Short-term lets – licensing scheme and planning control areas: consultation analysis

3. Introduction

Background

3.1. Short-term lets have become the subject of much controversy in some parts of Scotland and evoke strong opinions. Our 2018-19 Programme for Government made a commitment to ensure that local authorities have appropriate regulatory powers to balance the needs and concerns of their communities with wider economic and tourism interests.

3.2. The Short-Term Lets Delivery Group was established in 2018 to assess the evidence base and the impact, positive and negative, of short-term lets, identify the existing powers councils have and explore whether further measures are required. In April 2019, the Scottish Government launched a public consultation and commissioned independent research into the impact of short-term lets on people and communities. The 2019 consultation paper outlined possibilities for a regulatory approach, which included the licensing of short-term lets. In parallel with the consultation, what is now the Planning (Scotland) Act 2019 completed its passage through the Scottish Parliament and includes provision for the establishment of short-term let control areas. The reports on the 2019 consultation and research were published on 28 October 2019.

3.3. On 8 January 2020, Kevin Stewart MSP, Minister for Local Government, Housing and Planning, announced plans to regulate the short-term let sector in the Scottish Parliament, including:

• establishing a licencing scheme for short-term lets using powers under the Civic Government (Scotland) Act 1982;
• prioritising work to give local authorities the power to introduce short-term let control areas under powers in the Planning (Scotland) Act 2019; and
• carefully and urgently reviewing the tax treatment of short-term lets, to ensure they make an appropriate contribution to local communities and support local services.

3.4. Work was paused in March 2020 because of the coronavirus (COVID-19) pandemic but resumed in July 2020.

The consultation

3.5. The 2020 consultation covered the definition of short-term lets, the establishment of control areas under the Planning (Scotland) Act 2019 and the establishment of a licensing scheme under the Civic Government (Scotland) Act 1982. The review of tax treatment is being progressed separately and was outside the scope of the consultation.

3.6. The purpose of this consultation was to help the Scottish Government ensure that the legislation laid at the Scottish Parliament in December is as efficient and effective as possible. The consultation was not about whether to implement a licensing scheme or control areas nor the broad framework of the approach.

3.7. The delay caused by COVID-19 meant that this consultation ran for just under five weeks, a shorter period of engagement than originally planned. The consultation opened on 14 September and closed on 16 October 2020.

Respondent profile

3.8. The Scottish Government received 1086 consultation responses. Of these, some 1069 responses answered the question about themselves. They could select one or more of the following options:

Option	Total	Percent
Accrediting organization	4	0.4%
Guest	302	27.8%
Host	475	43.7%
Hosting intermediary	18	1.7%
Letting agency or destination management organisation	30	2.8%
Local authority or other public sector organisation	28	2.6%
Other hospitality (e.g. hotel or B&B owner)	33	3.0%
Neighbour (affected resident) or community group	151	13.9%
Platform	5	0.5%
Regulatory body	4	0.4%
Trade association	20	1.8%
Other, please state[6]	188	17.3%
Not Answered	17	1.6%

3.9. Of the 1086 consultation responses^[7], 893 (82.2%) identified themselves as being from individuals and 193 (17.8%) were from organisations^[8]. A full list of organisations who responded to the organisation is at Annex A.

3.10. There were 1014 responses which answered the question on how they had heard about the consultation:

Option	Total	Percent
Online at gov.scot or Citizen Space	142	13.1%
Press coverage (local or national TV, radio, social or print media)	241	22.2%
Referred by local authority / government / MSP / councilor	107	9.9%
Referred by host	175	16.1%
Referred by platform	149	13.7%
Other, please state[9]	350	32.2%
Not Answered	72	6.6%

3.11. We have published 947 responses (87.2%) in line with consultee expressed preferences and withheld 139 responses (12.8%).

3.12. We also asked about satisfaction with the consultation and received 1029 responses:

Option	Total	Percent
Very dissatisfied	265	24.4%
Slightly dissatisfied	133	12.3%
Neither satisfied nor dissatisfied	341	31.4%
Slightly satisfied	157	14.5%
Very satisfied	133	12.6%
Not Answered	57	5.6%

3.13. Over one third of respondents were dissatisfied compared with just over a quarter who were satisfied. Most of these (82%) were individuals, in proportion with the overall breakdown between individuals and organisations, see paragraph 3.9 above. By type of actor, guests and hosts were the most dissatisfied. We received 480 comments about this and the dissatisfaction covered a broad range of reasons, including the amount of time available and the COVID-19 pandemic. Some people said they found the consultation paper too complicated or had other issues with it. Many reasons offered were more focused on the policy rather than the consultation itself. So some care needs to be taken in interpreting this data.

3.14. Those who were satisfied or very satisfied offered a similar mix of comments in favour of the consultation paper, process or the policy proposals themselves.

3.15. Respondents were generally content with the platform (Citizen Space) as a means to respond to the consultation. Of the 1014 responses, less than 10% were dissatisfied:

Option	Total	Percent
Very dissatisfied	53	4.9%
Slightly dissatisfied	44	4.1%
Neither satisfied nor dissatisfied	371	34.2%
Slightly satisfied	250	23.0%
Very satisfied	296	27.3%
Not Answered	72	6.6%

3.16. There were 174 comments, many of which were content with the web portal and accessibility. Some respondents took the opportunity to recap their wider views on the policy proposals.

Methodology

3.17. Responses to the consultation were submitted using the Scottish Government consultation platform Citizen Space. The Scottish Government also took account of views expressed in correspondence received in and around the consultation period, even though these were not submitted as formal consultation responses.

3.18. A number of organisations expressed strong views about the proposals and encouraged their members or the wider public to respond along similar lines. Around 15-20% of the questions had answers that were not unique or left blank. Around 150 responses appeared to be part of a lobbying campaign by Discover Scotland^[10], which encouraged guests to respond, principally complaining about the potential increased cost of staying in short-term let accommodation. Airbnb and the Association of Scotland’s Self-Caterers (ASSC) also campaigned against aspects of the proposals and encouraged hosts to respond.

3.19. The Scottish Government also engaged through 20 virtual workshops and events at which 423 people attended; more information about these is provided at Annex B. Many of the issues raised at the consultation workshops were also raised in consultation responses, so these are not reported on separately; rather, they are referred to, where relevant, at each of the questions in this report.

3.20. It should be borne in mind that not every respondent answered all the three of the questions. This report indicates the number of respondents who commented at each question at the start of each chapter. We have considered all comments made by respondents, including the range of issues mentioned in responses, reasons for opinions, specific examples or explanations, alternative suggestions or other comments. The purpose of this consultation was to identify issues and solutions rather than test the popularity of different propositions. For this reason, we have focused on analysis of the substance of the comments, rather than on numerical or sectoral analysis.

Structure of this report

3.21. This report broadly follows the structure of the consultation paper. But first we set out our the implementation timetable in light of the coronavirus (COVID-19) pandemic at chapter 4. Revisions to the definition of short-term let are set out in chapter 5; the revised proposals for control areas at chapter 6; and revised proposals for the licensing scheme are at chapter 7. The six impact assessments (see paragraph 1.8) are presented or summarised at chapter 8 and following. The Business and Regulatory Impact Assessment will be published separately.

3.22. This report covers principal issues raised through consultation workshops and responses and sets out the Scottish Government’s policy response. It does not cover every single issue raised, some of which derived from a misunderstanding of the proposals or are straightforwardly dealt with through guidance or practice.

Next steps

3.23. The Scottish Government intends to lay both the Licensing Order and the Control Area Regulations in December 2020. They are expected to come into force on 1 April 2021. The Scottish Government intends to produce two guidance documents in spring 2021, one aimed at local authorities and the other for hosts and platforms.