Since 1st April 2010, local authorities have had carte blanch to designate licensing schemes wherever they wanted, with no independent scrutiny to agree that a case has been adequately made to introduce this measure. This has led for borough-wide licensing schemes, Newham and Liverpool being just two, though it seems difficult to believe that the whole of the Private Rented Sector in a borough could be so badly affected by anti-social behaviour and low demand that this was the only way to combat it.
It was originally introduced by part three of the 2004 Housing Act and came into force from 6th April 2006 and until 2010 it was necessary to seek approval from the Secretary of State. Reasons for a scheme were specific – it should be an area with a high incidence of anti-social behaviour and be an area of low demand. Landlords had to pay a fee to obtain a license for each property, which was a big drain on their profit margins. It is unpopular with landlords and not just because of the money; good landlords are being hit with the bad.
From 1st April 2015, this will change. Where an authority wishes to impose borough-wide licensing, they will require Government approval for this. Schemes will have to be smaller than 20% of the geographical area of a borough, or 20% of the private rented sector.
This is good news for those, like me, who feel that borough-wide licensing cannot be necessary; however, we all know that where an authority believes that selective licensing is the panacea to cure all ills, they will continue with the schemes, but now they will ensure that the numbers are such that they can continue without let or hindrance from Government.
We can, however, hope that this restriction and the challenges being made about licensing, will cause authorities to think very hard before they go ahead with more licensing schemes, which landlords dislike and where their efficacy has been challenged.
By Sharon Betton