The Queen's Speech has revealed the Government's agenda for new legislation in the coming year. We take a look at the key points which are likely to have an impact on the property sector.
It highlighted a focus on dealing with the cost of living crisis by levelling up opportunity in all parts of the country, supporting more people into work and a drive to strengthen the economy. We take a look at the key points which are likely to have an impact on the property sector.
1. Levelling Up and Regeneration Bill
The Levelling Up and Regeneration Bill was announced with the intention of driving local growth, empowering local leaders to regenerate their areas, and ensuring everyone can share in the United Kingdom's success. The main elements of the Bill will be:
Placing a duty on Government to set Levelling Up missions.
- Reform of local governance structures with the intention of enhancing local accountability, joining up services and providing transparent decision making to rejuvenate communities.
- New powers for local authorities to bring empty premises back into use and instigate rental auctions of vacant commercial properties;
- Giving local councils the power to compel landlords to let unused shops on the high street and new powers to take control of empty buildings by making changes to compulsory purchase orders; and
- Strengthening neighbourhood planning, making it easier for local authorities to get local plans in place, and limiting speculative development.
On planning reform, it was confirmed that significant swathes of the planning White Paper have been abandoned. There will be no new planning bill and the controversial proposals for a centralised zonal planning system have been abandoned. Instead a Levelling Up and Regeneration Bill will contain planning provisions designed to "give communities a louder voice, making sure developments are beautiful, green and accompanied by new infrastructure and affordable housing". The elements of the planning white paper that survive include:
- A new approach to environmental assessment in our planning system, stripping out certain requirements derived from EU Law. Will the Government reform the system of environmental assessments to address the nitrates and phosphates issues that are holding back development in an increasing number of local authority areas?
- Strengthening neighbourhood planning and digitalising the system to make local plans easier to find, understand and engage with and by making it easier for local authorities to get local plans in place. In line with the planning white paper this points to a simplified process of plan making, whilst retaining the core features of the current plan led system. However, the radical zonal rules based system of planning appears to have been abandoned as widely predicted.
- Capturing more of the financial value created by development with a locally set, non-negotiable levy to deliver the infrastructure that communities need, such as housing, schools, GPs and new roads. The Government appears to have stepped back from a nationally set universal levy to replace the Community Infrastructure Levy and section 106 agreements that it considered in the planning white paper. However, it seems to be pressing ahead with the idea that a levy can avoid the need for section 106 agreements, raising questions as to what will regulate how, when, where and by whom infrastructure and affordable housing will be delivered. It remains to be seen whether developers will have a choice between paying the levy or delivering these items themselves in lieu. The resources and capability of local authorities to deliver these items at scale will come under close scrutiny in due course.
2. Procurement Bill
The Procurement Bill was announced with the aim of simplifying public sector procurement to provide new opportunities for small businesses. The proposed legislation is aimed at taking advantage of Brexit by moving away from EU rules and introducing new procurement tools – however, the opportunity to "move away" from EU rules is limited due to our membership of the World Trade Organisation's Agreement on Government Procurement, which actually underpins a lot of the rules. Nevertheless, there will be a push to a more UK-based approach to procurement, with a number of exemptions, processes and selection criteria reflecting more closely what happens in current British procurement practice.
This will include the development of more flexible procurement tools, such as "open" frameworks and dynamic marketplaces (previously called dynamic purchasing systems), an enhanced approach to transparency (which is arguably being heavily pushed due to the PPE procurement cases that have been subjected to recent scrutiny by the Courts but that inevitably will significantly add to the administrative burden faced by public sector purchases). It will also redesign the procurement requirements to reflect UK-practice: articulating national selection criteria, enshrining procurement priorities and introducing new exemptions that reflect British business practice as it currently stands (e.g a new safe harbour for variations made to long-term, complex contracts).
There will be a "go live" period of 6 months following Royal Assent of the Bill and necessary secondary legislation and statutory guidance – in order to ensure the procurement capacity and capability in each organisation participates in the learning and development programme – so we expect the new regime to be in force by approximately September next year.
3. Social Housing Regulation Bill
The Social Housing Regulation Bill was announced with the aim of improving the regulation of social housing to strengthen the rights of tenants and ensure better quality, safer homes.
Draft legislation has been produced which will amend the Housing and Regeneration Act 2008 in order to:
- Give effect to the proposal that the Regulator of Social Housing becomes a proactive consumer regulator in order to better support transparency and drive better outcomes for consumers.
- Increase the Regulator's powers in relation to for-profit registered providers and local authorities.
- Introduce a renewed focus on decent standards and repairs, empowering the Regulator to arrange emergency repairs of tenants’ homes following a survey where there is evidence of systemic failure by the landlord.
4. Energy Security Bill
The Energy Security Bill was announced with the stated aim of delivering the transition to cheaper, cleaner and more secure energy. The key aspects of the Bill will be to protect consumers against rising global prices, enabling the price cap to be extended beyond 2023. It will also introduce new tools to encourage new innovative low carbon-technologies including models for Carbon Capture Usage and Storage. The Bill will also seek to encourage investment in the consumer market for electric heat pumps with the hope of reducing the cost of installation to consumers, as well as appointing Ofgem to regulate the heat networks sector.
5. Brexit Freedoms Bill
The Brexit Freedoms Bill was announced with the aim of making it easier to amend, repeal or replace retained EU laws and regulations which are deemed to no longer suit the needs of the UK and its economy. The government has stated that one potential outcome will be the removal of £1 billion of burdensome red tape for businesses in a push to improve innovation and competitiveness.
6. Bill of Rights
It was confirmed that a new Bill of Rights will be introduced in order to restore the balance of power between the legislature and the courts. One of the key aims of the Bill of Rights will be to reduce unnecessary litigation and avoid undue risk aversion for bodies delivering public services. It will also establish the primacy of UK case law, clarifying that there is no requirement to follow the Strasbourg case law and that UK Courts cannot interpret rights in a more expansive manner than the Strasbourg Court. Beyond these high level statements, the scope and extent of the reforms to human rights rules are yet to be outlined.
7. Data Reform Bill
It was confirmed that the UK's current data protection laws, which were only recently introduced under EU rules, will be reformed. The Government has stated that it intends to create a new UK data protection framework to reduce the current burdens on companies and instead use data to encourage growth and innovation, particularly in the fields of science and technology. It is also intended the Information Commissioner's Office will receive new enforcement powers when it comes to taking action against non-compliant organisations.
8. Financial Services and Markets Bill
New legislation will be introduced with the stated aim of strengthening the United Kingdom’s financial services industry, ensuring that it continues to act in the interest of all people and communities. The Bill will aim to encourage more international investment into the UK by reforming EU laws, cutting red tape and supporting the use of innovative technologies to improve security and investor confidence.
9. Leasehold Reform
Notably, the issue of leasehold reform was not mentioned in the Queen's Speech. As things stand, the Leasehold Reform (Ground Rent) Act 2022 will come into force on 30 June 2022 to ban ground rents in long residential leases. The Government also consulted earlier this year on the first phase of its implementation of reforms to the rules on leasehold enfranchisement, commonhold and right to manage. Whilst the Government has said that it remains committed to these issues, the timescale for introduction of the reforms is presently unclear.
10. Renters Reform Bill
Also on the Government's agenda (although not mentioned in the Queen's Speech) is the Renters Reform Bill, which is expected to:
- Abolish 'no fault' evictions under section 21 of the Housing Act 1988, preventing landlords from bringing a tenancy to an end without providing any reason for doing so.
- Introduce new grounds for possession for rent arrears and reduce notice periods for anti-social behaviour
- Provide local councils in England with powers to tackle non-compliant private landlords and apply the Decent Homes Standard to the private rented sector for the first time.
A White Paper is due to be published later this year setting out the full details and scope of the reforms the Bill will introduce, although the timescale for introduction of the reforms remains unclear.
11. Product Security and Telecommunications Infrastructure Bill
Although not specifically mentioned in the Queen's Speech itself, this Bill is expected to form part of the Government's measures to boost the economy and level up opportunity across the UK. The Bill is likely to include further reforms to the Electronic Communications Code in order to assist with the accelerated roll out of 5G and provide improved digital connectivity to all parts of the country. The aim of the reforms will be to streamline the negotiation process between operators and site providers by encouraging more collaboration between the parties.
