Chamber and committees

The Scottish Association of Landlords has set out in its submission some figures that suggest that the number of cases in which the outcome was altered as a result of the mandatory grounds being made discretionary under the emergency legislation was very small. It is important to recognise, however, that the impact in that small number of cases was extremely significant. Even if only a small number of people get different outcomes in their tribunal cases, the impact on their lives will be extremely significant.

The deeper point that I will make is that the bigger impact, which is perhaps harder to measure, relates to cases that do not go to tribunal in the first place. For example, a landlord might previously have thought about going to the tribunal on grounds that would have resulted in a mandatory determination for an eviction order. If the determination was discretionary, the landlord might reach the view that they had not taken a reasonable course of action and that the individual reasons for their seeking an eviction were not reasonable, so they might be more likely not to proceed with eviction in the first place.

This is related to the point that I made to Graeme Dey. We are looking to maximise the opportunities for negotiated outcomes, reasonable settlements and actions being taken that sustain rather than end tenancies. Whether we are talking about requiring compliance with the pre-action protocol and taking reasonable steps to engage, or ensuring that landlords know that they are more likely to get some kind of resolution if they try to sustain a tenancy instead of going straight for eviction, we are likely to have a sector that sees the resolution of any such problems as the first option.

As I have said, the approach is already good practice in the private rented sector. Landlords who follow best practice will already be taking such steps and will not pursue eviction if they think that there might be a chance of a tribunal considering the pursuit to be unreasonable.

That might be a little hard to quantify with precise or objective numbers, because the nature of pre-action protocols is that they are used prior to cases appearing before the tribunal. As such, we do not necessarily have official statistics on when actions have led to successful resolution of a problem.

However, there has been an overall reduction in the number of eviction cases coming before the tribunal during the pandemic, so it is fair to say that the provision has contributed to supporting tenants and landlords in achieving positive resolutions to problems and in sustaining tenancies. For example, when tenants have been able to secure additional sources of financial support as a result of signposting by landlords during the pre-action protocol process, that support will have helped to resolve problems.

The committee will be well aware of the tenant hardship grant fund, which is a source of additional support that was available during the pandemic. There are also discretionary housing payments and other forms of money and financial advice that tenants can access from the voluntary sector or community organisations. It might well be that we never have to count cases of landlords actively signposting tenants to support. We should see that as a positive thing.

We have, of course, engaged extensively on the provisions in the bill. In my opening remarks, I touched on the consultation that took place. It is possible that making all eviction grounds discretionary could lead to some increase in costs for landlords in certain circumstances—for example, as I mentioned earlier, if the consideration of a particular case takes a little longer due to the need to take individual circumstances into account. We think, however, that that is highly unlikely to lead to significant additional costs for landlords.

On the pre-action protocol provisions, the Scottish Association of Landlords pointed out during the consultation that many landlords already take that course of action to support tenants in rent arrears. Compliance with those provisions would not increase costs at all or even increase the amount of work or the action that is necessary for those who follow best practice. It would bring the additional advantage of encouraging and requiring good practice by those who have not previously taken that approach, but we do not believe that the provisions would create any significant additional costs for landlords.

In the European context, there is always a mix, but the mix is different in different places. Germany has a much bigger private rented sector, but it has had in place for quite some time some of the rights and protections that we will explore and develop in the year 2 housing bill.

In some European countries, there is little difference in the rights and protections for tenants between what we call the social rented sector and the private rented sector. In other places, the distinction that is made over who the housing provider is—whether that is a private or a social organisation—does not have the significant impact in producing a different experience for tenants that it has in this country. The consultation on the new deal for tenants and the development of the year 2 housing bill will be informed by consideration of all the examples and experiences from other contexts.

That is where what I said earlier about striking a balance between the interests and rights of landlords and tenants comes in. The tribunal will take into account the circumstances that pertain to landlords and tenants. Having some grounds where a tribunal is required or mandated to produce an eviction order shifts things heavily in one direction—it overbalances things in terms of not taking account of the tenants’ circumstances. However, giving the tribunal discretion does not take things to the other extreme; rather, it sets things in balance and ensures that the circumstances that apply to the tenant and the landlord are taken into account fairly.

I think that when I used the word “modest”, I was referring to any increase in the cost of consideration of individual cases. We are all very aware, as some of your witnesses in the earlier session pointed out, that there is a significant concern across a number of local authorities about the scale of rent arrears that have built up during the pandemic. That is why we are so committed to ensuring that a range of financial support is available.

There is the tenant hardship grant fund and the £82 million that has been provided for discretionary housing payment to support mitigation of the bedroom tax and housing costs, and there is additional funding to local authorities to ensure that they have the resources available to support people in their areas. There is also a range of support and intervention measures in response to the pandemic itself, and there is additional funding that has been passed in this year’s budget to ensure that we are supporting people with their housing costs.

There is no getting away from the fact that the financial impact that the pandemic has had on people has not yet fully played out. This is happening in the context of the wider cost of living crisis, so it is going to be a challenging period for tenants and for landlords, as well as for the organisations that are working to support them.

However, I think that the permanence of the provisions in the bill will help to ensure the greatest opportunity to resolve disputes between landlords and tenants constructively and to avoid the need for eviction proceedings wherever that can be done and tenancies can be sustained.

Obviously, that is a hugely important question, and we have actively considered it in Government. There were four key measures during the pandemic, two of which we are discussing making permanent today. As Mark Griffin said, the others were the eviction ban, which came to an end last year as areas dropped out of tiers 3 and 4, and the extended notice periods, which came to an end at the end of this month. I would however note that we have put in place transitional protection for tenants who are already facing action.

The emergency legislation that was put in place was a temporary public health protection measure. In introducing legislation of that nature, the Government needs to demonstrate the requirement for it. That legislation was introduced on the basis of public health protection and was aimed at ensuring that people could stay safe in their homes for as long as possible in the unprecedented circumstances of the pandemic.

Just because a measure is not being retained right now does not mean that the logic of it is lost. The on-going consultation on a new deal for tenants asks for views on winter evictions and on reviewing the grounds for eviction in the private residential tenancy. The experience that we have had during the pandemic will inform those reforms. However, provisions that we introduce need to be demonstrated as necessary and proportionate on their own terms, so simply extending the measures when the pandemic circumstances do not pertain is not an automatic given.

We believe that, in the case of the two provisions that we are seeking to make permanent, the experience is clear that that will have an on-going value and that it is proportionate and reasonable as a means of achieving the Government’s legitimate policy objectives of reducing the gap in outcomes between the private and social rented sectors and raising standards across the private rented sector. If we seek to make changes in relation to the issues that Mark Griffin has raised, we will do so as a result of the consultation that is under way and the proper development of a full bill on housing in year 2 of this parliamentary session.

I hope that that is enough to answer Mr Griffin’s question.

Indeed. The proposal will not only close a gap between the social and private rented sectors—by making provision that is permanent in the social rented sector permanent in the private rented sector—but will normalise what, as it made clear in its evidence, the Scottish Association of Landlords considers to be best practice. That is consistent with the general direction of travel; we are looking to close the gap in outcomes generally between the public and private rented sectors, so that outcomes do not depend on where people rent, and we want to raise standards across the board. The measure has received support across the board because it is clear that it will achieve that objective.

Good morning. I am grateful for the opportunity to say a few words about the tenancy provisions in the bill.

I thank everyone—individuals and organisations—who engaged in the consultation process, which helped to inform the development of the bill, or who provided comments in response to the committee’s call for evidence.

Before I turn to the detail of the tenancy provisions, I will give a general overview of the bill. The Scottish Government’s priorities are to continue to lead Scotland safely through and out of the Covid pandemic and to address the inequalities that have been made worse by Covid, progressing towards a wellbeing economy and accelerating inclusive person-centred public services.

As part of the process of learning lessons from the pandemic, the Government is committed to reviewing the impact of Covid on the Scottish statute book. The bill extends to around 30 different topics, most of which are being scrutinised by the COVID-19 Recovery Committee or other subject committees.

I turn to the tenancy provisions in particular. Part 4 relates to eviction from properties in the private rented sector. The effects of the coronavirus pandemic have undoubtedly led to a reduction in income for many households across Scotland. We already know that some of our most financially vulnerable citizens live in the private rented sector, and the impacts of the pandemic—immediately and in the longer term—mean that some private tenants are finding themselves in significant financial difficulty.

In recognition of that, the two emergency coronavirus acts—the Coronavirus (Scotland) Act 2020 and the Coronavirus (Scotland) (No 2) Act 2020—introduced a number of key provisions to protect tenants, and we are now seeking to introduce two of those on a permanent basis, because they have improved fairness in the system and better balanced the needs of tenants and landlords, and they explicitly give tenants support when it is most needed. The first concerns the private landlord pre-action protocol in relation to evictions on the grounds of rent arrears, while the second is to ensure that all eviction cases that go before the housing and property chamber of the First-tier Tribunal are considered on a discretionary basis, when previously some eviction grounds would have resulted in a mandatory eviction order being issued.

I will address the pre-action protocol provisions first. They formalise the steps that a private landlord should take as early as possible to support a tenant who has fallen into rent arrears. That aims to ensure that all steps have been taken to sustain a tenancy before the landlord takes action to evict.

The protocol sets out three key areas of action a landlord should take to support a tenant in rent arrears. The first action is for landlords to give tenants clear information relating to their rights in relation to eviction, how they can access information on financial support and debt management and an overview of their tenancy agreement; the second action is for landlords to make reasonable efforts to agree with the tenant a reasonable repayment; and the third action is for the landlord to give reasonable consideration to the steps that the tenant has taken. The tribunal must take into account the landlord’s compliance with the pre-action protocol when deciding whether to issue an eviction order.

Pre-action protocols have been in place in the social rented sector in Scotland for a number of years. Therefore, making the provision permanent for the private rented sector is an important step towards ensuring that there is a parity of rights across the rental sector in Scotland.

During the consultation on the bill, some private landlords and their representative bodies advised that they already take such action to support a tenant who has fallen into rent arrears. Therefore, the provision formalises what is already seen to be best practice by professional landlords within the private rented sector.

The second provision that we are seeking to make permanent is one to ensure that, in all cases that go before the First-tier Tribunal, eviction is ordered only where it is reasonable to do so. All eviction grounds would, therefore, become discretionary. Prior to the emergency legislation being introduced, if eviction was sought on certain grounds—such as the person being three or more consecutive months in rent arrears—the tribunal was obliged to issue an eviction order.

By ensuring that every ground for eviction is discretionary, we ensure that the tribunal is able to consider all relevant factors in eviction cases and determine whether eviction is reasonable. That would include consideration of whether a private landlord has undertaken all the steps that they should have taken as part of the pre-action protocol stage, or of any proactive steps that a tenant might be taking to reduce rent arrears. Again, it is worth highlighting that similar provisions have been in place in the social sector for many years.

I am aware from the responses that were received during the 12-week consultation period for the bill, and the responses that the committee received to its call for evidence, that diverging views exist on the tenancy provisions that we are seeking to make permanent. Tribunal discretion, in particular, is seen by some private landlords to create an unfair balance of rights between tenant and landlord. Private landlords argue that that provision will drive up costs, increase risk and dent investor confidence.

It is important to note that the tenancy provisions do not prevent a private landlord from seeking to recover possession of their property. Instead, the provisions introduce additional layers of protection to ensure that all avenues have been exhausted in sustaining a tenancy and that the eviction itself is reasonable, given the individual circumstances of the case. The fact that the tribunal has discretion allows it to take into account all the circumstances of the tenant and the landlord in order to come to a fair and appropriate conclusion.

Conversely, tenant representative groups have strongly welcomed our intention to introduce a private landlord pre-action protocol and tribunal discretion on a permanent basis. You will be aware that organisations such as Shelter Scotland, Citizens Advice Scotland, Living Rent, Public Health Scotland and Police Scotland support the move. They highlight that the negative financial impacts of Covid are on-going and that the tenancy provisions will help to deliver a recovery from the impacts of the pandemic. Indeed, Shelter Scotland specifically states that the tribunal discretion provisions will disproportionately impact people on lower incomes for the better and help to deliver a wellbeing economy.

Part 4 of the bill supports the Scottish Government’s Covid recovery strategy and its overall objective of addressing harms that have been caused by the pandemic and tackling systematic inequalities that have been made worse by the pandemic. It also supports the Scottish Government’s draft rented sector strategy, which, as you will be aware, we are currently consulting on. That aims to deliver a new deal for tenants, giving them more secure, stable and affordable tenancies, with improved standards of accommodation, new controls on rent and more flexibility to personalise homes. We have already committed to introducing a new housing bill in the second year of this parliamentary session in order to deliver on some of the legislative commitments that are contained in the strategy.

As I set out at the beginning of my statement, many of the people who live in the private rented sector are among the most financially vulnerable people in our society. In particular, that applies to people who have an income but are still living in poverty due to the longer-term impacts of the pandemic, coupled with ever-increasing living costs. I think that we are all painfully aware that that situation might continue to be exacerbated.

Making the tenancy provisions permanent will, therefore, provide an important extra layer of security for such households, as well as helping to ensure a parity of rights for renters, no matter whether they are in the private sector or the social rented sector. I also emphasise that the provisions will still enable landlords to recover possession of their property in circumstances in which a tenancy is genuinely unsustainable.

Yes. The grant fund is focused on helping tenants who are struggling financially. It is fair to say that, given the current circumstances, which apply more widely than to the operation of the private rented sector, we are all very conscious that the cost of living crisis is already severe and might continue to be exacerbated. Some of the actions that we can consider will go beyond my brief. I know that the Cabinet Secretary for Social Justice, Housing and Local Government wrote to councils in December—she followed up with them last week to reiterate it—to say that payments from the tenant hardship grant fund should be made to those who are in most financial need and who face the risk of homelessness, in particular people in the private rented sector who may be at risk of eviction. People in the social rented sector whose incomes were already low and have been hit hard by the pandemic can also get help through the scheme.

Under the pre-action protocol, landlords should make tenants who are at risk of losing their home as a result of rent arrears aware of all the forms of financial support that are available, and not just the tenant grant fund.

There will continue to be on-going debate across Parliament, and there will be discussions across a number of portfolios in Government, to ensure that we take the most ambitious approach that we can to supporting people through the cost of living crisis. That will apply to ministers who have a housing brief, but it will certainly go beyond that.