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Government propose mandatory 2- 5 year fixed term tenancies for council tenants 10/12/2015

In the last edition of the ARCH Bulletin we advised that the government intended to end the use of secure lifetime tenancies for new tenancies and require councils to issue fixed term tenancies of between 2 and 5 years to all new tenants. 


We can now confirm that the government has tabled the expected amendment to the Housing and Planning Bill to introduce mandatory fixed term tenancies for most new council tenancies in England.


The amendment will mean the phasing out of secure lifetime tenancies and in the future, new secure tenancies will have to be for a fixed term of between 2 and 5 years and will not be automatically renewed. The expected changes to rights of succession are also included in the amendment to the Bill.


At present a council tenant allocated a secure periodic tenancy can live in a property for life. The amendment proposed by Housing Minister, Brandon Lewis, will phase out so called lifetime tenancies. Towards the end of the term the landlord will have to conduct a review to decide whether to grant a new tenancy or commence proceedings to recover possession of the property.


The Housing Minister also proposed an amendment to tenants' rights of succession to secure, introductory and demoted tenancies.


At present certain people also have the statutory right to inherit a secure tenancy if they have been a resident with the tenant when the tenant dies. This amendment to the Housing and Planning Bill will change the succession rules: where a person other than the spouse or partner inherits a periodic secure tenancy, it will be converted into a 5 year fixed term tenancy and will not be automatically renewed when it comes to an end.


The requirement to grant fixed term tenancies of between 2 and 5 years will only apply to local authorities in England and not to housing associations or other registered providers. It is understood that the Department for Communities and Local Government want "Private" Registered Providers to follow suit but in the context of the recent Office for National Statistics' (ONS) decision to classify housing association debt as public debt, they need to carefully consider how they can do this.


The only exception on the face of the Bill to allow the granting of a secure periodic tenancy would be for existing tenants on "old style secure tenancies" affected by a regeneration/redevelopment scheme where the council requires them to move home and offers alternative accommodation.


The government may, by regulation, specify other circumstances where an old-style secure tenancy may be granted and DCLG officials have told ARCH that they want to work with local authorities on the detail of the regulations. ARCH has pointed out that, unless specifically exempt by such regulations, existing secure tenants affected by the spare room subsidy (bedroom tax) would lose their security of tenure and only be eligible for a 2-5 fixed term tenancy if they asked to move to smaller accommodation -  which seems somewhat unfair.  


The only good news is that the amendment to the Bill seems to leave it to the discretion of the local authority to determine what to do at the end of the fixed term. It would appear that the government do not intend to prescribe, either in the Bill or in Regulations, the reasons or grounds under which the local authority may decide to seek possession of the property at the end of the mandatory 2-5 year fixed term tenancy. Certainly there is nothing in the proposed amendment to the Bill that would seem to prevent an authority deciding to extend a fixed term tenancy at the end of the term. Paragraph 86C (4) of the new schedule NS4 to the Bill implies that each local authority will have discretion to determine a local policy about the circumstances in which it will (and will not) grant a further fixed term tenancy on the coming to an end of an existing fixed term tenancy.   


Read the full copy of the relevant proposed new clauses to the Housing and Planning Bill - clauses NC32 and NC33 (pg 20) and new Schedules NS4 and NS5 (pg 46 to 63).

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