Ministear airson Taigheadas agus Comhdhail Minister for Housing and Transport

Keith Mac Ille Dhuinn BPA Keith Brown MSP

FiT:0845 7741741
E: scottish.ministers@scotland.gsi.gov.uk

The Scottish Government

Riaghaltas na h-Alba

Ms Kezia Dugdale MSP The Scottish Parliament EDINBURGH EH991SP

DELIVERING A GAMES LEGACY FOR SCOTlAND

Ur faidhlelYour ref: CP-29/02/12 Ar faidhle/Our ref: 2012/0008392

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March 2012

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2012, where you highlight the issues a member of affordable private rented housing and where you cite as the main barrier. This letter also follows on from (S40-00762), that you raised on this issue on the

Thank you for your letter of 29 February your constituency has faced in securing holding fees, charged by letting agents, my response to Parliamentary Question 8 March 2012.

As you may know, the law currently prohibits charges for drawing up a tenancy agreement or placing a name on an accommodation list. Under section 82 of the Rent (Scotland) Act 1984, it is an offence to require any premium as a condition of the grant or continuance of a tenancy. According to section 90 of the Act, a premium includes "any fine or other like sum and 'any other pecuniary consideration' in addition to rent". Although it should be clear that this legislation prevents the making of any charge apart from rent and a refundable deposit (not exceeding two months' rent), there appears to be confusion about what a premium is and we are aware that some letting agents currently charge tenants a varying range of administration fees and charges. Due to this perceived confusion and in recognition that some tenants may be paying illegal and often over-inflated charges, the Scottish Government took legislative action in 2011. When commenced, Section 32 of the Private Rented Housing (Scotland) Act 2011 will make changes to the law on premiums within the private rented sector. It will enable amendment of the definition of "premium" in section 90 of the 1984 Act to make clear that a premium includes any service or administration fee or charge.

Cidhe Bhictoria, Dun Eideann, EH6 6QQ Victoria Quay, Edinburgh EH6 6QQ www.scotland.gov.uk

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Many letting agency organisations have made representations to the Scottish Government that there are reasonable charges that should be passed on to a tenant. Therefore, the 2011 Act also provides Scottish Ministers with the power to set out in secondary regulations, charges that will be allowed in connection with the grant, renewal or continuance of a tenancy. Such regulations would be able to specify categories of payment that are not to be treated as premiums in terms of the 1984 Act and to set a maximum limit to the amount of any such payment that could be charged. In recognition of the differing views that exist in relation to charges made by letting agents to tenants, the Scottish Government will be launching a consultation on this important matter at the end of March 2012. The results of this consultation will inform the approach to implementing section 32 of the 2011 Act later this year. Until the law is clarified on this matter, it is important for tenants to obtain clear, written information from an agent about which services their fees include and whether there are likely to be any further costs. It should be noted that many letting agents do not charge any fees to tenants - over and above rent and a refundable deposit - and your constituent may wish to consider using such letting agency organisations. Your constituent can also obtain free, independent advice and support on accessing private rented accommodation from organisations such as Shelter Scotland (free phone 0800 800 4444) and Citizens Advice Scotland (see www.cas.org.uk for local office contact details). You may be interested to know that both organisations have recently successfully supported a private rented tenant in Edinburgh to reclaim unreasonable fees charged by a letting agent, through the small claims court. Kind regards

KEITH BROWN

Cidhe Bhictoria. Dun Eideann, EH6 6QQ Victoria Quay, Edinburgh EH6 6QQ www.scotland.gov.uk

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