My Lords, I thank the noble Baroness, Lady Scott, and the noble Lords, Lord Willetts, Lord Evans, Lord Young—albeit that his amendment was very ably proposed by the noble Lord, Lord Willetts—and the noble Lord, Lord Best, for their amendments, and the noble Baronesses, Lady Wolf and Lady Warwick, and the noble Lords, Lord Shipley and Lord Fuller, for their comments during this debate. All these amendments seek to revise or introduce provisions in the Bill related to students, and I say well done to King’s College for having its team approach to this Bill in the Chamber today.
We do not expect that removing fixed terms will have a destabilising effect on the student rental market. New possession ground 4A will give landlords confidence that they will be able to regain their property to move in other students in line with the academic year. If tenants leave a tenancy early, the landlords will be able to find new tenants to take their place. The end of a fixed term does not automatically give the landlord possession. Landlords still have to follow the correct possession procedure. If fixed terms remained in the future, landlords would still need to follow the correct possession procedure.
Amendment 7 would allow fixed-term assured tenancies if the tenant was a student at the beginning of the tenancy. It would not be either right or fair for students to have less flexibility than other tenants just because of their educational status. Students who drop out of university could be required to pay rent for the rest of the fixed term, which could potentially reach thousands of pounds. All renters, including students, should have access to the benefits provided by the Bill.
The opportunity referred to by the noble Lord, Lord Willetts, is, as he rightly said, the meeting between housing and higher education. As someone who undertook a degree as a mature student with three children and a full-time job, I say that we simply must not assume that all students are the same. This is the opposite of elitism. It is ensuring that all student circumstances are taken into account and that those who need the greater stability that assured tenancies offer can have that option.
We have introduced a new possession ground to allow the cyclical nature of the student market to continue and provide landlords with confidence. This strikes the right balance and, in our opinion, is the much better approach. Referring to the question from the noble Baroness, Lady Scott, about tenancies in halls, the Government intend that any new purpose-built student accommodation tenancies created after transition will be exempted from the assured tenancy system following transition, as long as the landlord is signed up to a government-approved code of conduct. I hope that answers her question. For these, reasons I ask the noble Baroness to withdraw her amendment.
Amendment 40 seeks to expand ground 4A, which allows student tenants living in HMOs to be evicted in line with the academic year. It would allow students living in self-contained accommodation—one-bedroom and two-bedroom properties for example—to be evicted each year, and it seeks to address the concerns of some noble Lords that the existing scope of ground 4A does not cover all student properties. We have thought very carefully about the design of ground 4A. Limiting it to HMOs captures the bulk of typical students—that is, groups living in a house share. Meanwhile, students who need more security of tenure, such as single parents living with their children, postgraduate couples living together who have put down roots in an area, or families containing students, will be protected.
The core principle of the Bill is that tenants should have more security in their homes, and we think it is right that these groups should not be exposed to potential eviction using ground 4A. Self-contained one-bedroom and two-bedroom homes are also easier to let to non-students than student HMOs are, so, if a landlord cannot gain possession in line with the academic year and the tenants leave in the middle of the next one, the landlord is highly likely to be able to let the property out to non-student tenants. The noble Baroness, Lady Wolf, referred to student accommodation in London, and I imagine that there are other places where costs are prohibitive, such as Cambridge and Oxford. However, the Government’s action to increase supply is critical here. It is only by increasing supply that we will be able to stabilise rents. I do not think that the action proposed in the amendment would have that effect.
Amendments 41 and 45, taken together, seek to remove the requirement for a landlord intending to rely on ground 4A to give prior written notice to the tenants. This would mean that landlords renting to students in HMOs who satisfy the student test would be able to rely on ground 4A without giving tenants written prior notice, before the tenancy was entered into, of their wish to be able to recover possession using ground 4A. We cannot accept these amendments. The core aim of the Bill is to enhance the security of tenants in the private rented sector, including students. The prior notice requirement in ground 4A is key to this. If tenants are liable to be evicted through no fault of their own simply because of their student status, they must be informed of this reduced security before entering into a tenancy. Amendment 45 is purely consequential on Amendment 41, removing a later reference to the paragraph that Amendment 41 removes, and I therefore ask the noble Baroness, Lady Scott, not to press these amendments.
Amendment 42 tabled by the noble Lord, Lord Evans, seeks to allow the use of ground 4A in student tenancies agreed up to nine months in advance, rather than the six months in advance limitation that is currently in the Bill. Noble Lords will be aware that we introduced this measure in response to engagement with stakeholders and Members in the other place—I hope that answers the noble Lord’s question about consultation. They were concerned that students are often rushed into important decisions around accommodation before they have formed friendships or had time to properly judge a property’s condition or location.
This measure was intended to act as a strong disincentive to landlords who seek to sign students up to contracts early in the academic year. Increasing the time limit to nine months will push early sign-ups to too early in the academic year—before Christmas for a tenancy beginning in July. This entirely undermines the point of the deterrent. Six months strikes the right balance, allowing those who want to to agree a tenancy well in advance before exam season, but not too early before students have formed firm friendship groups, for instance.
Amendment 43, also tabled by the noble Lord, Lord Evans, goes even further and would extend the time limit to 12 months. For the reasons I have highlighted previously, we are of the view that six months is the right balance. Very few students sign contracts more than a year in advance, and this amendment would essentially destroy the entire premise of the provision, which is designed to prevent students being pressured into contracts too early in the academic year. For these reasons, I ask the noble Lord not to move these amendments.
Amendment 44 seeks to remove the restriction on the use of ground 4A to the summer of the traditional academic year. This would mean that students on a traditional term date, who are the majority, could be evicted in the middle of the academic year through no fault of their own. We recognise that the intent of the amendment is to ensure properties are available for students starting their courses on non-traditional dates, such as in January. However, we are content that supply will be available for these groups as previous groups on the same cycle would leave at the end of their courses, so there will be students leaving in January and students starting could take those properties. It would be wrong to expose all students to eviction in the middle of their academic year simply because, for example, a landlord found a group with different term dates who were willing to pay more. For these reasons, I ask the noble Baroness not to move this amendment.
Amendment 46 would allow landlords to evict approved English apprentices, as defined in the Apprenticeships, Skills, Children and Learning Act 2009, using the student possession ground 4A, provided all conditions for relying on that ground were met. Ground 4A was designed to capture the most typical students, such as those living in groups and away from home, on an annual letting cycle. Apprentices tend not to live that way, as they earn an income and are much more likely to live in a home they expect to stay in. I am therefore of the view that apprentices should enjoy the same security of tenure as other tenants and not fall under the scope of possession ground 4A. For that reason, I ask that this amendment not be moved.
Amendment 189 seeks to remove the private rented student tenancies from the assured tenancy system. I know there has been a lot of concern and debate over this at Second Reading and today. It would achieve this by allowing the Secretary of State to create or approve a code of conduct for student landlords and then allow landlords signed up to the code to offer tenancies that are completely removed from the assured tenancy system. This is the wrong approach: it would be wrong for students renting off-street housing, often indistinguishable from the property next door, to have an entirely different set of rights from their neighbours.
I understand that the noble Lord, Lord Young, is seeking to create consistency between private student landlords and landlords of purpose-built student accommodation, which we will exempt from the assured system through regulations. However, these are very different types of accommodation. Purpose-built student accommodation can often be rented only to students due to the nature of the property, and to be exempted in the future a private PBSA landlord will need to be signed up to the government-approved code of management practice. This code is managed by Unipol, an established organisation.
Other private rented accommodation let to students is significantly more diverse and often indistinguishable from other houses in the area. It would be wrong to remove the protections of the assured system. Other students renting privately should not be locked into fixed-term contracts or open to eviction without good reason. In addition, there currently exists no government-approved code that is relevant to such accommodation. Developing this would take a great deal of time and is likely to delay implementation of the Bill. We recognise that the student market has a cyclical business model and have therefore introduced ground 4A, allowing landlords to evict full-time students from HMOs in order to house incoming groups in line with the academic year. Ground 4A addresses the issues that the various amendments tabled by the noble Lord are, in effect, seeking to address. As such, I ask him not to move this amendment.
Amendment 266 seeks to exempt private purpose-built student accommodation from discretionary licensing where the landlord has signed up to a code of practice for managing such accommodation. Although codes of practice offer students assurance that a good standard of management is being met by their landlords, they are not tailored to addressing local issues in the way that licence conditions under licensing schemes are. Membership of the codes is voluntary, and members have an incentive to comply to ensure they can continue to present an attractive offer to students. While a failure to adhere to code standards can result in a landlord being removed from a code, licensing allows for stronger action to be taken where necessary. For example, local authorities can issue a financial penalty where there has been a serious breach of licence conditions.
We recognise that licensing can place a greater burden on landlords with large portfolios, such as those operating private purpose-built student accommodation. That is why local authorities already have discretion to streamline licence application processes and fees for such landlords. We trust local authorities to take a proportionate approach and work together with code operators and providers of these types of accommodation to make sure that licensing schemes remain focused on tackling the issues they were designed to address. I therefore ask the noble Lord, Lord Best, not to move his amendment.
I turn to government Amendments 47, 188 and 202. Currently, university-managed accommodation is exempt from the assured tenancy system, while private purpose-built student accommodation usually is not. Government Amendments 47, 188 and 202 would allow private PBSA to be subject to the same exemption, recognising that the two share many similarities. Students do not move into their accommodation expecting long-term residence, and it is right to ensure that this accommodation is available to new cohorts of students each year.
We intend that the exemption will apply only to private PBSA that is a member of the government-approved code of practice, which sets vigorous standards for the management of property and the relationship between managers and student tenants. If their membership of the code ends for any reason, so does their exemption. There will be no delay in requiring them to provide assured tenancies to new tenants. Although there is an existing power in the Housing Act 1988 to exempt PBSA landlords, it would have required government to frequently update secondary legislation with a list of landlords, causing a duplication of work between code administrators and officials and a lag in the link between code membership and exemption status.
We are also proposing an amendment to an existing power in the Housing Act 2004 that clarifies that educational establishments exempt from HMO licensing can be specified by reference to code membership and that the power can be exercised in the same way for private purpose-built student accommodation in future. The amendment also allows the scope of an exemption to be narrowed to certain groups of building, or building manager, within the membership if required.