Law Society fear over lower regulatory enforcement threshold for Welsh RSLs
A Welsh Government proposal to lower the threshold for regulatory enforcement from misconduct and mismanagement to breach of any statutory duty could expose registered social landlords (RSLs) in Wales to disproportionate enforcement actions, the Law Society has warned.
The Welsh Government had included the proposed change to Schedule 1 of the Housing Act 1996 as part of a package of measures amending or removing some central and local government controls over RSLs.
These proposals were announced in response to the decision of the Office for National Statistics to reclassify RSLs as public non-financial corporations in 2016.
The Law Society said: “By weakening regulatory control in other areas, it appears that this amendment is intended to strengthen the Welsh Government's ability to intervene where there are even minor concerns.
“While we agree that RSLs who fail to carry out their functions effectively, or pose a risk to their tenants should face strong sanctions, we are concerned that this proposal would leave RSLs disproportionately exposed to regulatory action. For example, an RSL could be subject to significant regulatory action where they fail to meet disrepair obligations.”
Chancery Lane questioned whether the proposal was likely to satisfy the Office for National Statistics (ONS) that Welsh RSLs were significantly outside the control of the regulator to warrant reclassification. “It is difficult to provide examples of other private organisations subject to the same level of regulatory control as that now proposed for Welsh RSLs.”
It added: “We recommend that you reconsider whether lowering the threshold in this way is an effective means for Welsh Ministers to retain a reasonable level of control in this sector.”
The Law Society also expressed concern that the consultation neglected to provide detail about how or why the measures identified for amendment or repeal were selected. An absence of information suggested that there was “some rush to implement these proposals”, it added.
Chancery Lane’s response can be viewed here.
