Politics

Why Has the Government Said No to Rent Controls?

Eleanor WhitcombePublished 2w ago5 min readBased on 4 sources
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Why Has the Government Said No to Rent Controls?

Deputy Prime Minister and Housing Secretary Angela Rayner has told BBC Breakfast that rent freezes and rent controls are "not a way forward at the moment." Rent controls are rules that limit how much landlords can charge or raise rent. Her comments push back against calls from within her own party and from local leaders for the government to step in. BBC News

Speaking on BBC Breakfast and BBC Radio 4's Today programme on Friday, Rayner said rent controls tried in parts of the UK in recent years had not necessarily brought rents down. Her remarks put her at odds with several prominent figures, including London Mayor Sadiq Khan, who has long called on the government to bring in a rent cap, and Green Party leader Zack Polanski, who has called for rent controls on all rented property in England.

In 2023, Andy Burnham, the mayor of Greater Manchester, called for a freeze on private rents until the cost of living crisis was over. Burnham is now seeking to replace Keir Starmer as Labour leader and prime minister. He has promised the biggest programme of council house building in decades and has also talked about reforming property taxes such as stamp duty and council tax, without specifying exact changes.

Rayner's position also marks a shift from her own past statements. In May, she posted on her official Facebook page that Labour would "take urgent action to protect private renters through rent controls, open-ended tenancies, and new, binding minimum standards." Facebook

The government department responsible for housing has long been sceptical of rent controls. Rayner's comments fit with that view, though her earlier statements had left supporters of the idea believing the door was still open.

The clearest UK example of rent controls happened in Scotland, where temporary limits on rent were introduced in October 2022 and expired last year. Housing policy in Scotland is decided by the Scottish Parliament at Holyrood, not by Westminster. Rayner is now pointing to Scotland's experience as evidence that rent controls do not deliver the results their supporters promise.

Rayner also spoke about the government's promise to build 1.5 million new homes by 2029. She told the Today programme that the target had become harder to meet because of rising construction costs, but she was clear it would not be dropped. Rayner said she would keep the target and not be defeated.

The Renters' Rights Bill, which the government describes as the biggest change to the private rented sector in over 30 years, returned to Parliament in January. Gov.uk The Bill, led by Housing Minister Matthew Pennycook, gives stronger rights to 11 million private renters across the country. It will abolish Section 21 "no fault" evictions, which let landlords remove tenants without giving a reason. It will also end rental bidding wars and cap upfront rent payments at one month's rent. Landlords can still request one month's rent in advance plus a deposit of up to 5 or 6 weeks' rent. The Bill also protects grieving guarantors from having to pay rent for the rest of a tenancy when a loved one has died.

There is currently no legal limit on how much rent a landlord can ask for upfront in England. Some renters are being asked to pay up to a year's rent before a tenancy is agreed. The Bill's cap on advance payments is designed to stop this.

The broader context here is a government trying to draw a line between tenant protections it thinks work and those it does not. The Renters' Rights Bill is significant legislation: abolishing Section 21 evictions alone has been a flagship Labour pledge for years and is the biggest change to private renting law in a generation. But turning away from rent controls narrows the gap between what Rayner will commit to now and what she previously said Labour would deliver. The Facebook post from May is unambiguous on rent controls, and the shift leaves supporters of intervention with less influence within the parliamentary party.

Burnham's bid for the Labour leadership adds a political dimension. His calls for large-scale council house building, rent freezes, and property tax reform place him to the left of Rayner on these issues. Whether that turns into real pressure in Parliament or stays as a campaign talking point will depend on backbench MPs and their willingness to challenge a sitting Deputy Prime Minister on housing.

For Scotland and Wales, the picture is different. Rent policy there is devolved, meaning those governments set their own rules; in England, it is decided at Westminster. Rayner's comments apply to England. Scotland's temporary rent controls have now expired, and Rayner pointing to them as a warning may make it harder for Holyrood or the Senedd to bring back similar measures, though neither is obliged to follow Westminster's lead.