Under the heading A One Nation programme with new ideas to begin turning Britain’s economy around yesterday Ed Miliband outlined six bills that would appear in Labour’s alternative Queen’s speech. It is good to see him offering some policy detail, at last, but to what extent are we being offered new ideas?
The focus of the housing component of his statement was the private rented sector, which in one sense is new. The idea that the political battle to be fought over housing was going to be fought over private renting is one that would have made no sense a few years ago. And whether it is the biggest problem facing the housing system at the moment, given the broader context of poor affordability for a nation of frustrated aspirant home owners, could be debated.
Leaving that to one side, what did he offer?
Under the heading ‘detail of bills’ we read the following:
- The housing market has changes significantly in recent years. There are now 3.8 million households in the private rented sector, including more than one million with children.
- Many are being ripped off through hidden fees, which are costing tenants £76m per year.
- More than a third of all privately rented homes are not up to decent standards, with more than 15 per cent lacking minimal heat in winter.
The Bill would:
- Introduce a national register of landlords, to allow LAs to root out and strike off rogue landlords, including those who pack people into overcrowded accommodation.
- Tackle rip-off letting agents, ending the confusing, inconsistent fees and charges.
- Seek to give greater security to families who rent and remove the barriers that stand in the way of longer term tenancies.
I’m not sure this qualifies as ‘detail’, but there is no doubt more to come. In fact, if you’ve read Labour’s housing policy review documents from earlier this year then none of this should be a surprise. Where the thinking is new it is not so much freshly-minted as finally bringing ideas that have been around for a while in the specialist literature into the mainstream policy process.
The statement of the situation is fair, although it leaves a lot implicit if the proposed content of the bill is addressing problems. There are presumptions lurking in the background about the quality of housing management and profiteering among landlords and not just letting agents.
I would characterise the three actions proposed by the bill as “old”, “at last”, and “broadly new”.
A proposal for a national register of landlords was under development in the last days of the Brown government, but it fell at the 2010 General Election. So this isn’t new. It also begs some important and long-standing regulatory questions. To what extent will it identify and address genuinely “rogue” landlords? Labour bequeathed us mandatory licensing for Houses in Multiple Occupation but we know that several years after its implementation compliance with the regime is very patchy. I’m not necessarily against licensing or registration – depending on the detail of its design and operation – but whether it will deal effectively with the problem you’re trying to address remains an open question.
The problem of letting agents has been identified for a long time. The situation is anomalous: estate agents have been working within a statutory framework for decades but letting agents have not. I’ve not seen any systematic evidence about it but the perception is that profiteering by letting agents has got worse as people have become more desperate for accommodation. Action here is necessary and overdue.
Any move on length of tenancies would represent a genuine departure from the direction of policy over the last thirty years. Longer tenancies, alongside rent control, had been placed in the box marked “too difficult” because they might act to discourage landlords and lenders from involvement in the market. So if Labour is going to take a different stance on this then that is welcome. Questions of detailed design will be important, but we know that other countries have private rental markets that survive and thrive while offered longer tenancies that allow households to be more settled. So it should be possible to come up with something that doesn’t cause the sky to fall in.
But we need to recognise that such proposals are perceived – by landlords, lenders and commentators alike – through a complex filter of cultural presumptions about rights and responsibilities. Just because German landlords will happily offer multi-year tenancies with built in inflationary uplift doesn’t mean British landlords will do the same, if they consider it their God-given right to extract as much money from tenants as they can get away with and dispose of their property at short notice as they see fit. So there may be a more subtle battle to be won before such a policy makes much headway.
These proposals are the opening statement rather than the last word in this debate. There is much that still needs to be fleshed out before it is possible to evaluate them properly. But it is good to see some policy thinking on housing. And, of course, Miliband’s statement can’t be seen in isolation. A day or so earlier Liam Byrne was making some broadly sensible points about the balance between capital subsidy and housing allowances. Again, that wasn’t so much a case of offering new ideas as at least taking a more plausible stance on a problem that has been recognised for a long time.
To be honest, given the mess that has been made of the housing system, we should the thankful for small mercies at the moment.
No policies for trying to discourage BTL and support FTB through removal of BTL tax allowances?