​Is there any point to selective licence schemes without inspections?

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Arguably, the April 2022 report into regulation of the private rented sector by the House of Commons public accounts committee (PAC) didn’t really tell us anything that we didn’t already know. The committee came up with 6 recommendations for the Government some of which related to selective licensing and property inspections. However, going back 16 years one can still find a 2006 “Best Practice Guide”, published by housing charity Shelter, which highlights (more as a premonition than a conclusion) some of the same issues for local authorities that are touched upon in the PAC report - issues which have also been covered in previous reports by the Government itself as well as the Chartered Institute of Environmental Health and the National Audit Office amongst others.

But, underlying the complex web of legislation, rights, and duties governing the private rented sector and the actual practice and behaviour of the different parties operating in it, is the fundamental issue of data - or rather the lack of it.

A consistent refrain echoed by different commentators is that many local authorities, large and small, often have incomplete knowledge of the private rented sector in their area. They don’t necessarily know how many privately rented properties there are (and this can lead to significant budgetary and staffing resource consequences); they have incomplete intelligence on the condition of the private rented stock in their area and, without a selective licence scheme with an associated inspection programme in place they rely on tenants coming forward and making formal complaints about a property or a landlord in order to trigger enforcement action - starting with a resource consuming full Housing Act HHSRS property inspection even if this culminates simply in “informal” action against an offending landlord.

The PAC report references this example, provided by Derby Council, of the problem of poor data: the council found “that [the] condition of privately rented homes in the more deprived areas of Derby is significantly worse than shown in the Department’s (DLUHC) English Housing Survey” - so, effectively, the bible of housing stock condition in England contains poorer data/information on PRS stock than a well designed licence scheme with compliance inspections embedded could provide.

The financial strains on local authorities as regulators have meant that their administrative burdens have been both underestimated and overwhelming at the same time. This is now well understood but - in the context of a major Government legislative reform agenda for the PRS - if, as it appears, there’s a sort of PRS data black hole then what will be the point of the new legislation if it can’t be enforced? It likely will be unenforceable without it being informed by the data/intelligence provided by inspections.

If landlords are to be held accountable to consumers under new legislation then local authorities will also need to be accountable in some way for taking action.

Often, survey requests sent out to councils have a relatively poor voluntary response rate whereas it probably should be the case that every local authority provides information on housing complaints, inspections (property conditions) and enforcement activity.

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