 firstly meeting in 2015 of the Infrastructure & Capital Investment Committee. Everyone present is reminded to switch off mobile phones as they affect the broadcasting system. As meeting papers are provided in digital format, you may see tablets being used during the meeting. Apologies have been received from Si protagon Mcman. The agenda item 1 is for the committee to take evidence from the scottish government the Scottish Government bill team responsible for the private housing tenancies Scotland bill. Can I welcome Barry Stalker, private housing tenancies Scotland bill team leader, and Kirstine Simony Lefevere, solicitor at the Scottish Government? Can I invite Mr Stalker to make an opening statement? Thank you, convener. The Scottish Government set out its vision for the private renties sector in its strategy published in 2013. That is for a private renties sector that provides good quality homes and high management standards, inspires consumer confidence and encourages growth through attracting increased investment. This bill will contribute to realising this vision by introducing a new private residential tenancy that will improve security of tenants and provide appropriate safeguards for landlords, lenders and investors. This policy has been developed from the work of the tenancy review group, which ministers established to examine the current tenancy regime. The group reported to ministers in May 2014 and recommended that the short-assured and assured tenancy be replaced by a new private tenancy that covers all future PRS lets. The ability for a landlord to end a tenancy on a specified date, calmly known as a no fault ground, is not included in the bill. Instead, landlords will be able to recover possession of the property using new modernised grounds. Those are to cover all the reasonable circumstances that a landlord would need. Twelve of the sixteen grounds are mandatory. Improved security for tenants will mean that they can no longer be evicted without a reason specified in legislation. That will enable tenants to set their rights where this is necessary, such as with regard to property condition, without the concern of possible arbitrary eviction. That will also help tenants to feel more settled in their home and in their communities. We know that, currently, it is tenants that are most likely to end a tenancy, and where a tenant does serve notice to quit, most tenants leave at that point without the need for the landlord to go to court. We expect this pattern to broadly continue. Under the new tenancy, should a tenant contest a notice to leave, the landlord can apply to the first year's tribunal to recover possession. The tribunal will provide an accessible, specialist form of redress for both tenants and landlords. As the new tenancy is effectively an open-ended tenancy, the bill also makes provision for rents. Tenants will be protected against excessive rent increases that take their rent to beyond the market rate. A judication will be provided by the rent service Scotland with a route of appeal to the first year's tribunal. The bill also provides for rent predictability, where rent increases can only take place once in a 12-month period with three months' notice. That will help tenants plan their finances for any future rent increases. Where rents in a local area have risen excessively, and this is having a detrimental effect on tenants and housing, local authorities will be able to apply to ministers to designate a rent pressure zone. Before making the decision, ministers will need to consult with both landlords and tenants. Any rent cap will apply to sitting tenants, be for a minimum of CPI plus 1 per cent, and be for a period of up to five years. The Scottish Government has consulted extensively on the bill, including undertaking two public consultations since October 2014. That led to 2,500 and 7,500 responses respectively. We have listened to all stakeholders and sought to understand their perspective on what was being proposed. That has informed the policy development and, for example, the number of grounds for possession has increased from 8 to 16. We have also undertaken impact assessments, including on business, children's rights and wellbeing and equalities. Those found that improving security of tenure could particularly benefit some vulnerable groups who may have previously found it difficult to find secure, long-term accommodation in the PRS. The bill has the potential to advance the realisation of children's rights and wellbeing. While it is recognised that there may be some reduction in flexibility for landlords in managing their properties compared to the current system, that will not significantly affect the most important driver to get a return on investment. Landlords will still be able to charge market rents, to recover possession, for example, if tenants do not pay the rent or to sell their property, and lenders will still be able to recover possession in the event of mortgage default. Overall, ministers have sought to stric a fair balance in what is being proposed in the bill and to ensure that the new tenant system will support a well-functioning sector that is fit for modern PRS and works for tenants and landlords. Perhaps I could kick off by asking what are the key differences between the current short assured tenancy framework and the proposed new tenancy? The key differences between the current assured tenancy framework and the new tenancy framework is clear and simple. One of the issues that the review group found with the assured tenancy system is that it has come with some complex and ambiguous, and it is quite difficult for many people to really understand that there are lots of pre-notice requirements. It is quite easy for a landlord who thinks that they have a short assured tenancy to, in fact, have an assured tenancy if they have not served all the notices in the right order and so on. One of the key considerations from the review group was to have the new tenancy that was simpler and clearer to use so that everybody understood the rights and obligations. That is the first key difference. The second one, as I outlined in my opening statement, is that this rebalances the relationship between tenants and landlords. Under the assured tenancy system, landlords who use a short assured tenancy are able to, if they choose, end the tenancy at the end date on the no-fault ground. That is not something that has been included in the new tenancy. In effect, landlords will need a reason, and all reasonable circumstances have been included in the grounds. That is the second difference. Finally, the assured tenancy system is developed in a different age in the late 1980s. Actually, there is a lot of evidence that suggests that the short assured tenancy was not intended to be used commonly, but, in practice, it has become the most common tenancy to use. What the new tenancy provides is a tenancy that works for the sector that the PRS has become today. It is a modern tenancy for the private sector, which has grown substantially over recent years and includes a larger number of tenants that are unique to settle in the longer term, as well as those that continue to look for the flexibility that the PRS is always provided for. You talked about rebalancing the relationship between tenants and landlords. Is it the Government's view, then, that the current short assured tenancy arrangements and framework disadvantages the tenant? The Government's view is that it can. One of the key benefits that we are looking to achieve from the new tenancy is to help tenants to better assert their rights without the potential concern around receiving eviction for no specified reason. There are many good landlords in the PRS, and the PRS plays a really important part in delivering housing supply across Scotland, but we know that there are still issues around quality in the sector, particularly around property condition. Having a new tenancy should help tenants to feel more at home and more settled in the communities and help them to speak to the landlord and ask them to comply with their obligations. If necessary, they can use the rights that they have to go to the House of Tribunals. Can I ask you about consultation? You mentioned a high level of responses up to 7,500 that there had been to the consultation process, and you talked about the impact assessments that have been carried out. Are you satisfied that the consultation process has been sufficiently rigorous and robust to gather all the views of the people who are going to be affected by the legislation? Can you tell us what steps you took to take the temperature of the sector and tenants more widely? The short answer to your question is yes. As an official, I am satisfied. We undertook two public consultations. The first consultation was commissioned by focus groups to reach out to tenants and landlords who may not necessarily always participate in consultations. We undertook two public consultations. As officials, we have always been available to engage with stakeholders, whether it be at public events or be open to discuss with them any of the issues or concerns that they may have with what they are proposing, or the opportunities that they see for the new tenancy. We have always done that as well. If you look at the trajectory of where we have gone, there have been changes that we have made to what we eventually put in the bill. I mentioned earlier about the number of grounds increases. The balance is that landlords need to feel confident that the grounds cover all reasonable circumstances. We went from 8 to 16. For example, we included a ground that landlords have long been calling for on abandonment. We have listened to landlords, and we have listened to tenants' representatives' groups as well. We have done all that we can, and we will continue to listen to what stakeholders think about the proposals that we have put in the bill. Can you explain the bill's provisions regarding the statutory terms of the tenancy as set out in part 2 of the bill and the tenancy information requirements, similar to the current tenant information pack provisions that have been set out in part 3 of the bill? Tell us perhaps what benefits those provisions might provide to tenants and landlords. I will start. I might ask my colleague from the Scottish Government Legal Director to contribute as well. In terms of the tenancy terms, what it is is a new tenancy, so it is not building on the 80 act, it is not building on the sure tenancy, it is a new tenancy, it is a new statutory tenancy and it is an open-ended tenancy. Part 2 sets out the statutory terms of the new tenancy. Those are the key terms that will apply to all the tenancies under the new regime. Part 3 looks at the information that needs to be required. Currently, landlords are required to provide mandatory requirements to tenants through the tenancy information pack. We are looking to continue the requirement for landlords to provide key information to tenants through the new tenancy system, because what we want to achieve is that we want the new tenancy to be clear for everyone to understand what it means for them and for their rights and responsibilities. In guidance, we will be issuing a model tenancy agreement and that will contain the statutory terms that are in schedule 2 and discretionary terms that may be used by landlords. Now, where, for example, landlords and tenants agree more generous rights of access notice rather than 40 hours of mail for three days notice, then there might be a possibility for the statutory terms to be overridden. So, there will be an ability in the regulations for landlords and tenants to agree slightly more generous terms to override the statutory terms once we make the regulations. It also allows further statutory terms to be added to the list should that be needed in the future. The information that landlords have to give to tenants would include the written terms of the tenancy and any other information that needs to be passed over in relation to condition of the property, etc. We are going to bring forward regulations that will settle that out quite clearly, together with the method by which the information may be given, perhaps on paper or electronically or by text. There may be a number of ways in which landlords and tenants are able to communicate with each other with this new simplified tenancy arrangement. Can I just ask for clarification on the model tenancy agreement that will be contained in the regulations? No, it will not be as such. It will give the statutory terms and there will be guidance that will give other discretionary terms and there will be a framework that people will be able to use. Do you have any indication at this stage of what the timescales will be on the publication of those? On the model tenancy agreement, as Christine said, we need to develop through second legislation. We look to hit the ground running quickly on that and we also need to have it completed in time for the new tenancy commencing, which we are looking to do by late 2017. The bill proposes an initial tenancy period of six months. Can you explain a wee bit about why that six-month period was chosen? For instance, was consideration given to a longer period for that initial tenancy period? The concept behind the initial tenancy period initially comes from the review group. That is one of the things that they considered. In summary, because the short tenancy period tends to work in a six-monthly bloc—that is the building blocks of how things work at the moment—there was a view that it would be good to try to have something that would carry that over to help the sector to transfer from the current tenancy to the new one. It is intended to provide tenants and landlords with assurance. What the initial period will do is, for a tenant, it will limit the grounds that a landlord would be able to seek repossession on. They would not be able to seek repossession on most of the grounds, but from a landlord's perspective, it would mean that a tenant would be tied into staying into that property and paying rent for that specified period of time. If you are a landlord and you are going to put your property into the PRS, then there will be transaction costs involved in doing that. You probably want to have a tenant in the longer term, but for the short term, that is something that landlords would find helpful. Equally, from a tenant's point of view, there needs to be balance. There are a number of grounds such as the landlord intend to sell and they will not be able to do that under the initial tenancy period. That would provide tenants with the reassurance that they would also have a degree of stability over that period. The trick here is that we have tried to do stability and flexibility, and we recognise that the PRS does both. Where a tenant would like a shorter period and the landlord is content with that, then that initial period can be for less than six months. For a landlord to offer, we have set out in the legislation that it has to be for a minimum period of six months. That seems to make sense. Just moving on to the approach that the bill takes towards notices to end a tenancy, there is a different notice period for tenants, a shorter one for tenants than there is for landlords. Can you perhaps explain the reasoning behind that? You are right. In terms of the notice periods, for a tenant, they would be required to give four weeks notice if it is less than six months, so up to that point, four weeks and eight weeks from beyond that. For a landlord, it would be for four weeks if it is before the six months period, and then after that it would be for eight to four days, so basically 12 weeks. I suppose that the easiest is that, when a landlord is recovering possession, it is not their home, but it is their property and they will probably look to re-let it out again. We felt that the timeframe would be sufficient for that, but when a tenant is looking to leave, obviously it is their home they will be leaving, so we thought that they should have a longer period because a tenant would need to be, for example, looking for alternative accommodation. Again, it comes down to balance, but the reason why landlords have a shorter notice period from a tenant is because we felt that landlords would be able to to re-let their property on the market, whereas tenants would need a bit more time to look for alternative accommodation. There is a provision that prevents a tenant from ending a tenancy during the initial period unless it is with prior written agreement with a landlord. What seems to potentially contravene the tenant's common law right to rescind the tenancy for breach of contract? Is there a difficult answer? That ensures that the tenant is tied in for the minimum period of six months. The reason why there is a right of recession for common law tenants is that tenants very often do not have many other remedies other than to end the tenancy when the landlord, for example, does not repair a broken boiler, whereas tenants who are in this sort of statutory tenancy arrangement, whether it is the current assured or the new private residential, have a large number of remedies in other pieces of legislation that ensures that landlords meet repairing standards, etc. We felt that in order to give security to landlords, the tenant should be able to tie themselves in for that period and did not require the right precision because of all the other remedies available. I am not quite sure that I am 100 per cent with you. The tenant will still retain the common law right to rescind agreement in the event of a breach by the landlord? No, the tenant will not have the common law right to simply tend the tenancy, but the tenant will have other rights to ensure that the landlord will comply with all the other requirements of the tenancy and other legislation. It comes down to trying to strike the balance here. By increasing security of tenants, that helps to enable tenants to assert their rights. If you take the example of condition where a landlord has not met their obligations, a tenant should be able to speak to the landlord about that. If they do not do anything about it, they will have a course of redress to the tribunium. In that situation, that is what I think that Custin is referring to. Where a landlord has not met their obligations, it does have a means of redress to ensure that the landlord does. I think that what Custin is saying is that, in other areas, they might not have the same range of redress available. Therefore, perhaps probably the only form of action that they have is to tend agreement, but that is not what we see as a case in the new tenancy. Okay, thank you. Are you confident that the tenant is not losing out in any way by this change? We have done is sought to strike a balance. We mentioned earlier about rebalancing the relationship between tenants and landlords. What that has done is maintaining landlord's confidence in letting out their property, improving tenant's security and improving their position to be able to assert their rights as well as how they feel about their home and how settled they can feel where they stay. Forgive me for being a bit pedantic. I am just going to seek a wee bit further clarification. Perhaps it will assist us if you mentioned the situation of a tenant with a boiler broken down. There is no heating. It is the middle of the winter. The landlord is unable to or refuses to repair the boiler. The tenant at that point cannot end the tenancy but has to go to the tribunal. Given that set of circumstances I have described, are you confident that the tribunal would perhaps be able to take effective action before the tenant froze to death? Sorry to put it in those terms, but I am just trying to get a proper understanding of that. What I will say is that when you are setting out legislation like this, you tend to set it out in the generality. That is a very specific and extreme scenario that nobody would want. On balance, it was felt that this would provide tenants with the ability to assert their rights and to go to a tribunal, which will be an effective place for them to go. Indeed, the tribunal is something that not just tenants but landlords have long called for and been supportive of as a form of redress that is more accessible and also provides specialist redress on housing in a way that was less so in the more general sense when under the current system we are, we need to go to court. I have one more question, convener. I think to ask, but I am very happy for you. On the subject, have you looked at the evidence of how tenants use the common law right at the moment and to what extent they use the referred cases to the tribunal, because there could be an argument that is much easier for tenants to use the common law rights than it is to access a tribunal, in which case that would be a disadvantage to tenants? Could you perhaps tell us what evidence you have looked at in this area? In terms of the tribunals, as you are probably aware, the tribunals are changing. At the moment, for issues to do with recondition in the PRS, to do with the pairing standard, tenants would go to the private rented housing panel, which is a tribunal that will merge into the first two tribunals that we refer to in the accompanying documents. At the moment, the PRHP receives around about two to three hundred applications a year, which is mainly for the pairing standard but can also be in some cases with regard to rent. That is perhaps not as high a number of applications as you might expect when you look at the evidence around some of the parts of the PRS where there are issues with condition. What we are looking to achieve from the new tenancy and by improving tenants' security of tenure is to help tenants to use the redress that is available to them at the moment. Because of the stensim and their regard as their home, they might want to improve where they are and not have to move. They might want to have where they are staying because there is a home and meet the requirements that they should do and maybe even beyond. The evidence at the moment is that there could well be more cases that will go to the tribunal based on the new tenancy that we have set out. That is something that we have reflected in accompanying documents, including the financial memorandum. We can explore that with other witnesses. I am just moving on to another area. One of the significant proposals of the bill is to remove the no fault ground for repossession in terms of the balance to be struck between providing tenants with greater security of tenure and the concerns that we have heard from landlords about hindering investment in the private rented sector. How do you reconcile those two concerns? Again, it comes down to balance. Ministers set the overall objective, which is to improve security of tenure for tenants balanced with appropriate safeguards for landlords, lenders and investors. That is what has driven the subsequent development of the policy on the new tenancy. The balance that we have struck is that landlords need to feel confident that they will be able to manage their properties effectively. That is why the grounds are important and we have said that the legislation will provide grounds for all the reasonable circumstances that landlords would need to recover possession of their property. I have previously talked about benefits to tenants around not having a no fault ground in the new tenancy system. Ultimately—I think that I mentioned this at the end of my statement—what is most important to landlords is that they are able to get a return on their investment. In the grounds that we have proposed, they will still be able to do that. They will be able to charge market rents for their properties. They will be able to sell their property to realise its capital value if that is something that they want to do. They will be able to manage their properties effectively because we provide for grounds that will do that. From the Government's perspective, there is nothing that we see in the bill that would fundamentally affect landlords' investment. However, that said, we have listened carefully to landlords. We know that there is a strength of feeling out there that landlords do not want to have the no fault grounds not included in the bill and that they have made that case strongly to us. However, on balance, ministers' position is that that is the right balance to strike. What is important is that landlords will still be able to, through what we have set out in the new tenancy, effectively manage their management properties. In particular, that is why the grounds are important to get right. That is being removed and replaced with a series of other criteria. In terms of the 7,500 responses that you received, have you done an evaluation of how the responses divide between those that are in favour and those that are against that provision? The first consultation asked basically the question on the broad policy intention around the no fault grounds. 81 per cent of those who responded were in favour of it, but not landlords and investors who were predominantly opposed to the removal of it. In terms of the consultation, it depends on which way you look at it, but in simple terms, landlords and letting agents and investors tended to not favour the removal of it, whereas tenants, representative bodies and tenants groups did favour the removal of it. From Winnes' point of view, what is important is that balance that I talked about. I consider the question, will that fundamentally alter the sector and what landlords will be able to get from the sector, which ultimately is to be able to manage their properties effectively and get a return on their investment? That is just wanting to understand what the balance of opinion was in the consultation. You have said that 81 per cent of responses were in favour of the no fault grounds being removed with that right. It was just to explore that slightly more. I absolutely accept your suggestion that the primary motivation of any landlord is a return on their investment, but I wonder what the situation in the landlord would be left in trying to remove an anti-social tenant. It may well be that the anti-social tenant continues to pay his rent, so the landlord is making good on his investment in that sense. However, there is an anti-social tenant and, as a good neighbour responsible landlord, he wishes to try to take action. Is he impeded from doing so in terms of the proposals regarding the no fault grounds being removed? In the proposals that were set on the bill, landlords will not be impeded in being able to deal with anti-social behaviour. The challenge of anti-social behaviour is that it is not an easy thing for anyone to deal with. On the one hand, you could have a situation where there is genuine anti-social behaviour, but it could be subjective. It depends on whether one person's view might be anti-social and another person might be just a different lifestyle. To illustrate that, if you have an elderly couple living next door to a young family, you could have somebody who likes living peace and quiet next door to somebody who makes quite a lot of noise. It is never really an easy thing for a landlord to deal with. What is important is that, when looking at the potential for someone to be evicted from their home, they should be fair and due process. That is what we set out on the bill. If there is an issue with anti-social behaviour, landlords will still be able to effectively deal with that, first of all, by engaging with the tenant and looking to resolve the problems of them or possibly the neighbours. Ultimately, if it comes out that they have a ground that they are able to use to evict a tenant, that is something that is necessary. Good morning. I would like to ask a couple of questions about the eviction grounds. I see that there are a number of eviction grounds and that some of them have received strong support, some of them have received mixed support. Can you briefly outline the proposed process for the landlord to end the tenancy and the role of the tribunal in that regard? If a landlord wants to end the tenancy, he has simplified it and made it clearer. There is one notice to leave. If a landlord wants to end the tenancy, he will issue a notice to leave to the tenant and will need to do that within the correct time period. They will need to cite the grounds that they are asking the tenant to leave on. The tenant then can either leave and will provide for that on the grounds. If a tenant leaves on their own accord, then that will bring the tenancy to an end. If a tenant chooses to stay and can test the notice to leave, they are also able to do that. At that point, a landlord will need to send the notice to leave to end the tribunal. They will also need to, under section 11 of the 2003 homelessness act, inform the local authority that they are seeking eviction. We have joined that up with that legislation. When the tribunal receives the notice to leave, the landlord will have that and will put the evidence in. It is for the tribunal to determine. Twelve of the 16 grounds in the legislation are mandatory, which means that, if the tribunal determines that the grounds have been met, they must order reposition to the landlord. In the other four, it is a discretionary act of discretionary and mandatory. We know that, in most cases, tenants will leave. We know that, in most cases, currently, when a landlord asks a tenant to leave, the tenant does that, but we accept that there will be cases where a tenant is quite ready, because that is a right that we will be able to contest the notice to leave, and that is where the role of the tribunal will come in. Can I ask—I believe that all the grounds used to be mandatory now, under provision of this, that the four on them, as you say, are going to be discretionary. Why is summer discretionary? Well, when all the grounds are mandatory, there was eight, and now there are 16. We are looking to strike a balance. We have listened to state calls. The balance is such that we need to be fair to tenants and to landlords. Landlords need to feel confident that they will be able to recover possession of their property, but we also need to be fair to tenants that the grounds would be reasonable for them to leave their home. That is why there are some that are not all mandatory. Again, it comes down to seeking an appropriate balance. Can I go on to another point? In Homeless Action Scotland, in Shelter Scotland, I have suggested that the grounds covering situations where the property is required for another purpose by the landlord do not contain definitions sufficiently tight enough to protect against the potential for abuse by the landlord. How would the Scottish Government respond to such concerns? What we are doing in the bill, as we are setting out the legislation, clearly there is work to be done once Parliament passes the bill. There is work to be done beyond that through second legislation and all the other work as well. In effect, what we have on the face of the bill is the high levels of principles around that. We also intend to issue guidance to landlords so that they will be clear of what evidence will be required. Clearly, the tribunal will have a view on what the grounds mean and the evidence that they will be looking for to ensure that the grounds are met. We have put in safeguards so that, if a tenant believes that a landlord has a sort of addiction but has not actually been genuine, tenants will be able to go to the tribunal to seek compensation if the tribunal finds them in their favour. Again, it is about balance. Landlords need to feel confident. In and in the main, most landlords will be absolutely genuine. They need to feel confident that they will be able to recover the person of their property, which is why they put it up for rent and then make that contribution to housing supply. On the other hand, tenants need to feel confident that, when a landlord says that they are seeking repossession on a specified ground, that is indeed genuine. Have you asked—I take it a homeless action in Scotland—in Shelter Scotland, to be aware of what you have just said to me, or have you still got some persuading to do with it? Well, we speak to all stakeholders, including Homeless Action Scotland and Shelter Scotland, on a regular basis. I think that they may well be aware of what I have said. David, do you want to come in at this point? Can I touch on a question that Shelter Scotland has raised with me about renter ears? Basically, their concern is that the ground 11 on renter ears is disproportionate and unfair to tenants. Perhaps Mr Stocker or his colleague could answer a very specific point. I have looked at ground 11 and it talks about renter ears over a three-month period and not three-months renter ears. I may seem a pedantic point, but let me give you, for example, that someone has got a new job. They are waiting for a sally to come in. They are one month behind and they are unable to catch up on that three-month period. Technically, they are in the rears over a three-month period, which is the ground for eviction. The point that I am making is, and the point that Shelter Scotland makes, is that are we right in raising concerns that for a one-month rears over a three-month period you could be evicted? That seems to me and to Shelter Scotland to be unfair and disproportionate. If that is correct, Mr Stocker, could you look at amending legislation so that that ground has changed? You set out how the ground works. Again, it comes down to a balance. Ministers have sought to strike the right balance, and I mentioned previously why that is important to do. Clearly, there is still some debate around whether the one month is sufficient for the mandatory term to kick in. It is probably a question for the minister and one that she may be happy to answer. From a policy point of view, what we try to do is have— Excuse me, I know that you cannot give a commitment on behalf of the minister, but in theory, could you be looking at replacing three months with, say, six months? Well, in theory, what we will do is we will respond to the stage 1 report, which the committee will provide. I think that that is about—obviously, we have to balance the needs of tenants, and obviously we look at the needs of owners as well. I fully understand that. It certainly seems to me that Shelter Scotland has a point here, and that the scenario where you are one month in a rears over a three-month period is very unfair to tenants. I would assume as well that owners do not particularly want that, because voids are not a good thing in your cash flow either. I mean that owners would want to make sure that there is security as well. I do think that the way that it is phrased is unfair, and I know that you cannot as an official make commitments today, but could you ask the minister to perhaps go homeward and think again in this particular line, because I do think that it is unfair, and I think that tenants across Scotland will think that it is grossly unfair. The rest of the bill seems to me to be sensible in lots of ways. I do not think that this ground is sensible, so please look at this and try to get this changed on behalf of tenants. If you have a brief comment on that, that would be fine. I will be happy to relay to the minister your general support for the bill, but also the points that you have made. On questions on additional grounds relating to a number of factors such as student lets and holiday lets, some suggestions have been made by respondents that the consultation for additional eviction grounds were not taken forward by the Scottish Government. In particular, there is no general eviction ground allowing landlords to recover properties that are let to students at the end of the academic year, or more generally properties that are required for the purposes of a subsequent holiday let. Can you explain the Government's reasoning for not adopting those suggestions? The overall aim set by ministers was to improve security for tenants' balance of safeguards for landlords, lenders and investors. Again, that has guided the policy development in this area. We also, as I mentioned earlier, want to have a system that is clear, simple to understand. Ministers took the position that they want all tenants that transfer from the old current-assured system across into the new system to be treated in the same way and have the same rights under the new tenancy. When you have one tenancy that is broad and covers a diverse sector, there will be an element of strains around the margins on that. What you have outlined there is an example of that. We recognise that for the student market that landlords will need to adapt their practice to reflect the changes of the new tenancy, but it should not be insurmountable. For example, if you look at what we have provided in the legislation, the minimum time that a tenant can provide in terms of notice to leave is eight weeks, it could be more. If a landlord is looking to manage their property and is looking at a tenant who is a student that they could ask them, have you got an idea when you might be looking to move out? That is obviously up to the tenant to decide, but there is nothing to stop a landlord to ask in that question. If the tenant leaves it to the last possible moment, it is still eight weeks in which they will know for certain that the tenant is looking to leave the property. That still provides a window for a landlord to be able to look to relate the property. We accept that that will have some impact on the holiday let and on the student market. We think that, fundamentally, the sector will be able to adapt to that. There was some question with regard to the holiday let that under the 1988 act a landlord might be able to operate a business model that involves mainly longer-term let, but with some short-term holiday let over the summer. For example, in Edinburgh with the festival on the go, will that still be possible using the new legislation? If a landlord lets a property out to a tenant, they have previously let the property out as a holiday let and informed the tenant that it has been let out as a holiday let, and they intend to do so again, that would allow them to be able to use the ground to recover position. Alternatively, if they are on the short-term tenancy, they can just set a date and recover position in that way. Under the new tenancy, it is about improving security for tenants, and the key to that has been the removal of the no-falt ground. That has been something that is very central in ministers' position on that. With that in mind, it would be quite difficult to then have a ground that, in effect, looks like a no-falt ground to be able to bring a tenancy to an end for the purposes of being a holiday let or for being the end of term for a student. Overall, the Government's position is that what we set out, there might be some adaptation, but it will still be able to work in those markets. Can I now raise some issues associated with the first-tier tribunal? Can you update the committee when the tribunal will be operational and how it might work in practice, in particular the timescales that eviction cases might take, the cost of using the tribunal and the potential for legal aid to be available for tenants? On timescale, the new tribunal system is currently being created, and the legislation that is derived from the 2014 tribunals act has been implemented. The new tribunal will start first of all with a housing property chamber, and this will start in late 2016. There will be a stage process where more of the existing tribunals will move into it and it will develop and build from there. On costs, that is not a matter for this bill, but I can say that ministers have not reached a position on whether or not to charge a fee for anyone going into the tribunal. In terms of the PRS element of it, which is from the 2014 housing act, which will be moving into the new first-tier tribunal, where the current tenancy arrangements on the short-tier tenancy will merge in, Llanos is currently charging £70 to go to court. That may or may not be something that carries on in terms of a fee for the new tribunal. That is a decision that has not been met. However, as it stands at the moment, if there is no fee, that would represent a saving to Llanos that needs to go to the tribunal. In terms of legal aid, tribunals are designed to be accessible and understandable and do not generally require legal representation, so there will also be a case in the new PRS tribunal. As I understand it, we recognise that the cases will be handled by the tribunal, including those involving repossession. They can be serious in nature. We are considering the clients' support for parties bringing a case to the tribunal. That will be done through the operational detail of delivering the tribunal. That could be through funding support for legal representation and or some form of lay representation. Funding support for legal representation and other tribunal jurisdictions is generally provided through assistance by way of representational ABWAR, which is a minister by the Scottish Legal Aid Board. If it is selected, that would be set in place by sectional legislation, which would be scrutinised by Parliament. That is the position on legal aid, as I understand it. Shelter Scotland has suggested that tribunals should have discretion to adjourn tribunal proceedings, for example, to monitor payments relating to rent arrears, or to monitor attendance behaviour in anti-social behaviour cases. What is the Government's view on that? I do not think that it is something that has got in the bill at the present moment. It is not something that we have in the bill at the moment, partly because that may come out in the rules of the tribunal itself that will have the ability to assist or adjourn in all types of cases. If we are not sure what is going to be in their regulations as to how they will have procedures, perhaps we may be looking to make a change to put something in its stage 2 on that. However, we were waiting to see what their regulations were with regard to their procedures so that we did not duplicate provisions about procedures in various different pieces of legislation. That is very helpful. Just following on from the line of questioning on the first-tier tribunal, can I ask about recourse to the tribunal in the cases of wrongful termination? The bill at sections 47 to 49 proposes that a tenant will have recourse to the first-tier tribunal if they believe that their tenancy has been wrongfully terminated. Therefore, can you explain the objectives behind the provisions in the bill and how you think they will work in practice? The intention here is to go back to what we said earlier about making sure that landlords are indeed genuine. One of the safeguards that we have put in place is that where a landlord has been disingenuous, a tenant would be able to seek compensation. For example, on the first ground, a landlord intends to sell. If a landlord issues a notice to quit intends to sell, the tenant is a victim on that basis. Three weeks later, the tenant discovers that the place that we are living in is rented to someone else. That would seem like an example of where they should have some recourse. What we want to do is something that is effective and has teeth. One of the most effective ways of doing that is by giving tenants ability where they feel that they have not been treated genuinely, the ability to seek compensation from the landlord. Again, it comes down to balance, but that is the basic policy intention behind those provisions. Just on this point about ensuring that those provisions are to use your words effective and have teeth, can I ask you about evidence that we have received and written evidence from Homeless Action Scotland that has suggested that very few tenants will bring a case against a landlord to the tribunal? Did the Scottish Government consider enabling and empowering third parties such as local authorities, law centres or advice agencies to have the ability to bring cases against landlords in order to raise actions at the tribunal on behalf of tenants? That is, of course, the view of Homeless Action Scotland. Our reckoning is that there might well be very few in the sense that there might not be a need for very many to go to the tribunal, but tenants should be able to go to the tribunal. If they need to help an assistance, there are different ways that that could be provided. For example, I was on the stop them taking a case in the tribunal with assistance from one of the advice agencies out there, but I do not think that something that we have included in the bill is specifically the ability for a third party to go to the tribunal. Would that provision not fulfil your aspiration to ensure that the provisions are effective and have teeth? I think that what is important is that they are effective and have teeth. We have given tenants that ability and they would also be able to seek assistance if that is what they needed. I think that that is the one for the minister when she appears before the committee. I am going to move on and ask Alex Johnson to ask some questions. Thank you very much. I wanted to look at the process for increasing rent and challenging rent increases. First of all, what is the policy objective behind the rent increase provision in the bill? The policy objective is this. It is an open entity and therefore we need to consider how to deal with rents because what we do not want is to increase security for tenants but then for that to potentially be subverted by rent heights. The ability for tenants to seek adjudication on an unreasonable rent increase, which takes a rent beyond the market rate, is in for that reason. We have also included predictability, so rents can only be increased once in a 12-month period with three months' notice. That is to help tenants to plan for the finances for any future rent increase. Fundamentally, what we have seen is the rents in the PRS and market-led. I think that both those provisions on rents show that. How do you assess what the market rate is? I know that some of the people I have spoken to are suggesting that the market rates are going up, but that can be based on advertised due lets, for example. The suggestion is that the rates in some areas have been relatively flat or perhaps even declining. How do we decide what market rates are? From a tenants point of view, does the rent increase seem unreasonable? You could go to an extreme example of 20 per cent. That seems quite a lot. You might be able to do a bit of basic looking around what others might be paying. In terms of determining the market rent, that would be a matter for the rent service Scotland. We have a lot of experience in that area currently, and they look to build on that to provide adjudication. That would be a combination of the work that they do based on the data that they hold and the inspections that they make to look at properties and determine what their market rent would be. I am slightly concerned about the provisions that are included for the increase in our rent. I know that, for personal experience, I have rented the same flat number for 10 years and the rent has never gone up. Is it going to be the case that, after the bill becomes low, annually the taxpayer will have to pay CPI plus 1 per cent extra? Is it an agenda for increasing rents where increases have not been happened? That is not the policy position. You are right in the current practice that landlords tend to increase rent at the end of the start of a new tenancy on the short-shore tenancy system. What is in the bill will not require landlords to increase their rents once a year. It just means that where a landlord chooses to increase their rent for whatever reason, they can only do that once every 12 months. Given that landlords currently, in many circumstances, do not increase rents that much for sit-in tenants, that was perhaps fairly comfortably of that practice. Where a tenant wants to challenge the rent, how easy is that going to be for them to do? If a tenant has a challenge to rent, they will be able to make an application to the rent itself in Scotland. The policy intention is that it should be easy for a tenant to do, and whether there is a case to answer the rents that will be able to make that determination. Where a tenant is in that position, whether they will proceed with a challenge, their rent increase or not, one of the pieces of information that will be vital to them is to know what typical rents are in that area. How will they get that information? Will the Government survey it and make it available, or will they be reliant on other organisations to tell them what the rent is in the area that they are in? I think that a tenant will be able to look at a range of sources. You are right that the Government provides statistics on rent levels, so that would give anybody an indication of what is happening in terms of rents in general, in terms of across Scotland. For individual tenants rents, they will be able to look at perhaps what their friends are being charged for similar properties. They will be able to go online. The PRS tends to be mainly, if not all, the younger folk who will be well versed at being able to go online and look at, for example, the different letting portals, say that rents are advertised or are at. I think that there will be a range of different sources that tenants will be able to look at when thinking about whether or not the rent increase that they have received seems unreasonable. Ultimately, it is for the rent service Scotland to determine whether it is unreasonable, which is based on whether or not it takes a rent beyond the market rate. The tenant's first protocol is, does it seem unreasonable? In section 29 of the bill, rent officers and tribunals have to publish information collectively to the public to say what rents have taken into account in doing adjudications and determinations and what amount of rent they made under the determinations under applications from individuals. They will be publishing statistics that will be available to people. I am not sure exactly how that will take place. I expect that it will be on a website and tenants who think that they have received a rent notice that seems rather high can perhaps go into that in the first instance and see what the prices are generally in their area for similar types of property. Are we in danger of being in a position where there is no a definitive or an authoritative voice on what rents or typical rents are in an area and that that may become an area for dispute in a case? Ultimately, the authoritative voice will be the rent service because they are the ones that will be determining whether or not a rent increase is unreasonable taking the rent beyond the market rate. That is the end point, as Gerson said. That information will only grow as a work that they do increases. Mr Stocker, your statement in response to Mr Johnson is that that is not the policy position that was spoken like a true civil servant. I am going to ask David Stewart to ask the final questions. Can I raise the next issue about rent pressure zones? At one level, I think that members of the committee can understand the need for such proposals. For example, in Aberdeen and Aberdeenshire, if you look at the period 2010 to 2014, for a two-bedroom house, rents went up by 40 per cent, which is a phenomenal figure. In fairness, because of the reduction in oil prices, there has been a fall in Aberdeen on that in more recent terms. Just to check that I understand that correctly, if a local authority feels that there is a demand, for example in Aberdeen, for the rent pressure zone, it applies to the Scottish Government and by an affirmation procedure, it could designate a zone. Can you confirm what the minimum size of the zone, for example, could it be an estate, could it be a village, could it be a town, could it be a city or does it have to be the whole local authority area? The other issue is why does it just apply to sitting tenants? If we are looking at a private rental sector in the long term, where a quarter now of tenants have children who see that the sector has been their long-term aspiration to stay in the private rental sector, why are we not looking at the zone applying to everyone, not just sitting tenants, but people who aspire to be tenants who are in another form of tenure? On your first question about the size of the zone, there is nothing in the legislation that determines the size of the zone other than it is for local authority to make the application. The local authority will be able to set out the zone that they think is appropriate for the rent pressure zone to apply to, so that would be a matter for local authority. On sitting tenants, again, this is another area where ministers have sought to strike the right balance. The fundamental problem is that in areas where rents have been increasing quite sharply, as you pointed out, the forefront of that will be the sitting tenants, because the other ones are getting the rent increases as rents arise. That is why the policy is to cap rents for sitting tenants in those circumstances. At the same time, the Scottish Government is committed to increasing overall housing supply and recognises that that needs to be done both through public funding but also through funding that we are able to leverage in from private sources as well. We need to be able to attract that additional investment to build more houses. That is why we have sought to strike the balance so that investors will be able to understand what we are doing and why we are doing it, but we will still be able to make investment commitments so that we can build more housing supply. Fundamentally, the more houses that can be built, the more houses that can be built will help overall in circumstances where rents have been rising quite sharply. Increasing supply is the longer-term solution to the problem, but the more immediate problem is where the rents that arise sharply are having a detrimental impact on tenants and on housing, the policy provides a discretionary measure that local frauds could apply to help to mitigate that. I understand that. I think that you probably picked up from the tone of my question. I thought that it was quite sensible provision. However, I think that it is a little bit confused. I think that it would be much simpler if the once local authority applied for the zone that applies to everyone, either existing tenants or potential tenants. For example, if you are in Aberdeen and you have two two-bedroom properties, one of them is sitting tenant and the other is not, then the rent increase would be CPI plus one for sitting tenants and anything that you want for new tenants. That does not seem very sensible. Perhaps again, could you ask the minister to look again at that and the point that I was going to make? Clearly, that is the policy. It is a sticking plaster. The longer-term solution is to try to provide more supply in those crucially hotspot areas such as Edinburgh and Aberdeen. However, you picked it up. How long would the zone designation last? Is that a matter for the Scottish Government or for local authority to recommend in its bid to the Government? What was said in the legislation is that the zone can be for a period of up to five years per application, so that is what we would say in terms of how long the zone could be applied for. If circumstances change, I have used the Aberdeen example, while price reduces, rent levels are going down, could local authority apply to deregister the zone to the Scottish Government? Will ministers have the power to vary the cap? They could revoke the instrument that designated the zone. If local authority were close to those issues, they could revoke the instrument that designated the zone in the first place if it were no longer appropriate. If the local authority were close to those issues and said that circumstances have changed, we do not want to have this rent control any more, we can apply to the Scottish Government and you could deregister it effectively. That is very clear. Could I move on to some wider issues? What best practice has the Scottish Government looked at across Europe in terms of rent controls? For example, in the Netherlands, there is an excellent system where rent can be charged, which is partly linked to property quality measures. Of course, the great advantage there is that you are stimulating and encouraging landlords to improve the quality of the sector, and therefore rent increases are linked to that. Effectively, you have a two to five star designation for the sector, which I think that tenants would understand if they are getting improvements in their property. They are more encouraged to play increased rent. What is your view on that, Mr Stock? We have looked at other international comparisons for this. On the Netherlands, like many European countries, the rent controls that they have in place can stay in place after the Second World War, so that is where they started from. They have been in place for quite some time and there has been quite an infrastructure put in place to enable them to continue. I think that it is similar in Germany. In terms of Holland, you are writing in the private sector about two thirds of the sector has rent control. The top third does not apply, but it applies to the lower two thirds. The system that they have is one in which, as you say, they look to assess properties and link that assessment against the rent that can be charged. My understanding is that Dutch Government policy is to look to move away from the proportion of properties in the rent control and to reduce that. However, as a system, it is something that we have looked at. In terms of what we are proposing in this bill, it is more limited in proportion compared to what they have in Holland, which is national for most, but not all, of the purest properties. My final question, convener, because I know times against us. I touched on the point earlier about protection for sitting tenants versus protection for prospective tenants, and I think that you have covered that. However, the other model in other countries is that they challenge unreasonably high-rent levels. What thought have you about that as a method of protecting the sector generally? That is tenants and prospective tenants. Just to clarify, when you mentioned challenge unreasonably high rents, do you mean initial rents? If you see a trend towards a city where market forces are, meaning that there are quite massive increases, I mentioned the Aberdeen example 40 per cent over a four-year period, what mechanisms would exist to try to challenge that to make the sector more affordable? Again, looking at international comparisons, we know that this is something that they are looking at in Ireland, in the Republic of Ireland. They are considering what they are calling rent certainty. It is something that is still under development in Ireland, so I do not think that they have made any clear decision on that. I think that looking at the evidence and the literature on rent, the different options around rent control, again, balances to be struck between if you go beyond a cap into something that is more about the total amount of rent that can be charged, then there could be potential unintended consequences. That is what the literature says. That is not something that we have covered in the bill, but, since you asked the broader question, there are a number of things that the evidence would say that would need to be considered, so that any intention to use an option around rent control or capping has an intended effect and not an unintended effect that could, for example, reduce investment in housing or have an effect of pushing rents at the bottom up, which could also happen if the market is constrained in a certain way. Quite a lot to consider on that evidence suggests to us. Can you say a little bit about what steps the Scottish Government is considering in order to raise awareness about the provisions of the new legislation to ensure that tenants and landlords are aware of the new framework? Yes, absolutely. Subject to the will of Parliament, if the bill is enacted, we have set aside a budget set out in the national memorandum that will help to raise awareness. We do that through marketing. It has ranged at £250,000 to £550,000. There are a number of options. There is marketing, there is looking at landlord registration, where local authorities hold the database, but we have the addresses, so there is potential option. There are certainly for landlords, there are email addresses for that database, there is social media, there is also looking at the difference of photos that are out there when the focus is on rent. There is quite a range of options. Clearly, it will be important when it is clear what the legislation says that we raise awareness. That is something that we are very mindful of. In terms of the implementation of the bill, you will continue to engage extensively with stakeholders? Absolutely. We have been very open to engaging with stakeholders in a range of fora. We continue to do that now and right through the process of the bill and beyond that, if it comes to developing a second legislation. I am more than happy to do that. Do members have any final questions? In that case, it remains only for me to thank the bill team for attending today's meeting and for their extremely helpful and comprehensive evidence this morning. We will, of course, hear from the Minister for Housing and Welfare later in the stage 1 consideration process. That concludes this evidence session. I will suspend for a few minutes to allow the committee room to be set up for a further round table session with stakeholder witnesses regarding the private housing tenancy Scotland bill. We now move to agenda item 2, where the committee will take further evidence on the private housing tenancy Scotland bill. In order to allow for a more free flowing discussion, the committee has chosen to conduct this session in a round table format. We are keen to ensure that we receive evidence on all aspects of the bill, and therefore the session will be structured around its different sections. Given the limited time available, it is therefore important and I encourage stakeholders to do that, which is to seek to speak on those areas of the bill that are most interesting and important to them. Members will ask questions on the various aspects of the bill. I will allow our witnesses to respond should they have any comments and committee members can then come back in if they wish to add to the discussion. I am going to ask each of our participants to introduce themselves, starting with my colleague to the left. David Stewart, I am the Libre MSP for the Hounds Islands region. I am Beth Redan from Crisis, which the charity represents in that single homeless people. Alex Johnstone, Conservative member from North East Scotland. Robert Aldridge from Homeless Action Scotland. Lizzy Lee, living rent campaign. Mike MacKenzie MSP, represent the Hounds Islands region. Rose-Marie Brochee, I am here from Shelter Scotland. James Dornan MSP for Glasgow, Cuthcart. Fraser Sollund from Citizens Advice Scotland. Adam Ingram MSP for Carrick, Cymlatt and Dyn Valley. I am Gary Paterson. I am the Vice President of the Communities of the National Union of Students in Scotland. Okay, thank you very much everyone. We will just get started. I will kick off and perhaps just ask in general terms whether our stakeholders think that the proposals in the bill achieve the balance or the rebalancing of the relationship between tenants and landlords, which the Government's bill team referred to in the previous session. Perhaps you might want to consider whether that balance improves security of tenure for tenants and provides appropriate safeguards for landlords, lenders and investors. Who wants to kick us off on that? Rose-Marie Brochee, thank you convener. Certainly, yes, we very much welcome the opportunity to give evidence on this bill today. We have been working with the Government and stakeholders across the sector for many years now to bring about change to the private sector tenancy regime, particularly because we think that it is a big impediment. The current regime is a big impediment to growth and to the confidence and security and stability that tenants have in the sector. The changes that we see bringing forward in this bill, in principle and in the broad structure, are very welcome. They are going to meet the needs of our clients. We do have some concerns, which hopefully will come out today about some of the operation and the detail of the terms of the bill. In broad terms, yes, we are very much in support. We will come on to the detail, I am sure, in due course. We share that view that it is a great improvement on the short-assured tenancy regime. The assured tenancy, in some respects, gave greater security of tenure to some tenants, but it has been so little used in recent years that what was needed is this modernised tenancy, which will give far more security to most tenants. We are in favour of the generality, but we also have some concerns about a number of the details around the edges. Who else wants to come in on the generality, Liz? We would echo some of those comments. We feel that the things that are outlined are an improvement, but we also have some serious concerns about some of the grounds for eviction, and particularly the mandatory nature of those grounds. We will probably come to those, but we acknowledge that that is a step forward, but there are definitely concerns within that. We know that security of tenure is a huge concern, especially for the client groups that we represent. When they go into the private rented sector, they are often in some of the poorer quality tenancies and are very worried about the security of tenure. They are really strongly welcome, the removal of no-fault eviction in particular and indefinite tenancies, and the greater clarity and simplification of the system that it will bring. Having a standardised tenancy will be really helpful in that respect, especially for those who are less able to advocate for themselves or understand complex legal terms, as can be in some tenancies now. First off, thanks for giving us the opportunity to come here today. Again, we welcome a lot of the proposals that are put in place. We will get into a little bit more of the detail from our position, but we are quite keen to echo the comments here and maintain the same level of tenancy, so there are not discrepancies between students and the general rent in public. We also very strongly welcome the reduction of rent controls because of the extent of rent increases, which can really impact students, because they are more likely to move around with shorter tenancies. Most of the same is what everyone has already said. We welcome the changes and the improvements that have been made on the current tenancies that are there, especially by welcoming the removal of the no-fault ground, which we think is a huge barrier to current tenants in protecting their security of tenure. Thank you. We are actually going to ask him. Thank you, David, for your understanding. As always, Michael, you are going to introduce the next section on no-fault ground for repossession and the private residential tenancy. I am pleased that I have led this nicely into that. That is one of the significant proposals of the bill to remove the no-fault ground for repossession. I wondered how people felt about that, but the points that were made from the landlord's perspective seek to discourage investment in the sector. There has been a suggestion that that might impact adversely on tenants by reducing the overall investment and, therefore, the number of houses that are available in the private rented sector. I wonder what your comments were on that theme. We are very pleased that the no-fault ground for eviction is going. That is going to be really good for tenants. On investment, I would make two points. One of them is that countries with a more stringent regulatory framework tend to have larger investment in the private rented sector. When you look internationally, countries with more stringent controls and more regulation tend to have more investment. However, when we are talking about investment, I think that there is a wider question that is possibly outwith the scope of the bill about what kind of investment in housing in general we want in Scotland. Scotland's Scottish Government's own research found that only 8 per cent of people want to live in the private rented sector. 92 per cent of people do not want to live in the private rented sector. They want to live in their own home that they own or in the social rented sector. I think that there is also a wider question about what sort of investment in housing in Scotland that we want and the private rented sector more generally. However, we are also taking into consideration the fact that, in countries where there are more things such as the no-fault grounds being removed and more stringent rent controls, there is investment there in the PRS, too. I think that we need to be clear about what we are talking about when we refer to the no-fault grounds. It has become a bit of a shorthand. What it actually refers to is that when the initial period of the tenancy is over, the landlord has the absolute right to end a tenancy after that point by just giving it a minimal amount of notice without reference to anything else. The importance of that, obviously, from a landlord's point of view, is to enable them to have the flexibility and the confidence that they can reclaim that tenancy back. That confidence is important to landlords because using the court system, which is their other recourse, has proved difficult for them. I think that, in the introduction of the new tenancy regime from a landlord's perspective, and I am sure that you will hear from them directly about that, the use of a tribunal system to replace the courts, the no-fault grounds and the simplification of the process should give them that confidence. Professional, reputable landlords who are actively managing their businesses should not have anything to fear from the new tenancy. From a tenant's perspective, removing what we call the no-fault grounds is hugely significant. We see tenants coming to us, coming to shelter, and we get 46 per cent of our calls that come to our telephone helpline from the private rented sector, when only 14 per cent of households in Scotland live in the private rented sector. The significant thing for tenants is that they will have the confidence and the security and, crucially, bargaining power with their landlords. We have already heard concerns that tenants have when they make a complaint that they are going to be subject to retaliatory eviction. We have certainly seen many cases of tenants who, for example, have complained about a repair issue, subsequently being served with a notice to quit, which results in them having to leave their tenancies. If we are concerned in Scotland with having a high-quality, professionally run and improved private rented sector, we need to give tenants that bargaining power and they need to be able to act as active consumers in the market. I do not disagree with anything. Rosemary and I were fortunate enough to be part of the Tenancy Reform Group, and one of the discussions that we had in that group was about what are the kind of reasons that a landlord would have to want to repossess their property. We went through all of them, and it is if somebody is not paying their rent, if somebody is behaving in an anti-social manner, etc. Those are covered in the grounds for repossession under the modern tenancy that we are discussing in this bill. There is a further point, which is that what we are looking to do, and I think that it is particularly in the interests of landlords, is to slightly change the reasons that people use the private rented sector so that more tenants are in the private rented sector for the long term can plan ahead without the uncertainty of perhaps being faced with a notice to quit with two months notice, so that people with families can make an investment in their community, in their local schools and actually use the private rented sector long term. It is of benefit both to landlords and to tenants to have greater security of tenure. I think that the other two points that I wish to make is that if the no fault ground were to be reintroduced, it is the only ground that would be used for repossession. You might as well rip up all the other ones because it is easy and it does not require any management by the private landlord, which brings me to the final point, which is that there is also an onus on a landlord who is managing a business to manage it, so that if somebody is behaving in an anti-social manner, for example, they need to be able to establish that that is what is happening and to manage that property well. I really welcome the removal of the no fault ground, mainly for the issues that Rosemary set out. We have seen a huge move in the types of people who are living in the private rented sector. It is not just where we see students in young professionalism that we maybe did 20 or so years ago. We are now seeing a lot more families who want to have a settled life, who want that security, who want to know that they can be certain that they are not just going to be given a very short notice period when they come to the end of their tenancy. I just want to make one point on the question that Mike put about investment. I think that it is about what type of investment we want. I do not think that it is really appropriate that people see investing in private rented property as something that they just put money in and make money out of. If you want to invest in the private rented sector, you should be doing it because you want to run the homes for people to live in. If you just want to make a return on your investment, maybe you should be putting it in a financial product rather than in housing. You have to have a commitment that you are going to look after that property and look after your tenants if you want to invest in private housing. A lot of the good landlords, that is what they do. That is the kind of people they want to be in the private rented sector. We do not want landlords who just treat it as a way to make a huge profit. We really strongly support the introduction of this. We know that there are some recommendations from other stakeholders that there should be different categories put in place for students. We would not really agree with that, because we think that once you start introducing different categories, it becomes hard to govern how to determine who is studying what and what kind of tenants they would require. We see that the needs for students are broadly in line with the needs for the rest of tenants as well. That has been said so far. The people that we work with, we found that very often they are very worried about this hanging over a world. We could be out of it within four weeks notice and where do we go. Rosemary said that it is about the balance of power between the tenant and the landlord. At the moment, many tenants just want as little contact with the landlord as possible. Then they are happy and that is okay, and it is about that rebalancing. The key to making this work is to make sure that the eviction grounds are set out really clearly. They work in a straightforward way so that both tenants and landlords know exactly what evidence that they need to be able to evidence the ground for eviction. That works straightforwardly. We heard in the last evidence session that the majority of cases probably will not go to tribunal, so we need to make sure that it works at the notice to leave stage so that tenants are clear about what would constitute the right grounds of evidence for eviction. The answer that landlords do as well, if there is any ambiguity about that, it is going to be quite difficult for tenants to enforce their rights. I was quite struck by what Liz had said in terms of, perhaps, lessons for us from other countries, but I wonder if any of our guests agree with me. You will see where I am coming from representing the Highlands and Islands. We will have to treat some of those lessons with a bit of caution, remembering that Scotland is really quite a diverse country. There, I represent, contains most of Scotland's islands. We have rural locations and remote rural locations in that some caution is required in terms of just transposing something that may seem to work very well in another country and transpose that on to Scotland. I wonder if any witnesses are aware of any research or any of your organisations have done research with stakeholders and so on, gathering any kind of evidence that may suggest a scheme that would work well for Scotland, bearing in mind just that precautionary note about the Highlands and Islands. The evidence from international examples of how tenancy regimes work elsewhere was fully considered by the working group that consulted before the bill was brought forward. I am aware that the Scottish Government considered international examples as well and looked at the security of tenure, if that is what we are focusing on at the moment, across Europe and beyond. It has also been the subject of work that Shels has commissioned some research on. Although I have not got the work in front of me, Scotland and the UK as a whole came out very near the bottom of countries for security of tenure. In fact, the system that we are currently working under has led to a lot of the problems that we are seeing existing in the current private sector market in Scotland. Regardless of whether you are in an urban or rural rental market, I think that the basic relationship between the landlord and the tenant is absolutely crucial in trying to drive improvement and change. Both enabling, as I said before, tenants to act as more active consumers but also crucially encouraging landlords to view letting as a business. We are asking landlords to up their game. I think that the landlords who are involved in consulting and looking in on this bill will be hoping that one of the consequences is that some of the less professional, more disreputable, landlords and letting agents will look at the new market and say that that is not somewhere that we want to be, which will leave space for the more reputable and responsible landlords to grow their businesses. Liz Smith. In bringing up international examples in that particular instance, it was as much to allay fears around investment. I think that one of the things that we hear time and time again is that any extra regulation is going to scare away investment. If you do anything, that means that there will not be investment and that will take away supply. I guess that looking to other countries where there is larger-scale investment, there are also stricter regulatory frameworks in those countries. Even though we might not want to necessarily take a model from another country right now and slap it and bang on to Scotland, certainly when we are looking at this issue about investment and supply, we can see that investment is not struggling in other countries where there is a stricter regulatory framework. Do any of the witnesses have anything specific to say on good practice from other locations, particularly internationally? If not, I will invite members to come in. I have Adam, David and then Alec. Yes, Liz highlighted the point. I think that you said that nobody actually wants to be in the private rented sector. That is not a universal phenomenon across Europe. Frankly, lots of countries have a very strong private rented sector. Is that as a consequence of the poor security of tenure historically that we have had in the private rented sector? Could the bill not presage a significant investment as demand might rise for homes in the private rented sector? If we are addressing the security of tenure issue, which Robert had indicated, is one of the constraints on people coming forward and seeking private rented accommodation. Is that an important departure from that? It is. A large number of people have regarded the private rented sector as somewhere before they buy a house or somewhere at a transient stage. It is a real possibility when the whole system gets embedded in that people will begin to regard the private rented sector as a housing option for the long term, which can be valued. As long as it is combined with good-quality housing management by good-quality private landlords, it will begin to be seen as a longer-term housing option for a broader range of people. I agree with that point. The situation for students in particular is very difficult for us to not be in the private rented sector. I cannot read by a house at this stage in my life, but it is important for us to imagine ourselves in a long-term property when every six months or every 12 months we have to apply again and not really know what the landlord's plans are for the property that you are staying in. You are putting yourself in a position where you have to negotiate financially with the landlord in some scenarios. Even without the balance and giving people more ownership over the places that they call homes is really important. I echo that the removal of the no fault could have that consequence. The fact that only 8 per cent of people want to live in the private rented sector is in part due to the lack of security, but it is also the least affordable 10-year type. It is much more affordable. I am 10 years away from being a student even though I might not look at it and I still cannot afford to buy a house. People that I know with mortgages pay less on their mortgage than I do to rent a one-bed flat, and we know that the social rented sector is a lot more affordable as well. Affordability has to come in with security for it to be a desirable 10-year type for people. I think that Adam has covered the point. I was just going to make a philosophical point that, if you take examples from France and Italy, the ability to rent there is seen as quite normal. The aspiration to buy is not the same as it is here. I echo Adam's point and it is hard to change that philosophy, but maybe we need to look at why it is more acceptable in Italy. Is it about 10-year? Is it about rent control? If it is certainly my experience of friends over there who are teachers, they think that it is quite standard to rent, but they tend to find that it is a longer-term lease, so they might have a five-year lease with rent controls. Maybe that is something that we need to bear in mind in this debate. Thank you, David. Alex, you have a different philosophical point. The moment has passed, I think. The moment has passed. I will look for the opportunity to come back. There will be other moments. Do not worry. I will make one small point to this discussion. We have been conducting a campaign over the last 18 months or so, and we have a huge amount of support from people across Scotland. Some of that support has come from landlords as well, who have looked at what the current situation is and looked at how they are able to attract people to the sector. Landlords want people to stay long-term, so they have no benefit to them to move tenants quickly through the sector. We would like to let to you and keep you here. It should be of a real benefit to landlords and should attract the right kinds of landlords, as well as appeal to the growing number of people in the sector who are farmers with children, for example, which now make up over a quarter of people in the private sector. James, do you want to introduce our section on the initial tenancy period? I would be interested to hear the witnesses' views on the initial tenancy period of six months, particularly to hear if they agree that the tenant should be restricted from ending their tenancy during this period unless the landlord agrees. I am particularly keen to hear from Robert from Homeless Action and Gary from NUS, who did not comment on that in their contributions. Robert. My own view on Homeless Action Scotland's view is that when you have a position of an indefinite tenancy, which is on a month-to-month basis, the need for an initial tenancy period is not really there. The need for an initial tenancy period was really linked to the short-assured tenancy to say that it is not going to be less than six months. You are going to have at least six months before a landlord can give you notice. However, given that there are notice periods built in to the new tenancy, we, personally, as an organisation, did not see the need for any initial tenancy period, other than that you have to have a tenancy period, which is, say, a month, because it is going to last indefinitely unless either side seeks to end it, either with the appropriate notice periods or by establishing grounds for eviction. You could have amended the grounds such as landlord wishes to sell to say that that could not be invoked in the first six months or a year of a tenancy. In our view, we felt that an initial tenancy period was not necessary, but it is not something that we are going to dine a ditch for because it is not an impediment to the legislation. I do not want to give a reborn response, but I would like to echo Robert's point on that. We did not note anything there, and I have to say that I do not want to make NUS policy on the hoof, but anything that we have not noted in there, we would go back and consult with our membership over the rest of the cycle of the legislation. However, I agree that having the flexibility and the long-term ownership over the property is something that we really support as an organisation. We do not think that there needs to be this six-month initial period, and we feel quite strongly that tenants should not be tied in to a six-month initial period for a number of reasons. In a lot of places, there is a lot of demand for tenancies and a landlord might pressure a tenant to stay longer where they are tied in longer than they actually want to be in, and tenants need that flexibility. However, we also feel that there are some serious equality issues with tying tenants in to six-month periods. We have a number of affiliates, including trade unions, charities—one of our affiliates is zero tolerance—who pointed out that that six-month period, if you are in an abusive relationship and you need to leave an abusive relationship quickly and you know that you have six months of rent that you have to pay, creates a further barrier. Women face a lot of barriers to leaving abusive relationships in the home, and having that six-month period you have to pay your rent adds another barrier on top of that, where there are a lot of stresses. As Robert mentioned, there is really no need for this initial period to be there, and it has the potential to create hardship for some groups of tenants. We do not feel that it is appropriate to have an initial fixed period for tenants. The interesting point about abusive relationships, and I am sure that there will be some discussion about how that one is resolved if it is not already in the suggested bill. I would like to go on to the notes of the end of tenancy and ask if you agree with the Scottish Government that the bill's proposals regarding notices to end of tenancy are simplified and the proposed timescale strike a good balance between the interests of landlords and the tenants. I would like to ask Cass Fraser this time and Gary, who had some specific views on this proposal. We raised exactly the point that Liz had just raised in terms of the tenants of landlord notice to leave around people with the fleeing abusive relationships. Anything that puts people off having to pay an extended period of rent would stop them from leaving that situation, would not be in the interests of anyone. To raise a specific point around that, currently the housing benefit rules allow for claimants to get four weeks on two different properties if they have to leave a property for that reason. If we are then intending that people have to give eight weeks, that is leaving them with four weeks of money that they have to find themselves if they are on housing benefit, so they are essentially paying for four weeks for having to leave for that situation. That is not ideal. I do not know if there is some way that that can be changed so that tenants have the ability to leave where they feel in a threatened relationship. The situation that we would prefer around notice to leave from tenants to landlords is to have the one fixed four-week notice period that is proposed for the first period. That would be much easier for tenants to understand, because it would then be the matter of what point you are leaving at. It is the one four-week standard timescale. Our feeling on this is that four weeks is not a lot of time. It is basically just a month. If that could happen midway through the year, it could be happening around this time of the year where you are being told in four weeks time that you need to be out. I am sitting and thinking about all my assignments and maybe part-time work that I have got to do as well. I am looking at areas such as Aberdeen, Glasgow and Edinburgh where housing is quite difficult to come by. It can take a lot longer sometimes than four weeks. We see students having to come into the city before they start at their university or college and sometimes staying with friends around hotels for even more than four weeks. We think that a period closer to eight weeks would be more suitable. Adam, you intend to introduce the next section on the termination of the tenants by the landlord. Yes, grounds for eviction. Do you think that the eviction grounds that have been included in the bill are reasonable from a tenant's point of view? Will they work effectively in practice? Are there any in particular that would cause a problem for tenants? I think that the general grounds are the right grounds, but there are some problems in wording. I mean the things that the landlord intends is used I think right the way through and I think that needs to be firmed up a lot more. Our own view as an organisation is that it would be more appropriate if all the grounds were discretionary rather than mandatory. We have a new tribunal system that aims to look at the broader interests of a case and to come to common sense agreement. If you have mandatory grounds, there is a danger that in anomalous cases all the boxes will be ticked when it is unreasonable for an eviction to happen. In particular, there are areas such as the landlord intends to sell. It would be perfectly possible for a landlord to put the property on the market at a highly inflated price that they were absolutely sure they were not going to get, showing an intention to sell and advert wherever it is. The tenant would be evicted and somebody else would move in. The penalty is simply a three-months rent, which seems to me to be a very paltry penalty. Similarly, it may be that the landlord states that they intend for a member of their family to move in permanently. However, the thing is that the eviction will happen before the move-in happens, so what happens if it does not? Is it simply a penalty of three months' rent, which is again a very, very small amount, which is not really a deterrent whatsoever? In our view, in a whole range of those cases, it would be more appropriate for the tribunal to investigate how reasonable in the circumstances it is for the eviction to be granted. I know that some landlords will be quite concerned about that, but in 95-98 per cent of the cases it will be straightforward and they will be able to regain possession. However, where there is this element, I think that it is quite important. I think that there are other things as well. It does seem to us that if the landlord intends to sell, there is not any reason why the tenant should have to move out until the contract of sale is concluded, because nobody else is going to move in. Similarly, with the refurbishment ground, it depends how big the refurbishment is. Is there going to be a discussion with the tenant as to whether they are prepared to put up with three weeks' disruption and stay as the tenant or simply be evicted under the mandatory eviction? I think that there are a whole lot of grey areas that are not well served by the grounds being mandatory. As I said earlier, the grounds for eviction are the key to making the system work well or not, so we need to make sure that the grounds are set out really clear and do not provide leaps poles. In terms of the grounds that they are currently, we would broadly agree with all of them, but it comes down to how they are evidenced, as Robert was saying. What would a tenant need to know to show that the landlord is genuinely going to sell? As I said before, in most cases, we will be about the notice to leave and not going to the tribunal because most cases will not go to the tribunal, so we need to make sure that it is at that stage. I think that there are some of the grounds that could be worded more clearly. The abandoned one, for example, currently says that you have to not be living there as your main home. If you are meeting all of the elements of the tenancy agreement, you are paying your rent and so on, does it matter if you are not there for a part of the year or whatever? I think that we need a lot more clarity in that ground. The one about the renter is grounds. At the moment, as I understand it, you would need all three of those grounds for it to be mandatory, but, again, I am not entirely sure that that is clear. The other one that is new in there is the cessation of the landlord's registration. If that is about being struck off the local authority list, that is one thing. If that is about the landlord ceasing to be registered and therefore saying that the tenant has to be evicted on that basis, I do not think that that would be acceptable from our point of view, so that needs some clarity. It is about making sure that those grounds work really well and really clearly, both for the tribunal but at an earlier stage before that as well. Just to echo in what Robert Scott said about the penalty that would be in place for landlords, the penalty for the tenant would be much more significant if they were having to be made to leave their property. We recognise the points that are raised in terms of the grounds that are noted. We think that the tribunals that are being set up provide an opportunity to work on those issues without any need for mandatory grounds in place. However, if they are to go forward, we would like to at least see discretionary elements attached to them. For example, the term grounds for refurbishment is not really detailed, but that means that it could be a look of paint at this point. The Tents has otherwise breached the Tents agreement. Again, it could be for a very minor situation that we have talked earlier about today about debt, which has been spread over a couple of months. Technically, that is breaching the agreement. If I could just speak briefly as well about some of the recommendations from some stakeholders about student tenses being implemented, I think that as a student I would be really concerned about those proposals. My feeling is that it is not in students' interests to not say that they are going to be leaving, because we do not want to get lumbered with loads of debt and rent that we cannot afford to pay. We think that better communication with landlords to the tenants to understand what they will be wanting to do in the next couple of months could alleviate some of the issues. However, just January, the highlighting of the student cycle, if you will, or the student market, currently does not meet the needs for students. We would not regard what currently exists as best practice, and we would not want that to continue into the new proposals. Generally speaking, we think that, as we have discussed already, the range of reasons that are set out for landlords wanting to be able to recover possession under those grounds are the right ones, and they cover the range of reasons that landlords might need to use. However, I agree with colleagues on the table that the detail of how they operate in practice needs some scrutiny. I will try to draw attention to those who have not already been mentioned, although I echo what Robert Scott has said about how the landlord's intention is defined in relation to the intention to sell, for example, and to refurbish needs to be tightened. It should be much more than just an aspiration. We should see evidence there that actively marketing the property is taking place. The ground that relates to the breach of tenancy agreement refers to materially failing a statutory term. We need to understand what that actually means in terms of materially failing to ensure that tenants cannot be a victor just simply for breaching a term of a tenancy that might be statutory but should not reasonably give rise to an eviction. The one particularly that I would like to draw attention to is the number of times already around the renter is grand. As was referred to in the earlier session by Mr Stewart, it is disproportionate in terms of the outcomes that it could result for in tenants. For a number of reasons, we heard the case study earlier on of a tenant who may have been entering a job and being paid a salary one month late. Although under this ground and in the schedule, it is specified that delays or areas in benefit payment might be excluded or taken into account, universal credit is designed in its very nature to be paid four weeks in arrears. On top of that four weeks, seven days delay is built in before you can even apply, so that does not fall within that exclusion around an error or a delay in benefit payment. That is just how the system is designed to work. I think that the proposal to a victim tenant after three months if they have one month's arrears at any point within that three months is disproportionate and needs to be looked at again. We think that there should be an increase to at least three months' rent arrears over that period, which is in line with the current ground for possession under rent arrears. Just finally, there needs to be a little bit further scrutiny around the ground for eviction where a landlord has ceased to be registered with a local authority. I think that there needs to be alternatives looked at for that, because a tenant under those circumstances would be suffering the loss of their home on the basis of a landlord's failure. I think that we need to look again carefully at whether or not that is a reasonable cause for eviction. Okay, Liz. Beth, do you want to think back in? I guess that Rosemary has covered quite a few of the additional things that I was going to say, just to echo very strongly that we do strongly agree about the facts about it being mandatory. Landlords and tenants agree that life requires discretion, and I think that those grounds need to be discretionary because of the many varied circumstances that come up and that penalising tenants for the behaviour of landlords and leading to a tenant losing their home is not the right way to deal with bad practice in the sector. The final thing to add in terms of discretion is that we would like to see something like a hardship clause being built into this when something is taken to a tribunal. With the case of rent arrears or antisocial behaviour, it might be that a tenant has got needed time to sort out a particular issue, and we feel that there should be some sort of thing built in whereby a court could postpone or delay a decision to repossess a property that might give a tenant time to get financial advice or to resolve an antisocial behaviour situation, because obviously losing your home is a catastrophic event bringing a lot of hardship, and some discretion within that is required. I think that I would like to echo what Liz has said. It has come up earlier that this is why we need the first to a tribunal being given discretion to adjourn proceedings, so that they have that opportunity to consider more complex cases. On the point about penalties and the maximum award of three months rents in a tenant where there has been a wrongful eviction. If there has been a wrongful eviction, in particular in cases where a landlord has deliberately misled a tribunal, three months rent awards of the tenant seem very insignificant given that they have misled a tribunal. It is also worth considering the other cost. If somebody is wrongfully evicted from their property and they go to the local authority to make a statutory homelessness application, there is considerable cost involved there for the local authority. I think that three months rents are not a huge deterrent from doing those things, and we need to make sure that the tribunal system has teeth and acts as a deterrent from bad landlords doing things wrongly. Thank you. We will need to move on from this section, but I will give the final word to the vice-scotland. Just to add on what Beth was saying about the wrongful termination orders in getting the three months back, it would be really keen for us to look at a way in which, if someone has misled a tribunal, are they still a fit and proper person as the test is required for landlord registration? I think that the answer would be no if they have deliberately misled a tribunal, especially on more than one occasion. I would expect a local authority to be allowed to look at that as a fit and proper person test and therefore remove their registration status in order that they could be a landlord. Alex, you are going to introduce our next section on the course of the first-tier tribunal for its wrongful termination. I am very interested to hear people's views on the bill's provisions in this area, but particularly in practice do you think that it is likely that tenants will make proper use of those provisions? I would also be interested in other people's comments on the suggestion by Homeless Action Scotland that the other third parties should be able to bring cases to the tribunal on behalf of the tenant. I am not another, but I am Homeless Action Scotland. I suppose just to build on that, the idea of third parties being able to take up cases, I think that we are all aware of particular landlords who have a very bad reputation, a small number of bad landlords who may intimidate tenants, for example. We are also aware of particular areas in Scotland where there have been activities by private landlords that are bordering on the extremely criminal. It is important in those circumstances that, if a local authority, for example, wishes to take action that it is able to do so, if there is a pattern by a landlord over a number of properties of manipulating the situation that it can then do so without it being all of the onus being on a tenant to take action. Of course, tenants must be entitled to do that, but most tenants who have been through this will be more focused on finding another home and moving on than on going through the process of taking the landlord to the tribunal for a wrongful termination order, where the most they might get is three months rent. I think that it is quite important that, particularly where there is a pattern, for example, that a local authority or another could take that forward. We support the idea to have a third party be able to do that and take things to tribunal for the reasons outlined by Robert. If you have lost your home or about to lose your home, it is a very stressful time. There is a lot of hardship involved. Going to court and going to tribunal is probably something that is outwith your experience. You are not sure how to go about it and you have a lot of other things on your plate, possibly with family, if you have a family and things like that. The ability of a third party to take cases to tribunal would allow those penalties to actually be implemented. That is part of it as well. In one aspect, there is the threat of the penalty. On the other hand, if those penalties are never given out and nobody has ever charged any money, it is an empty threat. We need those penalties to be used where bad practice is evident and it needs to have teeth. Those teeth need to bite sometimes. In order for that to happen, people need to take those to tribunal. A lot of tenants will not be able to do that for their own life circumstances, so it is important that the third party is able to do that. We have already heard the importance of access to justice for landlords and tenants and ensuring both how well the new tenancy is received and used and how effective it is in practice. We have already heard from the Government again that the implementation timetable for the new tenancy will fall in line with the implementation of the new tribunal system. Understanding the relationship between the two is crucial. We would like to see from the Government more certainty around what advice, assistance and legal representation are going to be available to vulnerable or low-income tenants to ensure that they can access justice. I echo that comment as well. Coming from a student's perspective, the idea of going to a tribunal could be quite daunting, particularly for someone who has just moved away from home. They are living in a new town, and they do not really know that many people in their feel perhaps that there is not an equal relationship between themselves and the landlord, and that the balance of power is tipped against them. Any support that could be provided in that regard would be very useful, because otherwise I do not expect that students would necessarily feel comfortable going out and using the tribunal system. Just to echo everything that has been said already, the other thing to factor into that would be the level of fees in accessing the tribunal and making sure that that is accessible that way as well. Just to say on what Robert was saying about the third-party referrals, I think that it is really important that there is a pattern of abuse by a landlord. Already the local authorities have the ability to make third-party referrals to the PRHP under the Housing Scotland Act, which is just about to come in force for them to be able to do that. It builds already on the powers that they already do, and they are already doing this, so it is just another string to their bow that is another reason that they could take it. I notice that in the written submissions and during the discussion around the table, but both Homeless Action Scotland and Crisis have expressed the view that the penalties available for wrongful termination are too weak. So, do you have any alternative approach that you would suggest? Fraser mentioned landlord registration and how that is linked to particularly where the landlord has misled the tribunal, so I think that that would be something to explore. I think that there are models elsewhere where penalties are much more significant. I think that it is a different system, but in Ireland in some cases there are penalties of up to €20,000 for certain breaches. Now, like I said, it is a different system to this, but three months rent in an average two-bed property would be about £1,800 of money and for the costs of removing and having to pay another deposit when you haven't necessarily got your current deposit back. All those costs that are associated with moving not sending aside all the emotional costs as well, it is not a huge amount of money in some cases for that. As I mentioned earlier, the costs to the local authority, if there has been a homelessness application, could mount well beyond that. You could even consider looking at whether in such a situation like that the landlord should be contributing some of the costs of the local authority? I think that there are a range of things that could be used. Our submission was suggesting that if a landlord is deliberately misleading and deliberately being disingenuous, that it should be a criminal offence and subject to quite severe penalties, including potential imprisonment. I am not a legal expert, but I have been told that there is a common law offence of fraud and uttering, which might be able to be used. I think that there is also potential of using contempt of court proceedings if that is possible in relation to tribunals and so on. However, I think that the deterrent value of deliberately misleading a tribunal or deliberately misusing those grounds should be not simply that the tenant gets adequate compensation but that there is a punitive element against the landlord that amines a real deterrent. The next item on the list that I have in front of me is rent increases. Without going into too much detail on the question, could you please have your comments on the proposals regarding rent increases? I think that, as the Government set out earlier, the mechanism has to be there for landlords to increase rent during a tenancy but also for there to be a limit to that so that it is not used as a way of getting a tenant out through the back door under the new secure arrangements. I think that what has been proposed strikes a good balance. It enables tenants to have that certainty about rent rises within their own tenancy and yet allow the market to operate outside of that. That proposal for the operation of rent increases alongside the suggestions of a rent penalty zone strike a good balance. I guess that our experience with tenants and through all the tenants that we have consulted with is that there is a crisis of affordability in the private rented sector now. It is the most expensive tenure type. In particular areas, we understand that there are areas where it is not as expensive but, given that market rates are too expensive for a lot of people, we have reports of people actually tenants doing illegal things and overcrowding flats themselves is very common just so that they can afford to live in places like Edinburgh and Aberdeen. That is a key issue when it comes to security as well because we have had people feedback to us that yes, I feel secure in my property. I would feel secure with the no-fault ground removed, but if the rent went up, I would not feel secure. In terms of what is being proposed in this actual bill, we feel that rent should be regulated for new tenants, not just sitting tenants because most rent increases at the moment happen between tenants. Regulating rents just for sitting tenants will not bring down that overheated market element in rent pressure areas because people will still be able to increase rates between tenants. In particular areas such as Edinburgh and Aberdeen, where there are a lot of students and people move around quite a bit, it will not do enough to bring down that rent pressure. The measure that is being used is CPI plus 1 per cent plus N, which, when N has to be a positive number, in the past CPI has been as much as 8.5 per cent, even though it is low at the moment. The formula that is being used could lead to quite high increases. We welcome the fact that those are being proposed, but we think that more work needs to be done in future to address the kind of quality issues there. Very briefly, we are quite happy with the proposals in the bill as they are at the moment as an interim measure. We understand that there are particular issues that need to be dealt with, particularly around the Aberdeen area at the moment, and it is a means of doing that. I think that the bill team's evidence was very wise on this in that it is a very complex area indeed, and we think that what we would recommend is that we spend a considerable amount of time investing in looking at a sustainable long-term system for the future. All kinds of systems have unintended consequences, and I think that we really need to get this right. It is far more complex than we could simply put in the face of the bill. On rent pressure zones briefly, Barry mentioned in the last session the importance of the wider measures around it. The rent pressure zones are very much a temporary solution. If you do not get those wider measures right, you will have to keep the rent pressure zone and renew it every five years to stop if you have a massive increase in rents in the wider sector, then sitting tenants will just have to meet those when the rent pressure zone ends. There is a point in there about charges for improvements, which presumably means increases in rents to reflect improvements. That needs to be clarified, both in terms of it being an increase in rents, but also in terms of how that would work in practice and what kind of improvements a landlord might be able to put into the rent. Just on the rent increases more specifically, so the one rise in 12 months with 12 weeks notice, that is very welcome. It is really important to be able to challenge those rent rises that seem to be higher than would be expected through the rent officer and also through the tribunal. Again, that is about making that process accessible and making sure that any fees are realistic and that the length of time to challenge is 21 days in there at the moment. That seems to be a fairly short time, especially if people need to get advice and so on. There is also a point in there about the liability for rent. If people have a big rent increase and it takes a long time for the tribunal to come to a decision, people could be liable for a very big rent increase at the end of that, which they would have to pay off in full in 28 days. That could lead them into the ground through eviction under renters if that is not looked at. There should be discretion for rent officers and the tribunal to allow that to be longer than 28 days to pay that money back. Those are both very helpful points. David, do you want to come in briefly? Yes, convener. I was just keen to get a bit more debate about the rent pressure zones. The witnesses would have… Gary, you wanted to make a point on rent increases. One of our main concerns in particular is for prospective tenants. There is a worry that landlords can just be playing catch-up, so they have had someone in for a certain period of time. As was noted earlier on, they could have a number of different properties at different levels. In cities such as Aberdein, where rents for students have increased over 40-50 per cent, but the level of income has not increased for them. We think that there is a disconnector, but there are ways of looking at that. We obviously think that building more affordable social housing is one way of looking at things. In terms of understanding the problems in the area, looking at the applications that are coming in for local housing support and opportunities would be one way of noting if there are income issues within a hot zone. I have nothing best to cover to the point that I was going to make about the notice periods and getting help and support, so I will not repeat exactly the same thing again. David, can you move us on to the issue of rent pressure zones, please? Thank you, convener. On the right point, I am happy to raise this. Winsons would have heard our previous debate about the area. My general view is that it seems quite sensible designation. District remind witnesses that the procedure has to come from local authorities, then goes to the Scottish Government under the affirmative procedure, and then it is designated. There is no minimum size, no maximum size, obviously up to the boundary of the local authority. There are some issues around there. We would only affect existing tenants, but if I give you an example, an areas declared around the pressure zone, someone moves in to a house in that zone, are they then subject to it, or is it after 12 months, or is it after the current tendency comes to an end? There are issues around that that we need to debate, so I am just keen to get some views around that. I think that Bethrae Lizsoy raised a technical issue around CPI. Obviously, we have to have some measure of inflation, and CPI is a lower index than retail price, which is normally about three quarters per cent higher. However, there are all those issues that we need to get some information about, so just walk through it open, convener, and get some views. I think that the value in the rent pressure zone is not just the impact that it can have on tenants sitting tenants' rent increases during the period that is in operation. I think that the real value in designating a rent pressure zone is the power and the focus that it would give for local authorities to examine and act on the rental market problems that they have in their area. Local authorities as strategic bodies already have to produce local housing strategies. I think that a local authority that is considering a rent pressure zone will have to, as part of the legislation, consult within the local authority area on the designation, but it should also be an onus on them to consider the impact that they should have on their local housing strategy and what other kinds of measures should be taken place. For example, it should be a red alert that more affordable housing is needed in that area and there should be steps taken to ensure that that affordable housing is provided. However, I also wanted to reinforce the point that Robert made in relation to the previous question, which is that the infrastructure, if you like, around controlling rents in other countries has been there for many, many years. I think that this is such a complex area that what we would want to see as a result of the focus that has been brought on this issue through the passage of this bill is the Government to go away and take some time as a result of this bill to fully consider the impact of rent across Scotland, to understand affordability and to think about what additional measures or mechanisms might be put in place in the future to deal with this issue. I think that that was a very good point, because there may be some number of interesting points. Is there a worry—I think that landlords have expressed that—that there could be an escape of capital? For example, the north of Aberdeen is designated and the south is not, is that potential new investment would go to the area that is not covered by the rent pressure zone because you can increase rents more there than you can in the rent pressure zone? What is your thought? Under the current arrangements and the current proposals, the rent pressure zone would only affect sitting tenants, so new investment coming in and letting properties for the first time would be able to set a market rent effectively. I do not think that it would have that impact, but I think that part of the responsibility of the local authority when they are considering a rent pressure zone is then to think about what impact that would have on the market as a whole and to think about what measures they might take to introduce and encourage new investment into private renting to improve supply. That should be one of the things that they take into account. I would reiterate the importance within a rent pressure zone of this applying to prospective as well as sitting tenants in any property because you can see how, if there was a rent pressure zone designated and a landlord knew that it was a rent pressure zone and they knew that once a tenant was in the property they would not be able to increase a rent by whatever they want. That would create an additional impetus to set a very high rent for a new tenant or to overcompensate for the fact that they are in a rent pressure zone, so I cannot put it up too much while they are in there, but before they are in I better put the rent up quite a bit. We think that if it applied to prospective as well as sitting tenants that problem would not be there. I commend that, but surely that would then mean that the investor would not invest? In that particular area, but it might increase supply. Also, what are we wanting to invest in? Maybe that is a red flag for the local authority to invest in more affordable housing in that area if the rent pressure is that high in that area? I think that the point that has been made is that you have introduced rent controls as a complicated business, so I think that the evidence for fairs suggests all of that. You can get into situations where ceilings become floors that actually bid up the rent levels in an area by introducing controls, so I would like to see a lot more research done in that particular area, and I think that that is the consensus that I am getting from the groups here. There have been similar measures introduced in other countries, but perhaps it would be good for us to learn what the experience has been from those other locations. Witnesses feel that the provisions in the bill go far enough. Does anyone have a view on that? We do not feel that they go far enough, although we accept and echo the fact that rent controls are complex and more research is needed. As a starting point, we are pleased with what is being offered. For example, you could have a measure, which was CPI plus N, where N could be a negative number in extreme cases. Now, it usually would not be, but if that was possible, that would go a little bit further towards making renting affordable, which it currently is not. Sorry, just on that point—that is a good point—but, of course, CPI itself can be negative if we have deflation, so that, in the centre, we will be covered. We have noted earlier on some of our concerns with some of the detail, but more broadly, I think that, first of all, we are really happy that there is some form of rent control being introduced, but it is very much a small step at this stage, and we would like to see much more significant development in that area. As far as I see it, there is a severe disconnect between the expectations on people in society for the rent that they have to pay in comparison to the income that they have, particularly for students who struggle to find part-time work and have to rely on their student loan and bursary. There is a question to be asked about reasonable investment into properties, and then a reasonable expectation of what should come out of that. My concern about tying it to a capital market price does not relate, in reality, to the income and the lives of the people who are living in those properties. We have just finally talked about it before, but the ability for landlords to massively hike up rents after our tenant has left and someone would move in is negative for society in general, but it would definitely impact students, because we are much more mobile in the cities that we live in. I think that, notwithstanding what we have said about the complexity of the whole area, and it was certainly something that was considered in a great deal of detail in the process that led to the bill being published, the two big changes that are coming forward and the two things that tenants, when we speak to them, really want is the security of tenure, which is the most fundamental thing that this bill is seeking to achieve. However, what they are also getting from this is a certainty about rents during the time of their tenancy, which again is just as important. With an eye to ensuring that we can create a sector that is going to thrive and grow and that we can see an increase in supply, because fundamentally, high prices are to do with the lack of supply. We would certainly want to see the Government take a much longer term look about rents and affordability and to understand what is best done to tackle those, but I think that what we currently have in this bill strikes the right balance. Does that point perhaps bring us back to a point that Liz made at the beginning of our session, which is that there are wider issues around where we place investment in how we provide affordable housing for people in Scotland? I am not sure that the bill can tackle that, but that is perhaps a good point to end on. Do you have any further points that you wanted to make, David? No, convener. I think that the points have been covered very comprehensively. Are there any issues in terms of what is being proposed in the bill that we have not covered often in our round-table discussion this morning that witnesses would like to raise? That is your last chance. One that I am slightly confused about, under the standard terms of the tenancy, where there is a requirement on tenants to inform the landlord of anyone who is staying with them, it seemed to me that that was quite a large intrusion. I was wondering whether it would be more appropriate for somebody staying with them as their principal home might actually be a more appropriate way of phrasing that. Thank you for that. That is helpful. Rose-Marie. One thing that has not come up so far in this morning's evidence is part six of the bill, which refers to the tenant having the right to, sorry, partner of a tenant having the right to succeed to that tenancy upon the tenant's death. That is a very welcome move. We fully support that, and it brings private sector tenants in line with the situation in the social sector. I am sure that it will come up in later evidence sessions, and I wanted to get on record that we would fully support that. Thank you very much. Any other final points? No, okay. I think that we have covered a lot of ground this morning. I am very grateful to members and also to witnesses for their time and their contributions this morning. Thank you for that. The next meeting is on 11 November. The committee will hold a second round table discussion on the bill, this time from organisations representing the landlord and letting agent industry, and we will take evidence from the Minister for Housing on a statutory instrument on the private rented housing panel. That concludes today's committee business. I close this meeting of the committee.