Chamber and committees

Absolutely. We will make every effort that we can to do that. It is something on which we can engage actively with the committee. For example, with the reporting provisions in the bill—assuming that Parliament approves it—the committee might want to write to us ahead of time to flag up the specific questions that you would want us to cover, either in the report that will be published or in the discussions that we have with the committee.

What we have set in the bill is, as I said earlier to Willie Coffey, six months of rent in relation to the private rented sector and a specific figure, which is roughly equivalent to six months of social rent, in the social rented sector.

I come back again to the point that I made earlier: the intention of setting a zero per cent cap until the end of March would not have a direct impact on rental income in the social rented sector because that sector does not have constant in-year rent increases; those tend to happen at the start of the financial year. We are working closely with the sector to understand all the implications, the way that it works and the impact that any future decision on the rent cap would have on its business model. We are also working with it to give assurance and confidence to its lenders.

The need for investment in provision of affordable social housing, in repairs and maintenance and in net zero, as well as in the other services that Miles Briggs rightly highlighted in his earlier question, are all important points of common ground between the Government, political parties and the social rented sector.

We must recognise that net zero investment is absolutely in the interests of tenants, too. I have spoken to social rented sector tenants who are now paying peanuts in energy bills after investment has been made not just in energy efficiency but in zero emissions heating systems, communal heating systems and so on.

We want to see much more of that. The Scottish Government is already committing substantial investment to support such work in the social rented sector. We are working closely and collaboratively with social landlords, many of which have been leaders in the field. We want such work to continue, and I am certain that it will.

Indeed I can. It is important to acknowledge that landlords, particularly those in the private rented sector, are not all in the same financial circumstances. Some are very large and profitable. Others, as John Blackwood said, are people who have for whatever reason, perhaps unintentionally, found themselves letting out one or two properties. Some of them will be facing the cost of living crisis and will be worried about their circumstances.

We have included versions of the existing grounds for eviction that are to do with the intention to sell or to live in a property, but the adapted versions that we are including on a temporary basis in the emergency legislation concern the landlord’s intention to do that to address their own financial hardship. We will work with the tribunal on how that is implemented.

Obviously, we do not want a landlord who would face the risk of severe debt or even homelessness to be unable to take action, so those limited and prescribed forms of eviction grounds will be included, and you can see that in the text of the bill.

Yes. We are defining “substantial rent arrears” as up to or the equivalent of six months’ rent in the private rented sector. We are using the specific figure of £2,250 in the social rented sector, which is roughly equivalent to six months’ average rent in that sector. Amanda, do you want to comment?

The impact assessment aims to capture those points, but I will perhaps take the opportunity, if I can, to address that in my closing speech.

I will now go through the provisions in some detail, starting with the rent freeze.

The bill will allow Scottish ministers to set a cap on the level of increase in rents, which will initially be set at zero per cent until 31 March 2023. Under the proposals, ministers will take powers to vary the cap, which will operate separately for the social and private rented sectors. Students in college and university halls and PBSA will also be protected through a zero per cent cap, ensuring that there will be no mid-tenancy rent increases. That will apply to all rent increase notices that are served on or after 6 September 2022.

As I said, we recognise that the cost crisis is also impacting on some landlords. Although the primary purpose of the legislation is about protecting tenants, it is also important to ensure that it reflects landlords’ circumstances. Private landlords will be able to make an application to increase rent for limited prescribed and legitimate costs associated with offering the property for rent where those costs have increased. The increase may be for up to 50 per cent of those costs and no more than 3 per cent of the existing rent. Those percentages may be varied if circumstances justify it.

I am aware that concerns have been expressed that some tenants—a minority, it should be suggested—might be tempted to stop paying rent even if they can afford it. I move on to the additional ground for eviction that we are exempting from the moratorium. We have taken the view that, both in the social and the private rented sectors, eviction may still take place in cases in which there are substantial rent arrears. I will lay that out in a little more detail, because I know that some members have concerns about it. For the private rented sector, that means a total value of six or more months’ worth of rent arrears. For the social rented sector, it means rent arrears of £2,250 or more, which is around six months’ worth of average rent in the social rented sector.

The decision on that has not been an easy one, but, having considered it at length, I am firmly of the view that the provision will act as a safeguard for landlords and tenants. It will allay the concern that a minority of tenants might stop paying rent even when they can afford it. On-going substantial rent arrears can mean that a landlord can find it increasingly difficult to offer a property for rent, especially where no rent has been paid for a prolonged period.

In addition, for a tenant facing unsustainable rent arrears, prolonging the situation will only increase their debt and financial insecurity and it can trap them with debt that they will never be able to service. The protection that a tenant in such circumstances needs is different. They need direct support, and we are making support available through discretionary housing payments and the tenant grant fund, which was introduced in recent years and has since been made more flexible, to allow it to be used for more recently accrued arrears that are not related to Covid.

Originally, under the initial coronavirus measures, there was a tenant hardship loan fund. There is now a tenant grant fund. That has been the case for some time.

The member mentions experts in the sector. Does he accept that tenants are experts in how the rented sector works and that tenant organisations have been crying out for the legislation?

I am going to have to make some progress.

The emergency budget review will have to consider all those things.

Several members have questioned the purpose and necessity of the measures, and I welcome the comments from Mark Griffin and members on the Labour benches, who recognise that thousands of people are being pushed to the brink in a crisis that is being made worse by the UK Government. Elena Whitham spoke of a “clear and present danger” from the current cost crisis and recognised that some of that has been at the hands of the chancellor over the past couple weeks.

The measures in the bill provide direct protection in terms of rent, but they do more than that; they also provide a sense of security. A good reason to ensure that all tenants in all sectors have equal protection, at least for the first six months, is to ensure that everyone has that sense of security. Emma Roddick spoke about the direct connection between a sense of being secure in one’s home and the impact on mental health.

I want to emphasise briefly a couple of aspects that did not come up very much in the debate, which I hope that we will discuss later in the week: the measures on penalties for unlawful evictions and the changes to rent adjudication. Those things will be very important in how the wider measures are implemented, and I hope that we will have further discussion of them later in the week.

Clearly, for some in the chamber, the provisions signal the end of private renting or some sort of imagined hostility that we have towards the rental sector, but, for others in the chamber, the measures do not go far enough.

Richard Leonard’s suggestion that the bill does nothing to strengthen tenants’ rights is, I am afraid, frankly absurd. It is very clear that some members think that none of this should be done at all, and others are demanding the impossible. Mr Leonard asked why we are not placing the onus on landlords. That is exactly what the bill does: landlords will be the ones who have the opportunity to apply for a prescribed set of costs to be taken into account, within clear limits.