Response to Scarborough Borough Council’s proposal for selective licensing

The National Landlords Association (NLA) exists to protect and promote the interests of private residential landlords.

The NLA represents more than 60,000 individual landlords from around the United Kingdom.  We provide a comprehensive range of benefits and services to our members and strive to raise standards within the private rented sector.

The NLA seeks a fair legislative and regulatory environment for the private rented sector while aiming to ensure that landlords are aware of their statutory rights and responsibilities.

The National Landlords Association (NLA) would like to thank Scarborough Council for providing the opportunity to comment on the Selective Licensing consultation.

Executive Summary:

Having considered the evidence presented and undertaken its own evaluation of the circumstances faced by the residents of Scarborough, the NLA can summarise its position in the following brief points:

•           The current proposal does not take into consideration displacement of problem tenants.

•           Landlords have very limited authority to deal with matters of ASB – licensing has provided no additional influence.

•           Lessons from the previous scheme not being fully run cannot be incorporated.

•           Discretionary licensing is not an appropriate reaction to the cited issues as it provides no further facility or powers to deal with criminal activity.

The consultation’s conclusion fails in providing a complete resolution to the problems that it has identified. The council fails to provide a roadmap of how the council will resolve the tenants and residents that are causing the anti-social behaviour, in conjunction with selective licensing. Without a structured plan to solve all three components, the council runs the risk of displacement of problems and further blight to Scarborough.

The NLA also has concerns about the proposed extension of the current proposal into different areas without proper analysis of the successes and failures of the first scheme being provided. This appears naive and foolhardy, as well as a waste of taxpayers’ money. Any scheme should be analysed so that improvements can be made and better delivery can take place.

General Feedback on Proposals:

The legislation in relation to selective licensing clearly states that the introduction of licensing has to be evidence based. This evidence must support an argument. On the basis of the evidence that is presented by the council, the NLA would argue that the case for the introduction of licensing is owing to the previous scheme not being allowed to run for its full five years, meaning that there has been insufficient time to (potentially) resolve the issues.

In the consultation document the argument is put forward that the areas have a high level of deprivation – it has been proven in other selective licensing areas that the cost is transferred through to the tenants. Thus the disposable income of those on fixed incomes will diminish as a result of the proposal. 

The NLA believes that any regulation of the private rented sector needs to be balanced. Additional regulatory burdens must focus on increasing the professionalism of landlords and the quality of private rented stock, as well as driving out the criminal landlords – who blight the sector. Unless adequate services are provided, this scheme will see displacement of both problem landlords and problem tenants in Scarborough. It should be the shared objective of all parties involved to facilitate the best possible outcomes for landlords and tenants and, as such, good practice should be recognised and encouraged in addition to the required focus on enforcement activity. This is not the case this time. Good landlords should have a further reduced fee to show that the work they have done is recognised.

We have concerns around how this proposal will be considered by the banking industry; already banks are not lending in areas in which councils have introduced discretionary licensing. By re-implementing licensing, the council is saying that Scarborough has significant problems, particularly anti-social ones, thus driving away investment from the area. 

The paperwork involved in applying for a licence can be reduced; the rationalisation of licensing administration is in need of review. This can be accomplished using the data derived from the initial scheme. The requirement to complete a form for each property needs to be reviewed. The process can be simplified along with the costs that are incurred by Scarborough Council and landlords. We would be willing to work with the council to establish how this can be done.

Landlords will outline to tenants at the start of the tenancy their obligations in relation to waste and what they have to do to comply with waste disposal rules. The tenants not using the service will discard waste, creating litter and fly-tipping in the borough. This in many cases occurs because tenants do not understanding the waste services provided by Scarborough Council.  If tenants do not comply with waste collection they are responsible and the council can take action against them directly. Licensing is not the appropriate response to address this issue. Improved access to waste facilities for those landlords who do comply should also be considered by the council as a means of mitigating the impact of waste.

 Current Law:

There are currently over 100 pieces of legislation with which landlords have to comply. The laws with which the private rented sector has to comply can be misunderstood. Landlords are expected to give tenants “quiet enjoyment”; failure to do so could result in a harassment case being brought against the landlord. Thus the law within which landlords have to operate is not fully compatible with the aims of the council.

Scarborough Council has many existing powers. Section 57 (4) of the Housing Act 2004 states that a local authority “must not make a particular designation ... unless (a) they have considered whether there are any other courses of action available to them … that might provide an effective method of dealing with the problem or problems in question”. The use of these powers as listed below gives Scarborough Council the ability to tackle many of the issues that they wish to overcome in all the parts of the city:

a)         Use of Criminal Behaviour Orders;

b)         Crime Prevention Injunctions;

c)         Interim Management Orders;

d)         Empty Dwelling Management Orders;

e)         Issuing improvement notices to homes that don’t meet the decent homes standard;

f)          Directions regarding the disposal of waste (for example under section 46 of the Environmental Protection Act 1990);

g)         Litter abatement notices under section 92 of the Environmental Protection Act 1990;

h)         Powers under the Noise Act 1996 to serve fixed penalty notices or confiscate equipment (sections 8 and 10);

i)          The power to require rubbish to be removed from land under sections 2–4 of the Prevention of Damage by Pests Act 1949.

There are currently over 100 pieces of legislation with which landlords have to comply. The laws with which the private rented sector has to comply can be misunderstood. Landlords are expected to give tenants “quiet enjoyment”; failure to do so could result in a harassment case being brought against the landlord. Thus the law within which landlords have to operate is not fully compatible with the aims of the council.

Scarborough Council has many existing powers. Section 57 (4) of the Housing Act 2004 states that a local authority “must not make a particular designation ... unless (a) they have considered whether there are any other courses of action available to them … that might provide an effective method of dealing with the problem or problems in question”. The use of these powers as listed below gives Scarborough Council the ability to tackle many of the issues that they wish to overcome in all the parts of the city:

The use of such orders will deliver results immediately – why does the council wish to do this over five years. A targeted approach towards those that have not complied over five years would be more appropriate. Targeting the specific issues in a joined-up way by agencies, the council, community groups (Margate Taskforce), tenants and landlords will have a greater impact.

The NLA would also like to see Scarborough Council develop a strategy that includes action against any tenants that are persistent offenders. These measures represent a targeted approach to specific issues, rather than a licensing scheme that would adversely affect the professional landlords and tenants while still leaving the criminals able to operate under the radar.

The council should consider alternative schemes such as the Home Safe scheme in Doncaster and SEAL in Southend. Both schemes offer alternatives that the council has not reviewed. This would save the council money.

Consultation Critique:

In relation to ASB reduction, and the authority a landlord has to tackle such activity within their properties, it should be pointed out that landlords and agents can only enforce a contract. They cannot manage behaviour (ref: House of Commons briefing note SN/SP 264 paragraph 1.1). In most circumstances, the only remedy available to landlords confronted with cases of serious ASB in one of their properties will be to seek vacant possession and in many instances will serve a section 21 notice rather than a section 8 notice identifying the grounds for possession. The former is simpler and cheaper and repossession (at present) more certain. No reason needs be given for serving a section 21 notice and the perpetrator tenant can then hypothetically approach the local authority for assistance to be re-housed (ref: Homelessness Guidelines cl 8.2). Crucially, no affected party need offer evidence against an antisocial householder, reducing the risk of intimidation, harassment and ultimately unsuccessful possession claims. The issue of ASB will thus not appear as a factor in the repossession. In providing evidence to support a licensing application the document should clarify for respondents the position of all relevant under landlord and tenant law.

Regarding the crimes mentioned – burglary, theft, arson and damage, and drug offences – how is selective licensing of landlords proposed to solve these crimes? The powers that landlords have are limited to enforcement of a tenancy agreement, meaning that contract law applies despite the abovementioned issues coming under criminal law.

Clarification of the council’s policy in relation to helping landlords when a section 21 notice is served is required. It would be useful for the council to provide a guidance document before the introduction of the scheme, outlining the council’s support for landlords who need to remove tenants who are behaving anti-socially and what evidence is required.

The ability to use rewards for good landlords needs to be considered, as the extension of licensing for a further five years does not appear to reward those landlords who have worked with the council.

The main argument appears to centre on the large number of properties in the private rented sector and their concentration in these areas. This is not a reason for the introduction of licensing. Equally it is not explained how selective licensing will reduce deprivation in the area.

Those landlords who have complied with the scheme should be subject to a reduced fee or be excluded from the extension of the scheme. NLA would also like to see an accreditation scheme used with annual professional development for those landlords instead of discretionary licensing with access to the council’s waste facilities and discounts on council tax when the property is empty. This rewards good landlords, while allowing the council to use its resources on the criminals.