Labour’s Rent Reforms

February 3rd, 2015. Labour have reiterated these proposals so I thought it might be worth revisiting this post. Since it was written, Generation Rent have produced substantially more radical proposals for rent controls with any monthly rent above the level of half the annual council tax band for the house subject to a 50% surcharge to pay for new social housing. There are clear questions over how this would work: would landlords reduce rents, particularly in areas of high demand, or might they increase them to try to cover the surcharge and, if so, why should private renters be covering the cost of social house building rather than it be covered out of general taxation? (and what is defined as “social” housing, anyway?) Nevertheless, their radicalism compared to Generation Rent’s previously insipid proposals indicates how both political struggle and the winning of small victories, as Labour’s proposals are, changes the terrain of politics and expands possibilities. Essentially, Labour’s proposals mean any private renters campaign not demanding rent controls that would bring down rents and secure (lifetime) tenancies is an irrelevance.

Labour’s proposals remain, however, timid and inadequate. The focus on security, stability, “driving up standards” (especially as landlord licensing is to be a large part of this) and how little is got for such high rents rather than the eye-watering rents themselves mark their limit. As Engels wrote, the housing crisis “gets talked of so much only because it does not limit itself to the working class but has affected the petty bourgeoisie too”, whilst Labour’s proposals will benefit all private renters, they only go a long way in resolving the problems the most privileged private renters- precisely those, as in 1872, whose difficulties have prompted the incessant talk about the housing crisis- face. Private renting in the UK, even with Labour’s changes will remain deeply exploitative and fundamentally unsuitable for all but the most privileged private renters, and, in particular, those people forced into the private rented sector because of the lack of council housing.

The first thing to say about Labour’s proposed reforms to private renting is that what is being proposed is concrete and meaningful and, if implemented, will significantly improve the lives of private renters; the second thing to say is that the proposed reforms are insufficient, particularly in terms of what is being offered in terms of controlling rents- we are, sadly, a long way from “Venezuelan-style rent controls”– but also in the potential loopholes and unclarified points that could be exploited by landlords particularly in rapidly gentrifying areas like Peckham and Hackney.

Before addressing the limitations of and problems with Labour’s proposed reforms, it is worth dwelling on their quite surprising radicalism and how much this radicalism represents a victory for those of us involved in the private tenants’ movement and for other housing campaigners. There is an ultra-leftist danger that, whilst, rightly attentive to the limitations of what is being proposed, downplays the usefulness of these reforms and how much the situation in which Labour can propose such reforms is the result of militant organising. In abstracting the reforms from militant, extra-parliamentary organising and action, the ultra-left position exhibits a peculiar dependence on the Labour cheerleading that presents these measures as the gift of Labour politicians. To grasp the relative radicalism of the reforms, it is worth comparing them with the policy demands of the campaigning group Generation Rent, who have been “working to change the culture, making long-term tenancies much more available” and calling for house building programmes and energy efficiency programmes to reduce costs. What is notable about Generation Rent’s proposals is how much weaker they are than what Labour is proposing with its willingness to use state power to introduce three year tenancies with considerable restrictions on landlords’ abilities to evict tenants and, albeit in a very moderate way, to control rents. Labour’s proposed reforms have rendered groups with moderate demands who claim to represent private renters entirely irrelevant. The proposals, particularly in admitting a role for the state to intervene in private renting in the interests of tenants, considerably expand the area of what constitutes “reasonable” demands from private tenants’ groups; the terrain on which we organise has been transformed.

It is the conceptual leap of the reforms and the expansion of possibilities that they could allow, in allowing a role for the state, acting in the interests of private tenants, to use legislation rather than asking, necessarily ineffectually, for “cultural change” that is behind the absurd squealing from Conservatives, landlords and right-wing thinktanks- City AM’s frontpage headline was “Labour’s War on Landlords”, The Conservatives have described the reforms as involving “Venezuelan-style rent controls”.

The resolution of the housing crisis in London in a way that improves the position of private renters does, in fact, require Venezuelan-style rent controls. In Venezuela, homes are inspected by the government in conjunction with tenants’ groups in order to determine the real value of the property, which is usually considerably less than the market value, rent is then set at between 3% and 5% of this value. Labour, by contrast, proposes that at the beginning of a three-year tenancy landlords may set whatever rent they wish but this rent may only be increased once a year and this increase will be capped based on “average market rents”. This ceiling does introduce a measure of protection but, particularly in rapidly gentrifying areas like Peckham, where letting agents brag about rents having increased by 50% over the past 5 years, its benefits will be fairly limited, as my Southwark & Lewisham Tenants comrade Robert says, “Labour’s proposal..sound[s] like a managed real-terms incline of rents. A trimming of the very worst extremes.”

In terms of tenants’ experiences of where we live, and our ability to enjoy them as homes, making the standard tenancy three years, with the abolition of Section 21, which allows for “no-fault” evictions, and a fairly limited set of causes allowing a landlord to evict a tenant, represents a huge improvement that will considerably reduce anxiety and insecurity. Furthermore, longer tenancies with the end of Section 21, will make it easier for tenants to exercise their rights to demand repairs without fear of eviction (in 2013 one in eight private tenants did not ask a landlord for repairs for fear of being evicted, and one in thirty-three had been a victim of retaliatory eviction).

However, Labour’s proposals still allow for evictions, this should be opposed. Some of the cases in which evictions are allowed may well allow considerable space for abuse from landlords, particularly in rapidly gentrifying areas. Evictions will be allowed, with two months notice, when there are rent arrears, a tenant is convicted of anti-social behaviour, if the landlord wishes to sell the property, needs the property for their or their family’s use, if the tenant breaks the tenancy agreement or if the landlord wants to change the use of or refurbish the property, – this is the most concerning case. A friend and comrade in Peckham is currently being evicted because their landlord wants to refurbish their home and let it out again at almost double the rent. This is not atypical in areas in which rents are increasing rapidly, the “physical change in the housing stock” (Neil Smith) is a major part of the gentrification process and the promise of higher rents for landlords- the closing of the rent gap, which necessarily will involve the eviction of tenants to allow (Smith again) the fixing up of buildings in run-down neighbourhoods is explicitly allowed in Labour’s proposals.

Labour’s proposed reforms will not fix the private rented sector for tenants, although they will substantially ameliorate things. However, as private tenant militants, it is necessary both to celebrate the victory that these proposals represent and how far they transform the political terrain around private renting. Private renters must continue to demand, as London Renters demanded of Labour, rent controls which would see rents fall in London, genuinely secure tenancies and that more council houses are built allowing tenants to exit an inherently exploitative relationship.

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2 thoughts on “Labour’s Rent Reforms

  1. Pingback: A Critical Analysis of Labour’s Rent Reforms |

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