Housing in Scotland

Tenants ‘sidelined’ as landlords lobby for extra Covid-19 subsidy

Landlord lobbyists have pressured Scottish Government officials for further coronavirus subsidies in regular meetings with civil servants, documents show.

The comments appear in emails and meeting notes from the Scottish Government’s Private Rented Sector (PRS) Resilience Group. The Ferret is publishing the full set of released documents today.

The group has met fortnightly since April and was set-up by Scottish Government officials to address issues affecting the privately rented housing sector in Scotland during the coronavirus pandemic.

Members of the group include the Scottish Association of Landlords (SAL), ARLA Propertymark, a trade body representing letting agents , the Scottish Association of Local Authority Chief Housing Officers, Shelter Scotland and Citizens Advice Scotland (CAS).

Records of meetings and emails sent direct to civil servants by group members show that organisations representing property owners have repeatedly called for the Scottish Government to provide further coronavirus subsidies to the sector.

SAL claim landlords are at risk of “falling through the cracks” of existing support schemes, whilst a ARLA Propertymark representative also described calls to extend emergency laws that protect tenants from eviction as an “emotional” response to a problem that “no-one can prove actually exists.”

Critics described the demands from landlord lobby groups as “callous” and argued that existing subsidised loan schemes for landlords act simply to line “the pockets of landlords at the expense of the taxpayer.”

Subsidised loans for empty homes

On 5 May the Scottish Government began accepting applications for a dedicated Covid-19  interest free loan scheme for private landlords with fewer than five rental properties.

The loan can fund lost rental income from a single property for up to six months, but only if the landlord can show the loss is a result of the impact of the Covid-19 outbreak.

Notes from a meeting on held on 27 May suggest officials expected hundreds of Scottish landlords to apply to the scheme. Government workers reported to the group members that more than 200 loan applications had been initiated within the first weeks of the subsidy scheme opening.

But earlier meeting notes show that property industry lobby groups called on civil servants to consider lifting the limitations on the scheme. They hoped to open the scheme up so that private landlords with more than five rental properties could also benefit.

Although the scheme currently remains limited to landlords with five our fewer properties, action notes show that civil servants responded to the call by offering a dedicated email for landlords who did not qualify for the existing scheme so they could set-out their circumstances.

This, civil servants noted, would help the Scottish Government “build up a picture of need in the sector.”

The Scottish Association of Landlords also says on its website that it persuaded civil servants to raise the limits on individual loans to cover 100 per cent of Covid-19 rent losses – when the initial proposals would have covered 80 per cent of losses.

More recent figures supplied by the Scottish Government indicate that 30 subsidised loan offers have so far been made to landlords. Just nine of the approved loans cover properties that are occupied.

According to tenants union, Living Rent, the figures show that the landlord subsidy scheme is of little practical help to tenants.

Sonja Coquelin, a spokesperson for the group, pointed out that landlords were already able to apply for mortgage holidays, as well as the additional option of a Scottish Government interest free loans.

She said: “Landlords are not falling through the cracks. Landlords have had the option of mortgage holidays and £5 million in loans set aside to support them. Tenants have had no extra help despite continued pleas from both tenants and politicians.

“Likewise, the knowledge that the majority of applications for loans are for properties with no-one in them rubbishes the notion that the loan was supposed to ‘trickle-down’ and help tenants.

“From the looks of it, it is just a handout that lines the pockets of landlords at the expense of the taxpayer. It is a slap in the face to tenants struggling to pay rent and to any notion of fairness in our housing system.”

Property sector lobbyists tabled further proposals in support of allowing more private rentals to qualify for special council tax discounts and raised concerns that some letting agents may not be eligble for small business grants worth thousands of pounds.

A briefing note circulated to the group outlines other concessions won by landlords groups on council tax payments. These let landlords defer payments or avoid them altogether during the pandemic where properties are empty.

An “emotional” response

The records show that both the housing charity, Shelter, and Citizen’s Advice Scotland, have been warning officials of the potential for a large rise in evictions, due to a build-up of arrears and the end of emergency measures that have helped to keep people in jobs and prevent evictions so far.

More recently a coalition of 10 charities have written an open letter to the Housing Minister urging the government to extend emergency protections for private sector tenants.

The Scottish Government faced criticism after it voted with the Scottish Conservatives against proposals by the Scottish Greens to amend emergency coronavirus laws that would have introduced more measures to protect tenants from eviction.

Rejected proposals included a plan for a two-year rent freeze for private tenants, a write-off of rent arrears built up because of hardship linked to Covid-19, and rule changes to prevent landlords using Covid-19 rent arrears as grounds for eviction.

The PRS resilience group documents show that civil servants have been considering proposals to extend emergency measures that currently restrict the ability of private landlords to evict tenants in financial difficulties because of the Coronavirus outbreak.

But in email correspondence dated May 4, a representative of ARLA Propertymark told civil servants that proposals that would extend emergency measures designed to stop landlords from evicting tenants with arrears were, “an emotional response to a perceived problem that nobody can actually prove exists.”

“Announcing any continuation of the measures has the potential to alienate landlords and future investors particularly,” they added.

Thirty-thousand extra people were unemployed in Scotland after the first five weeks of the Covid-19 lockdown. To date, the Scottish Government has not announced an extension of the emergency measures.

Meanwhile, The Ferret has previously reported that both Shelter and CAS have highlighted concerns over a lack of enforcement of the current measures designed to protect tenants from eviction during the pandemic.

Police urged to tackle landlords breaking lockdown laws

‘Sidelining’ tenants

The Scottish Government set up the PRS Resilience Group on 2 April but did not immediately publicise the move. The group first came to public attention after Scottish Green housing spokesperson, Andy Wightman MSP, asked a question in the Scottish Parliament on 2 June.

The MSP took to Twitter to question why a consultative group on the private rented sector had no organisations on it representing tenants.

Subsequently, a meeting note shows that members of the PRS Resilience Group discussed the criticism on 22 June and, “agreed that CAS and Shelter represent tenants.”

After seeing the meeting minutes, Wightman said he found it “shocking” that the PRS Resilience group had discussed calls for better representation of tenants on the group but was “content” that it was not needed. “It is unbelievable that the Scottish Government established an advisory group on private renting with no tenant voices represented,” he said.

“While this group is questioning whether fears about evictions even exist, tenants face the very real prospect of losing their homes. It is time for the Scottish Government to stand up for the human right to a home and protect those who are at risk of losing theirs,” Wightman added.

“They cannot do that if they continue to only listen to the advice of the private landlords lobby, who claim to represent tenants but do not in fact have any mandate to do so.”

Coquelin echoed Wightman’s concerns. She said: “For all the good work they do providing advice to tenants, Shelter and CAS do not ‘represent’ tenants. Only tenant organisations run for and by tenants can legitimately claim to represent tenants.

“By sidelining genuine tenant organisations, the resiliency group is ignoring substantive critiques of group’s policies while claiming to have heard all sides. This, she argued, tilted “the power imbalance towards landlords.”

However, a Scottish Government spokesperson insisted that Shelter Scotland and Citizens Advice Scotland did represent tenants sufficiently. They said: “Both Citizens Advice Scotland and Shelter Scotland represent tenants’ voices on the PRS Resilience Group.

“The meetings provide a forum for open discussion on the issues and challenges currently facing the sector, helping to inform action taken to support renters during the ongoing Covid-19 pandemic.

“Selecting an individual’s comments and purporting that to be the view of the wider resilience group is both unfair and inaccurate.

“Since it first met in April, the main focus of the group’s work has been supporting tenants during the Covid-19 pandemic and, in particular, sustaining tenancies. This will continue to be the group’s focus moving forward.”

After The Ferret made enquiries, civil servants also pledged to publish the minutes of the meetings in full on the Scottish Government website.

Daryl McIntosh, ARLA Propertymark strategic development manager for Scotland said: “We of course recognise the difficulties many parts of the private rented sector face right now. This is why throughout Covid-19 we have supported many of the measures introduced by the Scottish Government and ARLA Propertymark has provided agents with information and resources to help support tenants.

“We have encouraged agents to show flexibility and understanding when working with tenants and landlords, particularly when it comes to rent payments.

“ARLA Propertymark believes that in order to ensure that decisions are made in the best interests of the sector as a whole we must have evidence based policy and outcomes that support landlords and protect tenants.”

CAS spokesperson Mhoraig Green said: “The Citizens Advice network in Scotland deals with tens of thousands of housing issues every year from across the country and it is that evidence base that allows us to offer insight on how policy should be improved.

“We’ve seen growing demand for housing advice during the pandemic and have consistently made the case for the reform of housing policy to better represent the interests of tenants. CAS will continue to make the case for housing reform that is in the interests of the people who come us for help.”

A Shelter Scotland spokesperson said: “Shelter Scotland is committed to standing up for the rights of tenants anywhere we can, including through the Private Rented Sector Resilience Group. Tenants’ voices are always welcome.”

The Scottish Association of Landlords was asked to comment for this story but did not respond.

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Photo credit: Tom Parnell | CC | https://flic.kr/p/8tYRbs

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