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Category: Member Benefits

Short-term Lets (Licensing) General Questions

Posted on by Fiona Campbell

STL questions were asked in plenary during General Questions in Parliament today.

Short-term Lets (Licensing)

Finlay Carson (Galloway and West Dumfries) (Con): To ask the Scottish Government whether it will provide an update on its position regarding short-term lets licensing. (S6O-00196)

The Cabinet Secretary for Social Justice, Housing and Local Government (Shona Robison): Regulation of short-term lets is vital to balancing the needs and concerns that people and communities have raised with the Scottish Government, elected members and local authorities with wider economic and tourism interests.

Over the summer, we held a consultation on the legislation and the business and regulatory impact assessment. We are now reviewing the responses to make sure that we get that important legislation absolutely right. We have informed the Local Government, Housing and Planning Committee that we will lay the licensing order in November. By allowing local authorities appropriate regulatory powers through a licensing scheme, we can ensure that short-term lets are safe and address issues that local residents and communities face.

Finlay Carson: Given the contentious nature of the licensing scheme and the Scottish Government’s failure to adequately work with the self-catering sector to resolve the issues that arise, particularly with regard to rural businesses, can the minister set out how the Scottish Government or local authorities will compensate businesses—including many in rural areas such as Dumfries and Galloway—whose livelihoods could be taken away due to a short-term licence being refused on the ground of overcapacity?

Shona Robison: I do not accept Finlay Carson’s contention, as I believe that efforts have been made to work with the sector. Indeed, I met representatives from Airbnb and the Association of Scotland’s Self-Caterers just a few weeks ago and I have committed to continuing to work with them.

I do not believe that those responsibilities are onerous. The BRIA sets out clearly that the licensing fee will not be onerous and that local authorities can recoup only the cost of providing their licensing system. In addition, local authorities’ powers will be very important in addressing issues of local concern, which I hope Finlay Carson will also listen to, because it is important that we hear local concerns. The legislation is aimed at giving local authorities the powers to use, but they do not have to use them. I hope that Finlay Carson appreciates that local authorities should have the powers to address issues of concern within their areas.

Emma Roddick (Highlands and Islands) (SNP): Does the cabinet secretary agree that the devastating impact on housing stock in certain areas of the Highlands and Islands due to the high density of short-term lets needs to be urgently addressed?

Shona Robison: We know that, in certain communities, particularly tourist hotspots, high numbers of short-term lets can reduce the number of available properties and make it harder for people who work in the area to find homes to live in—a matter that I hope is of concern to members across the chamber. That is why we are taking action on short-term lets. We consider that the regulation of short-term lets—including legislation that allows councils to establish short-term let control areas, which came into force in April—and our proposals to license short-term lets will strike the necessary balance between the concerns that communities have raised and the wider economic and tourism interests.

We are also increasing the number of affordable homes. We are proud of having delivered more than 103,000 affordable homes since 2007, and we have committed to delivering 110,000 more by 2032.

Emma Roddick will note that Highland Council proposes to use a short-term let control order for the Badenoch and Strathspey area.

Willie Rennie (North East Fife) (LD): I am keen to use control areas for the east neuk of Fife to protect full-time residents and workers, and I am concerned that the argument over the licensing scheme might be holding that up. I am interested in the Association of Scotland’s Self-Caterers’ idea of having a registration scheme, which I know the Government is against. Will the cabinet secretary reconsider its opposition to that, so that we can get cracking on implementing the control areas?

Shona Robison:  Let me repeat: councils have had the power to establish short-term let control areas. The legislation for that came into force in April this year. City of Edinburgh Council is already looking at making the whole of Edinburgh a control area, and, as I said, Highland Council is looking at establishing a control area for Badenoch and Strathspey. It might be good for Willie Rennie and Fife Council to discuss the east neuk as well. It is a particular power that will be used by local authorities in the areas in which they decide to use it, in consultation with local people and, of course, ministers.

The idea of having a registration scheme has been discussed at length, and we do not believe that it would give the same protections, particularly given the need to have common safety standards across all short-term lets in Scotland. That is why we are bringing in a licensing scheme. We will make sure that it works for communities and that it will not be onerous for those who provide short-term lets.

https://archive2021.parliament.scot/parliamentarybusiness/report.aspx?r=13316

POTENTIAL HUMAN RIGHTS VIOLATION

Posted on by Fiona Campbell

POTENTIAL HUMAN RIGHTS VIOLATION

The ASSC has identified a potential human rights violation: Protocol 1, Article 1 and Article 17 of the Charter on Fundamental Rights – Right to Property.

The ASSC engaged the respected legal firm Burness Paull LLP in Summer 2021 to provide expert comment on the Scottish Government’s short-term let regulatory plans and their arguments are set out below.

We seriously question whether the draft Order is compliant with the European Convention on Human Rights (“ECHR”).  Protocol 1 Article 1 provides that every natural or legal person is entitled to peaceful enjoyment of their possessions.  To be deemed compatible with Article 1 of Protocol No. 1, the interference must fulfil certain criteria: it must comply with the principle of lawfulness and pursue a legitimate aim by means reasonably proportionate to the aim sought to be realised.   It is in our opinion clear that the draft Order fails to comply with the latter.

The specific public interest objective being pursued by the Scottish Government via this Order is unclear and as already articulated above, not sufficiently explained or underpinned by clear, sound data or evidence.  There appears to be no account taken of the following:

the existing regulatory framework for short-term lets.  There is no substantive evidence put forward to support the proposition that this existing framework is not fit for purpose or that the proposed measures are necessary and capable of effectively addressing potential issues such as availability of affordable housing and safety of short-term lets.  This results in the draft Order failing to be in the general interest; and

the lack of data to support the draft Order further underlines it ought to be regarded as irrational and arbitrary, such as in the case of R (Kensall) v Secretary of State for Environment [2003] EWHC Admin 459, where measures were found to be in convention of ECHR rights.

The proposed framework includes several aspects which prima facie look to be subjective and could lead to irrational decisions and/or disproportionate interference with property rights:

the short time duration of licenses, being three years, means that interference with peaceful enjoyment is extremely frequent and imposes an excessive burden, as in Sporrong and Lönnroth v Sweden [1983] 5 EHRR 35 where measures were found to be in contravention of the right to peaceful enjoyment of property;

the framework would appear to levy excessive, irregular and currently unquantifiable costs upon licence-holders and applicants; and

there are more proportionate and less intrusive measures available to the Scottish Government, including a mandatory registration scheme, as proposed by the ASSC previously.

We also challenge whether the draft Order would be in compliance with the Charter of Fundamental Rights of the European Union (the “Charter”).  Whilst the Charter no longer has effect in UK law following Brexit, the Scottish Government has made clear its desire to stay aligned with EU law as far as possible, and protect rights that existed for UK citizens.

Article 17 of the Charter provides that everyone has the right to own, use, dispose of and bequeath his or her lawfully acquired possessions, and the use of property may be regulated by law in so far as is necessary for the general interest.  For the reasons outlined above, we do not consider that objectively, a case has been made, backed up by evidence that the draft Order is either in the general interest or is only interfering in use of property so far as necessary.

ASSC Member Submission to the STL Consultation

Posted on by Fiona Campbell

Short Term Lets: Consultation on draft Licensing Order and Business and Regulatory Impact Assessment (BRIA)

Response to Scottish Government by D&M Nash

August 2021

 

  1. For Paper 2: Draft Licensing order – please state your issues and how to resolve them:

Please provide any comments and any suggestions you have to resolve this

We run a well-established (15 years) single property self-catering business in East Fife. This is run purely as a business: available for booking all year round, business rated and occupied around 250 nights per year including the majority of winter weekends.  We rarely stay there ourselves, perhaps 2 weeks in total over the last 10 years.

We were in 2 minds about bothering to respond to this consultation.  To be frank, on the basis of past experience with previous consultations on this legislation, and the recent experiences of those on the Working Group, it seems to us that the consultation exercises are little more than window dressing.  They give the appearance of industry consultation, but decisions have already been made and appear set in tablets of stone. We have seen no evidence whatsoever that the Scottish Government is (a) listening to concerns from those who actually understand the industry, and (b) properly considering alternative proposals to deliver its policy objectives in a way that will not harm our industry, our supply chains and our tourist guests.

However, we do feel we have to formally put on record our continuing concerns both as business owners who will suffer significant financial loss if these proposals are made law and in the context of the wider economic damage, and damage to the Scottish tourism industry that will demonstrably ensue.

As you are well aware having been repeatedly told from a wide cross section of stakeholders, the fundamental flaw in the licensing scheme is that it will lead to a large number of self-catering properties and B&Bs closing – 49% of self-catering and 46% of B&Bs from recent surveys. It goes without saying that will devastate the Scottish tourism industry, its supply chain and in consequence tourism reliant local economies.

We are one of the many that will close. As a small business it is simply not viable for us to continue if licensing is introduced, in particular for the following reasons –

  • Uncertainty over licence being granted: Councils will have very subjective grounds to refuse licence – and could grant licence then refuse renewal. Appeals against refusal would involve substantial legal costs and more uncertainty.
  • We will have to make advance bookings made during the licence application period conditional on licence being granted (which will put off guests) or risk being sued if we don’t and licence not granted – and this will be repeated every 3 years when licence must be renewed.
  • Increased bureaucracy and hassle: disproportionately affecting small business owners who are the backbone of Scotland’s tourist economy.
  • Investment uncertainty: we will be reluctant to invest in major repairs, replacements and improvements as we won’t know whether licence will be granted or renewed.
  • Unknown and open-ended licensing costs, realistically estimated as £1500k plus despite what, without evidence, the consultation suggests. Councils have to recover their costs from the scheme and operators will face additionally paying the Council for inspections which does not happen with other licensing regimes.

We will lose the income we have carefully built up over the years and will be faced with the difficult decision of marketing the property (and probably losing most of the money spent on quality furniture and fittings) or keeping the property as second home for occasional use by ourselves and friends (which will result in a drastic drop in occupancy). Our professional local housekeeping business and local trades we employ will directly lose several thousand pounds per annum, and less tourist accommodation will of course mean less tourists spending money in local businesses – some of which would not be viable without tourism. Families who form the bulk of self-catering guests will inevitable will inevitably pay more for their holidays as competition decreases – precisely at the moment when we are trying to recover from Covid and when we need to encourage more staycations to reduce carbon emissions. The Scottish Government’s timing is therefore extraordinary to say the least.

We are completely bewildered as why Scottish Government policy is to allow this to happen.

We are well aware in some specific areas there are concerns over the growth of second homes. But if anything, licensing will if make this worse as evidenced by the ASSC’s survey results showing many owners will close but keep the properties as reduced occupancy second homes, and in any event the new planning control areas will help in the future.

We are also well aware that there is evidence (albeit mostly anecdotal and much from small pressure groups) that rapid growth of Air BnB’s in Edinburgh is causing a range of problems. But this is highly localised and therefore needs to be dealt locally (including establishment of planning control areas) not by national measures that damage the rest of us.

But all this can be avoided. The answer is very simple: all the Scottish Government has to do is instead introduce the robust, tourism industry supported, registration scheme proposed by the ASSC which so far has been rejected without even a word of explanation. The requirements of that scheme are completely acceptable to professional operators like ourselves and deliver almost all of Scottish Government’s objectives in a far simpler and less bureaucratic form.

 

  1. For Paper 3: Draft Business and Regulatory Impact Assessment (BRIA) – please state your issues and how to resolve them:

Please provide any comments and any suggestions you have to resolve this

In our view the BRIA is fundamentally flawed. It simply ignores the fact that many self-catering businesses and B&B’s will close (as evidenced by surveys). Consequently, it fails to consider the economic impact such closures will have on business owners such as ourselves, on our supply chain (housekeepers etc), local trades people, cafes, restaurants, tourist services. And last but not least on tourists themselves who are likely to end up paying more as businesses closures lead to reduced competition and in addition the costs of licences have to be recouped by the businesses that stay open.

In addition, what little relevant analysis there is in the BRIA appears to be supported by anecdote, often provided by localised pressure groups rather than through objective surveys, rather than by empirical data.