A Welsh Government guide to the thinking behind its plans for tenancy reform
On Monday May 20, minister for
housing and regeneration Carl Sargeant
launched the public consultation on
the Welsh Government’s white paper
Renting Homes – a better way for
Wales.
This follows the publication last year
of the Welsh Government’s Homes for
Wales white paper by Huw Lewis, then
minister for housing, regeneration and
heritage. That set out a bold and ambitious
programme of legislative and nonlegislative
action to help people meet their
housing needs. It included a commitment to
bring forward proposals for tenancy reform,
based on the Law Commission’s 2006
Renting Homes report.
Nearly 70 per cent of respondents to
the white paper who expressed a view on
tenancy reform supported this approach.
There was also broad support for having
a dedicated Bill on tenancy reform, to be
introduced later in the current Assembly
term.
The Renting Homes white paper sets
out the Welsh Government’s proposals for
a Bill to improve arrangements for renting
a home. It has been informed by extensive
discussions with stakeholders and detailed
and wide-ranging work undertaken by the
Law Commission.
Commenting on the proposals, Carl
Sargeant said: ‘I am determined to improve
the efficiency of our housing system
and this ground-breaking legislation is a
significant step forward. These proposals
will create a level playing field for all
landlords and also provide a fairer deal for
tenants, irrespective of who they rent their
home from.’
The Welsh Government supported the
Law Commission’s recommendations when
first published, but at that time did not
have legislative competence to introduce
them on a Wales-only basis. As a result
of the referendum in 2011, the Welsh
Government now has primary law making
powers that enable it to take forward the
recommendations.
Updated report
Over the past year, the Welsh Government
has worked with the Law Commission and
a wide range of stakeholders to re-examine
the original recommendations. An updated
report Renting Homes in Wales was
published in April 2013, which takes into
account changes in housing law since 2006
and current Welsh policy priorities.
The Welsh Government believes that
the Law Commission’s proposals provide
a robust foundation for tenancy reform in
Wales which will result in a fairer, simpler
and more flexible system that will bring
benefits to tenants and landlords alike.
The current arrangements for renting
a home have evolved over many decades,
and have resulted in a complex system
where different categories of tenants and
landlords have very different rights and
obligations, often for no clear reason.
This complexity causes confusion and
uncertainty – even amongst those charged
with making the system work – and has
led to a situation where something as
simple as agreeing a tenancy between a
landlord and a tenant has become unclear
and fraught with uncertainty for both
parties.
Different types of tenancy agreements
and licenses have proliferated – some as
a result of a particular piece of legislation,
and others devised by letting agents or
individual landlords. This accumulation of
legislation, and the multiplicity of tenancies
it has created, also means that where
disputes or disagreements arise between
landlords and tenants these can be difficult
to resolve, and can all too often end up in
protracted and expensive legal proceedings
with uncertain outcomes.
Current differences between renting
a home from a local authority, housing
association or private landlord contribute to
weaknesses in the way the whole housing
system works. These differences can lead
to reluctance on the part of tenants to
move between different types of rented
accommodation, for fear of losing their
current level of security or tenancy terms,
which can in turn limit the opportunities and
advantages that greater mobility could bring.
The Welsh Government believes that
its white paper proposals present a more
coherent, transparent, equitable and
flexible legislative framework than that
which currently exists. The arrangements
would apply to social landlords and their
tenants, and also to the private rented
sector, improving the efficiency of the
housing system by creating a level playing
field for landlords, enabling them to work
more closely together in meeting the
housing needs of the people of Wales. The
proposals would also mean a fairer deal for
tenants, who will have comparable rights
and responsibilities, irrespective of who
they rent their home from. At the heart of
the Welsh Government’s white paper is a
proposal to replace the existing range of
tenancies with two types of rental contract:
(i) A ‘secure contract’ modelled on the
current secure tenancy issued by local
authorities
(ii) A ‘standard contract’ modelled on the
assured shorthold tenancy that is used
mainly in the private rented sector.
Social landlords would be required to
use the secure contract where they would
currently issue a secure or assured tenancy.
The standard contract will be used for
short-term renting, such as for introductory
and demoted tenancies. Private landlords, in
addition to issuing standard contracts, will
also be able to offer secure contracts.
Contracts
All landlords will be required to provide their
tenants with a written copy of their rental
contract. Terms to be included in all rental
contracts would be set out in legislation by
the Welsh Government. Model contracts,
incorporating all the relevant law in plain
language, would be published by the Welsh
Government and freely available for all to
use. Landlords and tenants would also be
able to agree relevant additional terms, for
example in relation to keeping pets.
Under the proposed scheme,
arrangements for starting and ending
a tenancy would be standardised and
the landlord’s obligation to maintain the
property would be included in the rental
contract. There would also be a clear
definition of unacceptable tenant behaviour
in all rental contracts, which should enable
landlords to deal more effectively with the
anti-social behaviour of some households.
In cases of domestic violence, it would also
enable the victim to remain in the home by
targeting eviction action at the perpetrator.
In addition, new provisions relating to
succession entitlements, joint tenancies,
renting for 16 and 17 year olds, and the
provision of supported accommodation for
vulnerable people are also included in the
white paper.
The Welsh Government believes that
there should be a consistent approach to
the way that possession proceedings are
managed by landlords and county courts
in Wales, including in situations where rent
arrears have arisen. To this end, proposals
to replace existing mandatory and
discretionary possession grounds with a
‘structured discretion’ approach have been
included in the white paper. This approach
is designed to provide courts with scope
to make decisions on any ‘proportionality’
defence raised under Article 8 of the
European Convention on Human Rights, or
the Equality Act 2010, but no more.
The white paper also includes proposals
to abolish the so-called ‘six-month
moratorium’, introduced by the Housing
Act 1996. This currently prevents a court
from ordering a ‘no-fault’ possession in the
first six months of an assured shorthold
tenancy. Removing this moratorium would
benefit tenants looking only for a shortterm
let. However, where appropriate, for
example where accommodation is being
provided to a homeless person in the private
rented sector, it would be possible to set a
minimum contract period for the tenancy.
The Welsh Government remains
committed to security of tenure in the
social rented sector in Wales and believes
that people in social housing, often the
most vulnerable, have a much better
chance to improve their long-term situation
from a position of security rather than one
of threat. There are therefore no plans to
bring in the type of fixed-term tenancies
for social housing that are being introduced
in England under the Localism Act 2011.
The Welsh Government is also keen to
encourage the further development of social
lettings agencies, where private landlords
make their properties available for longer
term renting through local authorities and
housing associations, and believes that the
proposals set out in the white paper for
a single and clear legal framework would
facilitate such arrangements.
Speaking at the launch of the white
paper at the Greenfarm Hostel in Cardiff,
Carl Sargeant, the minister for housing and
regeneration, said,
‘The white paper is a significant
document. It contains proposals for a
fundamental and much-needed overhaul
of the system for renting homes in Wales.
Our proposals present a more coherent,
transparent, equitable and flexible legal
framework for renting a home in Wales.
They will help whether you are a tenant or
a landlord, or an organisation that provides
advice or support to either.
‘I very much look forward to hearing
the views of our stakeholders over the
coming months: tenants and landlords;
organisations and individuals; public,
private and third sector – all are important.
I am looking to all organisations in and
around the field of housing to bring our
proposals to the attention of tenants so
that their voices can be heard.’
Consultation on the white paper will
continue until August 16, 2013. A series
of Welsh Government public consultation
events have been organised during the
consultation period: Llandudno on June
26; Aberystwyth on July 1, and Swansea
on July 11. In addition, a number of other
organisations are planning events focused
on the white paper.
The Renting Homes white paper,
together with a two-page summary, is
available at: http://wales.gov.uk/consultations.
The Welsh Government will
carefully consider all consultation responses
and publish a summary later in the year.