Forty Second Report Contents

Appendix 1: Tenant Fees Bill: Government Response

Letter from Lord Bourne of Aberystwyth, Minister for Faith at the Ministry of Housing, Communities and Local Government, to the Rt Hon. Lord Blencathra, Chairman of the Delegated Powers and Regulatory Reform Committee

I am writing to respond to the 35th Report of the Delegated Powers and Regulatory Reform Committee that considered the Tenant Fees Bill and which was published on 23 October 2018.

I am grateful to the Committee for their report on the delegated powers memorandum produced to support the Tenant Fees Bill and have thoroughly considered the Committee’s view on submitting the statutory guidance for enforcement authorities to Parliamentary scrutiny. However, I do not intend to accept the recommendation that the enforcement guidance should be subject to the negative Parliamentary procedure.

I respectfully maintain the position that it is unnecessary to debate the contents of this guidance in Parliament since Parliament will approve the overarching enforcement principles by enacting the legislation.

The function of the guidance is to support enforcement authorities in applying that legislation consistently, whilst allowing them a measure of discretion. It will include detail inappropriate for parliamentary scrutiny such as reporting processes. It is also important to have the ability to easily update the guidance following review of the practical operation of the ban in the marketplace.

Similar guidance has not been subject to any parliamentary procedure. This includes guidance on banning orders in the private rented sector produced under the Housing and Planning Act 2016, guidance regarding capital finance under section 15 of the Local Government Finance Act 2003, guidance regarding the community infrastructure levy under section 221 of the Planning Act 2008 and guidance under section 31 of the Small Business Enterprise and Employment Act 2015 regarding the appropriateness of including a review provision in secondary legislation.

There is nothing contained in the guidance that is not already set out on the face of the Bill and therefore subject to full Parliamentary scrutiny. My officials have been working with local authorities to produce the guidance and I have attached, at Annex A,8 the current draft to this letter and have also shared this draft with all Members of Parliament and Peers to give them the opportunity to scrutinise and provide comment. I hope this reassures the Committee as to the contents and intent of the guidance.

The Tenant Fees Bill is due to have its Lords Report Stage on 11th December. Government is proposing a number of amendments to strengthen the protections in the Bill. A full list of these amendments is attached at Annex B9 but in summary the amendments are to:

None of the proposed amendments introduce any additional delegated powers but I did want to draw the Committee’s attention to amendment 19 in Annex B, which amends the enabling powers contained in section 134 of the Housing and Planning Act 2016.

This amendment provides that regulations under this section may confer a discretion on the Secretary of State in connection with the approval or designation of a client money protection scheme, the conditions which must be complied with by the administrator of such a scheme, the amendment of such a scheme or the withdrawal of approval or revocation of designation of such a scheme.

These amendments are aligned with those in the Housing and Planning Act and do not give the Secretary of State any additional powers but provide clarification on those that are there. Subsection 2 of clause 134 already states:

the regulations may, in particular, make provision about:

(a)the making of applications for approval;

(b)conditions which must be satisfied before approval may be given or a scheme may be designated;

(c)conditions which must be complied with by administrators of approved or designated client money protection schemes (including conditions requiring the issue of certificates for the purposes of regulations under section 133(3) and about the form of those certificates); and

(d)the withdrawal of approval or revocation of a designation.

The detail of how these powers will be used is set out in the Client Money Protection Schemes for Property Agents (Approval and Designation of Schemes) Regulations 2018 and the Client Money Protection Schemes for Property Agents (Requirement to belong to a Scheme etc) Regulations and the proposed amendments attached at Annex B.

7 December 2018

8 Annex A has not been printed. See: Ministry of Housing, Communities and Local Government, draft Statutory Guidance for Enforcement Authorities

9 Annex B has not been printed. See: Tenant Fees Bill marshalled list of amendments to be moved on report, [HL Bill 129–R–I]

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