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On the basis that Meghan Gallacher and I are keen to ensure that there is clarity on a number of issues in the bill, will she join me in recognising that the Government and—I hope—her party do not want to include purpose-built student accommodation in the bill? If anything has caused that to happen, I hope that members will be able to work together to rectify that at stage 3, if required.

I hope that Willie Rennie heard me say in my remarks that I take the issue very seriously.

The points that he has raised are exceptionally important and have been made directly to me by the sector, loud and clear. I am keen to pick them up at speed in the consultation to provide clarity, just as I hope that I did last Thursday during portfolio questions, when I was absolutely clear that the Scottish Government has no intention of doing anything in the bill to bring in the PBSA sector. Indeed, if anything was done on that basis in last week’s committee meeting, we would work with members to seek to amend that at stage 3.

Meghan Gallacher has made a useful point about what can and should be in the public domain. It is important that we open up the information and data that are collected—indeed, that is why the Government has lodged the amendments—and I look forward to her taking part in the discussions over the summer to ensure that we test the system. It is important that we are able to test it before stage 3 to ensure that members who still remain concerned about, say, the system not collecting enough information or it collecting too much information and being overly cumbersome can come and have that discussion with me. They will then be able to come back with amendments at stage 3, should they so wish.

Amendment 137, in the name of Emma Roddick, and amendment 237, in the name of Maggie Chapman, would increase the potential financial penalty on landlords for failure to comply with requests for information from £1,000 to £10,000. However, I note that my amendments 324 and 325 seek to remove and replace sections 16 and 17, as a result of information-gathering powers being conferred on the Scottish ministers by amendments in the group. Similarly, Maggie Chapman’s amendments 324A and 325A seek to increase the relevant penalty to £10,000. Unfortunately, I cannot support the amendments, as I consider that they set a penalty that is too high in the context of a landlord’s conduct. I still believe that £1,000 represents a more proportionate penalty.

On that basis, I ask Emma Roddick and Maggie Chapman not to move their amendments and to work with me ahead of stage 3 if they still have concerns on the issue. From the work that the Government has done on the matter, I remain convinced that the penalty is at the right level.

Amendments 153 to 155, in the name of Edward Mountain, seek to make changes to the type of information that can be sought from landlords. I understand the purpose of the amendments, but I consider that amendments 305 to 313, in Paul McLennan’s name, provide a more comprehensive expansion of the list of information that can be requested from a landlord. The list that is proposed in amendments 305 to 313 is more consistent with the information that is collected by rent service Scotland to support decisions on rent adjudication. Amendments 305 to 313 are therefore more appropriate in the context of the information that is needed to support rent control, as they will deliver information that is more closely comparable with the data on advertised rents that rent service Scotland collects.

Amendments 156 and 157, in the name of Edward Mountain, would mean that the information that is requested by local authorities would be added to the landlord register. The primary purpose of landlord registration is to give councils a means to assess whether an individual is a fit and proper person to let property. I do not believe that adding that information to the landlord register would assist local authorities in making that assessment. The amendments could result in inconsistent information being held on different landlords, depending on whether a landlord has received a request for information. The amendments would also require further consequential amendments to the Antisocial Behaviour etc (Scotland) Act 2004.

Although I acknowledge the intent behind the amendments and recognise that there could be benefits to using the landlord register as part of the data collection process, it is important to emphasise that the proposed changes would place significant additional burdens on landlords and on local authorities as operators of the landlord register. I do not consider that they are necessary in connection with rent control, and I believe that they could inadvertently make a fundamental change to the purpose of the landlord register without due consideration of the impact on its core purpose, which is ensuring that someone is a fit and proper person to be a landlord. Therefore, I cannot support the amendments.

Amendment 448, in the name of Maggie Chapman, would amend the bill to change the discretion of a local authority to a duty, which would mean that every local authority in Scotland would need to write to every landlord on the register to request all the information that is set out in section 15(2) of the bill. As I have previously set out, although I understand and support the strong desire for robust information about tenancies, I cannot support the amendment. It would remove the discretion of local authorities to seek the data that they deem to be necessary, and it would be costly and disproportionate to the level of data that is needed to inform rent control assessments.

Amendments 449 and 450, in the name of Maggie Chapman, would provide for data to be obtained from landlords for the purpose of being provided to the rent officer or the First-tier Tribunal to assist them in determining open market rent. It is not clear that that information is needed by rent officers or the First-tier Tribunal, as they already make determinations of open market rent without access to that information. It is also uncertain how such a process is intended to operate or how often information would be needed for that purpose. That would place an additional burden on local authorities, with potentially significant costs and no clear benefit, and I am unable to support the amendments.

Amendment 481, in the name of Carol Mochan, would require local authorities to provide the tenant with a copy of the information that they have obtained from a landlord. Although I recognise the intention behind the amendment, it would add a significant additional administrative burden and cost in relation to the collection of data. The concern is about the accuracy of the information that is provided by the landlord, but there are already powers in the bill for local authorities to request information from tenants. I therefore cannot support the amendment, as I do not believe that it is needed.

Amendment 482, also in the name of Carol Mochan, would remove the ability of the Scottish ministers to remove information from the list of information that can be requested from a landlord. That would remove the flexibility that the power was intended to create, and it would mean that primary legislation would be required to remove from that list any information that is no longer considered relevant. Regulations under section 15(7) are subject to the affirmative procedure, so there would be parliamentary scrutiny of any attempt to reduce the information that can be requested. I therefore cannot support amendment 482.

Finally, Carol Mochan’s amendments 483 to 486 would amend sections 16 and 17 of the bill to remove elements of discretion from the enforcement procedures behind the duties on landlords to provide information. Those amendments would remove an element of discretion from local authorities and, in certain cases, would create strict liability for a financial penalty, even when the First-tier Tribunal considered such a penalty to be inappropriate. I therefore cannot support those amendments.

Sections 15, 16 and 17 of the bill were drafted with the intention of ensuring that the powers for local authorities and the Scottish ministers support the collection of data on a proportionate basis and do not unnecessarily burden local authorities, landlords and tenants. My amendments in the group seek to enhance those powers while respecting the rights of landlords.

I understand the intent behind the amendments in the group, but I cannot support them, for the reasons that I have set out. I therefore urge Emma Roddick, Maggie Chapman, Edward Mountain, Carol Mochan and Meghan Gallacher not to move their amendments in the group and to work with me ahead of stage 3. If any of their amendments are moved, I ask members to oppose them and, instead, to support the amendments that have been lodged in the name of Paul McLennan.

I move amendment 303.

This group of amendments relates to the provisions in the bill that create a power for Scottish ministers to exempt certain properties from rent control by regulations. Although I cannot support the amendments in the group that have been lodged by other members, I agree with the importance of ensuring that full consideration is given to the circumstances in which it might be appropriate to make exemptions. That is why we published a consultation on the use of the powers to ensure that the impact on landlords and tenants of any exemption that might be provided for in regulations is fully understood.

I repeat what I said earlier: I am completely convinced of the need to use powers in the bill to exempt, where appropriate, certain categories of property from rent control and to allow rent increases that are above the level of the proposed rent cap in certain circumstances. Members have already raised many compelling arguments for that. However, that must be supported by consultation that ensures that the impact of such measures is fully understood and that our actions do not create any unintended consequences, taking into account the views of everyone who has an interest.

With reference to amendments in the group, our consultation asks specific questions about possible exemptions for mid-market rent and build-to-rent properties. Alongside that, there are opportunities for landlords who do not see their circumstances reflected in the specific questions to give us their views, and for tenants to give us their opinions on how the proposals will impact on them. We will consider all those points as they are proposed in the consultation.

I turn to amendments 329, 330 and 331 in the name of Paul McLennan. Amendments 329 and 331 will have the effect of moving the power to define an exempt property in section 13 of the bill so that it appears in other legislation alongside the rent controls to which it relates. That flows from previously debated amendments that would replace the power to set a rent cap in section 9 of the bill with the provision for a rent cap in the other legislation. The relocation of the power would make obsolete the existing power to define what is an exempt property in section 13. Therefore, I support Meghan Gallacher’s amendment 107, which was debated earlier, because it would remove the resulting obsolete section of the bill.

Amendment 330 will make a technical correction to the bill to change part of the title for the new part 4A of the 2016 act from “excluded” to “exempt”.

I turn to other amendments in the group. Meghan Gallacher’s amendment 102, Edward Mountain’s amendment 150 and Willie Rennie’s amendment 329A would create a duty for Scottish ministers to define an exempt property by affirmative regulations. However, those regulations cannot be made without the approval of the Scottish Parliament, meaning that compliance with the duty would not be entirely in the gift of Scottish ministers. I agree that it is essential that exemptions are provided for, but imposing that as a duty on Scottish ministers is not the right way to progress that. Accordingly, I urge members not to press or move amendments 102, 150 and 329A but, if they do so, I urge members of the committee not to support the amendments.

I turn to Meghan Gallacher’s amendments 103, 105 and 106, Rachael Hamilton’s amendments 208 to 212 and 566, Mark Griffin’s amendments 411 and 416 and Willie Rennie’s amendments 329B to 329D and 329G to 329I. Collectively, the amendments set out potential exemptions from rent control in the bill, covering properties that are let by subsidiaries of landlords, including those delivering mid-market rental properties, built-to-rent properties, properties that are subject to improvements, including energy efficiency, and properties that have been offered for rent at below-market rates. Although I absolutely understand the reasons behind the amendments, I do not think that such properties should be included as exemptions in the bill. The reason for that approach is that exemptions must be fully informed by consultation with stakeholders so that they are framed in a way that ensures that they disapply rent control in the appropriate circumstances and do not capture circumstances in which rent control should apply.

I appreciate where Maggie Chapman is coming from on the issue. I thank her for lodging the amendments to allow us to have the debate about how we can clearly set out what the rent cap is.

I go back to the points that I have already made about the importance of having something that takes other income into account, although I appreciate what Ms Chapman says about the likelihood of wages being the primary source of income for many renters. It is also important to have something that is understood by renters, landlords and investors. We need to be able to provide that insurance to all those interested parties. The clarity that the use of the CPI can provide is exceptionally important. I also believe that the CPI is the most appropriate method, for the reasons that I have set out.

I just wanted to make sure that I could get in before Meghan Gallacher finishes winding up.

I am unable to find in my weighty folder the specific date on which the consultation closes, but I think that it is in July—

In some ways, that depends on when stage 3 is. I have also heard very understandable calls from the sector for us to move through the bill process at pace. We are still in the early stages of stage 2, so you will forgive me if I do not try to estimate when we will complete the bill process. However, I am mindful of the need to look at how quickly we can get that done, and I give the reassurance that, regardless of how we are working with regard to stages 2 and 3, we will be working at the same time on the analysis, so that, as soon as the consultation closes, we will get the analysis done and the regulations drafted. Therefore, regardless of when the bill process is complete, we are working to get that done as soon as possible.

To return to my earlier point, taking account of the views of those with an interest to understand the impact of any measures is why our consultation has asked some specific questions about possible exemptions for mid-market rent and build-to-rent properties. We have also asked questions about landlords who charge rents below market rates and who make improvements to the property. There are also opportunities for landlords who do not see their circumstances reflected in the specific questions in the consultation to give their views and for tenants to give their opinions on how the proposals will impact them. To that end, amendment 302, in Paul McLennan’s name, sets out that the requirement in the bill on Scottish ministers to consult before laying regulations specifying properties that might be subject to a modified rent cap may be met by consultation carried out before the relevant section comes into force. That will support bringing forward any necessary regulations as soon as possible after the legislation comes into force, as I mentioned in my responses to the interventions.

Amendment 332, in Paul McLennan’s name, sets out the form of the rent cap. Providing a formula for the rent cap in the bill—the percentage change in the consumer prices index plus 1 percentage point, up to a maximum increase of 6 per cent—is an approach that will provide protection for tenants who are at the highest risk of the most significant rent increases. Setting a ceiling of 6 per cent can help to protect renters against large increases in rents at times when inflation spikes. Including a ceiling means that a greater share of the risk of future extreme economic events that cause a spike in inflation will lie with investors or landlords, who are arguably better placed than renters to cope with the impact that such events can have in the short term. However, the cap will also provide clarity for landlords and investors on rent increases in rent control areas.

CPI is a comprehensive measure of the trends in goods and services purchased by consumers in the United Kingdom economy. Costs relating to running a home are included in the index—for example, costs relating to maintaining a dwelling as well as the items within a dwelling. Linking the rent cap to CPI is, therefore, a reflection of the cost to landlords of offering a property for rent.

Allowing some margin over inflation, such as the 1 percentage point that we are proposing, will give investors some assurance that, over the long term, any periods in which growth is below inflation may be balanced out with periods in which rents may grow a little above inflation.

Through the housing investment task force, we have worked directly with investors and developers to understand how we can bring forward a system of rent control that both works for tenants and supports continued investment in private rented housing.

Thank you for your assistance, Mr Simpson. I am very keen to move expeditiously with the discussions in short order afterwards.

I appreciate that Maggie Chapman is frustrated by the gap, but I go back to the point that I made about the arrangements being transitional. It was important that we supported people through the transition out of the rent cap, but that measure was intended to be temporary and exercisable only on or in anticipation of the expiry of the rent cap measure in the Cost of Living (Tenant Protection) (Scotland) Act 2022, and, through regulations that were approved by Parliament, they could apply for a 12-month period. Therefore, I go back to the fact that they were not designed to be a bridging mechanism to longer-term rent controls.

The existing mechanism for adjudicating rent increases under the Private Housing (Tenancies) (Scotland) Act 2016, which is based on open market rent, will continue to operate as intended, protecting tenants from unreasonable rent increases.

I cannot support amendments 186, 196 and 199 and urge Maggie Chapman not to move them. If they are moved, I urge members not to support them.

Amendments 424 to 426, in the name of Maggie Chapman, would provide for the introduction of special rent control areas. In those areas, a rent cap could be set for up to one year, which would be below the level of the rent cap that would apply under my amendment 332. Maggie Chapman’s amendments would enable the rent cap in a special rent control area to be set at 0 per cent, or even a negative figure, requiring landlords to reduce rents.

Although I recognise that Maggie Chapman has concerns with the fixed rent cap being proposed in my amendment 332, I consider that it is necessary to provide clarity for landlords, tenants and investors on the impact of rent control in those areas where it will apply. The amendments would remove that clarity and would reintroduce the uncertainty that landlords and investors have called on the Scottish Government to address.

For those reasons, I urge Maggie Chapman not to move amendments 424 to 426. If they are pressed, I encourage members not to vote for them.

I absolutely see where Maggie Chapman is coming from. I think that we will come back to the issue when discussing other parts of the bill. This is about trying to ensure that we make the bill as nuanced as possible. The Government is determined to provide clarity to tenants, landlords and investors on many aspects, so I would be happy to discuss the issue with Maggie Chapman in the run-up to stage 3. However, in all those discussions, my underlying principle will be our need to provide clarity to investors. I would be hugely reluctant to do anything that would detract from that clarity, which the Government is seeking to bring through its stage 2 amendments.