Renters’ Rights Bill

Baroness Hayman Excerpts

Wednesday 14th May 2025 Lords Chamber

[Baroness Bennett of Manor Castle (GP)]

My Lords, on behalf of my noble friend Lady Jones of Moulsecoomb, I will move Amendment 259, a three-word amendment that provides argument for the value of explanatory statements. As this explanatory statement says, the addition of “Energy Act 2011” would give local authorities

“the power to use this data”—

about home energy efficiency—

“to enforce minimum energy efficiency standards”.

As we have discussed often on this Bill, many renters are stuck in cold, damp, leaky homes. Sometimes there are very simple and cheap fixes, such as adding or topping-up loft insulation. Sometimes they are more complicated and challenging fixes, such as insulating solid wall properties. This amendment gives local authorities the power to obtain and use energy efficiency information to help private renters. This could allow housing officers to support tenants in the most poorly insulated homes or, importantly, it could support councils to develop the street-by-street insulation programmes that can bring economies of scale and support widespread installation of insulation.

The case study is quite an old but lovely one. In Kirklees, a Green councillor, Andrew Cooper, was one of the driving forces behind a street-by-street insulation programme. The noble Lord, Lord Cameron of Chipping Norton, claimed credit for it, which may be the first time that we have seen a Green achievement being so claimed. I saw reports on how that worked out afterwards. One of the things that really came through was how much people are concerned about cowboy builders, which might be true of landlords as well as tenants, but that they trust their local authorities. That street-by-street process works well, but to make that happen you need the data. That is what this modest amendment is designed to achieve. It builds on the positive Clause 134, which will give local authorities more data to support tenants and take enforcement action against failing landlords.

Given the hour, I will leave the noble Baroness, Lady Hayman, to explain Amendment 274, which is related to this. I hope that the Minister can set out—briefly, given the hour—how the Government plan to ramp up support for domestic energy efficiency, especially for private renters. As we have just heard, so many are in vulnerable situations. Given the cost of living crisis, this is often seen as an environmental measure, but it is a crucial anti-poverty measure. We need to make this as easy and simple for local authorities to achieve as possible. I beg to move.

[Baroness Hayman (CB)]

My Lords, I declare my interests as a previous chair of Peers for the Planet and a director of that organisation. I will speak to my Amendment 274, which is supported by the noble Baroness, Lady Penn, who cannot be in the Chamber this evening. It continues the theme of energy efficiency that the noble Baroness, Lady Bennett, has just spoken about on her Amendment 259. She dealt specifically with the issue of data on energy efficiency. I wish to contribute particularly on the issue of financing energy-efficiency measures. This is the first time that I have spoken in Committee on this Bill, mainly because of my interaction with the Minister and her officials in the run-up to it, during which several issues were clarified very helpfully.

The issue of improving energy efficiency in the private rented sector has been discussed at length and on multiple occasions in this House. I hope that the current consultation will go some way to address the lack of coherent and consistent long-term policy certainty in this area, because it has suffered from stop-go and from changes of administrations and forms of assistance that have been incoherent and stopped us making progress. Of course, one of the main issues preventing progress in this area is funding, so my amendment seeks to break through some of the barriers to progress by requiring the Government to publish a road map on how private finance initiatives could be scaled up to support the funding of energy-efficiency measures.

Other speakers in the Committee have pointed out the problems that exist because of the quality of the stock in the private rented sector. As the right reverend Prelate the Bishop of Manchester pointed out, nearly half the housing stock in the private rented sector has an EPC rating below C. Although fuel poverty has fallen 35% among owner-occupiers and 54% among council tenants since 2010, it has fallen only 4% for private renters. Their homes are still disproportionately damp and cold, causing both short- and long-term health issues, with higher bills adding insult to injury. Of course, this is an issue where we should take action not only because of the need to help people in this situation but because of the detrimental effects this has on our achievement of net zero and improving our energy security.

However, while there has been widespread agreement about the value of improving energy efficiency, finance has always been an obstacle to progress. The costs of improving the quality of housing will be substantial, as others have said, given where we are starting from, and it is not realistic to expect the Government to foot the bill in its entirety, nor to put intolerable burdens on landlords. We need to find a way to finance these improvements that will work for tenants, landlords and the public purse. I recognise that the Government are doing some work on this and looking at how barriers can be overcome. The green home finance accelerator fund, due to end in June, has a number of projects looking specifically at rented properties and a number of pilot schemes. I would like to hear from the Minister what steps the Government plan to take in response to what they are learning from the experience of the fund and to what timetable they will be working.

There is also a growing number of innovative private sector finance mechanisms that deserve serious attention. As the UK Sustainable Investment and Finance Association recently reported, the high upfront costs of installing energy-efficient technologies remain the biggest challenge for landlords, and ensuring that there is private capital to support this process, and investment to help drive down the costs of energy efficiency, is paramount. To meet this challenge, a number of policy proposals have been made that my amendment would prompt the Government to consider. The UK Green Building Council, for example, has proposed a warm home stamp duty incentive, where stamp duty would be adjusted up or down depending on the EPC of a property and a rebate would be triggered within two years of purchase if the energy efficiency of the home had been improved.

The Local Government Association has recently recommended that the Government should incentivise landlords through tax rebates. France has added energy efficiency improvements to the list of deductible costs of managing a property, such as legal fees or insurance. Within the UK, Scotland has introduced low-interest loans for landlords. Such loans could be linked to the property, rather than the individual, for which there is the precedent of the interest-free loans that were available to install renewables.

Property-linked finance has been deployed in several other countries, and these are all measures that deserve serious consideration by the Government. They could cut through the Gordian knot of all agreeing that a great deal needs to be done but no one being able to see how it could be financed.

I hope that when the Minister responds, she will provide a little more detail on the Government’s thinking in this area, particularly on ways of incentivising landlords and how the Government intend to make progress in an area about which much has been said but too little has been done.

[Baroness Grender (LD)]

My Lords, I thank the noble Baronesses, Lady Hayman and Lady Bennett, for tabling these amendments and generating this debate. We on these Benches support both amendments. Every renter has the right to a warm and energy-efficient home as part of a decent standard of living. Improving energy performance in private rentals not only is vital for tenants’ comfort and reducing fuel poverty but contributes to the all-important climate target.

I thank the LGA for its briefing. It is concerned about how enforcement will be enhanced to ensure that minimum energy-efficiency standards in the PRS are upheld. As we know, the sad reality is that some landlords continue to let out inefficient, poorly insulated properties, leaving tenants with high energy bills and cold homes. Indeed, tenants in the private rented sector living in the least efficient homes are paying as much as an additional £1,000 a year on their energy bills, compared with someone living in a relatively energy-efficient home. As we heard in previous discussions, an expansion of the rent repayment orders to cover situations where a landlord lets a property that fails to meet the minimum energy-efficiency requirements would mean that if a landlord breached energy standards, for example by renting out a property below the legal EPC threshold, the tenant or council could apply for an order to reclaim up to 12 months’ rent, which we think will be a powerful deterrent against non-compliance.

Amendment 274, tabled by the noble Baroness, Lady Hayman, is an extremely useful step towards the ultimate goal of making homes warmer and more sustainable. It proposes a clear government strategy to unlock private finance, for example with green loans or incentive schemes for landlords to retrofit insulation and efficient heating. It makes me a little nostalgic for something that we think was an excellent model, but it was on a wider infrastructural basis. I refer to the Green Investment Bank, which was introduced in the early days of the coalition Government. The National Audit Office praised it for having a clear rationale, mission and objectives, backed by sound oversight. The then Department for Business, Energy and Industrial Strategy, the NAO and the Institute for Government all concluded that it had largely been successful in scaling up the UK’s green investment during its early years. It invested £3.4 billion into green projects, attracting £8.6 billion of private capital—a healthy £2.50 of private investment for every £1 of public money. Its portfolio was expected to deliver a 10% return by 2017. Sadly, in 2015, the Conservatives flogged it off and that 10% return was not realised. I would love to be able to tempt the Minister to look at that model as a really interesting way of pulling in investment.

I thank the noble Baroness, Lady Bennett, for recalling the excellent Kirklees Council scheme. I think it was the local authority with the largest number of retrofitting and insulation projects. It was award winning. I would not want to miss the opportunity of mentioning that my noble friend Lady Pinnock was then leader of Kirklees. It drew on finance that it received for an infrastructure project; it decided to insulate across every tenure in the largest local authority area. I believe that it is still the largest local authority area, unless anyone wants to correct me.

These remain excellent examples of how facilitating investment in measures such as insulation, efficient boilers and double glazing, the Government can ensure that landlords have the means to comply with higher energy requirements rather than simply exiting the market or passing the costs on to their tenants. We therefore welcome this proposed roadmap and data collection and look forward to hearing the Minister’s response.