Scottish Govt "Short-Term Lets" Licensing proposals: our message to the Committee

 The Scottish Government plans to regulate "short term lets" by means of a licensing scheme that will also affect all small B&Bs (those in Use Class 9, ie "homes").

Our latest submission to their consultation can be read here.

The Local Government and Communities Committee are discussing this tomorrow (Wed 3 Feb).

This is the message the Scottish B&B Association have sent today to the Convener of the Committee, James Dornan MSP:

Mr Dornan,

May I request that you put this to tomorrow’s Committee meeting, as we are concerned that Kevin Stewart’s letter to the Convener of the Committee may be misleading?

I refer to this letter from Kevin Stewart MSP to James Dornan MSP (1 Feb 21):

https://www.parliament.scot/S5_Local_Gov/General%20Documents/20210201shorttermlets.pdf

And in reply I would like to refer you and the Committee to my email to Kate Forbes MSP [this can be read here]. 

As you can see, we felt Ms Forbes’s reply to a constituent was misleading, and pointed out how.   We asked her and her colleagues not to make similar statements implying that we agreed with the STL licensing proposals.

Unfortunately in his letter above, Kevin Stewart has again repeated the same misleading statements.  This is to correct those, so the Committee can make fully informed decisions.

May I also add the folowing points about Mr Stewart’s letter (using his numbering):

1) Mr Stewart says of the licensing scheme requirements:  “we do not consider them to be onerous”.   We strongly disagree, as our latest submission makes clear.  The requirements regarding EPC certificates, maximum occupancy, sound insulation (changing floor coverings etc), arrival time curfews, reporting etc ARE potentially onerous for micro-businesses - and are unnecessary to impose on rural B&Bs which are not causing the problems the Committee is seeking to address.  These will impose costs over and above the license fee.

4) “B&Bs have always been excluded”:  regardless of what was intended, the wording put out was less than clear.  Mr Stewart's letter points out that "Our 2019 consultation paper proposed excluding “licensed hotels and B&Bs and self-catering properties on their premises”.”

Many read this as excluding (a) licensed hotels and (b) B&Bs.   I have to say that many MSPs and even ministers have expressed surprise that B&Bs were ever intended to be included.  As soon as we heard that one of the options was to include B&Bs in UCO 9, we flagged this up as a problem issue in our formal consultation rsponse at the earliest stage possible.

5. "Average indicative fees are estimated to be in the range £223 and £377 for a three year licence”:

These figures are misleading, as there is NOTHING guaranteeing they will be in this range - and in fact there will be a equirement for Local Authorities to cover their costs, so depending on what Local Authorities choose to spend, and how many license fee payers are in their area, the fees may be much higher.

Some comparable fees are £800 and more, and the STL Licence fee may possibly reach £1,000 in some areas.  In any case, fees of several hundred pounds are disproportionate for microbusinesses with one or two guest bedrooms - and unnecessary, considering that (as Mr Stewart concedes) the established B&Bs are already complying with key existing safety legislation.

As you will know by now, the ASSC’s very recent survey (also sent to our members)  of B&Bs across Scotland found the following:

88% are rural / semi-rural / island

78% have been operating 3+ years, with 20% over 15 years, one 37+ years

76% are UCO9 (residential) compared to 24% UCO7 (Guest House), which means that 76% will be required to obtain a licence

39% believe that any additional licence fee would render their business unviable, 55% believe it would have a negative impact

Mr Stewart’s letter also repeats Ms Forbes’s potentially misleading statement to her constituents, saying:

"The Scottish B&B Association responded to both our 2019 and 2020 consultations, highlighting that their members adhered to safety standards and that they were in favour of levelling the playing field between B&Bs and properties listed on platforms such as Airbnb.”

As I said to Kate Forbes when she had used those words to her constituents:

We did give written responses to Scottish Government consultations in July 2019 and October 2020 (the latter a very limited consultation, as a licensing scheme had by then been decided upon).  However you omitted the significant fact that both times, we made very clear that a licensing scheme would be the WRONG way to go, and explained why.   And in October, we specifically warned of the danger of bringing in B&Bs into the definition of “short-term lets”. Again we were ignored.

Yes we have long been in favour of levelling the playing-field between B&Bs and properties on “platforms” such as Airbnb - and we have made very clear to the Scottish Government (since 2017 when we gave evidence to your Expet Panel on the “Collaborative Economy”) that this “playing field” distortion was a matter of ENFORCEMENT.  To put it simply, traditional B&Bs are subject to the enforcement by regulators of health & safety rules, and properties on platforms like Airbnb are in practice not.  The way to bring the same level of enforcement to both is to bring in a no or low cost accommodation registration scheme, not an onerous, costly, inflexible and unwieldy licensing scheme.

As regards the consultation excercise, as I told Ms Forbes:

In any case, seeking written submissions from voluntary trade associations is not sufficient as a consultation excercise before changes of this scope and scale - if your Government had intended every owner of a house (ie UCO 9) in Scotland who offered even one room as B&B to be subject to a licensing regime, it would have been incumbent on you to carry out a near population-level consultation and communications excercise.

Whether the consultation excercise was legally watertight is, I understand, a question worth asking. Unlike Acts of the UK parliament which (generally since leaving the EU) cannot be challenged in the courts, Scottish Acts can be challenged in the Scottish Courts if they are outwith the scope of the legal powers devolved to the Scottish Parliament. But there are much wider grounds for challenging subordinate legislation (ie legislation like this Order made not by Parliament but by Ministers in exercise of powers given to them under an Act of either Parliament). These include procedural impropriety etc. which may be wide enough to include failure to properly consult key sectors affected, particularly in the context of published “best practice”. As I told Ms Forbes and the Committee should be aware, this is something we are looking into at present.

We ask the Committee to set aside the current proposals pending a review, full economic impact assessment and appropriate scale of consultation.

Regards,

David Weston

Chairman

Scottish Bed & Breakfast Association