Mobile Homes Act 1983 - pitch fee uprating: consultation analysis

2) Background

Scottish Confederation of Park Home Residents Associations have estimated that there are around 100 mobile home parks with around 7,000 residents in Scotland, and report that many of them older people^[1]. Homes on licensed sites have pitch agreements under the Mobile Homes Act 1983 (the 1983 Act). Agreements include statutory implied terms to protect residents, including the basis of pitch fee uprating, currently the Retail Prices Index (RPI).

The RPI is a longstanding measure of inflation in the UK but is no longer classified as a national statistic. Information on the RPI and other common inflation measures like the Consumer Prices Index (CPI) and the Consumer Prices Index including owner occupiers’ housing costs (CPIH) is available on the Office for National Statistics website.

The cost of living crisis and a campaign by residents has highlighted the impact of the gap between different inflation measures on pitch fee inflation ^[2] and that the RPI is no longer judged to be a reliable measure of inflation. As a result, a commitment was made during the passage of the Cost of Living (Tenant Protection) Scotland Act 2022 to consult on changing the basis of pitch fee uprating from the RPI to the CPI and to consider making the change via forthcoming housing legislation.

This consultation was technical, focused on the most appropriate index to apply to pitch fee uprating and the impacts of moving away from the current index. The consultation paper gave background on the indices and explained that the RPI is no longer considered a reliable measure of inflation which has led to its designation as a national statistic being removed. The CPI, which is designated as a national statistic, is calculated in a different way to the RPI and is regarded as better measure of inflation. The Scottish Government proposed the CPI as a robust alternative that is widely forecast and used for uprating, including of pensions and benefits.

The consultation sought views to inform decisions on whether:

• it would be more appropriate for the presumption for annual increases in pitch fees to be set in line with the CPI rather than the RPI or the CPIH;
• the change should apply to agreements that are made in the future only or to both existing and future agreements; and
• it would be appropriate for ministers to be able to update the index in future via secondary rather than primary legislation, to keep pace with developments in statistics.