The next item of business is a debate on motion S4M-11763, in the name of Mary Fee, on private sector rent reform.
15:12
In opening for Scottish Labour, I put on record our party’s support for Shelter Scotland’s make renting right campaign. As always, Shelter Scotland is at the heart of putting forward proposals on what is best for Scotland’s residents.
The campaign, among others, best exemplifies why Shelter is important to our housing sector: its proposals come from its users’ experiences. Much of what Shelter requests was proposed by Labour during consideration of the recent Housing (Scotland) Bill, but the Scottish Government blocked our amendments.
A consultation asking for views on a new tenancy for the private rented sector has been launched; yesterday, we submitted our response. Will a bill follow the consultation? Will the minister tell the chamber the bill’s timetable?
We support many of the Government’s proposals, but others could go further. For example, the minimum duration of a new tenancy should be three years, unless the tenant specifically requests that it be shorter. The 28-day period for repossession might also be too short in some circumstances.
It is important to consider why Scottish Labour has brought the debate to the chamber. The private rented sector is broken and in need of reform. The number of tenants in the sector has doubled in the past 10 years, the gap between private and social rents in Scotland is the second highest in the United Kingdom, and private tenants are spending more of their income on housing in comparison with a decade ago.
With that in mind, let us assess what the Government has achieved: housing bills that failed to address new and existing pressures in the private rented sector; fewer houses built than at any point since 1947; and an expert working group that reported on what could happen with a yes vote but set no ambition for Scotland’s place in the United Kingdom. That said, we hope for a consensual debate, given that many Government back benchers have signed up to support the Shelter campaign.
As I have repeated many times and will continue to repeat, the Housing (Scotland) Act 2014 was a missed opportunity. Although Labour agreed with the Scottish National Party Government on aspects of it, we remain disappointed that the Government and its back benchers voted against our amendments, which would have made a difference to tenants in the private rented sector.
The make renting right campaign calls on the private rented sector to offer stability, flexibility and fairness to its tenants by modernising tenancies. That can be achieved only with the full support of the Parliament and the political will of the Government. A modern tenancy must strike the right balance between tenants’ rights and landlords’ rights. In our response to the private rented sector consultation, we stressed that the tenant must have the utmost protection from unnecessary evictions, poor security and unfair rent rises, while the landlord has a right to make returns on their investment in their property.
I recognise that there are many exemplary landlords. We do not seek to punish landlords, as many of our proposals would not apply to them. That is why we in Scottish Labour believe that the proposals that we put forward for inclusion in the Housing (Scotland) Bill and as part of our response to the private rented sector consultation could standardise the protection for all tenants and their families.
We know that a quarter of the Scots who live in poverty do so as private renters and that almost half of private rented sector households are families with children. The sensible and practical option for the minister and her Government would have been to support a cap on rent rises earlier this year. Given that new figures show that there has been an average rent rise of 2.7 per cent across Scotland and that there have been higher increases in different regions, I hope that she will see her error of judgment and act sooner rather than later.
This is not just an English or, more specifically, a London problem as the Scottish Government would like us to believe. For example, in the Aberdeen City and Aberdeenshire areas, average monthly rents have increased by almost two fifths since 2010 and, in the Lothians, private rents have increased by 17 per cent over the past four years. The cost of such increases pushes more families and tenants into poverty, yet the SNP refuses to take action. The average monthly cost of a two-bedroom property in Aberdeen is £898, while the Scottish average is £537. It is clear that there is a postcode lottery.
In June, an Ipsos MORI poll on behalf of the Chartered Institute of Housing showed that four in 10 private renters worry about meeting rent payments, and 43 per cent of respondents expressed concerns about not being able to afford their rent in 12 months’ time. A cap on the number of rent rises to one per year would allow tenants to manage their finances much better and would allow landlords to plan for investment while maintaining the tenancy. Let me be clear: Scottish Labour does not back rent control and we are not advocating rent control.
Living with a disability can present many challenges. One challenge that often goes unmentioned is access to suitable housing, especially in the private rented sector. As more people turn to private rented housing as a result of growing waiting lists for social housing, people with disabilities also find themselves looking to private lets.
Recent statistics from the Scottish Housing Regulator show that, on average, it takes social landlords 66 days to complete adaptations for medical reasons, and in some cases social tenants wait almost a year for such adaptations to be completed. That is shameful, and it backs up what Leonard Cheshire Disability warns us about in its briefing for today’s debate.
It is often expected that private landlords cannot compete with the resources that social landlords have to meet demands for repairs and adaptations. As no statistics are available for comparison, I share my support for the changes that Leonard Cheshire would like to be made, as I worry that the needs of many disabled people in private housing are not being met. When grants can be applied for, there are means of financial support. However, pressures on local government mean that demand is not being matched by supply.
Leonard Cheshire shows in its briefing why disabled-friendly homes are more cost effective in the long term. For example, installing a stairlift in a lifetime home can cost around £2,500. However, if a property’s wall is not suitable for a stairlift, the cost of adapting it could exceed five or 10 times the lift’s original cost.
Building homes that meet the needs of the elderly and the disabled requires commitment from the Government and developers. Without that, the necessary standards cannot be met.
I talked a few minutes ago about worries about meeting rent payments. The stress on finances, health and mental wellbeing caused through the lack of security cannot be overemphasised. Children’s education can suffer if they have to relocate every year or two. Research suggests that they can develop anxiety and stress because of the stress of moving. The average time that a family spend at the same address in the private rented sector is two to three years, in comparison with 10 years in the social rented sector.
Modernising the tenancy by scrapping the short Scottish secure tenancy, creating greater security of tenure and introducing an annual cap on rent increases would help to mitigate and tackle many of the direct and indirect problems that result from a lack of security.
Our motion does not seek to create division between members. It highlights the need for change in how the private rented sector works. The number of private tenants has doubled in a decade, as has the number of households living in poverty in the private rented sector. I hope that we can all agree that we want a well-regulated and stable private rented sector.
I move,
That the Parliament notes that, over the last 10 years, the number of households in the private rented sector has doubled to 368,000; notes with concern that the number of households in poverty in the private rented sector has doubled in the last decade to 120,000; further acknowledges that, in parts of Scotland, rents have risen by nearly 40% in four years and that the average Scottish rent now stands at £537 a month; welcomes Shelter Scotland’s Make Renting Right campaign; supports its calls for reform of the private rented sector, and, in particular, believes that private rented sector tenancies should be reformed to provide tenants with greater security of tenure, including longer standard tenancies and predictable rents for tenants and landlords, including supporting in principle the introduction of a cap on rent rises and the limitation of rent reviews to one per annum.
We have absolutely no spare time this afternoon. I call Margaret Burgess, who has up to seven minutes.
15:22
I am glad to have the opportunity to debate the private rented sector. The sector’s growth might be news to some members, but the Scottish Government identified it as an issue as far back as 2010, when we recognised that an increasing number of people, including families, were spending part of their housing journey in the sector.
At that point, we committed to developing a strategy for the private rented sector and set out to do so by working with the Scottish private rented sector strategy group, which comprised stakeholders who represented tenants, landlords and others with interests in the sector. The result was the first-ever strategy for the sector in Scotland, which we published in May 2013.
The strategy set out our vision for the sector and identified three aims: improving quality, delivering for tenants and landlords, and enabling growth and investment to help to increase overall housing supply. In those aims, we recognise not only that the private rented sector plays a valuable part in meeting housing need for many people but that more could be done to make it more attractive to those who, for a range of reasons, prefer not to buy.
We have made good progress in taking forward the strategy. The Housing (Scotland) Act 2014, which the Parliament passed in June, will improve quality through a regulatory framework for letting agents and additional powers for local authorities to deal with poor landlords. The consultation on a new tenancy for the private rented sector, which I launched in October, sets out proposals to give tenants improved security of tenure.
The minister tells the chamber that the Government has made good progress on issues in the private rented sector. Will she tell us why there was nothing in the legislative programme to address rent rises and the lack of security of tenure?
I say to the member that, when the strategy group met and consulted together, what he raises was not recognised as an issue. It was not part of our Housing (Scotland) Bill when it was introduced, it did not come up in the consultation and it was not raised by the Labour Party. We committed to consulting on a new tenancy for the private rented sector. That is the right way to proceed and that is what we are doing. We are consulting on that and we want to ensure that that provides safeguards for landlords, lenders and investors, as well as security of tenure for tenants.
I am pleased that Shelter welcomes our ambition for changes in the sector. I confirm to Shelter and to other stakeholders that the Government remains committed to passing, in this parliamentary session, the legislation that is necessary to establish a new tenancy regime for the private rented sector. We will say more about that in the spring next year, once we have considered the consultation responses.
The Scottish Government is supporting Homes for Scotland in its work to drive forward initiatives to build more homes for rent by attracting new sources of investment. As part of that commitment, we have funded the appointment of a private rented sector champion to lead on that.
In the context of the debate, increasing supply is particularly relevant. Where rents are high, the long-term answer is more supply, in every tenure, to meet growing demand. I recognise that rents are high in some hotspots across the country. Where that is the case, it reflects conditions in local housing markets. However, statistics published by the Scottish Government last month showed wide variations in average rents. For example, average monthly rents for two-bedroom properties range from less than £450 a month in Dumfries and Galloway to almost twice that in Aberdeen City and Aberdeenshire.
Likewise, increases in rents vary. Our statistics show that, between 2010 and 2014, most average rents increased at below the rate of inflation and some rents fell. In particular, 16 of the 18 rental market areas across Scotland have seen below-inflation changes in average rents for two-bedroom properties—the most common size of property in the private rented sector.
Will the minister take an intervention?
If it is brief.
I think that the minister has been listening too much to the letting agents saying that rents have increased at below the rate of inflation. Does she think that the average rent level of £537 per month is acceptable?
I say to the member that we did not listen to letting agents to get that information. The information is based on Scottish Government research, which shows clearly that 16 out of the 18 rental market areas have seen below-inflation changes in average rents.
Where rents are high or rising, the answer is to build more houses, not just for private renting but in all tenures, and we have taken decisive action on that.
We recognise that an inability to find affordable housing in Aberdeen has been causing difficulties in the recruitment and retention of key staff in the national health service and other parts of the public sector. Such workers are now set to benefit from various forms of affordable housing that will be developed on the Craiginches site in the city, which, importantly, will be targeted at them.
We have boosted housing supply budgets by investing £1.7 billion in affordable housing over the lifetime of this session of Parliament. Last month, we announced a £200 million increase in funding to stimulate Scotland’s housing industry.
Despite challenging economic conditions and despite Scottish budgets being cut, our rate of house building per head continues to outperform that in other parts of the UK. We have delivered more than 22,700 affordable homes, which is three quarters of the way towards our target of 30,000 affordable homes. More than 15,900 of those homes are for social rent, which is 80 per cent of our social rent target. I remind the Parliament that, in the last four years of the previous Administration, just over 20,000 affordable homes were completed. In the following four years, we increased that by 34 per cent. In fact, there was no single year during that period when this Government did not complete more homes.
The Scottish Government is working with our stakeholders to deliver better quality and more security in the private rented sector and to deliver the variety and number of affordable homes that are the answer to high rents in the sector.
I move amendment S4M-11763.3, to leave out from “notes with concern” to end and insert:
“recognises that, in May 2013, the Scottish Government published A Place To Stay, A Place to Call Home, which is Scotland’s first ever strategy for the private rented sector; welcomes the progress that has been made in implementing the strategy, in particular the publication by the government of the consultation on its plans to improve security of tenure for tenants in the sector while providing appropriate safeguards for landlords, lenders and investors; notes that, in most parts of Scotland, rents rose by less than inflation between 2010 and 2014 and that the consultation invites views on rent levels in the sector; considers that the government’s approach to reforming the private rented sector will deliver the outcomes sought by Shelter Scotland’s campaign, Make Renting Right; encourages stakeholders from all sides to respond to the government’s consultation, and looks forward to stakeholders’ views being reflected in the bill to reform private tenancies that the Scottish Government plans to bring forward later in the parliamentary session.”
15:29
I welcome Mary Fee’s motion because it gives us an opportunity to address an issue at the centre of the discussion on the private rented sector: the parties’ various positions on rent controls.
I hear what was said in the opening speech—that the Labour Party is apparently not in favour of rent controls—but I also hear that it is in favour of limits on annual rent increases. I am beginning to have some difficulty in understanding what is meant by rent controls, and why Labour wants one of those things and not the other.
It is sometimes said that there is nothing new under the sun, and rent controls have been tried often enough before. They were first introduced in the UK in 1915, so an opportunity exists next year for us to celebrate their 100th birthday by burying them deep in our history.
Any student of housing policy history will acknowledge that the introduction of rent controls in 1915 had a catastrophic effect. The number of houses to rent in the private sector collapsed dramatically as landlords sold off their stock, and the levels of investment in improvements also fell. The reintroduction of controls in the present day would make it more difficult for landlords to access finance, as lenders may be nervous of future interest rate increases against a backdrop of severely limited rent increases.
The year 1915 was not the only time that rent controls have been attempted in this country. They returned during the second world war, with significant effects. It is important that we do not make the mistake, whoever we are, of going forward with a third-time-lucky approach and our fingers crossed.
Although rent controls were abandoned in the UK many years ago, they have, in various forms, continued in many places throughout Europe. However, in those examples the effect of the rent controls is to keep rents at or around market levels. It may be, then, that introducing rent controls here would either result in the negative impact that I described earlier or, if the Scottish Government chooses to follow a European model, have little or no impact on rent levels.
Of course, it no longer surprises me that Labour, bereft of its own ideas, appears to use the position of Shelter as a default setting for its housing policy. However, I have discussed the private rented sector with Shelter, and it seems to me that it enjoys a much more sophisticated and realistic understanding of the issues than do some members in the chamber.
On the point about a realistic understanding of the housing situation, does the member recognise that one in four of those living in the private rented sector are living in poverty? What help are the Conservatives offering to those who require much-needed assistance?
We have to be careful of using inappropriate statistics. We have already heard one set of statistics balanced with the Government’s statistics in the two opening speeches.
A recent poll, far from showing that tenants in the Scottish private sector are concerned about escalating rent levels, found that 86 per cent of tenants who were surveyed had never received a request for a rent increase during their lease, and 90 per cent had never experienced a rent rise that was deemed to be unreasonable. In addition, 91 per cent of tenants thought that the frequency of rent reviews on their property had been reasonable.
Those statistics demonstrate that, unlike the Labour Party claimed at the start of the debate, the system is not broken. If we address the issues correctly, we can continue to rely on the private rented sector to make its contribution to the housing problems that we face in Scotland today.
I recently met representatives—I have met a lot of representatives—of the private rented sector, all of whom are open to working in a constructive manner with the Scottish Government to improve the industry. They are ready to engage, but they are also deeply concerned about the impact that some of the proposals might have.
The private rented sector is playing an increasingly important role in accommodating home seekers at a time when the private sector is picking up the slack from the lack of investment in affordable housing by both the current Government and its predecessors. For that reason, it is essential that we take a constructive, engaged and measured approach that does not have the negative impact on the private rented sector that all of us would regret should it happen.
I move amendment S4M-11763.1, to leave out from “; notes with concern” to end and insert:
“and that the demand for private rented properties is expected to continue to grow, which is why private landlords are a vital part of the Scottish housing sector and should be given the flexibility and support necessary from the Scottish Government to flourish in Scotland; notes the Scottish Government’s proposals for a complete reform of the current tenancy regime and considers that many of the proposals are welcome and will improve the private rented sector in Scotland; is concerned, however, that some of the provisions are very inflexible and will act as a disincentive for landlords, and is opposed to the introduction of rent caps as international and historic evidence indicates that this will have a catastrophic impact on the available rented housing stock.”
We move to the open debate, with speeches of up to four minutes, please.
15:34
The private rented sector is clearly changing and growing, so we need to keep legislation up to speed with those changes. My constituency of Glasgow Shettleston used to have a huge number of council and housing association houses, a fair number of owner occupiers and a traditional private rented sector. However, that has changed hugely, especially through the right to buy, and previous council or housing association properties as well as bought houses have moved into the private rented sector.
It seems to me that people use the private rented sector for a number of reasons. One is that some people, particularly younger people, just want a property for the very short term. I have been in that situation, as I am sure have other members. The second reason is that some people cannot get affordable housing, so they are forced unwillingly into the private rented sector. Part of the answer to that is ending the right to buy, which is absolutely the correct thing to do, and the other part is to build more affordable homes over time. The third reason is that some people cannot or do not want to buy, and private renting is their preferred route for the long term. That is much more common in other countries, but it seems to be becoming more common here, too.
Quite a number of the antisocial behaviour issues that are raised with me relate to private rented flats. There can be difficult residents anywhere, but the lack of stability for private tenancies makes things worse. If a tenancy is likely to be very short term, where is the incentive to build up relationships with neighbours and the wider community or to maintain, improve or invest in the property? If improving the property means that the rent goes up—as one of my colleagues told me that they had experienced—there is a positive disincentive to do that.
In Shelter Scotland’s make renting right campaign, I am very much attracted by the words “stability” and “security”. I was less comfortable with the phrase
“to stay as long as they want”
under the heading “Flexibility”. However, I was interested to see in the briefing that we received from Shelter that it is now talking about
“Flexibility for people to stay in their home as long as they need.”
I suspect that people will be more comfortable with that. Some of Alex Johnstone’s chums were perhaps a bit frightened off by the idea of people staying as long as they want.
There is a reasonable balance in the social rented sector. On the one hand, there is security and stability but, on the other hand, people can be evicted if the worst comes to the worst. I am encouraged by the positive relationship between police and housing associations, who work together so that the neighbour from hell can ultimately be evicted. We would certainly want a similar approach in the private rented sector.
As we are debating housing, the minister and members might not be surprised that I will mention the Bellgrove hotel in my constituency. It is privately owned and the residents are renting, although I accept that it might not be typical of the properties that Mary Fee talked about. One lesson from the Bellgrove hotel, which is in effect a hostel, is about the condition of private rented accommodation, which is another factor in the debate. If I took members to a range of tenement properties in Parkhead or Shettleston, they would know within seconds of entering them which are private lets and which are run by housing associations. I hasten to add that there are some very good private rented flats, but others are pretty grim, and that can be seen immediately.
A linked issue that has been raised is that of electrical safety. I hope that the Government will be open to input from the Electrical Safety First campaign.
Clearly, there is work to be done in what is a changing landscape, but we have to be positive about the achievements that have been made so far. Ending the right to buy has been a huge improvement and investing in new affordable housing whenever there is spare money has been great. Initial steps to register landlords and letting agents are moves in the right direction.
I see that I have run out of time, Presiding Officer.
Your time is up, Mr Mason. I appreciate your brevity—thank you very much.
15:39
In our previous debate on housing, I described the difficult and anxious situation facing a resident in East Renfrewshire who came to see me for advice and any assistance that I could offer. The resident was a young man with two children at local schools but whose partner had left and who could no longer afford to live in the family home.
With few priority housing points, there was next to no chance of that man getting a council or housing association property on the Eastwood side of the authority and, although he has worked all his life, a mortgage in the area was well out of his reach. I am pleased to tell members that, along with his children, he has found a private rented flat on the south side of Glasgow, which is close enough for the children to get the bus up to school, and is, more importantly, just about affordable.
How many cases like that have we all heard about over the past few years, some with far less satisfactory outcomes?
Problems with housing supply are helping to drive huge changes to the way that we live in Scotland. We are simply not building enough homes. The number of new private homes has more than halved in recent years, while the population is increasing. In terms of council or housing association property, Audit Scotland has identified a shortfall of almost 14,000 homes in the past decade alone, and there are up to a dozen local authorities in the same situation as East Renfrewshire, where the waiting list for a council house has increased over the past five years. An estimated 150,000 people find themselves in that predicament around Scotland. The fact that the number of Scots who live in private rented accommodation has doubled over the past decade demonstrates precisely how important the sector has become.
My constituent and his family landed on their feet but, for many more families, moving into a private let leaves them feeling insecure or, worse, it becomes a move into poverty. The Joseph Rowntree Foundation has found that private renters spend 23 per cent of their income on housing, which is up from 18 per cent just 10 years ago, and that the number of families in the private rented sector who are on housing benefit has increased from 60,000 in 2008 to 97,000 in 2013.
Last year’s Scottish household survey highlighted the insecurity of tenure in the private rented sector compared with the alternative. The average length of time for someone in the private rented sector to stay at the same address is between two and three years, compared with more than 10 years in the social rented sector and 15 years in an owner-occupied home. As John Mason has pointed out, some of that might reflect choice or people in transition to home ownership but, with so many families now leasing privately, there is a danger of such instability having a detrimental effect on the more vulnerable.
There is no one solution to Scotland’s housing problems—although we clearly need to build more homes—but reform of the private rented sector should be at least part of the way forward. At the moment, many people are fearful of moving into a private let but are forced by circumstance to do so. The constituency case that I gave as an example is far from unique. As I am sure that most colleagues recognise, renting privately is the least favoured option of the majority of tenants. Similarly, many landlords are increasingly wary of renting to bad tenants who they then cannot get rid of. I do not believe that that is a sustainable basis on which the sector can develop.
Shelter’s campaign to make renting right could help tenants and landlords. It could provide stability and security for both and introduce a fairer system for resolving problems when they occur. There are plenty of examples of places in Europe where private renting is seen as a safe, affordable and desirable option; here in Scotland, on the other hand, the gap between the tenancy regime for public and private landlords simply aggravates the sense of inequality that is created by the difference in rent levels between the two. According to the Joseph Rowntree Foundation, the average private rent is 86 per cent higher than the average social rent.
The proposal is not an anti-landlord measure. Shelter has shown the way forward, and Labour has put that into the parliamentary process. I urge all members to support the motion.
15:43
I want to start by picking up on some of the comments of my colleague John Mason about the quality of tenancies.
I chair the cross-party group on accident prevention and safety awareness. We are aware of the dangers that exist in the home, and we have covered that issue on many occasions. Indeed, our most recent meeting was about the challenges of electrical and gas safety, and the responsibility of landlords. It was an informative meeting. We had presentations from SELECT, Electrical Safety First—formerly the Electrical Safety Council—and SGN, on the gas issues. All of those organisations provide guidance and information to landlords and tenants, and their presentations are available on the website of the Royal Society for the Prevention of Accidents. I commend them to members who have concerns.
I would welcome an updating of the electrical guidelines, following amendments to the Housing (Scotland) Bill, which were championed by my colleague Bob Doris, so that we can tighten up some of the issues around electrical safety. I would also welcome any further information that the Government might have on the tightening up of the regulation of electricians in Scotland.
Although we are having a very good debate this afternoon and we all recognise that we could be doing more in Scotland, I take issue with Mary Fee saying that this is a Government that has not taken action. This is a Government that acted very responsibly on housing, with its action on affordable homes and on tackling the problems in the private sector, as have just been outlined.
Clare Adamson says that the Government has acted responsibly. Would a responsible Government have a record on building housing that is the lowest since the second world war? Is that responsible?
I remind Mary Fee of the Labour and Liberal Democrat record on this area. “Housing Statistics for Scotland 2014: Key Trends”, published by the Government, shows that on average, for housing association build, local authority build, rehabilitation and conversion, Mary Fee’s party’s former Government built an average of 5,856 houses a year. This Government’s average, under austerity and with our capital budget slashed, is 6,193 houses. The average local authority build levels were 43 under Labour and the Lib Dems and under this Government they have been 658. That shows that this Government has been taking action and has been responsible on housing in Scotland.
Will the member give way?
No, I only have four minutes. Sorry.
We have taken action on tenancy deposit schemes and we have launched a consultation on tenancy, which will gather information that will allow us to introduce a tenancy bill that is relevant to what is happening in Scotland.
We also took action on the right to buy, which will be transformational for the opportunities for local authorities to build housing. We have taken action on landlord registration and we are tackling supply with innovation, as announced by the cabinet secretary this morning. We will use the charitable bond model to invest £25 million next year, which could lead to an additional 450 affordable homes in Scotland.
Alex Neil said this morning:
“In a fair and ... just society we want to make sure that everyone in Scotland has access to good quality housing that meets their needs.”
I am very glad that this Government is taking that forward.
15:47
I am pleased to be able to take part in this afternoon’s debate. I will highlight just one of the housing issues that my constituents face.
I was contacted some months ago by a constituent who works as a porter in the national health service. He was forced to take a private rented flat after his long-term relationship broke up. As a result, he finds that his NHS wage meets only his rent and household bills. His situation is so bad that he has to go to his parents every night for his evening meal. This man is in his 40s and has worked his entire adult life, and he cannot afford his rent. That is nothing short of scandalous, and it is one of the many reasons why I am supporting Shelter’s make renting right campaign.
I am particularly pleased to support Shelter’s call for more flexibility with regards to the tenancy agreement. Shelter states:
“The private rented sector is changing. Current demand suggests that while some people want the option of a tenancy that lasts for as long as they need it, others want flexibility if they need to move. We want a tenancy regime that can respond to people’s needs and work for both landlords and tenants. For tenants, it is about striking the balance between being able to live as long as they need in a property, with due consideration given to the landlord in terms of adequate notice when they want to leave.”
I believe that that is a practical measure, which will benefit not only tenants but landlords, too. By offering an agreement that benefits both parties, greater trust and commitment will be established, and as a result there will be greater belief in the system—something that is missing from the current tenancy agreement.
We need to take action on the spiralling costs of private rents. It is simply not good enough that hardworking people have no other choice than to get themselves into huge amounts of debt to keep a roof over their heads. Given that 13 per cent of housing stock is in the private rented sector and that one in four private rented households have children, we need to address the massive problem in the sector quickly. It must be a priority for the Government and for this Parliament.
Only a few weeks ago, I asked the minister a very straightforward question in this chamber. I asked her whether she supported Shelter’s campaign. It was a question that needed a simple yes or no answer, but I got neither in return. I hope that she will be definite in her answer today, will once and for all pledge her support for the campaign and will confirm what action she will take given that—in her own words—the Government has known about this problem since 2010.
To hear that the number of people who are living in poverty in the private rented sector has doubled in the past decade should make all politicians extremely uncomfortable. That is why we need action now and that is why I ask the minister to support Shelter Scotland’s campaign and to back Scottish Labour’s proposals to introduce a bill on the private rented sector. We want a bill to provide people with greater security of tenure and we wish to see a cap on rent rises. That would make a huge difference to tenants’ lives, and it could be legislated on quickly. I hope that the minister will back our proposals.
On a separate note, I was delighted that the Smith commission suggested that our Parliament should receive the power to legislate on socioeconomic areas. I hope that that will mean establishing an equality impact assessment. I called for that in my submission to the Smith commission. Such a power would allow the Government to truly assess whether its policies are making the difference it would like to see by reducing poverty in our communities. An equality impact assessment would be particularly useful in assessing how effective the Scottish Government’s policy on housing and housing stock has been in reducing inequality in Scotland.
I hope that the minister is listening to the requests being made of her today and that she can find a way of addressing the concerns of members, charities, campaigners and—most importantly—tenants, who need action now, not more warm words.
15:51
I welcome this debate because housing is an important and basic need and the Scottish Government takes it very seriously. As members have already said, it is a major issue in all our constituencies as we see from the cases that we deal with every day.
In my constituency, there is proof of the Scottish Government’s investment in private and social rented housing, which is being built right smack in the centre of town. This is not a case of a Scottish Government that is refusing to take action. Those buildings are right in the centre of town, creating homes for families and helping to regenerate the town centre in the face of all the challenges that face town centres such as Paisley’s.
There are many challenges around the private rented sector, but affordable housing is the main solution, and it is the solution that the Scottish Government is using. As the minister said, the Scottish Government plans to spend more than £1.7 billion on affordable housing during the current parliamentary session. That is part of an on-going bold and ambitious plan for housing.
In 2015-16 £390 million will be invested to deliver—
Will George Adam take an intervention?
Unfortunately, I have only a short time.
That money will be invested to deliver a further 6,000 affordable homes, of which 4,000 will be in the social rented area. Those are the homes that will make a major difference in constituencies across the country. [Interruption.] It appears that although I said no to Mr Findlay, he still wants to shout from afar. This is a very important issue and it should be taken seriously by members, who should not bring the chamber into disrepute.
Since 2009, the Scottish Government has spent £135 million on council housing. Housing is a main priority for the Scottish Government, which is taking steps to realise its vision for the private rented sector by dealing with the sector’s many issues. One such step is the strategy that was set out for the private rented sector, which will help many of our constituents by improving the quality of property management, condition and service, delivering for tenants and landlords, and meeting the needs of people who are living—
Will Mr Adam take an intervention?
I am running out of time, and the more interventions I get, the more time I seem to lose.
Will the member take an intervention?
If Labour Party members such as Mr Bibby believed in doing something for the constituents in my area, they would have had more than a short, last-minute debate on housing; they would have taken the full time for it.
The issue affects every single one of our constituencies. [Interruption.]
Order!
I am not going to listen to members of the Labour Party showboating when we are dealing with people’s lives. We represent those people and we have to make sure that we can make a difference for them. This is not just about politics; it is about people’s basic need for a roof over their head—for a home. We need to debate the issue in a mature manner. I urge the Labour Party to become serious about the issue, rather than sitting there, playing some back-and-forth political game of tennis.
I have already said that housing is a very basic need, but it is also an extremely complex and challenging issue. I appreciate the work that the Scottish Government has done and its on-going vision, and I am only too aware of the difference that its policies are making in constituencies such as mine and throughout the country. It is time for everyone else in the chamber to take this debate seriously and to begin to represent their constituents.
Many thanks, Mr Adam. I appreciate your brevity.
15:55
I thank the Labour Party for bringing this debate to the chamber. To be fair, I should point out that it is by no means the first debate on housing that Opposition parties have brought in the current session, and in those debates I have repeatedly argued that we cannot afford to treat housing like any other commercial transaction. It is different, because it is intimate. It impacts on our physical and mental health, our access to friends, family and neighbours, and our ability to live as part of a community; it impacts on our access to employment and public services; and it impacts on our dignity and our very identity.
However, it is not just that the nature of housing is such that it goes beyond other commercial transactions, but that, as John Mason said, people lack availability and choices. So many people in our society no longer have social rented housing available to them, and many of them can no longer afford to become owner-occupiers at any point in their lives. Private rented housing is the only housing that our society makes available to them for large parts of their lives. That is why we need to take the issue seriously, recognise that this is social provision, expect that of it and regulate it as such.
Mary Fee said that there are many exemplary landlords out there, and I suspect that everyone will recognise that tenants have a wide spectrum of private rented sector experience, ranging from exemplary landlords to quite the opposite. There are those who recognise that the provision of housing is significant and meaningful and that if they charge more rent than they are paying to service the debt that is secured on a property they need to earn the profit that they make. Being a landlord is a job, and there are landlords who understand that and take pride in providing a decent standard of service and ensuring that their tenants are well looked after. There are also landlords who feel a sense of entitlement in raking in the profits. Both ends of the spectrum exist, and there are all forms of behaviour in between.
It is not enough simply to say that more people are going to be in a sector that has doubled in 10 years, and which wants to double again. It is not enough to say that, because the sector is going to be part of the mix, we have to support all landlords. We should support good landlords, and good landlords who provide a standard of service that they can be proud of will have nothing to fear from the imposition of a decent regulatory expectation on the sector.
In her speech, Margaret Burgess recognised that many families spend time in the private rented sector as part of their housing journey—but where is that journey to? The Joseph Rowntree Foundation recently issued a report entitled “Young, working and renting” that highlighted the changing nature of poverty and inequality in this country. It said:
“The number of private landlord repossessions is now higher than the number of mortgage repossessions”
and that
“The end of a private rented sector tenancy”
is the primary reason for people becoming homeless. Those are UK statistics, and I would be interested if the minister could confirm whether they are also true at a Scottish level.
Finally, I sound a note of caution about the term “home seekers”, which we heard from Mr Johnstone.
You must close, please.
Given that we have already seen the use of euphemisms such as jobseekers for unemployed people, we should not make the same mistake and talk about home seekers instead of recognising the significant reality of homelessness in our society.
15:59
I commiserate with Mary Fee on her sore throat, and I hope that it gets better.
I read the Labour Party’s motion with interest and, indeed, found it interesting that it
“believes that private rented sector tenancies should be reformed to provide tenants with greater security of tenure”.
I understand that the Government is taking action to improve that area, so it is already doing that.
Members may have read, as I have, the private rented sector tenancy review group report, which took forward the work of the private rented sector strategy group. The review group was set up by the Scottish Government in 2013 with the purpose of examining the suitability and effectiveness of the current private rented sector system, and, crucially, to consider whether changes in the law are needed.
It will be of interest to the Labour Party that the Scottish Government accepted the group’s main recommendation, which was that current private rented sector tenancies—the assured tenancy and the short assured tenancy—should be replaced by a new tenancy for all future lets.
Will the member take an intervention?
No thanks. I have only four minutes.
The Government then published its draft consultation on the proposed new type of private rented sector tenancy. I am sure that, after considering the views of the people who responded to the consultation, the Government will act accordingly.
The Government has a track record of looking carefully at the issues that the private rented sector faces. It has been clear about the private rented sector, particularly in “A Place to Stay, A Place to Call Home: A Strategy for the Private Rented Sector in Scotland”. It has set out a vision and strategic aims for the private rented sector, including clear aims to improve and grow the sector by enabling a more effective regulatory system, having tougher targeted enforcement action and attracting new investment, which can only improve the situation for tenants.
In a nation such as ours, which is rich in natural resources, it is simply an utter scandal that people are living in poverty. That is mainly due to the UK Government’s benefit cuts and austerity measures, which are increasingly hurting Scottish families. We are also now seeing an increase in the use of food banks.
The Scottish Government is doing everything that it can to help those who are in that situation by working with stakeholders to mitigate the worst of the impacts of welfare reform on those who are on the lowest incomes through the various measures and decisions that it has taken. I note that it is providing nearly £33 million of support to the most vulnerable through the new Scottish welfare fund.
Mr Findlay will find it interesting that last night at an event, I had a very interesting discussion with an official who is involved in the housing sector—no, he was not lobbying me. He informed me that there are currently three types of rent: social rent, middle rent and private rent. In his opinion, the Labour Party’s proposal is totally unworkable and would cause many owners in the private rented sector to withdraw from the sector, which would put undue pressure on families who currently rent.
At an event before I came to the chamber, I had a discussion with representatives from the Glass and Glazing Federation, who—
Will the member take an intervention?
No. I do not have time.
Those representatives informed me that the UK Government is charging 20 per cent VAT, instead of 5 per cent VAT, on replacement windows. That is another example of where we could improve matters and help to address fuel poverty, if we were minded to do so and if the UK Government would do so.
I am sure that the Scottish Government is committed to taking action on the issues that the private rented sector faces and, moreover, that it is whole-heartedly committed to tackling poverty in Scotland and its various symptoms.
I support the Scottish Government’s amendment.
16:03
There have been a couple of mentions of Shelter Scotland’s make renting right campaign, which it has been asking politicians to sign up to. I have discussed the campaign with Shelter Scotland. I have not signed up yet but, to be honest, there is much in it that I support, and I have come very close to agreeing to put my signature to it. The strange thing is that it would be impossible for me to sign up if it turned out that what it means is what the Labour Party thinks that it means.
As has been demonstrated during the debate, people have different opinions in different parts of the chamber, but there is a disconnect. For example, we have heard much talk of the average rents in the private sector in Aberdeen and Aberdeenshire, but there has been no attempt to understand that the current private rented sector in the north-east includes people who are extremely high earners renting extremely expensive property—I am talking about properties and certainly rents that would make our eyes water in the chamber. However, those figures have been taken into the average and misrepresented in the debate.
The comment was made that many people rent as part of their housing journey. In fact, that is simply what happens. For a while, many of my family rented in the private sector while preparing to take on a mortgage. That happens all over the country, but those people, too, are included in the statistics.
Will the member give way?
I am afraid that I do not have the time to do so—I need to get to my conclusion.
Ultimately, we need to understand that the private rented sector does different things in different parts of the country, and different things in different streets that are close together. Such things are not easy to compare. This is a complex marketplace, and during the debate some members have demonstrated a much greater understanding of that than others. Whether by accident or by design, the private rented sector has become an essential part of housing strategies, although there are people out there who are very tempted to blame the sector for many of the problems that we face. I do not think that that is justified in every case. The last thing that the sector needs is a politically inspired witch hunt like the one that is currently being visited on landowners.
There are aspects of the Scottish Government’s proposals that are worthy of consideration and support, but the bottom line is that any form of rent control or tinkering with tenancies will achieve little when the primary issue is a lack of investment by the Scottish Government in bricks and mortar. I was surprised to find myself agreeing very strongly with George Adam’s comment that we cannot legislate our way out of a housing crisis—we can only build our way out of it. Making more houses available for rent means that landlords in the private sector will have to compete for tenants and offer higher standards and lower rents. If we build houses, the market will deliver the changes that many members have asked for in the debate.
However, at the moment, we cannot do without the private rented sector plugging the gap. We will need the private rented sector until we can build an adequate number of houses. If we make the wrong decision and the mistake of undermining the private rented sector without taking action elsewhere to plug the gap, the only result will be homelessness.
I call Margaret Burgess, who has up to six minutes.
16:07
The debate has certainly confirmed the growing significance of the private rented sector and the increasing role that it plays in helping to meet our people’s housing needs. On the Shelter campaign, which has been mentioned a number of times, I say to Siobhan McMahon that the Scottish Government has been working with Shelter and other stakeholders in developing our proposals for a new private rented tenancy. Indeed, Shelter’s make renting right campaign states that it supports the Scottish Government in making rent right across Scotland.
Will the minister take an intervention?
I will take one in a moment.
Shelter is supporting us because we have put forward proposals that seek to improve tenants’ security of tenure.
The question was about whether the minister supports Shelter, not whether Shelter supports the minister.
As I said, I support the wider aims of Shelter’s campaign to make rent right across Scotland, and I have never said that I do not support it. We are working with Shelter, but we are also currently consulting on our proposals, so it would not be appropriate for me to come down in favour of one set of proposals over another. A consultation is about looking at all proposals, so we are talking to all those who are involved in the housing sector. We consider that to be the right way to proceed before we change any policies for the private rented sector. We are seeking views on rents and tenancy reform in the consultation, which does not close until 28 December, and we will reflect carefully on all the responses before we decide what will be in our forthcoming bill on tenancy reform. We will announce our plans in spring next year, and we hope to introduce our bill in the autumn.
I have stressed in this debate, as have other members, that the best way to tackle high-level rents—
Will the minister take an intervention?
I will take one more intervention.
I thank the minister. Even on the timetable that she has outlined, by the time any bill is enacted it will be another two years before tenants in the private rented sector get any support on the issues that they face around security of tenure and rising rent levels. That is unacceptable. Does the minister accept that legislation should have been included in the programme for government last week?
No. We are currently consulting and we have to take time to do that and look at the responses. That is the proper and measured approach, and our stakeholders in the sector are aware that that is the timescale according to which we are moving forward. We said from the outset that we would legislate within the current session of Parliament. That is what we intend to do.
Patrick Harvie talked about the housing journey. I want to make it clear that the housing journey that I was talking about is different for different people at different times in their lives. It is not automatic that people move from social rent to private rent to owner occupation. Some people will stay in one sector because that is what suits them and their needs. I was not in any way suggesting that there is an automatic transition. Patrick Harvie also asked about figures on homelessness. I cannot tell him whether we have those figures, but we will look at that, and if we record the information I will pass it on to him and Parliament.
We have talked about increasing the supply of housing, so I want to remind Parliament of some of the Government’s achievements on that score. I say again that we have in the past seven years built more social rent, housing association social rent and affordable housing than any previous Administration. We have also boosted the house building industry in a time of recession. We are on track to deliver more homes, but we are also helping the house building industry with our help to buy scheme, which has boosted the industry and jobs. We have boosted our affordable housing supply budget over five years, we have committed more than £300 million to our help to buy scheme and we have our national housing trust scheme. We are constantly looking at ways of boosting the housing supply.
I am also proud that we have legislated to end the right to buy—John Mason mentioned that in his speech—and that we have provided £55 million for the period 2013 to 2015 to mitigate the effects of the bedroom tax.
We continue to work with partners to develop new housing investment models that are capable of attracting large scale long-term funding from the capital markets in order to expand delivery of housing for affordable and private rent. An example is the plans by Hearthstone Investment for a £150 million fund to invest in more than 1,000 homes across Scotland, which has secured £30 million from the Falkirk Council pension fund.
We continue to use innovative financing approaches—for example, our successful national housing trust, which is the first guarantee-based model for housing in the UK and is helping hundreds of households to secure a high-quality home that meets their needs.
We continue to work with stakeholders and our partners and we will publish a joint delivery plan for housing in Scotland by the end of April 2015.
Draw to a close, please.
That follows on from our housing event in November, which was unique in that it brought together councils, housing associations, house builders, lenders, landlords and many others who have contributions to make to our shared ambition that everyone in Scotland has access to good-quality and affordable housing that meets their needs.
16:13
The Labour Party has used one of its slots—not for the first time—for a debate on housing because of the important issues that are being faced in the private rented sector. Because there is a shortage of housing supply and a lot of people lack the finance to be able to afford mortgages, the private rented sector has really grown—in recent years, it has doubled in size to 368,000.
Two problems that have been brought out in Labour’s motion and during the debate are rising rent levels and security of tenure. It is a fact that rents have been going up in every region. The average rent in Scotland is now £537 a month, which is a staggering figure.
In the context of high rent rises in Aberdeen, Alex Johnstone said that there are high earners in the city. I point out to him that people in Edinburgh have to spend on average 47 per cent of their income on rent. That tells us about the issues that people have to face on the ground. Mr Johnstone would not have to walk far from the Parliament building to find out about the issues that people in the private rented sector face.
Does James Kelly accept that in 16 out of the 18 broad rental market areas in Scotland the average increase has been less than inflation?
I think that the minister has been listening to letting agents too much. She can go to postcode areas in Glasgow, Dundee, Aberdeen and Edinburgh and find staggering rent rises—up to 40 per cent, in Aberdeen, for example. That is unacceptable, and it is the Government’s job to intervene and take action on rent levels.
Another issue that has come up in the debate is security of tenure. People tend to stay in private rented accommodation for only two to three years, compared with 10 years in the social housing sector. Given that there are children in one in four households in the private rented sector, that has a big impact on children, as Siobhan McMahon said. People are vulnerable, because a landlord can end a tenancy or put up rent at short notice. As Ken Macintosh said, people struggle to find alternative accommodation.
It all comes down to power. The power lies with the landlords and the letting agents, and it needs to be shifted towards tenants, with more consideration being given to tenants’ rights. That is why Labour lodged practical amendments to the Housing (Scotland) Bill, which would have addressed rising rent levels and security of tenure. SNP member after SNP member talked about the importance of addressing issues in the private rented sector, but when they had the opportunity to do that, every one of them voted down the Labour proposals—every one of them voted down the opportunity to help their constituents.
We can all quote statistics at one another, but what Siobhan McMahon said about her constituent, whose rent is so high that he cannot afford to feed himself and has to go to his parents’ house for meals, showed the reality of what is happening on the ground. The Conservatives and the Government need to open their eyes to the issues.
It is unfortunate that the Green amendment was not selected for debate, because it would have given us an opportunity to focus on rent levels for students. There is no doubt that students are hit hard by issues such as security of tenure and rent levels.
The Tory amendment lauds the growth of the private sector and the benefits to the economy, as Alex Johnstone did in his speech. However, the Tories have not acknowledged rising rents and the rising number of people in the private rented sector who are in poverty. It is one thing to laud growth in the sector, but rising poverty is a real problem in communities throughout Scotland.
The SNP amendment is staggeringly complacent. As it says, and as various SNP members have told us, the Government published its strategy for the private rented sector in 2013. According to the amendment, the Government has made great progress on its strategy, because it is running a consultation. So: a strategy was published 18 months ago, and there is now a consultation to talk about the issues.
Will James Kelly not accept that the strategy covered a number of other areas, including repair and tenancy deposits, and that we now have regulation of letting agents? We have done a number of things with regard to the private sector, and we are now consulting on the tenancy regime and rents.
The minister acknowledged in her opening speech that she recognised in 2010 that there were issues with the private rented sector. The present Government has had two bills, a strategy and a consultation. There was nothing in last week’s legislative programme to address rent increases and security of tenure. The Government is on a go-slow when it comes to housing. It is time that we saw some action.
People are asking the question: the SNP Government is in power, so what is it going to do with that power? If people cannot pay their energy bills or pay for their food, or if their landlord imposes an excessive rent rise at short notice, they will see that the response of the SNP Government is to have a strategy and a consultation. It is not enough to chat about it; it is time we had some action, and it is time the SNP Government stood up on behalf of tenants, instead of backing the Tories and the rogue letting agents and landlords. We want action now.