Chamber and committees

I have one more question, which is about what will happen if the freeze is extended beyond 31 March. It is directed at Aaron Hill and John Kerr.

You have talked about there being a caveated acceptance of a freeze up to 31 March but have said that there would be a real and dramatic impact on investment programmes if rents were to be frozen beyond then. Do you feel that any decision to extend the freeze should be accompanied by financial assistance for the social sector to maintain essential supply-side programmes and programmes that support tenants through the cost of living crisis?

Just for clarity, then, it is the Government’s view that rent rises can legally go ahead up until 5 December.

Again, just for clarity, my understanding is that the effective rent cap period runs from 6 December to 1 July, as long as no provisions are repealed.

I just want to move to the other end of the freeze. Is it the Government’s understanding that a rent increase notice cannot be issued up to and including 31 March, which means that no rent rise can take effect until 1 July? In other words, does the effective rent cap period run from 6 December to 1 July? Have I understood that correctly?

I am asking the questions purely on the basis of what a tenant’s practical experience would be. I think that I have clarity from the minister.

The justification for it was the severe hardship that tenants were and are facing, which is why the Government has acted, so it seems as though the moves that Labour made were justified.

However, my remark was an opening point in the debate and an invitation to the Government to get round the table and discuss how we might seriously implement such measures. Instead of just pooh-poohing the idea and then coming back months later to claim it as its own, it could have worked constructively and included my colleague Mercedes Villalba in the whole process, and then everyone would have been a lot better placed.

It has taken a month for tenants to have sight of the detail. We will continue to scrutinise the content of the bill to ensure that there is flexibility to deal with the crisis in the long term, while guarding against any potential unintended consequences. There remains a threat of more unmanageable arrears and homelessness after the moratorium ends. It is not a feature of the bill, but we urge the Government to renew the tenant grant funding urgently. I also welcome provisions to review and report on measures and for the Parliament then to come back and agree either to extend or to end those powers.

Likewise, new verification processes and protections against evictions are badly needed. Communication about the cap, the moratorium and the right to those protections is key. In May, RentBetter reported that there is a lack of confidence and, some would say, a fear about residents exercising their rights due to the potential repercussions of rent increases or losing their homes. Labour will draft an amendment to put a duty on the Government to write to all registered landlords and tenanted properties to provide advice and information about the provisions. I look forward to sharing that with the Government and discussing it.

However, it remains a fact that rents will continue to rise between tenancies at what look like increasingly higher rates and that rents will rise in tenancies until 5 December. There is a contrast in respect of what the First Minister said in her statement in the programme for government. I think that she said that the practical effect of her statement was that rents would be frozen immediately. There is a gap between that rhetoric and what will happen in practice. Rents will not be frozen until 5 December due to notices issued in advance of 6 September still having a three-month notice period. That is confirmed by the policy memorandum.

In closing, I want to highlight what the social sector, including the Scottish Federation of Housing Associations, the Convention of Scottish Local Authorities, local housing conveners and housing associations, has alerted the committee and parliamentarians to: the risk of a freeze next year to the affordable house-building delivery and maintenance programmes. Last week, I visited tenants and staff at Abronhill Housing Association’s new Aspen Place development. We need to see many tens of thousands more new and warm affordable homes. Those people told me about the financial implications of a rent freeze for next year. Upwards of £100,000 being lost from the business would mean cancelling all investment plans for 2023-24 and 2024-25. Those plans are worth nearly £400,000, including kitchens, bathrooms and heating upgrades.

Given that seven in 10 social tenants receive housing benefit or universal credit, the majority of social tenants will not benefit from a freeze but will lose out from a lack of investment in their homes. Where rent is paid by the United Kingdom Government, so are the increases. Modelling on a 3 per cent rent rise for next year would mean that £30 million would be lost to the housing sector and would go back to the UK Treasury.

The regulator puts the cost to the whole sector at £50 million, rising to £230 million by March 2027. It is clear that that would put at risk the 110,000 affordable homes and all the other measures that we would like to see as part of those investment programmes. Would ministers be able to fill that black hole if they were to continue the rent freeze into the following year?

The bill is not a panacea or a long-term solution. For that, housing policy in Scotland needs fundamental reform. We need to build far more houses. Although the bill is very welcome in the short term, it should not get in the way of that.

I draw members’ attention to my entry in the register of members’ interests, which shows that I am the owner of a rental property in the North Lanarkshire Council area.

Labour will be supporting the emergency legislation this week. We want to see the rent freeze and moratorium on evictions on the statute books without delay. In fact, we wanted to see that months ago. When we called for emergency legislation in the summer, we did so because we know that the Government has the powers to help people who are battling with living costs. Even if it has taken months to get to this point, we welcome the change of heart in the SNP-Green Government.

It goes without saying that thousands upon thousands of people will struggle to heat their homes or keep a roof over their heads this winter. People who previously were just managing will find themselves pushed to the brink with repeated financial shocks. We are in extraordinary times, made worse by the economic chaos unleashed by Tories after the bill was announced. That chaos will make winter longer and harder than any of us expected. The blame for the sky-high interest rates that are pushing up people’s bills is at the door of the Conservatives. Food bills, heating bills, fuel costs and rents keep going in one direction, and that is up.

I would like to make a bit of progress.

My colleague Mercedes Villalba made the case for an immediate rent freeze before the summer recess. Even then, that was the only solution that could offer tenants temporary respite from the crisis, which is currently escalating. At the time, it seemed as though the Government did not want to listen to the evidence. Had it backed the proposals back in June, the rent freeze could have been in place months ago. Indeed, had members of the Government backed Pauline McNeill’s bill in the previous session, we could have seen the provision of far more support for Scotland’s tenants.

In May, Citizens Advice Scotland reported that concerns around landlords increasing rent were now eight times higher than they were at the start of the pandemic. In June, the Office for National Statistics reported that private rental prices were growing at their fastest rate since 2012. During the passage of the Coronavirus (Recovery and Reform) (Scotland) Bill, Mercedes Villalba told members of the COVID-19 Recovery Committee what members of Living Rent were reporting. For example, a tenant whose landlord had increased their rent by £300 with no reason given was forced to leave. Another landlord decided that he could raise a tenant’s rent by £100 to £900, just by having a look at the average rents on the street. The landlord of another tenant, who had a pregnant wife and was living in a top-floor flat with nicotine-saturated carpets, increased their rent by £150 because he

“‘could not be expected to stand still while the market moves on’”.—[Official Report, COVID-19 Recovery Committee, 9 June 2022; c 93.]

We are talking about people’s homes.

If the member has listened to my speeches in the Parliament over the past six months, he will have heard me repeatedly calling on the Government to insulate as many homes as possible before the winter. Housing associations have said that they are able to manage the current programmes up to 31 March and Scottish Labour will be lodging an amendment to ensure that additional funding is provided for social landlords if the freeze continues beyond that date, to provide tenants and housing associations with assurance that no capital investment programmes will be affected. I look forward to the member supporting that amendment.

Thank you, Presiding Officer.

That proposal holds merit but, rather than limiting the rent rise that tenants might experience at this extremely difficult time, I think that a rent rise of zero per cent would be far better for Scotland’s tenants than any rise at all and would support people through the winter. That is why Scottish Labour called for it months and months ago, but the Government was ready to turn a blind eye to such calls. Back then, we heard the usual excuses from ministers and members of the Government that amendments were not competent or would be subject to legal challenge, that the Government had not consulted on them or that they would, in fact, push up rents. The Government advanced those excuses months ago to dismiss Labour’s campaign for a rent freeze, but they now seem to be accepted although they are absolute nonsense.