Rented sector reform: child rights and wellbeing impact assessment

CRWIA Stage 2 – Assessment of Impact and Compatibility

What evidence have you used to inform your assessment? What does it tell you about the impact on children's rights?

In 2022, it was estimated that there were 832,300^[1] children in Scotland under the age of 15. The rented sector is home to around 959,000 households, 618,000 of which live in the social rented sector and 341,000 in the private rented sector^[2]. In Scotland families with children^[3] make up 22% of the private rented sector^[4] and 23.3% of households living in the social sector. Scottish Household data^[5] also indicates that private tenants are staying in properties for longer. Data from the Scottish Household Survey indicates in 1999, 46% of households lived at their current address for less than one year, 25% for between 1 and 2 years, 11% between 3 and 4 years, 8% for between 5 and 10 years, 6% for 11 to 20 years and 5% for more than 20 years. This compares with 32% of households living in a let property for less than a year, 27% for between 1 and 2 years, 15% between 3 and 4 years, 18% for between 5 and 10 years, 7% for 11 to 20 years and 3% for more than 20 years in 2022.

The assessment has been informed by a range of quantitative and qualitative evidence. Links to this evidence is provided in the footnotes throughout this assessment. The following evidence has also been used to inform the CRWIA.

• Scottish Core Questions 2022^[6]
• Every Child, Every Chance: The Tackling Child Poverty Delivery Plan 2018-2022. Annex 2 – Technical Annex^[7]
• Rent Better | How is private renting in Scotland changing? (indigohousegroup.com)^[8]
• Scottish Women's Aid - Rented Strategy Consultation Response^[9]
• Scottish Women's Aid - Improving Housing Outcomes for Women and Children Experiencing Domestic Abuse Report^[10]
• Living in Scotland's private rented sector survey report (UK Collaborative Centre for Housing Evidence, 2022)
• Children's social circumstances and educational outcomes (NHS, 2018)^[11]
• Fuel poverty is intimately linked to poor health - The University of Liverpool Repository^[12]
• Hidden homelessness international evidence review: exploring ways of identifying and counting hidden homeless populations^[13]
• Illegal Evictions: Experiences of CAB Clients in Scotland Summary Report (April 2023)^[14]
• Shelter Scotland Report – Evictions by social landlords in Scotland (2012-16)^[15]

Affordability and financial concerns in the private rented sector for families and households with children

Households in the rented sectors have a higher proportion of people who are in relative poverty^[16], as well as children in relative poverty^[17]. They are also more likely to be financially vulnerable. In addition, households in the rented sectors, especially those on lower incomes, in general pay more of their income on housing costs than owner occupiers, have higher rates of poverty (including child poverty) and have less resilience to cope with financial shocks^[18]. Households in the rented sectors, especially those on lower incomes, in general pay more of their income on housing costs than owner occupiers^[19].

Recent YouGov polling from the Public Insight Monitor (March 2024)^[20] shows that when asked how they and their household were managing financially, a combined 36% of all renters said that they were either not managing very well, having some financial difficulties or were in deep financial trouble. The corresponding figures for those who owned with a mortgage and owned outright were a combined 20% and 11%. Those in the private rented sector ("PRS") were also more likely to express concern over paying rent/mortgage^[21] in the next 2-3 months compared to all tenures as a whole (27% for private renters compared to 12% all tenures in March 2024).

We know that households with children are at higher risk of experiencing poverty^[22]. Households living in poverty will have less disposable income and more likely to spend a higher proportion of their monthly budget on housing costs.

Evidence suggests that there are some types of households with children who are at a higher risk of being in poverty. These include households with single parents, those with three or more children, households with a disabled person/child, of a minority ethnic background, those with a child under one, or households where the mother is aged under 25. Taking together, these groups represent 90% of households with children in poverty^[23].

Over recent years, evidence shows that households with children under one are at a heightened risk of poverty, and that families with a new child are more likely to enter poverty, even when controlling for other factors^[24]. Evidence from a recent focus report on poverty and households with babies^[25] suggests that new mothers found Universal Credit payments helped to relieve housing costs by covering their rent. However, most of the interviewees were in social housing and it was suggested that private rented accommodation is unaffordable. Many within the study mentioned that having a baby prompted a change in housing; often moving out of pre-pregnancy housing to avoid overcrowding. While rental costs were not a prominent concern, mothers highlighted the challenges of securing homes which suit their family's needs.

Results from a survey of PRS renters' experiences in Scotland from 2022^[26] suggest that higher proportions of renters living in a household with children may worry about being able to afford rent, may find it difficult to afford their current rent, and may report that they regularly cut spending on household essentials in order to pay their rent, in comparison to households without children.

RentBetter research^[27], aimed at understanding the impacts of change in the PRS in Scotland, found that families who did not have financial stability were particularly impacted by financial pressures from renting, preventing these households from saving over the longer-term.

Evidence^[28] suggests that just under three in ten renting households without children (29%) find it difficult to afford their current rent, rising to 37% of renting households with children.

The data set out above suggests that, in seeking to stabilise rents in areas where market rents have been increasing particularly steeply through the introduction of rent control along with restricting when the first increase in rent for a new tenancy can take place and capping the rent increase in cases of referral or appeal, have the potential to improve outcomes for families and households with children in the PRS, who may be more likely to experience barriers related to affordability in accessing and sustaining tenancies in the PRS.

Improving Tenants' Rights – consideration of matters which may impact the experience of families and households with children in the rented sectors

Research published in 2022^[29] on renters' experiences living in the PRS provided some insights into experiences of households with children living in the PRS. It found in discussion with focus group participants that the two main benefits of private renting were the flexibility, particularly in terms of location for example in relation to maintaining family ties and schooling, and greater choice in terms of location and the ability to move quickly. This research also found that some private renters reported difficulties in making changes to their home by redecorating and/or upgrading the property – for example, in cases where landlords did not allow drilling holes in the wall and/or painting the property. Where landlords do allow greater flexibility to decorate this was appreciated by their tenants. Being able to personalise and redecorate the home was particularly important to families with children, so they could create child-themed bedrooms and/or manage children sharing bedrooms.

A survey in 2022^[30] on renters' experiences in the PRS asked about what renters find important in the private rented sector. 62% of those who responded identified being able to make the property a home by being able to decorate and keep pets as important. It also found that 45% of respondents strongly agreed that their landlord would be open to them personalising the let property (e.g. putting up pictures, changing curtains, painting a room), 35% tended to agree, 13% tended to disagree and 7% strongly disagreed. It also found that, of the renters surveyed, 44% strongly agreed they feel at home in the property, 40% tended to agree, 10% tended to disagree and 5% strongly disagreed. A higher proportion of households with children (49%) also reported that their house needed to be decorated or modernised compared to households without (43%)^[31]. 62% of those who responded identified being able to make the property a home by being able to decorate and keep pets as important to them.

Evidence^[32] identified also highlights the significant benefits that allowing personalisation of a rented home can provide to tenants including wellbeing benefits^[33] more stability, security of tenure and increases the likelihood that tenants will look after the property. It also highlights that where personalisation is not allowed, the negative impact of a lack autonomy and control for example on a tenant's ability to feel safe, secure and settled in their rented home^[34].

Similarly, there is evidence of the health benefits from pet ownership^[35] including for families with children, but we know that pet ownership can be a barrier to finding a property in the PRS in Scotland^[36]. In addition, engagement with stakeholders including Scottish Women's Aid indicates this issue can be particularly difficult for families with children who need to leave their home due to domestic abuse. While much of this evidence does not specifically refer to children, it is reasonable to consider the benefits that personalisation and pets bring to tenants more generally would extend to the wider household. A recent Scottish Government report^[37] into child and parental wellbeing sets out that whole family wellbeing is a vital aspect for creating the right environment for families to move out of poverty and for families to thrive.

There is also clear evidence^[38] on the negative impact on the health and wellbeing of children from eviction and of becoming homeless. This evidence supports the benefit of introducing measures that give greater protection during the eviction process, helping to reduce, as far as possible, the negative impact that the timing of the enforcement of an eviction may have.

Evidence^[39] also suggests that families in which there is domestic abuse may be four times more likely to lose their homes because of rent arrears than the general population of tenants. Women experiencing domestic abuse report^[40] concerns about the impact on their children of having to leave their home, often moving multiple times. The difficulties experienced in moving school and the impact on their children's emotional wellbeing and health, missing education, bullying, loss of friends and support particularly at a time when they really needed it.

Additionally, women are more likely than men to become homeless from private rented tenancies^[41], violent household dispute is the most common reason for women applying for statutory homelessness assistance. It is acknowledged that the scale of domestic abuse is still under-represented in homelessness applications, as many women will not disclose domestic abuse when applying for assistance.

Evidence from the review of tenancy deposit schemes in 2018^[42] indicates that unclaimed deposits particularly appear to affect students, including foreign students.

Identify any gaps in the evidence base, and set out how you will address these

We have identified the following gaps in the evidence base:

• Robust and comprehensive evidence related to rent levels experienced specifically by families and households with children on existing tenancies in the PRS.
• Information about the age and profile of households who make use of the rent adjudication processes under a Private Residential Tenancy ("PRT") or under an Assured Tenancy.
• Information about the profile of households evicted from both the private and social rented sectors.
• Information about the profile of tenants and their households who are subject to an unlawful eviction.
• Information about the age and profile of households who remain tenants under pre-existing assured tenancies.
• Evidence on the intersection of experience where households including children also have other protected characteristics e.g. a household member with a disability.

Evidence from stakeholders/policy colleagues

The Rented Sector Reform measures in the Housing (Scotland) Bill ("the Bill") have been informed by public and stakeholder engagement, including but not limited to engagement with tenants; private and social landlords; housing investors; third sector organisations; local authorities and public bodies.

In December 2021, the Scottish Government issued its New Deal for Tenants – Draft Rented Sector Strategy consultation^[43] seeking views on a wide range of rented sector reform measures, including the introduction of a national system of rent controls for the private sector. The consultation closed in April 2022 with 8,434 responses available for analysis in total. Organisations accounted for 170 responses, individual members of the public accounted for 756 responses and 7,508 respondents made a campaign-type submission. The consultation analysis^[44] was published in August 2022.

The Scottish Government also issued the 'Landlord and tenant engagement questionnaire on rented sector reform' on 29 September 2023. This set out some of the proposals for rented sector reform and sought the views of tenants and landlords on certain aspects of those proposals. The questionnaire closed on 27 October 2023 with 6,645 responses received. Discussions were invited with stakeholder groups and two discussion groups were also held on the questionnaire topics. The independent analysis of this is also published on the Scottish Government website^[45]. Over the course of the consultation, 123 emails were also received from the public as well as stakeholder organisations related to the rented sector aspects of the Bill. An independent analysis of the email responses has also been published and taken into account^[46].

An overview of the outcome of Scottish Government consultation on the individual measures, as outlined in the Policy Memorandum^[47] for the Bill, is set out below with any specific additional information around children and young people highlighted.

Part 1 (Chapters 1 & 2), Powers for Scottish Ministers to introduce rent control areas

The Scottish Government consulted on the vision and principles of a national system of rent controls as part of the 'New Deal for Tenants: Draft Rented Sector Strategy' public consultation^[48].

When considering the principles for a system of rent controls set out in the consultation paper, respondents expressed support for a localised approach to rent controls, based on evidence, which ensures openness and transparency.

Some respondents were opposed to any form of rent control, raising concerns around the potential for unintended consequences, for example reducing the supply of rented homes in the short term through making the PRS less attractive for landlords and investors. There was also a view from some that, while the proposals are welcome, rent controls cannot solve the issues around inadequate supply of affordable homes and that increasing the supply of social housing is the most important change needed to support the right to adequate housing. It was argued that the overall vision for the sector should be reflected in any future rent control system, including detail on how rent controls will balance protection for tenants with the risk of encouraging disinvestment by existing landlords. There was some concern that the vision and principles set out in the consultation did not consider the potential impact and risks associated with rent controls for the PRS and a need to ensure that policy design anticipates potential adverse impacts, incorporates appropriate enforcement, and can respond to local variation in market pressures was highlighted.

The following areas were highlighted by respondents specifically in relation to children and families and rent affordability:

• Those disproportionately affected by poverty and rent affordability pressures included single people on low incomes (with or without children) and families. Respondents also pointed to challenges as set out in the consultation paper (such as tenants being more likely to be on low income and to experience financial hardship) and to household characteristics with potential to impact economic circumstances and incomes (such as disabilities and health-related needs), suggesting that equalities and human rights should be given particular prominence when considering housing affordability in the rented sector.
• Respondents also highlighted unaffordable rents and unreasonable costs associated with setting up a new home and being forced to move to areas away from their family and friendship networks for women and children experiencing domestic abuse.

The 'Landlord and tenant engagement questionnaire on rented sector reform' and accompanying discussion group events set out more detail on some of the emerging rent control proposals in September 2023, and sought the views of tenants and landlords on these. As with most consultation and engagement, those choosing to respond were self-selecting and should not be considered to be representative of those in the wider sector.

The questionnaire responses indicated a range of views on whether rent control should be introduced on a local basis, where assessment shows that there is a need, or be applied across all tenancies. The majority of landlord respondents expressed support for rent control on a local basis. However, most tenant respondents felt it should be applied across all tenancies.

Just over half of respondents (58%) thought any restrictions on rent increases should apply to both sitting tenants and in between tenancies, while the remaining respondents thought the restrictions should apply to sitting tenants only. A majority of respondents (80%) agreed that, if rent controls applied both within and between tenancies, the first rent increase in a tenancy should be possible at any point after the start of the tenancy, provided that at least 12 months has passed since the rent was last increased.

Respondents were evenly divided on whether there should be a mechanism to allow landlords to raise the rent above the rent cap in certain circumstances, such as where there have been improvements to the let property. A majority of respondents thought that no categories of housing should be exempt from rent controls.

Part 1, Chapter 3, Frequency of rent increase

The Scottish Government's 'Landlord and tenant engagement questionnaire on rented sector reform' sets out the proposal that in most cases, a landlord would not be able to increase their tenant's rent until at least 12 months after the tenancy started. Respondents were not asked directly about this proposal, although they were asked whether it should be disapplied in rent control areas if rent controls were applied between tenancies, and the majority agreed with this approach.

It is intended that further engagement and consultation will be carried out in relation to the measures before implementation. The further consultation will allow for detailed feedback on issues such as circumstances where it may be proportionate for Scottish Ministers to disapply the requirement.

Part 1, Chapter 3, Capping of rent increases on referral or appeal

Many respondents to A New Deal for Tenants - Draft Rented Sector Strategy: consultation^[49] supported proposals to change the rent adjudication process to remove the ability for a Rent Officer to increase the rent above that requested by the landlord in relation to PRTs. There was agreement that the risk of the rent being raised higher than the rent requested by the landlord has limited the effectiveness of adjudication. Those in favour saw rent adjudication provisions as the only safeguard for tenants against unaffordable rent increases and there were calls for more action to ensure all private tenants are aware of the adjudication option.

Those who disagreed argued that the proposed changes would result in adjudication being unfairly balanced in terms of the impact on landlords, and that current rules should remain unchanged to ensure fairness to landlords and to prevent 'speculative' rent appeals. Those who supported the proposals suggested that changes were unlikely to result in unreasonable adjudication requests, given the under-use of the facility to date, and that a more effective and better used rent adjudication process may act as a deterrent to landlords considering unfair or unaffordable rent increases.

No specific consultation has taken place in relation to taking forward amendments that would extend these changes to Assured Tenancies under the Housing (Scotland) Act 1988 ("1988 Act"). However, the intention is to provide parity of approach where feasible for tenants seeking a rent adjudication.

Part 2, Evictions: duties to consider delay

The Scottish Government consulted as part of the New Deal for Tenants: Draft Rented Sector Strategy^[50] on introducing a specific requirement on the First-Tier Tribunal (Housing and Property Chamber) ("the Tribunal") and the Sheriff Court to consider delaying the enforcement of eviction orders and decrees based on the circumstances of the case during the winter period. A substantial majority thought that a specific requirement for the Tribunal and Sheriff Court to consider delaying the enforcement of eviction orders and decrees during the winter period should be introduced. However, of the non-campaign respondents (those whose response was not an endorsement of a wider organisational campaign) only 14% agreed with this proposal, on the basis that additional protections were not required.

The most frequent point made by those who disagreed was that, in relation to the private rented sector, a specific requirement is not necessary as the Tribunal already can and does delay evictions taking place when they consider it necessary in a particular case. Other comments included: any flexibility should only cover the Christmas and New Year period; should not be available when criminal or anti-social behaviour is involved; or that landlords should receive financial compensation to cover any delays.

Further views in response to the consultation and from engagement with stakeholders were that the time of year is not, and should not, be relevant, because the Scottish climate can be challenging at any time of year.

There may be other times of the calendar year which present major financial and emotional/wellbeing pressures for people, e.g. periods of religious significance, and school exam periods for households with school aged children. There may be a desire to be equally sensitive to this. As well as times where there is additional pressure on housing stock levels, for example University term times.

Reflecting on the range of views, measures in the Bill make it a requirement on the Tribunal and Sheriff Court to consider, in light of the individual circumstances of a case, delaying the enforcement of an eviction regardless of the time of year.

Further engagement on the detail of policy proposals was carried out through focussed stakeholder engagement and the landlord and tenant engagement questionnaire and accompanying policy paper^[51].

Questionnaire responses indicated a majority strongly agreed or agreed that the Tribunal (for the private sector) or Court (for the social rented sector) should be required to consider whether it is reasonable to delay the enforcement of an eviction at any time of the year, as indicated by 59% and 69% of all respondents to those questions. Broken down by respondent type, this rose to 98% of private tenants (for private sector evictions) and 100% of social tenants (for social sector evictions). However, 67% of PRS landlords either strongly disagreed or disagreed with this proposal for the private sector and a small majority of social landlords (54%) either strongly disagreed or disagreed with this proposal for the social sector.

Meetings were also held with a range of key stakeholder representing tenants and landlords. At one of these meetings, Living Rent highlighted that there were other circumstances other than seasonal pressures where a delay to an eviction might be welcome. For example, where there is a child involved and eviction is due to take place during their exams.

Part 2, Evictions: damages for unlawful eviction

The Scottish Government consulted as part of the 'A New Deal for Tenants: Draft Rented Sector Strategy'^[52] on simplifying the process for a tenant to challenge an unlawful eviction. This would in turn deter landlords from carrying out an illegal eviction as the risk of challenge and penalty will be higher.

The Scottish Government sought views on the current calculation for unlawful eviction and whether it should be reformed and simplified. Analysis of responses found that a substantial majority, 94% of those answering the question, agreed with the proposal. However, this level dropped to only 31% of non-campaign responses. Among organisations, a large proportion of those who disagreed were 'Private landlord, letting agent or their representative bodies' respondents.

In response to the consultation on the minimum and maximum multiplication of damages that could be awarded, there were a range of views. Some respondents were supportive of the approach proposed, seeing the minimum of three months and maximum level of 36 months as reasonable with at least one suggesting the maximum should be higher. Others saw the maximum level of 36 months as excessive and not justifiable; other suggestions included a lower level of multiplication, or fixed amounts would be more appropriate. It was also suggested by some that no minimum should be set, instead relying on the discretion of the Tribunal to set an amount relative to the individual circumstances of the case.

Also raised by respondents was the importance of working with stakeholders, including Police Scotland on ensuring enforcement. Awareness raising and supporting the enforcement of the legislation was seen as important to addressing illegal evictions.

Measures to temporarily introduce changes to the way unlawful eviction damages are calculated were made by the Cost of Living (Tenant Protection) Scotland Act 2022. Further engagement on proposals to make the temporary measures permanent was carried out through focussed stakeholder engagement. Stakeholders did not identify major changes to the proposed policy approach during this engagement.

Part 3, Private residential tenancy: Keeping pets and Scottish Secure tenancies: Keeping pets

Scottish Ministers consulted as part of the 'New Deal for Tenants: Draft Rented Sector Strategy' consultation^[53] on how a right to keep pets could be most effectively introduced for the private sector – for example by the introduction of a statutory right or by amendment to the Model Tenancy Agreement – and whether or not to allow exceptions. It also consulted on whether or not the right to keep pets should also be introduced as a right in the social sector.

Around 750 non-campaign respondents made a comment regarding a right to keep a pet in the private sector. A substantial majority – 94% of those answering the question - thought that the right to keep pets should also be introduced as a right in the social sector. The most frequently made point was that the approach should be tenure neutral. Comments often focused on the importance of pets to people's emotional life as well as mental health.

Private landlords and letting agents raised significant concerns about any right to keep a pet being introduced. Respondents also reflected that keeping pets was already common practice in the social sector.

A frequently expressed view was that, rather than a general right, each situation must be assessed on its merits. More generally, feedback suggested that tenants should be required to request permission in advance, which should not be unreasonably withheld.

Further engagement on the detail of policy proposals was carried out through focussed stakeholder engagement and the landlord and tenant engagement questionnaire and accompanying policy paper^[54]. Again, as with most consultation and engagement, respondents were self-selecting and results should not be considered to be representative of wider populations.

Findings from the questionnaire responses indicated that the majority of respondents (63%) agreed that private tenants should have a right to request to keep a pet and that request should not be unreasonably refused. The remaining 37% disagreed.

Broadly, a substantial majority of tenant responses supported the introduction of the right to request and not be unreasonably refused. A majority of PRS and social rented sector ("SRS") tenant organisations also agreed with the proposal. However, a majority of PRS landlords, and landlord organisations and SRS landlord respondents disagreed.

A majority of respondents thought private landlords should have 20 working days to respond to a request to keep a pet, with the remaining respondents favouring a longer period. The majority of respondents from PRS landlords and PRS landlord organisation respondent groups expressed preference for a period of 30 working days at 47% and 51% respectively.

As part of our additional engagement on the proposals for reform, at a meeting with Scottish Women's Aid they welcomed this potential reform. They indicated that from their experience that a lot of families experiencing domestic abuse have had to leave their home and the accommodation they go to then often do not accept pets. This can have a negative effect on the family at an already difficult time especially for children in the household who are attached to the pet.

Policy measures have taken account of responses to the consultation, questionnaire and stakeholder engagement in the development of this measure. The Bill therefore creates the enabling framework for a right for tenants to request and not be unreasonably refused permission to keep a pet and for landlords to set reasonable conditions for approval, the detail of which will need to be prescribed in regulations which will be subject to Parliamentary approval.

Part 3, Private residential tenancy: Making changes to let property

The Scottish Ministers consulted as part of 'A New Deal for Tenants: Draft Rented Sector Strategy' consultation^[55] on how a right to personalise a property could be most effectively introduced.

Many landlord respondents understood the desire to personalise a home but were concerned about how this would work in practice and the problems that could arise. These included the standard of decoration by tenants, potential damage that could be caused to the let property and furnishings, cost to return the let property to its previous state at the end of the tenancy and how disputes would be managed. Respondents highlighted a need for clear guidance on this to inform and protect both tenants and landlords.

Further engagement on the detail of policy proposals was carried out through focused stakeholder engagement and the landlord and tenant engagement questionnaire and accompanying policy paper.

Findings from the questionnaire responses indicated that the majority of respondents felt small changes, for example putting up pictures and posters should not require consent.

A majority of respondents also agreed that other bigger changes (for example painting walls and installing wall shelves) could be requested and not unreasonably refused.

A majority of respondents overall (63%) thought landlords should have to respond to a request for a change that cannot be unreasonably refused in 20 working days, with the remaining respondents favouring longer periods. The majority preference among PRS landlords and PRS landlord organisations was for a 30 day period, with 53% and 54% respectively preferring this option.

Among all respondents to the questionnaire, the preferred length of time for a tenant to have lived in the let property before they can request bigger changes that could not be unreasonably refused was three months (50% of those answering). The next most frequently chosen option was 12 months (38% of those answering), with PRS landlords more likely to favour this option than any other time period (selected by 77% of PRS landlords and 72% of PRS landlord organisations).

Policy measures have taken account of responses and the provisions in the Bill will create an enabling framework that allows regulations to be made to set out certain prescribed minor modifications that tenants can make without the landlord's permission, and a right for tenants who have lived in the let property for a prescribed period of time to request certain other prescribed modifications that cannot be unreasonably refused. Landlords would be able to set reasonable conditions for approval helping to address some of the concerns raised by landlords. The detail of the framework would need to be prescribed by regulations that would be subject to Parliamentary approval.

Part 4, Unclaimed tenancy deposits

An initial review^[56] into the Tenancy Deposit Schemes in 2018 sought views on the use of unclaimed deposit funds. It found that all schemes agreed in principle with the proposal to explore the reinvestment of unclaimed deposits after a five-year expiry period. The review also asked landlords whether they would object to unclaimed deposits being reinvested in the PRS after five years. 55% of respondents indicated they would not object to the money being used in this way, 15% objected but gave no alternative suggestion of what it should be used for. A number of uses of the money were suggested by landlords - 14% suggested unclaimed funds should be given to the landlord and a smaller proportion suggested giving the money to charity, to homelessness or to the social/affordable housing sector.

Scottish Ministers subsequently consulted on making use of unclaimed deposit funds in 'A New Deal for Tenants: Draft Rented Sector Strategy'^[57]. A very substantial majority of those who responded to this consultation agreed that unclaimed deposits should be reinvested if they remain unclaimed after a period of five years, and after all avenues to reunite deposits with their tenants have been exhausted.

Respondents also suggested that Tenancy Deposit Schemes should obtain multiple means of contacting a tenant. Respondents also provided feedback in relation to being clear what is meant by 'after all avenues have been exhausted' and how this would operate in practice.

Further engagement on the detail of policy proposals was carried out through focussed stakeholder engagement, including with the three approved tenancy deposit schemes. The landlord and tenant engagement questionnaire and accompanying policy paper^[58] also sought views on five potential uses for unclaimed tenancy deposit funds.

The questionnaire responses indicated that respondents were most likely to strongly agree that any unclaimed funds should be used on the prevention of homelessness. This was the only use of funds with which a majority of both PRS landlords and tenant respondents strongly agreed or agreed.

A majority of respondents also agreed or strongly agreed with use in connection with providing advice, information, and assistance to private tenants and with assisting private tenants to exercise their rights. A small majority of PRS landlords disagreed or strongly disagreed with using the funds to assist private tenants to exercise their rights.

In terms of using unclaimed funds to address barriers to the PRS and support access and support private tenant participation and representation, the majority of respondents neither agreed nor disagreed.

Responses to the consultation and questionnaire have been taken into account in the development of the policy measures in the Bill, including in relation to the use of unclaimed tenancy deposit funds for prevention of homelessness and providing or securing the provision of advice, information, or assistance to private tenants.

Part 4, Ending Joint tenancies

The Scottish Government consulted in 'A New Deal for Tenants: Draft Rented Sector Strategy'^[59] on proposals to enable one joint tenant to end their interest in a joint tenancy without the agreement of other joint tenants. A very substantial majority thought the Private Housing (Tenancies) (Scotland) Act 2016 ("2016 Act") should be amended to allow joint tenants to terminate their interest in a PRT without agreement of other joint tenants.

Among organisations, a large majority of those who disagreed were from the 'Private landlord, letting agent or their representative bodies' group. Feedback highlighted concerns around the remaining tenant's ability to afford the rent, and the possibility of a build-up in rent arrears.

Overall, the proposed changes were described as a sensible, practical approach that brings the PRS in line with the social sector and reinstates the position prior to the 2016 Act. The ability to terminate an interest in a joint tenancy was seen as both an issue of individual choice for all tenants and also as an important protection for those experiencing domestic abuse.

Further engagement on the detail of policy proposals was carried out through focussed stakeholder engagement and the landlord and tenant engagement questionnaire and accompanying policy paper^[60].

Findings from the questionnaire responses indicated that a substantial majority of respondents agreed that the notice period which the departing joint tenant must give to the other joint tenant should be two months.

A clear majority of respondents in all groups agreed with the proposal, although at a lower level for PRS landlord and PRS landlord organisations and SRS landlord organisations.

Reflecting on these consultation responses and stakeholder feedback the Scottish Government are proposing measures which will introduce a power to enable one, or more, joint tenants to end the tenancy without the agreement of all but only after providing reasonable notice to other joint tenants.

Part 4, Social landlords: delivery of notices etc.

The Scottish Government is making changes to ensure modern methods of delivery can be used by social landlords for serving legal notices. This is a minor modification and does not represent a change in policy or direction. This amendment was identified by social housing landlords as being a beneficial change that will better reflect modern communication methods and provide benefits for both tenants and landlords.

Part 4, Converting older tenancies

The Scottish Government sought views on this proposal in the 'Landlord and tenant engagement questionnaire on the rented sector reform'^[61]. The questionnaire asked for views on whether short assured and assured tenancies under the 1988 Act should be phased out. 71% of those answering the question agreed with the proposal. Support for the proposal was strongest amongst tenant respondents. However, a smaller majority of landlords and landlord organisations responding also supported the proposal.

Part 5, Social landlords pre-action requirement where domestic abuse a factor

The Scottish Government consulted as part of the New Deal for Tenants: Draft Rented Sector Strategy^[62] on introducing a new pre-action requirement into the existing pre-action requirements in the Housing (Scotland) Act 2001 to ensure social landlords have fully considered all forms of domestic abuse, including coercive control, and the impact it can have before commencing legal action to recover possession of a property. There were relatively few comments relating to the social sector pre-action requirements in consultation responses. Those that did comment tended to suggest that the current requirements are sufficient or satisfactory. However, there was support for amending social sector pre-action requirements to specifically take account of the impact of domestic abuse on rent arrears as a way of providing additional support to victims of domestic abuse.

The Scottish Government sought further views on this proposal in the 'Landlord and tenant engagement questionnaire on the rented sector reform'^[63]. This questionnaire asked whether respondents agreed with the proposal to amend social housing pre-action requirements to require social housing landlords to specifically consider the effect of domestic abuse in the accrual of rent arrears. Where domestic abuse financial control has had an impact on the arrears, social landlords would be required to fully consider further actions that could assist the victim-survivor before eviction action for rent arrears could be taken in court. 83% of those answering the question, agreed with the proposal to amend social housing pre-action requirements. Support for the proposal was strongest amongst tenants responding. However, a smaller majority of landlords and landlord organisations responding also supported the proposal.

The amendments to existing requirements are largely already being delivered by social housing landlords. This amendment therefore seeks to formalise this process, requiring social housing landlords to specifically consider the effect of domestic abuse in the accrual of rent arrears, before eviction action can be taken on the grounds of those rent arrears. Where domestic abuse in terms of financial control has had an impact on the arrears, this would require the landlord to fully consider further actions that could assist the victim-survivor having regard to the landlord's domestic abuse policy before eviction action for rent arrears can be taken in court.

Evidence from children and young people

We have not engaged directly with children and young people but our engagement with stakeholders who have an interest in children's rights have provided insight into how reform to rents and eviction rights will have an impact on the life of children. In addition, some of the evidence sources which have been considered include the views and experiences of children and young people and many of the findings that relate to tenants generally will also have relevance to the impact on children and young people.

Organisations that work with children, young people and families which have participated in the consultation process and with whom engagement has taken place that has informed policy development include: Shelter Scotland, Citizens Advice Scotland, Scottish Women's Aid, Child Poverty Action Group, and the Joseph Rountree Foundation.

How have the findings influenced the development of the relevant proposal?

Part 1, Chapters 1 & 2 - Powers for Scottish Ministers to introduce rent control areas

The outlined findings have significantly influenced the development of our proposals. The Scottish Government wants to improve housing outcomes for those who rent their home and understands that rent levels, as set by the market in the private rented sector, can be unaffordable for some tenants in some areas, leading to people struggling to find suitable rented homes. By stabilizing rent levels and preventing steep rises between tenancies, children living in rented properties could benefit from a more stable living environment.

This stability can be crucial for their wellbeing and development, as it can reduce the risk of having to move frequently due to unaffordable rent increases. The measures aim to make rents more affordable. This could mean that families with children might have more disposable income to spend on necessities such as food, clothing, and educational resources for their children.

The measures in the Bill create the framework to deliver a nationally consistent approach to the consideration of the need for rent control, whilst maintaining the link to local circumstances. Local authorities will take the lead in carrying out mandatory assessments in their areas, ensuring that local circumstances are taken into account, to reflect the geographical variations that can exist in conditions relating to rents across Scotland.

The assessments will be carried out on a cyclical basis, to ensure there is ongoing consideration of the need for rent control. The mandatory assessments conducted by local authorities could ensure that the specific needs and conditions of different regions are taken into account. This could benefit children as it ensures that the measures implemented are responsive to the local rental market conditions and the specific challenges faced by families in those areas.

The outcome of these assessments will inform Scottish Ministers' decisions on whether it is justified and proportionate to designate, by regulations, rent control areas for the purpose of protecting the social and economic interests of tenants in those areas. In any area designated for rent control, the restriction on the level of rent increases that are permitted will apply both within and between tenancies, to stabilise the level of rents within the area and avoid the potential for rents to continue to rise steeply between tenancies.

Rent control policies are aimed at making rents more affordable and ensuring tenants are less likely to be 'priced out' of housing due to rent increases. The introduction of a framework for a national system of rent controls in the private sector through the measures included in the Bill will contribute towards achieving the Scottish Government's overarching objective of improved outcomes for tenants.

Rent control is designed to help stabilise rents in areas where market rents have been increasing particularly steeply, whilst ensuring there can be a balanced approach that provides appropriate protection for the property rights of landlords. By preventing tenants from being 'priced out' due to rent increases, the risk of homelessness could be reduced. This is particularly important for families with children as homelessness can have severe negative impacts on children's health, education and overall development.

Part 1, Chapter 3, Frequency of rent increase

The Bill will modify the requirements to provide that the rent payable under a PRT may not be increased during the first 12 months of the tenancy in areas not subject to rent control.

These measures may indirectly affect children under the age of 18 by providing tenants, including those with children, with the security of knowing that the rent they have agreed to at the start of the tenancy will not increase during the first 12 months. This may be particularly beneficial for families living in the PRS who experience affordability concerns.

Part 1, Chapter 3, Capping of rent increases on referral or appeal

Analysis of consultation responses to our New Deal for Tenants: Draft Rented Sector Strategy and further engagement with stakeholders has influenced the development of this measure.

The Bill will amend the rent adjudication processes to ensure that the rent set by the Rent Officer on referral or by the Tribunal cannot be higher than the rent proposed by the landlord in the rent increase notice. This measure will benefit all tenants with a PRT or an assured tenancy subject to a rent increase who wish to seek a review of the proposed rent level but may be particularly beneficial for households with children and young people deterred by the current process due to affordability concerns.

By ensuring that the rent set by the Rent Officer or the Tribunal cannot be higher than the rent proposed by the landlord in the rent increase notice, the amendment could contribute to removing the concern that the rent might be raised above that asked for by the landlord following adjudication. This would contribute to giving tenants greater predictability on the outcome of a rent adjudication application and greater confidence to challenge rent increases which they feel are not justified. This could lead to tenants paying a lower level of rent than that proposed by the landlord for the next 12 months helping make rent more affordable and providing housing stability. This stability is crucial for children's wellbeing and development, as it can reduce the stress and disruption caused by frequent moves.

The amendment could potentially make housing more affordable for families with children. If rents are kept at a reasonable level, families may have more disposable income to spend on other necessities, such as food, clothing, and educational resources. By potentially reducing housing costs, the amendment could contribute to poverty reduction. Children living in poverty are at risk of a range of negative outcomes, including poor health, lower educational attainment, and social exclusion.

If families are able to afford to stay in their homes, children may be able to maintain access to local amenities such as schools, parks, and community centres. This continuity can be beneficial for their social development and educational continuity. The amendment strengthens the rights of tenants, which could indirectly benefit children. When parents or guardians have greater agency and security in their housing situation, it can create a more stable and secure environment for children.

Part 2, Evictions: duties to consider delay

We know from the available evidence that the eviction process can have a significant negative impact on the mental and physical health of tenants and particularly children. The eviction process is a highly stressful and difficult experience leading to significant disruption for the household in finding and moving to alternative accommodation. Potentially relocating away from family, friends and changing schools and navigating local authority homelessness services and potentially being housed in temporary accommodation.

Provisions in the Bill respond directly to concerns about the potential negative impact of the timing of an enforcement particularly at certain times of year or in certain circumstances. For example, due to seasonal pressures, periods of religious significance, exam periods for families with school age children or in College/University and where more time is required to access suitable alternative accommodation.

The measures in the Bill are intended to, as far is possible, reduce the negative impact of an eviction by ensuring that the Tribunal or Sheriff Court (Courts) considers whether it would be reasonable in the circumstances of the case to delay the enforcement of an eviction. This measure may therefore be particularly beneficial for households with children and young people up to the age of 18.

Part 2, Evictions: damages for unlawful eviction

While there is no definitive information about the profile of tenants who are the subject of an unlawful eviction, given the general profile of the rented sectors as a whole, children and young people are likely to be affected by unlawful evictions. Like lawful evictions, there will be similar negative impacts from an unlawful eviction, but these are likely to be exacerbated where intimidation and harassment has been involved.

Research by Citizen Advice Scotland ("CAS") into Illegal Evictions in Scotland^[64] provides a strong indication that people in the most deprived incomes are much more likely to seek advice, although the CAS report can only speak to the profile of those who interact with their service. It is also known that certain groups with protected characteristics are also more likely to fall into the lower income bracket which includes single parents.

The current process for seeking damages where an unlawful eviction occurs requires a costly professional valuation, which can be a significant barrier to tenants pursuing an application for unlawful eviction damages especially for lower income tenants. Measures in the Bill therefore aim to make it easier and more meaningful for tenants to challenge an unlawful eviction and receive appropriate damages where an unlawful eviction is found to have occurred.

The change to the civil process for seeking unlawful eviction damages under the 1988 Act would remove the requirement for a professional valuation and replace it with a calculation based on the monthly rent between three months and 36 months (although the Tribunal or Court could set a lower level where reasonable in the circumstances of the case). This will make it more difficult, more expensive, and higher risk for a landlord to pursue an unlawful eviction rather than going through the lawful routes.

This change will positively impact all tenants but may particularly support tenants on lower incomes who are less able under the current system to be able to afford to make an application and who may be more likely to be financially negatively impacted by the disruption of an unlawful eviction. This change therefore has the potential to positively impact households with children and young people living in the private and social rented sectors, however there are currently no known cases of illegal eviction in the social rented sector

Part 3, Private residential tenancy: Keeping pets and Scottish Secure tenancies: Keeping pets

The Bill aims to improve the renting experience for private and social housing tenants by giving them more control over having a pet by creating a right to request to keep a pet and for that request not to be unreasonably refused. This measure will benefit all tenants with a PRT and social tenants with a Scottish Secure or Short Scottish Secure Tenancy.

A recent evidence review of pet ownership in the PRS indicated that "younger tenants with dogs, found they were 'stuck in a cycle of rental insecurity', both 'settling' (paying more for lower quality housing, in less desirable locations) and 'staying put' (worrying about their tenancy security, neighbourhood safety, and trying to save money for future home ownership)"^[65].

In Scotland, families with children make up 22% of the private rented sector^[66] and, 23.3% of households living in the social sector, the types of home most likely to want a pet according to RentBetter research^[67]. Owning pets can have a positive impact on mental health and wellbeing, for example it has been found that children growing up with pets have increased levels of physical activity.

In a 2021 survey of Scottish private renters^[68] focussing on low income households, almost one-fifth of those surveyed (19%) had experienced difficulty finding a landlord or letting agent that would allow them to keep pets. An evidence review from the same study, published in 2022^[69], suggested that pets may enhance wellbeing and failure to be allowed to keep pets can impact on residents' ability to make their rental property 'a home'.

In addition, stakeholder engagement highlighted families experiencing domestic abuse who have had to leave their home can find that the accommodation they go to does not accept pets. This can have a negative effect on the family especially the children who are attached to the pet. The measures in the Bill will ensure that a landlord is unable to have a blanket ban on pets and that tenants are able to keep a pet where it is reasonable to do so.

Enabling a tenant to request to keep pets and for that request to not be unreasonably refused can make a positive difference to how people feel about their home contributing to their health and wellbeing and may be particularly beneficial for the wellbeing of young people and children.

Part 3, Private residential tenancy: Making changes to let property

We know from our consultation and engagement on rented sector reform and from the available evidence that there are an increasing number of families living in the rented sector and children make up 22% of those living in the private rented sector.

There is also evidence that allowing tenants to personalise and decorate helps them to 'feel at home' and offers tenants more stability, security of tenure and increases the likelihood that tenants will look after the property. Evidence also highlights that where personalisation is not allowed, tenants lack autonomy and control and this has a negative impact on a tenant's ability to feel safe, secure and settled in their rented home^[70].

Research from 2022^[71] into what lower income tenants want to see from a new rented sector founds that some private renters reported difficulties in making changes to their home by redecorating and/or upgrading the property – for example, in cases where landlords did not allow drilling holes in the wall and/or painting the property. Where landlords do allow greater flexibility to decorate this was appreciated by their tenants. Being able to personalise and redecorate the home was particularly important to families with children, so they could create child-themed bedrooms and/or manage children sharing bedrooms.

A survey in 2022^[72] on renters' experiences in the PRS asked about what renters find important in the private rented sector. 62% of those who responded identified being able to make the property a home by being able to decorate and keep pets as important. This survey also provided some insight on the proportion of renters who feel their landlord would be open to them personalising the property (e.g. putting up pictures, changing curtains, painting a room). This found 45% of respondents strongly agreed that their landlord would be open to them personalising the let property, 35% tend to agree and 13% tended to disagree and 7% strongly disagreed. It also found that of the renters surveyed 44% strongly agreed they feel at home in the property, 40% tend to agree, 10% tend to disagree and 5% strongly disagree.

The Bill includes measures to create additional rights for private tenants to make changes to their rented home. These are intended to improve the renting experience for those with a PRT by giving them more control over personalising their home, supporting better mental health and wellbeing.

Provisions in the Bill create a framework to enable tenants with a PRT greater rights to make certain prescribed changes (category 1) without the consent of their landlord, and the right to request certain other prescribed changes (category 2) to their rented home that cannot be unreasonably refused. Under the changes, category 2 requests can only be made after a tenant has lived in the let property for more than 6 months; and landlords will be able to set reasonable conditions for approval. Provisions in the Bill require Scottish Ministers to carry out further consultation with private tenants, landlords and other relevant stakeholders on the types of changes that will be included in category 1 and 2 and these will need to then be prescribed in regulations.

Changes that give private tenants additional rights to make changes to a let property will give greater control over making changes to their rented homes and have a positive impact for all tenants with a PRT, but may be particularly beneficial for families with children.

Part 4, Unclaimed tenancy deposits

Where a private landlord asks a tenant to pay a tenancy deposit, the deposit must be lodged with one of three independent approved tenancy deposit schemes.

Monitoring of the operation of the schemes has highlighted the previously unforeseen issue of deposits remaining unclaimed by some former tenants after the tenancy has ended.

A review^[73] of tenancy deposit schemes in 2018 explored the issue of unclaimed deposits. It found that the majority of unclaimed deposits belong to students, in particular, overseas students who regularly return home without claiming their money back from the schemes.

As part of our engagement and development of reforms for the Bill, we consulted on enabling the use of unclaimed tenancy deposit funds to improve and benefit the PRS and the purposes to which unclaimed funds should be used.

Measures in the Bill have been informed by the available evidence and stakeholder views. Provisions therefore enable the use of unclaimed tenancy deposit funds and sets limitation on the use of these funds to ensure they benefit PRS tenants including providing and securing the provision of:

• advice, information or assistance to private tenants in relation to their rights as tenants
• other services or facilities that promote of support the interests of such tenants, and
• preventing private tenants from becoming homeless.

The use of unclaimed deposit funds therefore has the potential to support activities in the future that may positively impact on children and young people living in the private rented sector.

Part 4, Ending Joint tenancies

Measures in the Bill have been developed following consultation and engagement on concerns around the negative impact of the current process for ending a joint tenancy under a PRT, particularly for those experiencing domestic abuse and students. Where relationships have broken down, refusal to allow another joint tenant to leave the tenancy can be used as a method of financial and coercive control.

We know that in cases of domestic abuse, where there is a joint tenancy or mortgage the woman may leave the home but retain her legal obligation for any debt outstanding. Where this occurs, this situation will clearly constrain the choices and ability to obtain an independent tenancy of her own^[74].

Measures in the Bill are designed to reform how joint tenancies under a PRT are ended to enable one joint tenant to end the tenancy for all tenants where there is no mutual agreement between joint tenants. This would only be possible after the tenant who is seeking to end the tenancy has provided the other joint tenants with two months' notice.

Enabling a tenant who is 'trapped' in a joint tenancy to leave will particularly help women with children who experience domestic abuse where the tenancy is being used as a means of financial control.

Part 4, Social landlords: delivery of notices etc.

This measure was identified by social housing landlords as being a beneficial change that will better reflect modern communication methods and provide benefits for both tenants and landlords. The current methods of delivery are considered restrictive, outdated, and do not reflect modern mail delivery methods or widely used electronic delivery methods such as email or secure access tenancy management IT systems.

Part 4, Converting older tenancies

Scottish Ministers propose to create a regulation making power which would enable a date to be set on which tenancies under the 1988 Act would convert to PRT under the 2016 Act. Exercise of this power would be subject to a consultation first. If used, this would enable tenants with tenancies under the 1988 Act to benefit from the protections under the 2016 Act, as well as proposed protections in this Bill, and reduce complexity and confusion in the sector.

If the tenancies under the 1988 Act are converted to PRT under the 2016 Act, children living in these tenancies would benefit from the enhanced protections under the 2016 Act. This could offer better security of tenure and more rights for tenants with families. The proposal aims to reduce complexity and confusion in the sector. This could lead to a more straightforward and understandable system for families with children. It may be easier for them to know their rights and responsibilities.

The regulations would be subject to a consultation first. This process would allow for the voices and concerns of families with children to be heard and considered when designing the final regulations.

Part 5, Social landlords pre-action requirement where domestic abuse a factor

We know from available evidence that domestic abuse can have a serious impact on the overall wellbeing of victims and their children and also that eviction can have a significant negative impact on the mental and physical health of tenants and particularly children.

A report by Refuge^[75] into different forms of economic abuse and its impact on women and children experiencing domestic abuse demonstrates how victims may develop rent arrears as a result of financial abuse by their partner. The high risk of domestic abuse victims becoming homeless and the challenges and impacts homelessness can bring including, reduced health and wellbeing outcomes and increased financial instability is explained in a domestic abuse briefing report by Crisis^[76].

Provisions in the Bill respond directly to concerns by helping to protect the rights of those living in social housing, including young tenants up to the age of 18 and households with children experiencing domestic abuse financial control by requiring social landlords to support individuals experiencing domestic abuse causing rent arrears in a specialised manner.

Households with children are more likely to be financially vulnerable compared to those without. 37% of households with dependent children were financially vulnerable in 2018-2020, compared to 28% of households without any dependent children^[77].

Scottish Government data on Poverty and Income Inequality in Scotland^[78] shows that in the last 15 years, the youngest households (household heads aged 16-24) have been consistently more likely to be in relative poverty compared to older households. In the period 2020-23, 39% of people in households with household heads aged 16-24 were in relative poverty after housing. In comparison, the age groups 25-34, 35-44, 45-54 and 55-64 all had lower poverty rates between 17% and 23%.

These provisions in the Bill will positively impact all tenants but may particularly support young tenants on lower incomes and households with children. Enabling tenants in rent arrears as a result of domestic abuse financial control to remain in their home, or be re-housed if that is their wish, and ensure rent arrears accrued because of domestic abuse are not a barrier to these households accessing social housing in the future will contribute to the overall health and wellbeing of the household, and may be particularly beneficial for the wellbeing of young people and children.