Diolch, Llywydd. Today, I am introducing the Renting Homes (Amendment) (Wales) Bill to the Senedd. This is an important Bill, and an unusual Bill in the sense that it will amend an Act of the Assembly, the Renting Homes (Wales) Act 2016, that has not yet been brought into force. I will have more to say on that presently, but first, I want to take a few moments to explain what it is that this Bill seeks to achieve, and how it will change the relationship between landlords and tenants, or 'contract holders' as they are described in the 2016 Act.

This Bill will amend the 2016 Act to provide greater security of tenure for contract holders who rent their homes in Wales, in particular those who live in the private rented sector and who will, when the provisions of the 2016 Act come into force, do so under standard occupation contracts with their landlord. These standard contracts will become the default contract type in the sector, replacing assured shorthold tenancies made under the Housing Act 1988.

The Bill will increase security of occupation under a periodic standard contract in the following ways: it will extend the minimum notice period for a landlord’s notice given under section 173 of the 2016 Act, which is similar to section 21 of the Housing Act 1988, from two months to six months; it will restrict the issuing of such a notice until at least six months after the occupation date of the contract—the 2016 Act currently sets this at four months. Together with the extended notice period, this will double, from six months to one year, the minimum occupation period for someone who does not breach their contract. 

The Bill will also prevent a landlord from serving a new section 173 notice until at least six months after the expiry or withdrawal of the previous section 173 notice. This is to ensure that landlords are not tempted to issue repeated section 173 notices 'just in case', which would be damaging to a contract holder’s sense of security and certainty. However, in recognition of the fact that landlords do, on occasion, make technical mistakes when serving notices, the Bill also includes a provision that enables a landlord to withdraw and reissue a notice within 14 days.

The Bill will also make a number of changes to the way that fixed-term standard contracts operate so that landlords are not tempted to use fixed-term contracts as a way of circumventing the additional security that will be provided under periodic standard contracts. It will remove the ability a landlord would otherwise have had to issue a notice during a fixed-term standard contract requiring the contract holder to leave at the end of the fixed term. Instead, a landlord will be required to serve a section 173 notice to bring to an end the periodic standard contract that will automatically arise at the end of the fixed term. That section 173 notice would, of course, be subject to the extended six-month notice period, regardless of the length of the initial fixed-term period.

The Bill will also prevent the inclusion of a landlord’s break clause in fixed-term standard contracts of less than 24 months, and prevent the activation of any break clause before month 18 of a fixed-term contract. Again, this will be subject to a six-month notice period.

To ensure that there are no loopholes that unscrupulous landlords might seek to exploit, we will also be removing the arrangement under the 2016 Act that currently allows a landlord to seek possession if a contract holder does not confirm, within two months of being notified, that they are content with a variation that has been made to a term in their contract. In addition, a regulation-making power will be used to limit the use of a term, which allows the contract holder to be excluded from the property for specific periods, for example, to contracts for student accommodation let by higher education institutions.

And finally, the Bill also makes a number of miscellaneous amendments to the 2016 Act. These include removing the subjective element of the test that establishes whether a modification to a fundamental term in a contract improves the contract holder’s position. This is to preclude unscrupulous landlords from seeking to undermine security of occupation by pressurising contract holders to agree that a notice period of less than six months, for example, would be in their interests.

The Bill also provides exemptions for particular types of very specific contracts, such as prohibited-conduct standard contracts, service occupancies or supported accommodation, where it is accepted that shorter notice periods and greater certainty regarding contract-end dates is required. These are very tightly controlled in the Bill to prevent any potential misuse, while still enabling social landlords, as well as employers who undertake a landlord function in relation to some of their employees, to have the certainty required in particular circumstances.

My previous statement to Members on this Bill was back in September, when I provided a brief summary of our proposals as they stood at that time and initial feedback from the consultation exercise that had recently concluded. You will know from the statement I issued last month that the final consultation response has since been published, and that the changes we are seeking to make have not been met with universal support. That is to be expected, but this Government makes no apologies for bringing forward legislation that will, as part of our wider programme to support a professional and well-regulated sector offering high-quality homes to those who wish to rent, create conditions of improved security and certainty for the growing number of our citizens who rely on the private rented sector for their accommodation.

Earlier, I mentioned that this Bill was unusual as it amends the Renting Homes (Wales) Act 2016 that has not yet come into force. The reasons for the delay in implementing the 2016 Act are complex, but I am confident that we now have the assurances we need from the UK Government that the necessary infrastructure will be in place to enable us to go live with the new arrangements before the end of this Assembly term. The 2016 Act, will, when implemented, bring a number of significant wider benefits for those who rent their home in Wales. I wrote to all Members in October last year to set out these benefits, and have re-circulated that letter as it provides more detail than time will allow for now.

This Bill, if passed, will add a further significant benefit by ensuring that a possession notice, where there is no breach of contract, cannot be served for the first six months of occupation, and where possession is sought, giving the contract holder six months’ notice. This will provide valuable time for individuals and families faced with possession under section 173 and the organisations and agencies that support them, to find a new home that is right for them and make all necessary arrangements for a smooth transition to their new home.

I look forward to working with you and all of our stakeholders constructively in the coming months, as this Bill makes its way through the scrutiny process. Diolch.