Sadiq Khan: Ministers are ‘all talk and no action’
The Mayor of London, Sadiq Khan, has today accused the government of ‘bottling it’ on pledges to help renters in the capital.
His attack came after ministers significantly watered down plans to ‘cap’ deposits for tenants.
In the Queen’s Speech earlier this year, the government said it would cap deposits at one month’s rent to help Londoners – and those renting in the rest of England – with up-front costs.
Sadiq argued that more should be done to support tenants with the cost of deposits, and that they should be capped at a maximum of three weeks. His call was echoed by Citizens Advice, Shelter and Crisis, who all recommended a cap of three weeks’ rent.
Most letting and estate agents, however, supported a six-week cap – and now ministers have agreed with them in a move which will hit the capital’s renters in the pocket.
Ministers have now given the green light for deposits worth up to six weeks’ rent being charged – no different from what is already often the standard amount in the capital.
This will see renters face up-front costs of about £2,000 – double the £1,000 deposit cap proposed by the Mayor, and £500 more than the government said it would do.
Sadiq also proposed a cap on ‘holding deposits’ – charges that cover the cost of references or losses in rent if a new tenant needs to be found – which the Mayor said should be set at one day’s rent, around £50.
However, the government now says a holding deposit will be allowed to go as high as a whole week’s rent, which would work out in London at a staggering £340.
Sadiq has also criticised the government’s failure to use this opportunity to bring financial penalties for letting agents into line with those currently in place for landlords.
He argued they should be put on par with the £30,000 fines councils can use to punish rogue landlords for breaching housing legislation.
Instead the government has set the initial fine for breaking the law at only £5,000, which the Mayor believes is far too low and has proven to be wholly ineffective for similar offences.
The Mayor of London, Sadiq Khan, said: “This government once again has proved it is all talk and no action when it comes to making it more affordable for those struggling to rent or buy a home.
“Ministers have bottled it on their commitment to reduce up-front deposits, which we know hit thousands of low-income Londoners the hardest.
“While I welcome the fact lettings agent fees paid by tenants look set to be finally banned – something I and others have called for over many years – the caps on deposits and holding deposits are almost meaningless and will do nothing to make renting more affordable for Londoners.
“Instead the government should cap deposits at three weeks’ rent as I argued, raise the penalty for charging illegal fees to £30,000 or a criminal prosecution, and give local authorities extra funding to enforce these new penalties.”