legislating further in the coming years. In November 2017, it published the Draft Tenant Fees Bill, which will prohibit letting agent fees charged to tenants at the start of a tenancy, on which we have undertaken pre-legislative scrutiny alongside this inquiry.95 In January 2018, the Government announced its support for Karen Buck MP’s Private Member’s Bill on housing standards.96 The Ministry has also published several consultations in recent months on policies which are likely to require primary legislation, including on a mandatory ombudsman service for landlords, the introduction of a specialist housing court (discussed in Chapter 1), and the regulation of letting agents.97

Sufficiency of powers

52.Most local authorities told us they already had the powers they needed to address low standards in the private rented sector. However—as we will explore later—many said they did not have the resources they needed to enforce those powers. Councillor Robert Lawton explained that, in Bournemouth, while more powers would always be welcome, the greater concern was a lack of resources for enforcement.98 Similarly, Andy Fisher, Head of Housing, Health and Communities at Boston Borough Council, told us that “the suite of tools we have in our toolbox is probably among the best in any enforcement role”, noting in particular Parts 1 to 4 of the Housing Act 2004 and the power local authorities had to demand production of documents.99 However, he explained that “resource is a very different issue”. The NLA agreed:

Local authorities already have sufficient powers to enforce standards and deal with “rogue landlords” in the PRS. The NLA has been arguing for better enforcement for quite a while and for local authorities to properly utilise the powers they currently enjoy… The drive to improve enforcement activities of local authorities should be aimed at more effective use of these powers, rather than the introduction of new regulations.100

Calls for a review of the legislation

53.The RLA explained that there were over 140 Acts of Parliament and more than 400 regulations affecting landlords in the private rented sector.101 David Cox told us that successive governments, over 20 years, had sought to find individual legislative solutions to specific problems, rather than looking at the private rented sector as a whole: “they have just passed law after law, and none of it is being enforced”.102 Shelter said that, while recent legislative developments were welcome and had emerged from good intentions, taken as a whole, the legislative framework was “piecemeal, out-dated [and] complex”.103 Isobel Thomson agreed, telling us, “It is a bit like a jigsaw: we have all the pieces but we do not have the picture”, while arguing that the sector needed a more coherent legal framework.104 Dr Julie Rugg argued that, “A lot of legislation has been brought in quickly and has not been drafted very well. There is information and changes that come on top of that. It is like a ship with lots of barnacles”.105

54.We were told that this complexity affected how the legislative framework was used in practice by local authorities. David Smith said that the legislation was “too patchy and complicated, and far too much of it is cross-cutting”, making it difficult for Environmental Health Officers (EHOs) to understand what their powers are and how to use them in practice.106 Mr Smith emphasised that much of the legislation was very old, and told us that he continues to refer to the Distress for Rent Act, passed in 1737.107 Dr Rugg agreed that the legislative framework made enforcement difficult for councils:

One of the big issues that relates to some of the legislation is that it tends to split issues between condition-related issues, management-related issues, and issues that relate to letting agents [ … ] All of these things have been added on to other bits of legislation, and now we are in a situation where it is hard for a local authority that thinks, “Which bit of legislation do I use to deal with this particular problem?” and then finds that none of the bits of the regulation that they have got to work with will deal with that particular problem, because none of it fastens up.108

55.The complexity of the legislation was an issue our predecessor Committee highlighted in its 2013 Report. They recommended that the Government conduct a wide-ranging review to consolidate legislation covering the private rented sector, with the aim of producing a much simpler and more straightforward set of regulations that landlords and tenants could easily understand.109 However, the Government did not accept this recommendation, stating in its response that, “ a wide-ranging review would introduce uncertainty into the sector and would slow down investment at a time when it is most needed. It would also provide significant and unwarranted upheaval for tenants and landlords.”110 Nevertheless, as outlined earlier, the Government has subsequently introduced a significant number of new laws affecting the private rented sector.

56.We heard from several witnesses that the legislative framework now needed reform. Dr Rugg said that too much time was spent explaining the complexity of the legislation to tenants and landlords, and that “maybe our focus should be on getting rid of some of the complexity”.111 However, the Minister’s view was that the existing legislation was “delivering results in terms of improving standards and quality”, and that the Government intended to “explain the legislation that is out there, rather than introducing new overarching primary legislation to bring it all together.”112 She also argued that there was no appetite in the sector for a complete overhaul of legislation.113

57.This was supported by Adrian Jeakings from the NLA, who warned that “tinkering always produces perverse outcomes” and, while the legislation was “probably too complex [ … ] I would not rush into changing it”.114 Similarly, Melanie Rees told us that the Chartered Institute for Housing would not support a radical overhaul of the framework, but would be in favour of a review, in time, of how newly introduced regulations had worked in practice, and which considered where there had been unintended consequences of the new legislation.115

58.The Government’s recent legislative activity is well-intentioned, but we are concerned that it builds on an outdated and complex foundation. The Coalition Government rejected our predecessor Committee’s recommendation for a much simpler set of regulations for landlords and tenants. However, the volume of new legislation that the Government has introduced in the sector has added to this complexity and, as such, we feel that our predecessors’ recommendation is even more relevant today. We therefore recommend that the Law Commission undertake a review of the legislation relating to the private rented sector and provides guidance as to whether a new approach to regulation in the sector would bring more clarity for tenants, landlords and local authorities.

Legislation on carbon monoxide alarms and electrical safety checks

59.We note that other parliamentary inquiries have also concluded that current legislation can be confusing to both landlords and tenants. For example, in October 2017, the All-Party Parliamentary Carbon Monoxide Group (APPCOG) published a report which found that the that the Smoke and Carbon Monoxide Alarm (England) Regulations 2015 were confusing and risked inadvertently turning landlords into ‘rogue landlords’.116 It called on the Government to amend the legislation to make it explicit and mandatory for landlords to provide carbon monoxide alarms in the rooms of private rented properties containing any fuel-burning appliance.

60.We also heard concerns regarding electrical safety in private rented accommodation. In November 2017, the Private Rented Sector Electrical Safety Standards Working Group made eight recommendations to the Government for improvements to standards in the sector, including calling for mandatory five-yearly checks on electrical installations.117 Electrical Safety First told us they were concerned by the lack of Government action following the publication of the Working Group’s report, as well as the general inadequacy of support given to local authorities to prevent electrical hazards in private rented homes.118 In February 2018, the Government launched a consultation seeking additional evidence on the recommendations made by the Working Group. They explained that their final conclusions would also take into account the findings of the Independent Review of Building Regulations and Fire Safety.119

61.We support the finding of the All-Party Parliamentary Carbon Monoxide Group (APPCOG) that legislation should be amended to make it explicit and mandatory for landlords to install carbon monoxide alarms in the rooms of private rented properties containing any fuel-burning appliance. We also call on the Government to implement the recommendations of the Electrical Safety Standards Working Group as soon as practicable, including the introduction of mandatory five-yearly checks on electrical installations in private rented accommodation.

Housing Health and Safety Rating System

62.The HHSRS, introduced through the Housing Act 2004, came into force in England and Wales in April 2006. It replaced the Housing Fitness Standard, a pass or fail system, which had been in place since April 1990. The HHSRS is a risk-based assessment tool which is used by EHOs to assess the likelihood and severity of a hazard in residential housing to the health and safety of occupants and visitors. EHOs use a scoring system to calculate the seriousness of hazards. If the EHO finds a Category One (serious) hazard, the local authority is required to act, for example by issuing an Improvement Notice, Prohibition Order, Hazard Awareness Notice or by emergency remedial action. Category Two hazards are less serious and councils have more flexibility as to their course of action.

Baseline assumptions

63.The operating guidance, and the baseline assumptions that underpin the HHSRS, have not been updated since 2006.120 The Chartered Institute for Environmental Health (CIEH) told us that 97% of EHOs wanted the evidence base of the HHSRS updated, while 53% reported that they were seeing hazards in homes that were not adequately addressed within the existing guidance.121 While the CIEH called for the retention of a risk-based evaluation system, and did not advocate the return to the pass/fail Housing Fitness Standard, they were one of several organisations who noted that the baseline assumptions in the HHSRS were out-of-date. Andy Fisher agreed, telling us that the sector had improved over the past 12 years, and so what was an acceptable baseline then is now inadequate.122 Councillor Simon Blackburn told us that the HHSRS baseline assumptions were “very low indeed. All it helps you to do is deal with the worst bits of it”.123

64.The Minister disagreed; she believed that the HHSRS was working “really, really well” and did not accept that the baseline assumptions were out-of-date, stating that they were “as strong today as they were in 2004”.124 She highlighted statistics that showed that the number of properties with hazards had declined from 31% in 2008 to 17% in 2015, and credited the HHSRS for this. However, the Ministry did tell us that they would consider whether there was a need for a review of the HHSRS once the Independent Review of Building Regulations and Fire Safety had published its final report later this year.125

Wider reform of the HHSRS

65.The HHSRS has been criticised with respect to the limited knowledge of its existence, and lack of understanding about how it works, amongst landlords and tenants, and its inconsistent application and enforcement by local authorities. ARLA Propertymark believed that it should be reviewed with a view to introducing a set of criteria which are easier to use, and argued that the current system was “too complicated and poorly understood by tenants, landlords, agents, and enforcement officers”.126 Dr Rugg told us:

I wonder whether we might think about looking at the standards again and think about what is a reasonable standard to be working to and whether that standard is too complicated to work with very easily and cost-effectively [ … ] If we are expecting landlords to deal with the regulations, they have to deal with somebody who has sufficient knowledge to be able to understand how the system works, and that really posits that information in a group of people who are very heavily under pressure. We need standards regulations that are more readily accessible so that everybody can work with them [ … ]127

66.The HHSRS’s complexity can be seen in the processes for assessing hazards. Kate Webb from Shelter explained that it does not look at a property in isolation, but also at who was living in it, to take account of the fact that a home that is safe for one person might not be safe for another.128 Councillor Blackburn also criticised the complexity of the HHSRS, and gave a specific example of the most commonly found Category One hazard—excess cold—and how the HHSRS could fail to protect tenants:

[ … ] the preventative measures listed that can have an effect on the likelihood and harm of that in the scoring matrix just include tick boxes that refer to appropriate levels of thermal insulation or heating systems with expressions such as “properly sized and sited ventilation.” A property can have all of those things and you can tick all the boxes but it does not mean that it is not excessively cold within that property. It does not mean that the residents will not suffer. It is a binary tick-box approach [ … ]129

67.London Councils highlighted how the HHSRS limited the local authorities’ capacity to act to ensure that items imperative to the integrity of a block’s fire protection system—such as fire-resistant doors—were adequate, unless it could demonstrate the issue posed a risk to a person within a given dwelling. This was particularly concerning in the context of the Grenfell Tower fire, and London Councils called for a “simpler regulatory framework that clarified the responsibilities between building control, local authorities and private sector housing Environmental Health Officers”.130

68.We also heard that the complexity of the system led to the inconsistent application and enforcement of the HHSRS by local authorities. David Cox from ARLA Propertymark told us, “you can have two local authority officers from the same council come and do an HHSRS inspection on the same property and you will get two different results, because it is so complicated”.131 Similarly, David Smith from the RLA argued that the HHSRS was not working because it was not being effectively utilised by EHOs.132 He told us that many EHOs “get lost in the bureaucracy of it, because they choose to”, focusing on one hazard that is of limited importance, while ignoring those that really matter to the tenant. The CIEH disagreed with these representations, arguing that EHOs were fully qualified to understand and apply the law.133

69.When our predecessor Committee investigated the HHSRS in 2013, they argued that, if landlords were to be expected to provide housing of a decent standard, there should be a straightforward way of assessing whether this standard had been met. They called on the Government to “consult on the future of the housing health and safety rating system and the introduction of a simpler, more straightforward set of quality standards for housing in the sector.”134 While the Government agreed to undertake a review of the system “to ensure there is a robust framework in place to check that tenants’ homes are safe”, following that review in 2015, it decided not to commit to updating the guidance, arguing that most respondents to their consultation considered the current guidance to be fundamentally sound.135

70.We acknowledge that the Housing Health and Safety Rating System (HHSRS) is supported by many environmental health professionals, but the evidence we received indicated that the system is unnecessarily complicated and fails to give tenants, landlords and agents a clear understanding of the minimum standards that are expected in a private rented property. The Government must immediately update the baseline assumptions within the operating guidance for the HHSRS, which are now twelve years out-of-date. We have already called on the Law Commission to review private rented sector legislation, including the Housing Act 2004, and believe that this should include a review of the HHSRS itself. Ultimately, it is our strongly held view that the Government should introduce a more straightforward set of quality standards for the sector, so that it is clear to everyone—not just to highly qualified professionals—whether a property meets minimum standards. These standards should be higher than those in the HHSRS, reflecting an improvement in housing quality since the system was introduced.

Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill

71.The Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill 2017–19 is a Private Member’s Bill introduced by Karen Buck MP, which seeks to amend the Landlord and Tenant Act 1985 by extending its obligations to cover almost all landlords and to modernise the fitness for human habitation test.136 Due to rent limits that have remained unchanged since the 1950s, the requirement in the 1985 Act for properties be fit for human habitation has ceased to have effect. The Bill would remove those rent limits, bringing the fitness requirement back into effect. It further provides that, where a landlord fails to maintain a property that is fit for human habitation, tenants would have the right to take action in the courts directly, without the intervention of the local authority. The Government announced its support for the Bill shortly before its Second Reading in the House of Commons, which took place on 19 January 2018.137 It will shortly move to Committee stage.

72.We heard near unanimous support for the Bill, not only from tenants’ advocates, but also from landlords’ associations, professional bodies, and local authorities. Shelter told us it was actively supporting the Bill, highlighting how it brings together existing, and updates defunct, fitness legislation and incorporates the HHSRS into one fitness test that would be determined in the courts.138 The NLA expressed their support, in particular for provisions that enable tenants to enforce property standards and fitness considerations for themselves, so they are not reliant on local authorities.139 Similarly, the CIEH support the Bill, “because it gives the tenant another avenue to get compensation”.140

73.Nevertheless, some concerns were raised about how the powers in the Bill might be used by tenants in practice. Sir Robin Wales, of Newham Council, warned that, “tenants will find it very difficult to exercise their powers”, although he noted that this did not mean they should not have the right to do so.141 Councillor Blackburn, of Blackpool Council, questioned whether it was right to place the onus upon the tenant to take legal action against their landlord, arguing that many tenants were highly unlikely to have the time or resources to know how to begin taking legal action. He commented, “We are all free to buy a Rolls Royce, but the vast majority of us cannot exercise that freedom”.142 Similarly, Andy Fisher from Boston Borough Council told us that, in his experience, “there are not going to be flocks of tenants in a position to secure the independent legal advice to bring claims and cases”.143

74.Mette Isaksen from Citizens Advice told us she supported the Bill, but acknowledged that many tenants would not be able, or willing, to go through a court process.144 She recommended that the Bill be accompanied by a wider set of non-court-based responses to circumstances in which the disrepair is not meeting the fitness for habitation threshold, but where the landlord was nevertheless failing to meet their legal responsibilities. David Smith from the RLA highlighted that it was not only tenants who were reluctant to go to court, but landlords too. He noted the potential applicability of the Bill of the Government’s proposal for a specialist housing court—as discussed in
Chapter 1—modelled along the lines of the existing first-tier tribunal.145

75.The Minister told us that concerns around access to justice were unfounded, as the Government had assessed that “in 99 out of 100 cases”, tenants would not need to go to court.146 They would have clear visual evidence of their complaint and, knowing that tenants had new powers to act directly, landlords would be motivated to avoid allowing cases to reach court. Anne Frost, Deputy Director of the Private Rented Sector Division at the Ministry for Housing, Communities and Local Government (MHCLG), told us:

The way it is currently drafted, in terms of relying on the HHSRS, means in our view that they will be able to see if there is a hazard that is applicable. Assuming the Bill goes through, we would provide guidance to tenants in any case, but our expectation is that that power provided to tenants will mean that landlords are less likely to want to go to court, because they know that proof is there up front.147

76.We also heard that local authorities would need sufficient resources to ensure tenants had access to expert advice they need to accurately assess hazards as defined through the HHSRS. Sir Robin Wales told us that, “If it is going to work, councils should support people and that would mean resourcing us”.148 This was supported by Councillor Tony Newman, representing the Local Government Association (LGA), who noted that frontline services like environmental health were under budgetary pressure, and that without sufficient resources, “we will not be able to act on even the finest of Bills”.149 The Minister told us that the Bill would incentivise local authorities to act on behalf of tenants, as they would continue to be able to retain any civil penalties.150

77.Some witnesses noted that the Bill did not contain any additional provisions to protect tenants who take up their rights from retaliatory eviction or rent increases (as discussed in Chapter 1). Councillor Blackburn told us that the provisions within the Bill could “heighten the risk of retaliatory eviction by landlords”.151 Tamara Sandoul pointed out that, where the local authority takes a formal action to protect a tenant in response to a complaint, the tenant would be protected for at least six months, whereas if the tenant goes to court on their own, they will not be protected.152 On the risk to tenants of retaliatory eviction, Councillor Lawton made the point vividly:

If you are a vulnerable person living in a two-bedroom or one-bedroom flat and there is water running down the wall or whatever, and you go and make a complaint about that particular landlord, his argument would be, “If you do not like it, go somewhere else. I have got 20 people waiting to fill in that space”.153

78.We offer our support for Karen Buck MP’s Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill. However, while the Bill is a very positive step-forward, there is a risk that these new rights will be underutilised by more vulnerable tenants at the lower end of the market. To try to mitigate this, we recommend that:

93 DCLG (PRS0068), para 9

94 DCLG (PRS0068), para 3

95 3rd Report - Pre-legislative Scrutiny of the Draft Tenant Fees Bill, 2017–19, Housing, Communities and Local Government Committee

96 Government supports new measures to improve the safety of tenants, Ministry of Housing, Communities and Local Government, 14 January 2018

97 DCLG (PRS0068), para 49

98 Q205 (Robert Lawton, Bournemouth Borough Council)

99 Q205 (Andy Fisher, Boston Borough Council)

100 National Landlords Association (PRS0043), paras 2 and 13

101 Residential Landlords Association (PRS0011), para 2.2

102 Q177 (David Cox, ARLA Propertymark)

103 Shelter (PRS0028), para 11

104 Q177 (Isobel Thomson, National Approved Letting Scheme)

105 Q7 (Dr Julie Rugg)

106 Q115–7 (David Smith, Residential Landlords Association)

107 Distress for Rent Act 1737,, accessed March 2018 and Q117 (David Smith, Residential Landlord Association

108 Q7 (Dr Julie Rugg)

109 1st Report - The Private Rented Sector, 2013–14, CLG Committee, para 13

111 Q13 (Dr Julie Rugg)

112 Q280 (Mrs Heather Wheeler MP, Minister for Housing and Homelessness)

113 Q280 (Mrs Heather Wheeler MP, Minister for Housing and Homelessness)

114 Q117 (Adrian Jeakings, National Landlords Association)

115 Q233 (Melanie Rees, Chartered Institute of Housing)

116 Carbon monoxide alarms: tenants safe and secure in their homes, All-Party Parliamentary Carbon Monoxide Group (APPCOG), October 2017

117 Electrical safety standards in the private rented sector: working group report, Ministry for Housing, Communities and Local Government, November 2017

118 Electrical Safety First (PRS0013), para 2.2

119 Electrical safety in the private rented sector

121 Chartered Institute of Environmental Health (PRS0072)

122 Q207 (Andy Fisher, Boston Borough Council)

123 Q160 (Councillor Simon Blackburn, Blackpool Council)

124 Q268 and Q306 (Mrs Heather Wheeler MP, Minister for Housing and Homelessness)

125 Q299 (Anne Frost, Ministry for Housing, Communities and Local Government)

126 ARLA Propertymark (PRS0035), para 8

127 Q9 (Dr Julie Rugg)

128 Q9 (Kate Webb, Shelter)

129 Q157 (Councillor Simon Blackburn, Blackpool Council)

130 London Councils (PRS0061)

131 Q181 (David Cox, ARLA Propertymark)

132 Q136 (David Smith, Residential Landlords Association)

133 Q232 (Tamara Sandoul, Chartered Institute for Environmental Health)

134 1st Report - The Private Rented Sector, 2013–14, CLG Committee, para 18

137 Government supports new measures to improve the safety of tenants, Ministry of Housing, Communities and Local Government, 14 January 2018

138 Shelter (PRS0028), para 21

139 National Landlords Association (PRS0043), para 23

140 Q237 (Tamara Sandoul, Chartered Institute for Environmental Health)

141 Q158 (Sir Robin Wales, London Borough of Newham)

142 Q158 (Councillor Simon Blackburn, Blackpool Council)

143 Q209 (Andy Fisher, Boston Borough Council)

144 Q93–4 (Mette Isaksen, Citizens Advice)

145 Q116 (David Smith, Residential Landlords Association)

146 Q300 (Heather Wheeler MP, Minister for Housing and Homelessness)

147 Q302 (Anne Frost, Ministry for Housing, Communities and Local Government)

148 Q158 (Sir Robin Wales, London Borough of Newham)

149 Q158 (Councillor Tony Newman, Local Government Association)

150 Q300 (Heather Wheeler MP, Minister for Housing and Homelessness)

151 Q158 (Councillor Simon Blackburn, Blackpool Council)

152 Q237 (Tamara Sandoul, Chartered Institute for Environmental Health)

153 Q209 (Councillor Robert Lawton, Bournemouth Borough Council)

Published: 19 April 2018