The proposed legislation aims to tackle homelessness and remedy the UK housing benefit freeze.
On 28 November 2024, the Scottish government passed Stage 1 of the Housing (Scotland) Bill, focusing on the general principles of the legislation. Proposed by Paul McLennan, the Minister for Housing and MSP for East Lothian, the bill aims to address the significant rise in rent levels, which are reportedly increasing at more than twice the rate of inflation. The key provision of the bill caps rent increases at the Consumer Price Index (CPI) plus 1%, with a maximum allowable increase of 6%.
A study by Student Finance and Wellbeing Scotland for the academic year 2023-2024 found that housing costs represented the highest category of expenditure for higher education students, accounting for around half of the median total expenditure for both undergraduate and postgraduate students.
The bill received broad support from the SNP, Scottish Labour, and the Greens, concluding the vote with 83 in favor, 31 opposed, 4 abstaining, and 11 not participating. Notably, of the 31 votes against, 30 came from the Scottish Conservatives, who unanimously opposed the bill, while one vote against was cast by the Alba party.
Opponents of the bill, including Conservative MSP Meghan Gallacher for Central Scotland, argued that the primary issue to do with affordable housing is the lack of housing supply, which is unaddressed by this legislation. Gallacher stated, “To tackle the housing emergency, we need to build more homes. We cannot afford for £3.2 billion of investment to disappear into thin air because of permanent rent controls being brought in by the SNP.” She also pointed out that “between September 2022 and March 2024, when rent controls were active, private rents increased by 16.5 percent. That shows that rent controls do not work.”
This sentiment was echoed by Labour MSP Mark Griffin, who argued, “Stakeholder after stakeholder … has been clear that the cause of the housing emergency is the shortage of affordable homes, and that the demand for homes far outstrips the supply… However, the bill attempts only to manage the symptoms of that chronic lack of supply.”
A YouGov poll cited within the legislation finds that 82% of Scots support the introduction of rent controls. The bill received support from non-profit organizations such as Homeless Network Scotland and Living Rent, a Scottish tenants union. On November 27, over 300 members of Living Rent gathered outside the Scottish Parliament to express their backing for the bill.
The legislation proposes wider reforms to the housing sector, including measures that would delay enforcement of evictions in circumstances where the tenant’s situation or the time of year makes the eviction especially problematic. It also aims to simplify the renting process for tenants with pets, enable them to seek damages for unlawful eviction, and ensure that unclaimed tenancy deposit funds are used for the benefit of tenants.
The bill highlights gender differences in the causes for homelessness, citing that 23% of the women who sought homelessness assistance in 2023-2024 did so because of reported domestic violence. To address this, it proposes additional mechanisms that would allow tenants to end a joint tenancy without mutual agreement.
The recent budget, announced by Rachel Reeves in October 2024, revealed that the local housing allowance (LHA), which supports 4.6 million tenants, will remain frozen at its current level until 2026. This freeze is expected to exacerbate the widening gap between the allowance and rising rent prices, which surged by 8.4% from September 2023 to 2024. As a countermeasure, the budget included a £500 million commitment to the affordable homes program, aimed at adding 5,000 social homes to the housing market.
As the bill moves to Stage 2, where MSPs can propose amendments, McLellan has indicated that there will be a consultation in Spring of 2025 regarding which building types will be exempt from the rent control measures.
