<p>Banning Letting Agency Fees</p>

1. 1. Questions to the First Minister – in the Senedd at 2:02 pm on 29 November 2016.

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Photo of Jenny Rathbone Jenny Rathbone Labour 2:02, 29 November 2016

The leader of Plaid Cymru has already stolen my question, but I’ll ask it for the record anyway.

In light of the measures announced in the autumn statement, will the Welsh Government consider joining England—

Photo of Elin Jones Elin Jones Plaid Cymru

Sorry, questions are not stolen in this place. Somebody has asked your question before you got to it. So, just ask the question on the order paper.

Photo of Jenny Rathbone Jenny Rathbone Labour 29 November 2016

(Translated)

5. In light of the measures announced in the Autumn Statement, will the Welsh Government consider joining England and Scotland in banning letting agency fees? OAQ(5)0306(FM)

Photo of Carwyn Jones Carwyn Jones Labour 2:02, 29 November 2016

It’s a matter of where questions are asked, of course, when these things arise, but I give the Member the same answer I gave to the leader of Plaid Cymru, which is: we are studying the impact of the ban in Scotland and, together with the final details of proposals in England, that will inform any action that we take. And as I mentioned earlier on, I thank the Member for the advocacy she has shown to so many tenants in her constituency, where they have been exploited over some years. This is a matter I know she has been very active in combating.

Photo of Jenny Rathbone Jenny Rathbone Labour 2:03, 29 November 2016

Just to put some details on the bones of that issue, I’ve got information that Citizens Advice says the average tenancy fee is £337, Shelter says that 15 per cent of renters are using an agency where they’ve had to pay up £500 or more, and tenants in Cardiff have said that fees are around £450.

Too many agents, certainly operating in my constituency, are charging exploitative levels of fees, frequently far in excess of the actual cost, and also putting on hidden fees, often on people who are very young and are tentatively working their way through what are their rights. You can charge £60 or more for a credit check—a check that the firm will be doing for as little as £5. The renewal fee for staying in the same property can be as high as £300, when it amounts to little more than printing off a contract to sign. So, too many unscrupulous agents have got away with excessive fees and double-charging landlords.

I just want to refer the First Minister to a report from Shelter. Shelter’s research shows—it isn’t just the ONS—that landlords in Scotland were no more likely to have increased rent since 2012 than landlords elsewhere in the UK. So, can you confirm that the Welsh Government has not ruled out action to prevent letting agents charging exorbitant and hidden fees?

Photo of Carwyn Jones Carwyn Jones Labour 2:04, 29 November 2016

Yes, I can confirm that. The Member, of course, makes a strong case for the abolition of such fees. I know that the Minister is actively looking at how this can be taken forward in the future and examining the emerging evidence from Scotland.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru 2:05, 29 November 2016

First Minister, there seems to have been some confusion at the time—when we debated this previously, in the previous Assembly—over whether you had the powers, or not. And I understand that you were able to give backbench Labour Assembly Members advice to suggest that it wasn’t, in fact, legal for you to do so, something that wasn’t shared with the rest of us as part of that particular debate. I would like to ask here today, First Minister, if you’re minded to bring forward any future debate or any future legislation, if you could put forward that advice to the Assembly, so that we can analyse it independently so that we can assess the way forward, because we seem to be hearing one thing from backbenchers and another from Government.

Photo of Carwyn Jones Carwyn Jones Labour

Well, the Member’s not a member of the group on this side of the Chamber, and how she is aware of what was and wasn’t said is a matter for her, but what I can say is that anything is potentially open to challenge, because of the inadequate nature of our devolution settlement, which is why, even though the opportunity hasn’t been grasped properly by the UK Government, we need to make sure there is greater clarity. We will look to proceed on the basis that we will do for the people of Wales what is proposed in England and in Scotland. The fact that the Government, the UK Government in England, I would argue, has already conceded in any event that they believe this is devolved, because they’ve only talked about England in this regard, is something that is, of course, helpful to any future potential reference to the Supreme Court.

Photo of David Melding David Melding Conservative 2:06, 29 November 2016

First Minister, these fees are something of a horror. There aren’t many goods and services where we actually get charged for the process of purchase, and there’s clear support all around the house for action to be taken on this. These fees do distort the market. They’re a disincentive to the mobility of labour, and the clear experience in Scotland is that the charges would be absorbed by those offering homes to rent, which is where they’ve traditionally been.

Photo of Carwyn Jones Carwyn Jones Labour 2:07, 29 November 2016

I don’t argue against what the Member has said; that evidence that Shelter has produced in terms of Scotland is useful and strong evidence that will inform the way forward as far as Wales is concerned.