CONSULTATION
Part 1 - Landlord Registration
1. The system of landlord registration was established by Part 8 of the Antisocial Behaviour etc. (Scotland) Act 2004. Registration is designed to ensure that only people who are fit and proper to let out residential property can operate legally as landlords. The operation of landlord registration is the responsibility of local authorities.
2. Last year Arneil Johnston carried out for the Scottish Government a review of the legislative framework of landlord registration, following up a review of good practice. We have listened to concerns in relation to gathering evidence, fines and other aspects of the scheme, although we continue to be clear that the first priority remains for local authorities to use their existing powers to enforce landlord registration as effectively as possible.
3. There are several areas where amending primary legislation may strengthen existing powers or clarify the legislation, and thus may help local authorities to take action where they have concerns. These are set out below.
Enforcement
4. When a landlord or agent breaches the terms of the 2004 Act, authorities can apply sanctions which can lead to criminal prosecution or a cessation of the rent payable. These sanctions effectively act as a bar on a landlord's ability to let a house. The use of enforcement powers varies among local authorities. In general, where it has been used, the rent penalty notice is seen as the most effective tool for enforcing the scheme and the results have been positive. We are encouraging local authorities to increase their use of the rent penalty notice where appropriate.
5. There are a significant number of landlords who are under review because of concerns a local authority has. However, some local authorities tell us they are reluctant to use the powers they have to refuse applications for registration. There have been no reports to the procurator fiscal as a result of landlord registration. Some local authorities have said this is for a number of reasons, including difficulties in gathering evidence to ensure that robust cases against landlords can be developed where there are concerns.
6. This issue was discussed during the review of landlord registration. The landlord, agent and tenant groups felt that evidence on the use of current enforcement powers is limited and therefore it is difficult to justify giving local authorities additional powers at this stage. There was a general feeling that local authorities should be able to demonstrate how existing powers were being used and why they did not work (if this is the case), prior to extending the powers available. Views from the local authority focus group were mixed, with some calls for additional powers, whilst others were content with the existing level of powers and were making effective use of their powers.
7. The review recommended that the Scottish Government should consider local authorities' ability to obtain information. One of the key issues for local authorities is proving that a tenancy is in place, and an extension to powers could tackle this. There are provisions in section 186 of the Housing (Scotland) Act 2006 to require persons associated with a property to provide information to a local authority to enable or assist it to exercise functions contained within the Act (including the HMO licensing provisions, which are not yet in force). This covers persons who own or occupy the land or premises concerned, or receive rent, directly or indirectly, in respect of the land or premises. On request, they must state in writing to the local authority the nature of their interest in the land or premises and the name and address of any other person known to them as having an interest in the land or premises, and also provide the local authority with any other information about the land or premises that it may reasonably request.
8. Failure to provide information without reasonable excuse or making false statements are criminal offences, subject to a fine not exceeding level 2. It may be helpful to local authorities to replicate these provisions for the purposes of landlord registration, in order to make it easier to gather evidence.
Question 1.1: Do you consider that a local authority should be able to require persons associated with a property to provide information to help it to carry out its landlord registration functions?
9. The 2006 Act also increases the maximum fine for operating without an HMO licence from £5,000 to £20,000. We propose increasing the maximum fine level for failing to register as a landlord or communicating with another person with a view to entering into a lease or an occupancy arrangement without being registered (currently level 5, or £5,000) to £20,000 also. The sanctions available to the sheriff on disposal of landlord registration cases is an issue that has been raised by Glasgow City Council and Govanhill Housing Association in the context of the housing problems in Govanhill. A substantially higher fine may act as more of a deterrent (although no reports have yet been made to the procurator fiscal under landlord registration). This would bring landlord registration in line with enforcement powers for HMO licensing in the 2006 Act.
Question 1.2: Do you consider that the maximum fine for failing to register as a landlord or communicating with another person with a view to entering into a lease or an occupancy arrangement without being registered should be increased, and if so do you consider that £20,000 is the appropriate maximum level of fine?
Register
10. Local authorities are required to maintain a register of landlords and agents who are considered fit and proper persons to let a house under a lease or occupancy arrangement. Information on registered persons and their residential properties is held on the register. The release of information to members of the public is circumscribed to ensure that the information is not used for malicious or commercial marketing purposes or would not, if released, represent an unacceptable intrusion in a registered person's private life.
11. Access to the register in a local authority's area is, in legal terms, by application to the local authority. In the great majority of cases this is done by accessing the landlord registration website. A member of the public can request information with respect to a particular residential property or a particular person.
12. Local authorities have indicated that there are circumstances where it would be helpful to give out additional information regarding an application for registration. This is in two main areas:
- Where an application has been received but has not yet been processed or approved. This could include where a member of the public or a tenant raises concerns about an unregistered landlord.
- Where a landlord has been refused registration or has been de-registered.
13. In their review of landlord registration, Arneil Johnston recommended that a change to legislation was needed to allow additional information on applications to be given out. The issue was discussed by stakeholders at the legislative focus groups. The majority view was that additional information on whether an application had been submitted would be useful, but that it should be limited and specific. Information about the status of an application should not be provided, for example, that the landlord was under review. Stakeholders also felt that as one of the principal aims of landlord registration was to remove the worst landlords from the sector then having the facility to make members of the public aware that landlords had been refused registration would help protect tenants. The main landlord bodies support these changes and the local authorities represented, including CoSLA, were content, as long as the information is worded carefully. We feel this could be a beneficial amendment to make to the primary legislation.
Question 1.3: Do you consider that the landlord register should contain additional information, indicating (a) that an application has been received but has not yet been processed or approved, and (b) that a landlord has been refused registration or has been de-registered?
Agents
14. The position of agents in the private rented sector is important. They can often be the only point of contact for tenants and have considerable responsibility for ensuring that lawful practices are in place and that standards are reasonable. The landlord and tenant surveys undertaken as part of the Scottish Government's Review of the Private Rented Sector show that agents are involved in between 40% and 50% of tenancies.
15. There is no requirement for agents to register in their own right (although an agent may choose to do so). However, a landlord must include any agent in an application for registration. Where a landlord has been registered and then adds an agent, there is currently no fee-making power within legislation for a fee to be charged for this addition. This is despite the fact that the agent will have to be assessed as fit and proper, if they are not already registered, which will involve expense for the local authority. Allowing a fee to be charged would require an amendment to the Antisocial Behaviour etc. (Scotland) Act 2004. We think it could be helpful to do this.
Question 1.4: Do you consider that a local authority should have the power to charge a registered landlord a fee for nominating an agent? If so, what do you think would be a reasonable charge?