- Committee (2nd Day)
- Relevant document: 14th Report from the Delegated Powers Committee. Scottish Legislative Consent granted, Welsh Legislative Consent sought.
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- My Lords, before we start the debate on the first group, I remind the Committee of the protocol around declaring interests, following a number of questions. As I mentioned earlier this week, noble Lords should declare any relevant interests at each stage of proceedings on a Bill. That means that, in Committee, relevant interests should be declared during the first group on which a noble Lord speaks. If a noble Lord declared an interest during the previous day of Committee then that is sufficient, but if this is their first contribution then any relevant interest should be declared specifically but briefly.Clause 3: Sections 1 and 2: effect of superior leasesAmendment 16
- 16: Clause 3, page 3, line 6, leave out from “tenancy” to end of line 8 Member’s explanatory statement This amendment seeks to probe the government’s rationale for introducing retroactive legislation.
- My Lords, I am grateful for that clarification from the Government Whip. On that basis I declare again that, as in the register of Members’ financial interests, I receive a rental income from my one property, which was my matrimonial home.I will speak to Amendments 16, 17 and 18. My intention is to highlight an important principle that this legislation seems to violate. The amendments in this group are underpinned by the Bill’s retroactivity. I seek to probe the Government’s use of retroactive provisions, and I urge them to reaffirm from the Dispatch Box their commitment to prospective lawmaking.Retrospective legislation is generally defined as legislation which“takes away or impairs any vested right acquired under existing laws, or creates a new obligation, or imposes a new duty or attaches a new disability in respect to transactions or considerations already passed”.The Oxford Dictionary of Law defines retroactive legislation as:“Legislation that operates on matters taking place before its enactment, e.g. by penalizing conduct that was lawful when it occurred. There is a presumption that statutes are not intended to have retroactive effect unless they merely change legal procedure”.Stroud’s Judicial Dictionary of Words and Phrases—a tome that I am sure we are all familiar with—defines it in Latin as:“Nova constitutio futuris formam imponere debet, non praeteritis”.That is, unless there be clear words to the contrary, statutes do not apply to a past but to a future state or circumstance.The general approach to retrospective legislation was summarised by the noble Lord, Lord Kerr, in the Supreme Court case of Walker v Innospec Ltd and others in 2017, where he said:
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- Retroactivity is damaging because it violates the principle of fairness and undermines legal certainty. If laws can change after a contract is formed, nobody can rely on what the law says today. It sends a message that the laws that form the basis of an agreement today could be retrospectively changed tomorrow. This Bill erodes trust in the legal system. It creates unclear implications for decision-making and disrupts property and contract rights. Should not this be challenged? That is the basis of my amendment. Regardless of the Bill’s specific contents or intentions, its retroactive nature raises significant legal concerns and marks a clear departure from the well-established way in which law is enacted in this country.
- Let me remind the House, if I may, of some relevant precedents from Acts that this Bill directly seeks to amend. When this House passed the Tenant Fees Act 2019, the legislation applied only to new or renewed tenancies from 1 June 2019. For all existing tenancies, the rules did not apply until 1 January 2020—a full 12-month transitional period. The much-debated Housing Act 1988 went even further in demonstrating the principle of prospective lawmaking. At the top of Schedule 1 it included a clear and explicit statement that the provisions would not apply retroactively. The words affixed to the Act are clear that legal certainty must be upheld and contractual agreements must be respected. Even the predecessor to this Bill adopted a model of prospective lawmaking by setting out a two-tier approach to implementation. The Renters’ Rights Bill stands in stark contrast. It contains no transitional period; all existing assured shorthold tenancies, even those still mid-term, would be immediately converted upon commencement.
- I urge the Government to reconsider this approach and to reaffirm the long-standing commitment to prospective lawmaking by providing clear commencement dates and reasonable transition periods for all new obligations, to protect both tenants and landlords from the risk of abrupt and unfair change. The approach will give landlords, tenants and letting agents time to adjust their practices. I urge the Government to stop, think and assess the damage that they could cause. With that, I beg to move.
- My Lords, my noble friend raises a very important point. The Bill has merit. It also endangers the overall objective of increasing the supply of housing for the people of this country. It is very important that the transitional costs of introducing the Bill, if it becomes an Act, are minimised. The point that my noble friend perhaps did not emphasise sufficiently is that if there is a retrospective element to the Act, particularly if it is a rather obscure and unclear retrospective element, that will result in more confusion and, most importantly, more need for judicial decision. We should bear in mind throughout Committee that the judicial system in this country is under huge stress, the Chancellor is being asked for more money for really crucial cases, and it must be an objective of the Government, as we consider the Bill, to make sure that, in whatever form the Bill eventually comes out, it will require a minimum of judicial intervention.
- My Lords, I support what the noble Lords have said there. The principle against retrospection is long-lasting and fundamental to our constitution and our legal system, and it is enshrined, as has been said, in the European Convention on Human Rights.There is an ECHR memorandum on the Bill in which the assessment is made that it strikes a proportionate balance between rights of property on one hand and the rights of tenants on the other. I would like to know from the Minister whether that proportionality assessment has properly taken into account the significance and the implications of the retrospection that has been drawn attention to here. What actually are the implications of that retrospection? What does it affect? If those words are kept in the Bill, what rights do they actually affect which are imposed in a new way by the Bill?
- Not wishing to lower the tone of erudition in the Committee, I would say, “latine non studi”. In plain English, what I would like to say is that the kernel of the noble Lord’s concerns is about certainty and clarity over arrangements. We have all had letters from different people saying, “I don’t know whether this means I now have to change”. So I genuinely think that there is an issue around clarity and understanding and, to that end, I really look forward to the Minister’s response, because what we all need is a clear and flexible framework for tenancies that everyone understands. She spoke in some of her answers about making it simpler, but it seems that, historically, we have inherited quite an amazing array of differences, and it is perhaps no wonder that some people are struggling. So I think that the transition, and transitional arrangements, is something we should look at.
- My Lords, I again note my interest in the register as the owner of a single rented property. The Minister has asserted, as Ministers are required to do, that, in her view,“the provisions of the Renters’ Rights Bill are compatible with the Convention rights”.I am just wondering, because it does tend to be a bit of a routine that those of us who have ever done this sign these things: can she tell the Committee whether there was a very specific examination of the circumstances in the Bill?I must also say that the tour de force by the noble Lord, Lord Jackson, was impressive. We all felt that his Latin was very good—we will give him marks for that, I think—and he raises a very significant point. It is not unique to have retrospective legislation, but it is certainly frowned upon, bearing in mind the number of people who could be directly affected—their financial welfare, their own welfare, their concerns and the worries that can be generated by having something done, in effect, long after they had agreed and thought they had a deal. I am sure that President Trump will be listening to this debate, because he might be learning lessons; we might be teaching him things to do.Can the Minister assure the Committee that when she signed that, or gave her views on the convention rights, that it was actually properly assessed, and legal advice was provided, rather than it simply being a piece of routine that departments do when they bring legislation to Parliament? Having listened to the contribution of the noble Lord, Lord Jackson, I think there could very well be people who will feel aggrieved if something happens subsequent to an agreement that they entered into freely and, all of a sudden, things have changed. I think we do need an explanation.
- Can I just add that I was disappointed that we did not have any phraseology in ancient Greek? We will have to put up with that for today, I suppose. I echo my noble friend Lord Carter’s point: I think it would be really helpful, whatever one thinks of the rights and wrongs of retrospective legislation, that a proper list is set out as to which rights are going to be affected. I think everybody outside this Chamber is going to need that, in practice, in the rental sector. It would be very helpful if something could be published that literally specifies which bits are going to be affected retrospectively and how.
- My Lords, I start by thanking my noble friend Lord Jackson of Peterborough for bringing Amendments 16 to 18 to the Committee today. The question of the retroactivity of the Bill is not just a question of how it will be applied, it is a question as to whether it is fair at all. It is easy for Governments armed with executive powers to apply the law retrospectively, but it should be the duty of every Minister to ask: is this the right way? Is it the fair way?I invite noble Lords to imagine that they signed a tenancy agreement under a clear set of rules in January 2025; they followed all the rules; then, in June 2025, Parliament passes a law saying that their tenancy is now invalid. Well, many will have to imagine no longer, because once the Bill gets Royal Assent, tenants and landlords may find that their agreements are no longer valid.The predecessor of the Bill adopted a model of prospective lawmaking by setting out a two-pronged approach to implementation. It would have assured that substantial changes were introduced at a suitable pace, one that brought the sector along with it, giving it time to understand the new requirements and adapt accordingly. In their haste to publish the Bill, the Government appear willing to abandon the principle of prospective lawmaking, placing an immediate and heavy burden on landlords. The Committee will be well aware that 45% of landlords own just a single property. These are not professional landlords with teams behind them. They lack the infrastructure to absorb complex regulatory change. They are not poring over the details of legislation, nor do they have time to follow days of Committee proceedings. How do the Government expect these individuals to implement such sweeping reforms all at once and without a serious and structured implementation period?At this Dispatch Box on Tuesday, I quoted some statistics from Paragon. In the same survey, it noted that 39% of landlords had not even heard of the Bill. Will the Minister please explain how the Government will communicate these changes? The department must begin explaining in clear and simple terms what is coming down the track. Landlords need to know that change is coming. Regardless of the Bill’s specific contents or intentions, its retroactive nature will pose challenges. It will not only bring an abrupt end to agreements freely entered into by two consenting adults, it will unleash a wave of challenges upon landlords through its immediate implementation.
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