Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Bill — House of Lords, 2018-06-19
Topic: Housing
Kathryn Pinnock (Liberal Democrats, Centre to centre-left): My Lords, this amendment seeks definitions of the terms "unoccupied" and "substantially unfurnished" dwellings. On the face of it, the descriptions pose no difficulties of interpretation—but in practice that is far from the position. Is a dwelling unoccupied if it is used for, say, all but two or three weekends in a year? Does that usage enable the property to be classified as, for instance, a second home? What does "unoccupied" mean? Under the Bill there would be a significant financial cost to the owner if the dwelling is deemed to be unoccupied—one that a homeowner might well challenge if there is no clarity as to the definition There is a similar fog around the meaning of "substantially unfurnished". There must have been calls for clarity from the local government sector, because in September 2014 the DCLG, as it then was, sent a letter to local authorities headed: "Council Tax Information Letter: Council Tax—Definitions of Empty Homes and Second Homes" In my view, the letter does little to clarify the definitions. It states, unhelpfully, that it, "outlines the current situation and the Department’s informal view on these matters" In other words, the descriptions provided have no basis and are open to challenge. For instance, it states: "There is a misconception that the premium"— on council tax— "is easy to avoid by simply placing some furniture into a property. We do not have evidence that this is the case. ‘Substantially unfurnished’ is not defined in council tax legislation, but is used for the purposes of the empty homes discount regime and the empty homes premium" So it says that, while there is no evidence that people are putting furniture into property, "substantially unfurnished" is not defined. I am seeking a definition. If these penalties or premiums on council tax are to be raised significantly, local authorities require further guidance on what "substantially unfurnished" means The letter further states: "Local authorities will have formed their own views on the definitions"— which of course may result in a multitude of definitions of "substantially unfurnished", and that could lead in turn to disputes. I quote again from the letter: "A property which is substantially unfurnished is unlikely to be occupied or be capable of occupation. A property which is capable of occupation can reasonably be expected to contain some, if not all, items from both of the following categories: furniture such as bed, chairs, table, wardrobe or sofa, and white goods such as fridge, freezer or cooker" Noble Lords will recognise that properties which are left unoccupied often contain such items as are listed, as they are nowhere near as valuable as they once were and so are not worth removing. The letter goes on to explain further checks that can be made. For instance, it suggests that, "it will be reasonable for the local authority to cross-check with the electoral roll, or ask for evidence, such as utility bills showing usage of services, driving licence as proof of address, or receipts or other proof of moving costs" Of course, that means that the owner can be traced—but in my experience of properties in the neighbourhood where I live, certainly long-term empty properties, that is often not the case. I am sure that the Minister knows that many property owners now live abroad and are difficult to contact. Certainly, my experience of the electoral roll is that it is not a sure test of occupancy in either direction In our view, the Government have a responsibility through regulations to provide guidance to billing authorities on how to determine whether a dwelling is unoccupied or substantially unfurnished. The financial cost to an owner of a dwelling that has been classed as unoccupied could be significant, so natural justice demands that local authorities have that legal guidance. Failure to provide such guidance may result in local authorities not using the powers provided for in the Bill, for fear of a legal challenge and the inability to get the supporting evidence. This would undermine the whole purpose of the Bill, the direction of which I support: namely, to try to get empty homes back into use by families, whether in the relatively short term or the very long term, and to cut the need for the building of even more homes on greenfield or green-belt land. I beg to move.