Dear Shona

I am writing to you in your capacity as Cabinet Secretary for Social Justice, Housing and Local Government with regard to the Short-term let licensing regulations. (Short-term Let Control Areas) (Scotland) Amendment Regulations 2022 )

 

Some friends who are involved in the short term letting sector have recently got in touch to ask my advice about these regulations which are causing them great concern.  I therefore felt obliged to do some research and I have to confess I was appalled at what I read about these regulations and I am greatly concerned that they could have a devastating effect across the Highlands and Islands.

I am sure you are aware that the economy of Argyll and of the Highlands and Islands is dependent on tourism to a much greater extent than the rest of Scotland and as a consequence was and continues to be damaged much more by the Covid pandemic than other parts of the country.

As such our tourism accommodation sector will have to bear the effect of these regulations at a time when it is on its knees as a result of the pandemic. Island businesses, and I am thinking particularly  in Argyll of islands like Islay, Mull, Tiree and many others, have had the further challenge of trying to deal with a period of catastrophically unreliable ferry services. The timing of the imposition of these regulations is therefore particularly unfortunate.

I understand that these regulations are not directed at alleviating the shortage of affordable housing, that issue having been dealt with by separate planning regulation, and that these regulations are concerned only with safety. I am not aware of  particular and urgent safety issues which affect this sector and the statistics I have looked at involving accidental death and injury seem to suggest a long term trend of accident reduction. I would be much obliged if you could direct me to any statistics which suggest the urgent need for this regulation.

I note also the view from within the short term letting sector that safety concerns could be largely dealt with by a registration scheme rather than a licensing scheme which would be much less onerous for both the regulators and the regulated. The landlord registration scheme for long term letting, for example, costs under £100 per property and involves a minimum of bureaucracy.   

I should also say that I share all of the concerns articulated by my former colleague, Fergus Ewing MSP, especially his suggestion that the regulations may not be legally competent and that because they may result in the closure of businesses on various unspecified grounds that the effect could be ‘draconian’. ‘Draconian’ is a strong term and I am sure that Fergus Ewing, whose loyalty to SNP and to the Scottish Government is beyond question, has only used it after considerable thought and to express a legitimate and deep concern.

Having for a number of years in the past operated a small business in the short term letting sector I know how onerous the burden of dealing with such regulations is and I can well understand the uncertainty that will now be gripping the whole sector. I can sympathise too with their fears about the costs of licensing which have been estimated to be between £1500-£2000 and that is before the separate cost of the required planning consent is taken into account. I understand too that this will not be a ‘one off’ cost and that relicensing will be required every three years.

I am sympathetic also to local authorities, like Argyll and Bute Council, who will have to set up and administer this licensing scheme at a time when their resources have been stretched by Covid and when they have now also been stretched for many years due to cuts to their budgets. They would be entitled to look at the very least towards full cost recovery and it would not surprise me that licensing fees are therefore at the top end of the suggested estimates and may even exceed these. You will appreciate I am sure, that Argyll has short term letting premises in some very remote and far flung places and that licensing and enforcement of licensing conditions offers particular challenges in rural areas.

There appears to be a widespread belief that these regulations are an attempt to deal with the shortage of housing ‘by the back door’ and that therefore they may have some justification. I recall the 2008 SNP  policy document , Firm Foundations’ , in which the then Deputy First Minister, Nicola Sturgeon, stated that the reason for the shortage of affordable housing was that new housing completions (all tenures) amounted then to around 25,000 per annum when the acknowledged need was for 35,000 house per annum. You will know that since 2008 we have failed by a very large margin to build the required number of houses and that this is the real reason for the shortage of affordable housing. For example the most recent statistics show that we have built less than 15,000 in the last year. Surely you would agree with me that when there is a very significant shortage of houses prices will increase and that the real solution for the housing crisis is to build more houses.

The Covid pandemic is the biggest crisis we have faced since the last war. Just as we built our way out of the economic crisis that might have engulfed us after that war, in building ‘homes for heroes’, so we could build our way out of the Covid crisis by addressing our appalling shortage of houses. Surely you would agree with me that this is a much more positive way of addressing our manifest problems than by heaping unnecessary bureaucratic and cost burdens on our already hard pressed small businesses.

I look forward to your reply and would welcome any reassurances you can give to my friends in the short term letting sector.

Best Regards

 

Mike MacKenzie

 

PS. I will be publishing this as an open letter on social media as I believe this is a matter of public interest and concern. I would be pleased to publish your reply provided I have your express written consent to do so.