Proposed banning order offences under the Housing and Planning Act 2016 RLA Submission to the Department for Communities and Local Government Consultation.
About the RLA The Residential Landlords Association represents the interests of landlords in the private rented sector (PRS) across England and Wales. With over 30,000 members, and an additional 20,000 registered guests who engage regularly with the Association, the RLA is the leading voice of private landlords. Combined, they manage almost half a million properties. The RLA provides support and advice to members and seeks to raise standards in the PRS through its code of conduct, training and accreditation and the provision of guidance and updates on legislation affecting the sector. Many of the RLA s resources are available free to non-member landlords and tenants. The Association campaigns to improve the PRS for both landlords and tenants engaging with policymakers at all levels of Government to support our mission of making renting better.
General comments As stated in our response to the Housing and Planning Bill 2016, the RLA welcomes the principle of banning orders and the database of criminal landlords. The Association has long argued that those landlords who wilfully breach their legal obligations should face the consequences. That said, we remain concerned that local authorities will not make full use of banning orders given the current low level of enforcement. For those landlords who find themselves subject to an Order or included on the rogue landlord database through a mistake that was unintentional, we believe that there should be a formal route for the landlord to be released from an Order and from being listed on the database. We also believe similar provision should be made for landlords who demonstrate remorse and undertake appropriate education or training. This has been acknowledged in part, whereby although the banning order has no upper limit it does not state that the ban is permanent. This principle should also apply to the criminal landlord database. We have concerns that well-intentioned landlords may fall foul of relevant housing offences, as committing just one offence can lead to being placed on the register, or receiving a banning order. Given that proposed offences extend to such areas as licensing conditions and HMO management, it is important that a process exists for landlords to appeal or that a route exists to be removed from the register, where appropriate. We are pleased that the proposals state that those landlords that have committed a relevant housing offence but received a minimal sanction should not be treated as having a banning order where they have received an absolute or conditional discharge. We understand the reasoning in making banned landlords subject to management orders in respect of their property. However, the take up of management orders to date has been very low and local authorities are reluctant to enter into them. We see no reason why this marked reluctance will change under the banning order regime and we are concerned that the property of banned landlords will be lost to the market, so reducing supply. As per our submission to the Housing and Planning Bill 2016, we would propose banned landlords have their properties made subject to selective licensing under the Housing Act 2004 with a presumption that the banned landlord cannot be a licence holder. We have concerns where the Landlord holds a property portfolio across a number of local authority areas any ban will result from offences relating to one property. However, the proposals suggest that the banning order will apply across all activity. The success of a wider ban will depend on sophisticated information sharing between Local Authorities on the proposed database (if it will be designed to do this) and the presumption that Local Authorities will have the time and resources to manage properties they have acquired, potentially from outside their area as a referral from another authority (where the Landlord does not reside). It is important principle that the local authority must apply to the First Tier Tribunal for a banning order.
We hope that the process of banning orders and the rogue database will be used in the spirit it is intended to root out criminal landlords operating in the PRS. It is important that local authorities retain the confidence of the majority of compliant landlords by using the civil penalty regime sensibly. It should not be used punish minor breaches that would previously have been dealt with informally. Neither should local authorities look to apply Civil Penalties large civil penalties of up to 30,000 where very serious breaches have occurred, as an alternative to prosecution. We do not believe that repeat offending should be dealt with by higher penalties. Repeat offending should be dealt with by full prosecution in the Magistrates Court in which an unlimited fine is available. Many local authorities have enforcement policies relating to prosecution for housing offences. Where an authority has no clear written enforcement policy, setting out how civil penalties should be used and the circumstances in which a prosecution will be more appropriate, then there should be a restriction on the use of civil penalties by that authority. This would increase clarity for landlords, ensure that local authorities comply with the Regulators Code and will prevent enforcement for trivial matters.
Relevant housing offences Question 1: Do you agree that the relevant housing offences described in this document should be regarded as banning order offences unless the offender received an absolute or conditional discharge? Yes. We are pleased to see that a sensible approach has been taken to ensure that those landlords where no further action was taken against them or if they have successfully complied and met certain conditions will be able to continue to operate as opposed to a blanket ban without consideration of past discharge. This is especially important within relevant housing offences as there is the potential for a banning order as a result of a single offence. We agree that criminals operating in the PRS should be banned from rental activities but feel that those Landlords that have demonstrated an intention to fulfil their legal obligations should be permitted to continue to operate, particularly where they have received a very minimal sanction. Question 2: Do you think any of the relevant housing offences described in this document should NOT be regarded as banning order Yes. Question 3: If you answered YES to the previous question, please specify and give reasons We do not object in principle to Gas Safety being included in the relevant housing offences. However, we do have some concerns around including all of Section 36 of the Gas Safety (Installation and Use) Regulations 1998 as a relevant housing offence, especially given that one breach may lead to a banning order. Section 36 of the Gas Safety (Installation and Use) Regulations 1998 covers having yearly Gas Safety Certificates available to the tenant. This is covered already by existing legislation under the Deregulation Act 2015, whereby a Landlord cannot serve a Section 21 notice on a tenant if they do not have a yearly Gas Safety Certificate given to the tenant. Also, Section 36 requires the Landlord to keeps the Gas Safety Certificate for 2 years on record. We hope that in practice Local Authorities would not apply for a banning order on the grounds of an administration oversight. It appears a harsh penalty in relation to this particular offence if the Landlord did have the inspection carried out and can prove that they did so.
Question 4: Do you think any other type of offences for which a local authority has powers to prosecute should be treated as banning order offences? Yes. There are a number of key gaps in the list of housing-related offences. Question 5: If you answered YES to the previous question, please specify which other offences should be treated as banning order offences and give reasons. None of the offences relating to a failure to give information to a tenant or responsible local authority is within the scope of the legislation. Concealing information from a tenant or local authority is a key method used by bad landlords to evade their responsibilities and mask the person who is properly responsible for the property. While these offences can also be committed inadvertently or due to clerical errors the banning order and database regime is sufficiently flexible to permit local authorities to deal with errors of this nature. Therefore, the following offences should also be added to the list of banning order offences: Offences under: section 1, 2, 3, and 7 Landlord & Tenant Act 1985; section 16 Local Government (Miscellaneous Provisions) Act 1976; section 236 & 238 Housing Act 2004. Additionally, the offences listed exclude those relating to unlawful charges for regulated tenancies which are often used to harass tenants. Therefore, offences under Part IX, Rent Act 1977 should be included. Immigration Offences Question 6: Do you agree that letting to someone disqualified from renting because of their immigration status, resulting in an offence under Part 3 of the Immigration Act, should be regarded as a banning order offence? Yes, this is the correct approach if a Landlord is found to be deliberately exploiting and housing persons disqualified from renting housing as a result of their immigration status. However, it is important that the local authority considers that landlords have the right to a statutory defence (Immigration Act 2016) if they have received a notice from the Home Office informing them that their occupier is disqualified. If the Landlord is taking reasonable steps to remove an occupier from their property and has performed the right to rent checks on time it would not be fair for a banning order to be applied for until the matter is resolved under existing legislation.
Also, we would expect that where a landlord has been presented with forged documents then under the Immigration Act 2016, provided that those forgeries were not obvious, a landlord will be protected because they would not necessarily have known that those persons did not have a Right to Rent. Therefore, we would hope that this existing legislation would be applied before local authorities seek banning orders for landlords at risk of committing an Immigration Offence under the Housing and Planning Act 2016. Serious criminal offences Question 7: Do you agree that any offence involving fraud under the Fraud Act 2006, and for which the offender was sentenced in the Crown Court, should be regarded as a banning order offence? Yes. However, we would like to be sure that the local authority would examine cases of fraud appropriately and banning orders used for the worst offenders who have received substantial sentences. Also, it would be beneficial to have more information around what happens once the person found guilty of fraud has served a period of rehabilitation. If they have shown intent to change, paid back what they owe if applicable, and have a clear record for a period of time, is it fair to assume the local authority will pursue a banning order against them because of their record? Fraud under the 2006 Act is wide ranging and there could be a scale of offences shown that could be considered before applying for a banning order. It must also be noted that local authorities can use the Fit and Proper person test to prevent a bankrupt or insolvent person from obtaining a licence and that should be used as a preference to a banning order to reduce the risk caused by bad landlords in relation to vulnerable tenants. Question 8: Do you agree that an offence for which the offender was sentenced in the Crown Court and which involves the production, possession or supply of all classes of illegal drugs (including poisons) and/or managing premises where drug dealing and/or production takes place, should be regarded as a banning order offence? Yes, so long as the offender was found guilty in the Crown Court and it was not the case that the property has been shut down by the local authority without clear evidence that the Landlord was directly involved in the offence. Landlords are frequently victims themselves of criminals targeting their properties for the cultivation of illegal substances.
Question 9: Do you agree that any offence under Schedule 15 of the Criminal Justice Act 2003 (specified violent and sexual offences) should be regarded as a banning order offence? Yes. Question 10: Do you think any of the serious criminal offences described in this document should not be regarded as banning offences? No. Question 11: If you answered YES to the previous question, please specify which offences should not be regarded as banning order offences and give reasons N/A Question 12: Do you agree that an offence for which the offender was sentenced in the Crown Court should be regarded as a banning order offence where it was committed against, or in conjunction with, any person who was residing at the property owned by the offender, other than a person associated with the offender? No. This is an excessively-wide criteria which has little to do with the suitability of a person as a landlord and relates to more general offences which are loosely connected with an occupier but without providing any useful commentary on an individual s suitability as a landlord. Question 13: Do you agree that a link should be maintained between the property and the offence when determining what should constitute a banning order offence? In theory, yes. However, in practical terms this might present some difficulties when local authorities are expected to undertake a management order on the property. The proposal paper makes clear that banning orders are intended to be punitive and that where somebody is subject to a banning order they will not be able to earn income from renting out housing or engaging in property management work. Our concern lies where the Landlord has more than one property across multiple local authority areas, or even different parts of the UK including Scotland and Wales. The ban will relate to the offending property initially reported, however the proposals suggest that the banning order will
apply across all renting/management activity. The chances of this working successfully are dependent on sophisticated information sharing between local authorities on the proposed database (if it will be designed to do this) and the presumption that local authorities will have the time and resources to manage properties they have acquired, potentially from outside their area as a referral from another authority (where the Landlord does not reside). Additionally, as we highlighted in our previous submission to the Tackling Rogue Landlords and improving the Private Rental Sector consultation, local authorities already have considerable powers to take over management of property where a person has been convicted of an HMO licensing offence and there is no prospect of the property being licensed. In practice the current power to take over management is used rarely by local authorities as they tend not to understand the power well and do not have the resources to deal with the management of property. There is no evidence to suggest that a new power to take over management of property of blacklisted landlords will be used any more enthusiastically. Again, we would suggest that the transfer of management to a Registered Provider or appropriate agent could be considered. Another option might be that banned landlords have their properties made subject to selective licensing under the Housing Act 2004 with a presumption that the banned landlord cannot be a licence holder. This would allow such landlords to re-let their property provided they presented a suitable alternative person, ideally a letting agent, to be the holder of the licence. Conditions could then be applied to the licence to ensure that the banned landlord had no involvement in the day to day operation of the property. Management orders could be retained as an option where no suitable person is put forward as a licence holder. This would mean that the operation of the property of banned landlords would stay within the private sector at the banned landlord s immediate cost but with oversight through the licensing regime rather than local authorities being forced to bear that cost and workload and having to recover it from the landlord at a later date. Question 14: Do you have any further comments about banning order offences? The RLA agrees that changes are needed around banning orders and the proposed database of rogue landlords to help incentivise improvements. As we previously stated in our response to the Housing and Planning Bill 2016, the RLA welcomes the principle of banning orders and the database of rogue landlords. The Association has long argued that those landlords who wilfully breach their legal obligations should face the consequences. We hope that the process of banning orders and the rogue database will be used in the spirit it is intended and root out the criminal landlords that are operating in the PRS. We also hope that local authorities will consider offences on a case by case basis and avoid the temptation to either apply civil penalties for minor breaches that previously would have seen informal action, or used for very serious offences an alternative to prosecution. We do not believe that repeat offending should be dealt with by higher penalties. Repeat offending should be dealt with by full prosecution in the Magistrates Court in which an unlimited fine is available.
Many local authorities have enforcement policies relating to prosecution for housing offences. Where an authority has no clear written enforcement policy, setting out how civil penalties should be used and the circumstances in which a prosecution will be more appropriate, then there should be a restriction on the use of civil penalties by that authority. This would increase clarity for landlords, ensure that local authorities comply with the Regulators Code and will prevent enforcement for trivial matters. If you have any questions regarding this submission please contact Senior Policy Officer, Natalie Williamson Natalie.williamson@rla.org.uk. Kind Regards Natalie Williamson Residential Landlords Association 1 Roebuck Lane, Sale, Manchester, M33 7SY Tel : 0161 905 0884