Agenda item

 

To consider the reasons for the call-in request relating to the Selective Licensing Policy Cabinet decision.

 

Report from the Strategic Director of Regeneration and Environment.

 

Recommendations: That Cabinet:

1.    Review all options proposed in section 3 of the report and approve Option 3, which is to proceed to approve Selective Licensing declarations, including the establishment of a stakeholder steering group (based on the criteria set out within the report and appendices);

 

2.    Approve the revised Licence Fee and the Licence Conditions, in all of the proposed areas which are:

a.    Town centre / Eastwood / East Dene / Clifton / Boston Castle

b.    Masbrough / Kimberworth

c.     Thurcroft

d.    Dinnington

e.    Brinsworth

f.      Parkgate

 

 

In relation to this item, Councillor Tinsley declared that he had previously held a licence in Maltby. It was not a financial interest.

 

Councillor Yasseen expressed her gratitude for the opportunity to present the call-in, noting that raising housing standards across Rotherham was a shared priority. It was stated that while the principle was supported and had been backed over the past 10 years, Councillor Yasseen did not support the current proposal. Concerns were raised that the model would not deliver lasting change, as similar issues persisted in the same streets after a decade. The procedural, legal, and policy concerns were highlighted, including flaws in the consultation process, inadequate responses during engagement events, and anomalies such as reopening the consultation and rebranding it as “landlord licensing,” which it was believed was inconsistent with the Housing Act. Evidence-based feedback had previously been submitted, including examples of inaccuracies on the council’s website and maps.

 

Councillor Yasseen stated that the consultation process had undermined trust and integrity, describing aspects as misleading. Concerns were reiterated about the equality analysis, noting that it lacked evidence of mitigating measures for disproportionate impacts on protected groups. Reference was made to central Rotherham areas, Boston Castle, Wath East, and Wath West, where engagement events were held and which have high ethnic diversity. Additional concerns included inadequate data on mobility and immigration markers under the Housing Act, particularly the mobility index, and a lack of transparency regarding alternative schemes submitted during consultation.

 

In continuation Councillor Yasseen cited Little London in Maltby as an example, noting it had previously been identified for improvement, fined, and featured on a national programme for poor housing conditions, yet was removed from the proposed selective licensing scope. Questions were raised about the basis for accepting or rejecting schemes and concerns expressed about transparency, as residents perceived possible preferential treatment of landlords. It was emphasised that the call-in focused on tenants’ rights to safe, secure, and decent homes, which they felt had not been achieved over the past decade. They argued that the proposed model risked duplicating regulation given the forthcoming Renters Reform Bill and Awaab’s Law and suggested waiting for these measures to be implemented. A borough-wide scheme, similar to Barnsley’s approach, was strongly supported as an alternative to selective licensing.

 

Councillor Yasseen went on to raise concerns about the financial model, noting that over 300 properties had been removed from the selective licensing scope without clear rationale and questioning how this affected projected income from licence fees. Clarification was sought on whether any deficit had been accounted for and whether funding was ring-fenced for the dedicated team. It was queried how tenant involvement would be strengthened, expressing doubt based on previous poor engagement outcomes and a lack of significant changes in approach. Finally, concerns were reiterated about transparency in property removals, with assurances requested that decisions were not influenced by lobbying.

 

Councillor A Carter confirmed agreement with previously stated reasons for the call-in and requested either a revision of the decision or, at minimum, a pause for Cabinet to reconsider pending the impact of the Renters Reform Bill and Awaab’s Law. Councillor A Carter highlighted that Brinsworth was newly included in the scheme and reiterated long-standing opposition to selective licensing due to perceived lack of effectiveness. Additional points included:

• Consultation results: 80% of tenants said they would not support the scheme if it led to rent increases, and 59% of overall respondents opposed the scheme.
• Evidence of success: The report cited Maltby as proof of concept, but this was questioned, noting repeated cycles of licensing and continued issues.
• Impact on rents: Concern was expressed that selective licensing could raise rents in lower socio-economic areas, making housing unaffordable for local residents.

 

It was argued that selective licensing was punitive yet ineffective, citing national examples, and suggested that forthcoming legislation, including a national landlord registry, would provide stronger enforcement and broader improvements. A borough-wide approach was supported rather than selective licensing.

 

The Vice-Chair expressed initial concerns about potential rent increases but acknowledged that officers had referenced a report suggesting otherwise. It was asked whether any supplementary evidence could be provided to address those concerns and queried whether the issue related to supply, such as landlords leaving the market and reducing availability, or whether it was an external factor that would inevitably increase rents.

 

In response Councillor Yasseen noted that while some landlords had sent letters, they were not lobbying on behalf of landlords but advocating for a better approach. They shared recent examples, including a tenant who reported a rent increase after years of stability and expressed concerns that selective licensing would not address wider community issues. Councillor Yasseen also cited feedback from a landlord in Clifton who was selling a property due to opposition to the policy. It was argued that national reports did not reflect local realities and reiterated concerns that rents would rise and that the proposed scheme lacked a broader strategy to tackle underlying problems.

 

As a sponsor of the call-in request, Councillor A Carter noted evidence from landlords indicating rents could rise and agreed multiple factors were involved. It was highlighted that the borough relied heavily on the private sector to meet housing needs due to limited council housing. Concern was expressed that landlords selling properties could reduce rental stock, limiting options for residents wishing to remain in their communities. Councillor A Carter warned that this could harm social housing provision and lead to poorer landlords entering the market, ultimately lowering standards.

 

In a follow up question, the Vice-Chair noted that officers might argue the scheme provided powers to inspect properties and address faults, and asked whether any aspects of the Renters Reform Bill could mitigate this.

 

In response to the question, Councillor Yasseen reflected on lessons from the first decade of the scheme, citing inefficiencies such as properties registered but not inspected despite fees being paid. It was argued that selective licensing had not delivered its intended outcomes and highlighted the benefits of the forthcoming Renters Reform Bill, which would require landlords to register properties and strengthen tenant rights. Councillor Yasseen suggested this national approach would be more effective and efficient than current practices and recommended pausing the scheme until these changes were implemented.

 

Councillor Blackham referred to legal grounds in the report, noting a statement that the designation could risk being deemed ultra vires. It was asked whether this was a genuine risk and if the council might be acting beyond its powers, stressing the seriousness of the issue and questioning whether such a risk was acceptable.

 

In response Councillor Yasseen stated they believed several council policies had been breached, as detailed in their call-in request. They emphasised that their role was to present a case based on resident engagement and improving housing standards, not to provide legal expertise. They warned of potential legal challenges, citing past cases where landlords had taken the council to court, which, although successful, were costly and time-consuming. Concerns were raised that the current scheme could expose the council to similar risks, particularly given growing dissatisfaction. Councillor Yasseen also questioned the effectiveness of the scheme, noting issues such as cannabis cultivation increasing in Eastwood during its implementation and failure to meet inspection targets.

 

Councillor A Carter added that, even if the council successfully defended any legal challenge, exposing itself to such risk was not a prudent use of public funds. They argued that resources should be directed toward core services, especially given the potential duplication with the forthcoming Renters Reform Bill, which is expected to take effect in 2026. They recommended pausing the selective licensing scheme for 12 months to assess the impact of national legislation before proceeding, noting that circumstances had changed since the original decision and that a review was now appropriate.

 

In a supplementary question Councillor Blackham asked whether, given the potential risk of acting ultra vires, the council should pause the scheme and seek legal advice to confirm its position. Councillor A Carter agreed, stating that a pause was appropriate and added that, regardless of legal opinion, proceeding would not represent good value for money.

 

The Chair invited the Monitoring Officer to address concerns regarding legal risk. The Monitoring Officer confirmed that while the report acknowledged a potential risk of challenge, such risks exist for many council decisions, particularly controversial ones. Previous challenges to selective licensing had been successfully defended. Legal advice had been sought throughout the process, and external counsel retained to ensure decisions were lawful and defensible. The Monitoring Officer stated that the decision-making process had been appropriate and that, should the Cabinet decision stand, the council would be able to robustly defend any legal challenge.

 

Councillor McKiernan expressed concern that the call-in did not present new evidence, noting that many of the questions raised had already been addressed during previous scrutiny, including consideration of the Renters Reform Bill before it became law. They asked what was new in the call-in that justified Cabinet revisiting the decision, given the extensive pre-decision scrutiny already undertaken.

 

Councillor Yasseen disagreed with the suggestion that the call-in lacked new points, stating that previous responses had been inadequate. They highlighted equality concerns as an example, noting that earlier replies focused on commitment rather than concrete actions or mitigation measures. Councillor Yasseen stressed that tenants deserved better outcomes, citing persistent deprivation in areas like Eastwood despite 10 years of selective licensing. It was explained that issues had been raised repeatedly over several months with little response, which was why they continued to press for improvements.

 

Councillor A Carter added that, while scrutiny had taken place previously, the situation had changed since the Cabinet decision because the Renters Reform Bill had now passed, and its provisions were clear. It was argued that this represented a significant development and justified reconsideration of the scheme.

 

At the Chairs invitation, the Cabinet Member for Housing began by thanking colleagues for agreeing on the aims of selective licensing, safe communities, decent homes, and healthy living, and acknowledged the robust scrutiny previously undertaken.

 

The Cabinet Member for Housing stated they did not believe the consultation was flawed, asserting that proper process had been followed. The extensive engagement undertaken was outlined, including notifications to 16,000 addresses, emails to residents and agents, landlord newsletters, social media, press releases, paid adverts, ward newsletters, public meetings, town council forums, door-knocking, posters, and targeted engagement with minority groups. Paper surveys were also provided on request, and feedback led to updates in consultation materials, removal of a potentially biased question, extended consultation, and revised boundaries. In conclusion it was felt that the consultation was adequate and inclusive.

 

The Assistant Director, Community Safety and Street Scene thanked members for their questions and provided clarification. They noted that while only 20% of councils operated selective licensing in August 2024, 25 new schemes were launched during 2024 and 37 were under consideration by January 2025, indicating growing adoption nationally. On procedural concerns, it was confirmed the consultation was robust and adaptable, with Cabinet fully aware of the majority opposition when making its decision. The decision was based on statutory guidelines and a strong evidence base.

 

It was stated there was no rebranding and that the equality impact analysis complied with the Equality Act and council frameworks, drawing on consultation data, ward demographics, deprivation indices, and census information. Risks and mitigations were identified, and the policy aimed to advance equality by removing barriers to reporting and ensuring proactive inspections.

 

On migration and mobility indices, it was clarified these were referenced for context but not used as grounds for designation. All alternative schemes submitted were assessed and documented in the report. Regarding Little London, it was explained its exclusion was due to historic circumstances involving two major landlords, making a different approach viable.

 

The Assistant Director outlined legislative changes during the process, noting that the removal of the 20% threshold requirement allowed councils greater flexibility to consider additional areas for future selective licensing.

 

Finally, the Assistant Director clarified that while the Renters Reform Bill had now become law, there had been no substantive changes since previous discussions. They noted that implementation would take time, with measures such as the national landlord database not expected until winter 2026. It was explained that selective licensing still offered unique benefits, including the ability to set local conditions tailored to Rotherham’s needs, which the national legislation could not provide.

 

The Cabinet Member for Housing addressed legal and procedural points, confirming that areas were designated based on meeting at least one of five statutory criteria, poor housing conditions, antisocial behaviour, high deprivation, high crime, or low housing demand. They emphasised the scheme’s purpose of professionalising the private rented sector and protecting tenants. The Cabinet Member noted that while the Renters Reform Act was now law, full implementation would take time, and selective licensing remained essential for setting local conditions.

 

The achievements of previous schemes were highlighted, including addressing over 8,000 hazards, inspecting 2,300 properties, tackling 2,000 antisocial behaviour cases, and securing 15 successful prosecutions with 23 pending. One in seven inspected properties had serious Category 1 hazards. The Cabinet Member rejected claims of landlord self-regulation, stating that some landlords with convictions had opposed the scheme. It was argued that rent increases were landlord decisions, not a direct result of licensing, and fees equated to less than £1 per week. Evidence showed no strong link between licensing and rent rises.

 

The Cabinet Member concluded that selective licensing had delivered improvements, citing Maltby as an example, and reiterated its role in reaching vulnerable tenants who might otherwise face barriers to reporting issues.

 

Councillor Yasseen noted there was no mention of finance regarding the 319 properties that had been removed. The documentation did not account for this, even though they had already been excluded before the cabinet paper. It was felt this was a poor financial response, given that many of the arguments were strongly based on financial considerations.

 

The Assistant Director, Community Safety and Street Scene explained that finances were recalculated for the final cabinet report. The team had responded to consultation feedback, which included requests to penalise bad landlords and support good landlords, leading to a review of the fee structure. The removal of properties also prompted a review of the scheme’s expenses, and budgeted costs were reduced to reflect the lower income.

 

The second finance question from Councillor Yasseen concerned legal counsel. It was noted that legal advice had been sought throughout the process, and clarification was requested on how much of this cost came from the council’s general fund. The Assistant Director reiterated that as the Monitoring Officer had noted, counsel’s advice had been taken. These costs were not linked to selective licensing and were funded from the council’s general fund. The exact cost was not available at the time, but the officer agreed to discuss with legal colleagues and provide details if appropriate.

 

Councillor Yasseen noted that, based on the latest figures, 15 of the 16 areas selected for selective licensing had become more deprived over the past 10 years. Concern was raised that the proposed approach appeared to replicate a scheme that had not delivered improvement, with deprivation worsening in most areas, including Eastwood, which ranked among the top 2% most deprived nationally. The question asked was how the new scheme would address issues that had not been resolved in the last decade.

 

The Assistant Director acknowledged that there was a fundamental difference of opinion on the success of previous schemes. The factual point that deprivation had increased in the designated areas was accepted, though the national context was unclear. The Assistant Director stated that the scheme had been successful in improving housing conditions for tenants in selective licensing areas, delivering positive outcomes. Scrutiny had reviewed the scheme several times and recommended closer alignment with wider council policies and strategies. The proposed scheme was described as different, with a critical change being the introduction of area plans based on available data, consultation feedback, and using selective licensing as one tool within a broader approach to improve wider outcomes. In summary, the Assistant Director believed selective licensing had significantly improved individual properties and tenants’ conditions, and the new model reflected scrutiny recommendations and public consultation, aiming to deliver better results for residents.

 

Councillor Yasseen acknowledged the level of consultation but expressed concern that the consultation document was biased, as highlighted in their submitted analysis. They noted that only one question had been changed, whereas their review suggested around 60% of the content was biased. They asked whether more could have been done to make the process fairer and more accessible. The Cabinet Member for Housing stated that, in her opinion, no further changes were necessary.

 

The Vice-Chair noted the justification for selective licensing as a local response to national issues but questioned how this aligned with studies suggesting rents do not increase as a result. Concern was raised about the potential for rising rents due to basic economic principles and the risk of council policies contributing to this. It was asked how confident officers were that rents would not rise, given that decision ultimately rested with landlords.

 

In response the Cabinet Member stated they could not be fully confident that landlords would avoid rent increases, acknowledging that some might use the scheme as justification. An example was cited where a landlord planned a rent rise after five years without an increase. However, it was noted that rules governing rent increases in the private sector remained in place and must be followed. The Cabinet Member emphasised that good landlords had been recognised through reduced fees, amounting to less than £1 per week, and argued that any significant rent increase would likely be for reasons unrelated to selective licensing.

 

Councillor Tinsley noted that the Rental Rights Bill was not yet fully implemented and asked whether, once the housing order and related measures such as the landlord register were in place, the council would review how these interact with selective licensing and consider whether the scheme should continue. In response the Assistant Director confirmed that the scheme would be reviewed annually. If conditions changed to the point where selective licensing was no longer considered necessary or proportionate in specific areas, a recommendation could be made to Cabinet to consider withdrawal.

 

In a supplementary, Councillor Tinsley asked whether the Rental Rights Bill’s decent homes standard would operate in the same way as selective licensing, using the Housing Health and Safety Rating System for monitoring.  The Assistant Director explained that some aspects would be similar, but others would differ. Selective licensing was highlighted as a local tool that allows tailored conditions, such as stricter overcrowding thresholds based on usable living space rather than total square meterage, which includes kitchens and bathrooms. This flexibility enables the council to address specific local issues. While some elements will be covered nationally under the Rental Rights Bill, others will not, which underpins the council’s approach.

 

The Vice-Chair raised concerns about situations where landlords with problematic tenants might be disproportionately affected. They asked what would happen if a tenant caused damage or issues, making it harder for the landlord under the Renter’s Rights Bill to evict them, while also facing council inspections identifying hazards. The Cabinet Member clarified that landlords remained responsible for ensuring properties were free from hazards, even if tenants caused damage. Regarding antisocial behaviour, it was noted that under the Renter’s Rights Bill, landlords could still evict tenants for a valid reason, but no-fault evictions were no longer permitted. Eviction for antisocial behaviour remained possible, subject to following the correct process.

 

The Assistant Director highlighted differences between selective licensing and the Renter’s Rights Bill. The Bill focused on tenants’ rights and offered little on managing antisocial behaviour, whereas selective licensing allowed local requirements for landlords to address such issues. It was noted that selective licensing provided additional levers beyond ensuring homes were decent and fit for habitation, by elevating expectations for landlords to manage tenants effectively for the benefit of the wider community.

 

The Vice-Chair asked what safeguards were in place for landlords dealing with tenants who caused property damage, particularly if issues arose immediately before an inspection. They queried how landlords could report such situations to the council and ensure their concerns were taken into account. The Assistant Director stated that enforcement was evidence-based. Landlords could demonstrate compliance by showing regular property inspections and that hazards had not previously been identified. It was acknowledged that tenants might cause damage or create issues, but officers were experienced in assessing housing conditions and determining causes. The general enforcement policy applied to selective licensing, with the focus on compliance and achieving positive outcomes for both landlords and tenants.

 

At the Chair’s invitation the Cabinet Member for Housing concluded that the call-in should not be accepted for several reasons. On procedural grounds, they stated the consultation was not flawed in design or execution; it was extensive, inclusive, and transparent. Proper processes had been followed, and the consultation was considered adequate. On legal grounds, they believed the criteria for designating selective licensing were clear and had been met, with no breach of equality duty. On impact grounds, they stated the scheme did not disproportionately affect Roma or other ethnic minority tenants, as ward inclusion was evidence-based and clearly set out in the submitted papers. Finally, on reasonableness, they believed the Cabinet decision to approve six further designations was reasonable and evidence based. They reiterated that the purpose was to ensure safe living conditions and create safer, healthier communities for a better Rotherham.

 

The Assistant Director agreed with the Cabinet Member’s summary and added that no new information had been presented for scrutiny to consider. They noted that the same conclusion had applied at the end of the previous scrutiny session.

 

At the Chair’s invitation, Councillor Yasseen thanked everyone for their contributions. They stated that while everyone agreed on the desired outcomes, they believed selective licensing had not achieved improvements in housing standards or quality of life over the past ten years. National IMD data showed that 15 of the 16 designated areas had become more deprived during this period. Councillor Yasseen advocated for an alternative, borough-wide approach to improving housing standards, noting that most councils without selective licensing had found other methods. Councillor Yasseen also suggested pausing the scheme in light of upcoming national changes, such as the Renters’ Rights Bill, and recommended revisiting the policy next year.

 

At the Chair’s invitation Councillor A Carter clarified that the OSMB’s decision was whether to accept the Cabinet’s decision or request reconsideration. They confirmed that the call-in proposal sought Cabinet’s agreement to a 12-month pause, as outlined in the call-in document. They noted that the Cabinet Member believed the consultation was robust but had personally observed very low tenant engagement in Brinsworth. They highlighted that most residents did not support selective licensing and expressed concern that the council was proceeding with an unpopular scheme. They argued that decisions should reflect tenants’ wishes rather than assumptions about their best interests. Councillor A Carter questioned the adequacy of criteria used for designation, noting reliance on deprivation rather than evidence of poor housing standards. They also raised concerns about rent increases, citing contradictions in the Cabinet Member’s statements. They reiterated that deprivation had worsened in previous selective licensing areas and warned that continuing the scheme could exacerbate this trend. In conclusion, they recommended pausing the decision and revisiting the policy after 12 months.

 

The Chair invited members of OSMB to make comments with the Vice-Chair stating that he would vote to refer the decision back to Cabinet. They explained that, regardless of personal views, Cabinet ultimately makes the decision, but it was felt the reasons for the call-in should be reviewed again at Cabinet level. The Vice-Chair expressed concerns about the consultation process, including the removal of a question due to potential bias, and noted uncertainty around the issue of rising rents. They concluded that Cabinet should revisit the matter and review it properly and confirmed his support for referral.

 

The Chair noted three options available were that OSMB could decide not to support the call-in, allowing the original decision to be implemented. Alternatively, OSMB could refer the matter back to Cabinet for reconsideration, setting out its concerns in writing. In exceptional circumstances, OSMB could refer the decision to full Council. If Council supported the call-in, the matter would be referred back to Cabinet for reconsideration; if not, the original decision would stand.

 

The Chair moved to a vote for those in favour of supporting option one, to not to support the call-in, allowing the original decision to be implemented.  Six members of the Board voted in favour of supporting option one.  Five members of the Board voted against supporting option one, therefore it option one was carried, and the original decision could be implemented.

 

Resolved: That the Overview and Scrutiny Management Board:

1. Did not support the request for call-in, therefore the original decision could be implemented with immediate effect.