Housing Minister Matthew Pennycook has defended the Renters’ Rights Bill, insisting it is “fit for purpose” despite criticism from a key parliamentary committee.
Responding to a written question about whether the Bill could affect the availability of private rental homes, Mr Pennycook dismissed concerns that it would damage future supply.
Yet, as highlighted by Property118, the legislation has already prompted a number of landlords to exit the sector, raising fears that rental stock is being reduced rather than protected.
Renters’ Rights Bill is fit for purpose
In response to the written question, Housing Minister Matthew Pennycook argued that responsible landlords have nothing to fear from the Renters’ Rights Bill and will remain confident in continuing to invest in the private rental market.
He explained that the government had already published an Impact Assessment for the Bill on 22 November 2024, which was given a ‘Green’ rating by the Regulatory Policy Committee, confirming it was “fit for purpose.”
Mr Pennycook acknowledged that adapting to such a significant shift in regulation would take time, but maintained that the changes would not damage the supply of rental homes going forward.
He also pointed out that despite years of discussion around reforming the private rental sector, the overall size of the market has stayed largely stable since 2013-14.
According to the Minister, the Bill aims to give responsible landlords the confidence needed to keep investing and operating, while the government continues to work closely with them and their associations during the transition.
The impact assessment has not adequately considered the potential costs for landlords
A deeper examination of the Regulatory Policy Committee’s (RPC) findings suggests the picture is not as straightforward as it first appears. Although the Renters’ Rights Bill received an overall “fit for purpose” rating, several parts of the review were marked as only “weak,” including sections on wider impacts and the cost-benefit analysis.
In its assessment, the RPC raised concerns that the government had not fully accounted for the financial pressures the legislation could place on landlords.
The report cautioned that the impact assessment overlooked potential consequences for both landlords and tenants, particularly in relation to the quality and liquidity of the private rented sector.
It highlighted that if landlords face tighter restrictions on evictions — such as the abolition of section 21 “no fault” evictions — and find it harder to reinvest in their properties, the incentive to improve standards may decline.
The RPC warned that, under these conditions, some landlords may only carry out the minimum work required to meet regulatory standards, which could lead to a drop in the overall quality of rental housing.
This, it said, would be a worrying trend given the UK’s rising demand for rental properties, especially for more affordable homes.
Ombudsman fee will proportionate and good value
The committee also raised concerns that the government’s Impact Assessment (IA) did not properly examine the cost-benefit implications of introducing the new Ombudsman scheme.
Its report noted that the assessment would be stronger if certain areas of the analysis were clarified. In particular, questions were raised about why the annual registration fee had been divided by ten, and why staff costs for running the Ombudsman had been excluded from the calculations. The committee suggested the government should make clear whether these costs would be covered by fees paid by landlords.
As previously highlighted by Property118, Housing Minister Matthew Pennycook has maintained that the Private Rented Sector (PRS) Ombudsman will not operate on a profit-making basis. He has argued that the registration fee will be both proportionate and offer landlords good value.
The government has also suggested there may be a way to streamline processes by combining the registration system for the PRS database with that of the Ombudsman. However, it has yet to confirm whether landlords will ultimately face two separate charges, or if a single payment will cover both schemes.
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