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Extension of Tenants’ Protection from Eviction in Wales5th July 2021 Commercial Litigation
Residential property possession notice periods were extended in Wales on 24 March 2020 as part of the Coronavirus measures which were adopted at the time under the Coronavirus Act 2020. Landlords seeking to evict their tenants since March last year have had to serve 6-month notices except for in cases of anti-social behaviour and domestic violence. The extension was due to expire on 30 June 2021 alongside the stays on execution of warrants by bailiffs. However, this did not happen in quite such a simple way.
While the stay on executing warrants in Wales did end and landlords with court orders can now seek possession, the longer notice periods did not end. Instead, new regulations were laid before the Senedd Cymru on 17 June 2021 to extend the period during which longer notices will be required until 30 September 2021. These regulations came into force less than two weeks later on 30 June 2021 and in breach of the convention that at least 21 days should elapse between laying the regulations and their coming into force. In a cabinet statement by Julie James (the Welsh Minister for Climate Change) it is said this was due to the “urgent need to continue to provide greater security of tenure at this time”. However, this “urgency” is hardly something new and it does not really explain the last-minute nature of the regulations, admittedly not as last-minute as similar changes made by Westminster earlier this year.
This is the third extension to the Coronavirus notice periods in Wales, which were originally supposed to apply only until 30 September 2020 and then 31 March 2021. The extension highlights the difference in approach between the Senedd Cymru and Westminster, as notice periods in England have already been shortened (largely to 4 months) from 1 June 2021 and are expected to be reduced further in August 2021.
Among other reasons, the Senedd Cymru justifies the extension by stating that the longer period will allow for local authorities to be able to meet the demand of a potential surge in evictions and homelessness, will provide increased security and reduced anxiety for tenants and will allow for a better opportunity for landlord and tenants to make arrangements in respect of rent arrears.
The cabinet statement and the regulations’ explanatory memorandum, however, do not appear to make any reference to the financial difficulties, stress and anxiety suffered by landlords also as a result of the Coronavirus pandemic. Landlords and those advising them would have likely reasonably expected some type of tapering of notice periods, similarly to the approach taken by Westminster, rather than this blanket extension. Even more strangely, the Welsh Government is partly reliant on its tenant loan schemes to justify its continued extensions to longer notice periods. However, the previous loan scheme was not available to tenants with rent arrears built up before Covid and the new scheme is yet to come into effect. So, some of the tenants that landlords would be most likely to wish to evict are not able to get loans to reduce their arrears but are also still able to benefit from longer notice periods.
The Senedd Cymru’s concern about protecting frontline staff from being overwhelmed is of course well-founded. However, arguably, a taper would be more suitable for resolving disputes in the private rented sector. Simply postponing an inevitable outcome where, for example, tenants have incurred substantial rent arrears, which they will never be able to repay, and landlords will be forced to swallow that loss does not look like a well-balanced decision, especially where those losses exceed the loans on offer from statutory schemes. Allowing for shorter notice periods for very high arrears, as is the case in England, would seem to be more equitable.
Inevitably many landlords and tenants are struggling to navigate the unpredictable PRS landscape and should seek legal advice to guide them through this minefield.