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Amendment to the Scheme of Delegation of Functions - Renting Homes (Fees etc.) (Wales) Act 2019

Minutes:

The Operational Manager SRS presented a report, in order to inform Cabinet of new legislation, namely the above and to seek to amend the Scheme of Delegations of Functions to accord with this.

 

He confirmed that the Renting Homes (Fees etc) (Wales) Act 2019 came into force on 5 May 2019. Since the 1 September 2019, letting agents and landlords who manage their own properties are prevented from charging any fees before, during or after a tenancy, unless they were specifically exempt under the provisions of the Act. Such a banned payment is called a ‘prohibited payment’. He added that Letting Agents and Self-Managing Landlords are also banned from requiring a tenant to take out a loan or entering into a contract for services.

 

Enforcement of such new requirements can be undertaken by the Council and Rent Smart Wales (as the Single Licensing Authority). They will contribute to a fairer and more transparent experience for tenants relying on the private rented sector.

 

The Operational Manager SRS added, that Welsh Government believe that any costs associated with renting in the private sector should be reasonable, affordable and transparent.

 

Paragraph 3.5 of the report, defined the different methods by which payment can be required by letting agents and self-managing landlords, whilst the next section of the report highlighted other issues regarding payments, including those that are banned and prohibited.

 

He proceeded further, by confirming that offences were committed where landlords and/or agents failed to comply with the Act and that local authorities were responsible for enforcing this legislation, in partnership with Rent Smart Wales (RSW).

 

He further added, that local authorities are primarily responsible for enforcing the requirements of the Act and have a duty to inform the Rent Smart Wales if they take enforcement action. Rent Smart Wales will also have a duty to inform Local Authorities, if they serve a fixed penalty notice or prosecute under the new Act. There were two formal enforcement options as described in paragraph 4.3 of the report, whilst paragraph 4.4 outlined the proposed new provision to be inserted in Scheme B2 of the Scheme of Delegation of Functions.

 

He finalised his submission by confirming that the Joint Working Agreement for the Shared Regulatory Services will also need to be varied, due to there being an extension of delegations to the Service.

 

The Cabinet Member – Future Generations and Wellbeing, advised that this was a good news report, it prevented tenants in the future from being exploited by landlords, etc.

 

The Deputy Leader referred to paragraph 3.5 of the report in respect of permitted payments. He advised that when he was a member of the V2c Board there was an issue regarding disaggregating rent charges from certain other associated tenant costs, such as for example, grass cutting or issues such as charging for installing sound proof insulation between rented properties under any Management Agreement that may be in place. He asked how matters such as this would be considered under the new Act and permitted payments, as these were extra payments over and above rent.

 

The Operational Manager SRS, advised that the main purpose of the new legislation, was to avert tenants having ability to unfairly charge tenants significant costs over and above the standard rent for the letting of a property. However, this was also dependent upon other contractual arrangements that were in place between the landlord and tenant he added. He confirmed that he would look into this point and come back to the Deputy Leader outside of the meeting.

 

The Cabinet Member – Future Generations and Wellbeing added, that further charges such as for those referred to above, were probably classed as utilities and other services as part of any tenancy agreement.

 

The Leader referred to paragraph 4.3 of the report and reinforced the importance of the enforcement options available, should landlords not fully comply with the permitted payments scheme, which included the issuing of a fixed penalty notice (FPN) of £1,000, the payment of which would avoid prosecution proceedings.

 

He also encouraged effective promotion of the proposals through as many avenues as possible, including on-line, as well as directly reminding landlords of their responsibilities under the new legislation.

 

RESOLVED:                         That Cabinet:

 

(1)  Approved the amendment to the Scheme of Delegation of Functions as set out in paragraph 4.4 of the report.

 

(2)  Approved that the Monitoring Officer have delegated authority so as to authorise relevant officers to exercise as and when may be required, the carrying out of those statutory enforcement powers; 

 

Delegated authority to the Monitoring Officer to approve and finalise and execute the terms of the Deed of Variation as set out in paragraph 4.5 of the report.             

Supporting documents:

 

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