Apologies were received from Annie Wells (Glasgow) (Con) and Jeremy Balfour (Lothian) (Con) attended the Committee as a substitute.
The Minister for Local Government, Housing and Planning, Kevin Stewart provided an opening statement covering the following points:
Scope of Regulations
The Convener James Dornan (Glasgow Cathcart) (SNP) highlighted the Committee had been inundated with industry correspondence, with many noting the “geographical problem” of short-term lets being a specific issue in some areas, like Edinburgh, but not others. The Minister asserted the regulations enabled local councils to be flexible in their approach and introduce additional measures, if required, in addition to the mandatory health and safety criteria.
Keith Brown (Clackmannanshire and Dunblane) (SNP) later picked up on this point, noting that some concerns focused on why this was an Edinburgh-based issue which may not be relevant to them. The Minister responded that some respondents had tried to paint the situation as an Edinburgh only issue but that complaints were received throughout the country, including in Skye and the East Neuk of Fife, and that councils would have autonomy and independence to tackle local issues. Keith Brown also mentioned problems in Caithness.
Impact on Local Authorities
The Convener inquired about the regulatory burden placed on local councils despite the flexibility alluded to by the Minister. The Minister again reiterated the points about the flexibility built into the system. Sarah Boyack (Lothian) (Lab) touched on the financial issues for councils who would have to set-up the system in advance of receiving income from fees, thereby providing additional work and costs. The Minister responded that the government had consulted with councils through the BRIA and that the concept of licensing was not new for them.
Alexander Stewart (Mid Scotland and Fife) (Con) returned to the issue later in proceedings, seeking assurances that councils would have adequate resourcing and staff to deal with new obligations. The Minister claimed that of the 23 council responses, 5 talked about the financing of the regime.
Impact on Operators
The Convener sought detail on the cost of licensing to operators, noting that many had said it would cost £2,000. The Minister queried this figure and challenged those making it to illustrate how this was calculated and share it with officials/the committee. He said that it would cost around £223-377 to cover a three-year licence. Fees would be a matter for local authorities and he emphasised that it was cost-neutral and would not allow “profitability” by councils.
The Minister was repeatedly asked by MSPs why B&Bs had been included in the regulations, especially as there was scant evidence that such accommodation disturbed communities. He replied he could “actively explore solutions” with industry if needed but said there could be “no loopholes” in the regulations, adding that: “It may well be that STL operators try to prove that they are a B&B by getting round the law by providing breakfast boxes”.
The panel was asked by Sarah Boyack to provide figures on the number of B&Bs covered by the 2005 Licensing Act and how many would now be covered by the STL Licencing Order. Neither the Minister nor Andrew Mott had the figures to hand but would endeavour to provide them. Andy Wightman (Lothian) (Ind) also raised the issue of B&Bs, highlighting correspondence from David Weston which challenged the Minister’s interpretation of events. Jeremy Balfour (Lothian) (Con) asked specifically if B&Bs were excluded as part of the 2019 consultation and the Minister retorted that the Scottish Government were levelling the playing field as requested by the B&B Association.
Guidance and Further Changes
Sarah Boyack wanted to hear more about the monitoring in place for assessing the impact of the regulations, as well as any review in the next parliament. The Minister argued that the approach taken by the Scottish Government – to use secondary legislation – was correct and it was imperative to get the guidance right. He left the door open to returning to primary legislation in the next parliament if required and emphasised he would continue to work with stakeholders to avoid unintended consequences.
Alexander Stewart said he had strong reservations about the regulations and the fact that the Scottish Government may have to take action in the next parliament to rectify issues showed that their approach was wrong. The Minister replied that the Scottish Government had worked extensively on the issue through two consultations, that it was essential to strike a balance between competing interests, and that the government had listened to industry and would continue to do so.
Keith Brown and the Minister exchanged views on the obligations placed on platforms, with the latter stating that the government were working with them to ensure that the scheme works well. He further added that they gad a reputational interested in offering licensed businesses but that government cannot compel the to ensure the licensing number is posted.
Andy Wightman engaged the Minister and Andrew Mott in a discussion on the rationale behind an operator having to secure licenses specific to each of their properties rather than one license designating all properties.
Alexander Stewart sought detail about the criteria for local authorities to establish control areas, which the Minister replied would be set out in the guidance. Gordon Macdonald (Edinburgh Pentlands) (SNP) raised issues over enforcement through planning rules for short-term lets, claiming that there were 8,000 of the properties in the capital buy only around 100 had applied for planning permission.
Following the earlier debate, the Committee moved to the formal debate and vote on the short-term let control area regulation. Firstly, Andy Wightman noted his disappointment that the Scottish Government refused to share draft SSIs with the Committee and that there was no opportunity to amend the regulations. Andy Wightman stated he would “rather we get it right first go” and refused to back the control area plans, based primarily on the fact ministers would be required to consent to any plans from local authorities. The Minister pointed to a similar process over conservation areas but Andy Wightman said that for conservation areas, councils only need to “give notice to ministers”.
Sarah Boyack believed the powers were needed urgently, pointing to the loss of housing stock and residential amenity in Edinburgh. She said there were constituent concerns to address and that effective monitoring and accountability was required; however, despite some disappointment with elements of the regulation, she would vote to accept as holding back would be a retrograde step for communities.
Alexander Stewart thought it was necessary to regulate short-term lets and that while he had concerns about ministerial control, he would be voting for the planning regulations, a point echoed by Jeremy Balfour.
MSPs voted 6-1 to recommend to parliament to agree the planning control regulations. Only Andy Wightman voted to reject the SSI, with SNP, Scottish Conservative and Scottish Labour members voting to agree.
-23718—That the Local Government and Communities Committee recommends that the Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Order 2021 [draft] be approved.
MSPs then moved onto formal consideration of the Licensing Order. Andy Wightman argued it was “bad governance and bad law” to pass it so quickly ahead of the election and merely say ‘we’ll look at it afterwards for any changes’. He expressed his disappointment that the Minister refused to share a draft SSI with the Committee and stated his preference that the regulations should be withdrawn and rewritten. He added that it was imperative to get the regulations right, noted that some respondents had called for the inclusion of grandfather rights, and that it was never contemplated that B&Bs should be part of this (and was “distressed” by that fact).
Alexander Stewart expressed his difficulties with the Order and his belief that it would burden the sector. Like Wightman, he spoke of the need to get the detail right now and that improvements could have been made if the Committee had held dialogue much earlier. Similarly, Sarah Boyack articulated her disappointment that there was not more time to make improvements and that there was no capacity to amend. She maintained that the Scottish Government had to address concerns from the STL industry, provide clarity on the costs as there was a disparity between government and industry calculations, and the need to provide guidance and support vis-à-vis EPCs. While she said she was “conflicted” on the issue, she would support the Order but added more work needed to be done ahead of the full parliamentary vote.
Keith Brown maintained that the government had a difficult job in balancing community and tourism needs but that they had done so successfully. The Minister declared that the issue was polarising, with industry wanting no change and communities wanting immediate and robust action.
MSPs narrowly voted in favour to recommend the Licensing Order to parliament by 4 votes to 3, with Scottish Labour’s Sarah Boyack voting with the three SNP MSPs on the Committee. The Scottish Conservatives and Andy Wightman voted to reject.