NRLA: Common sense prevails as Welsh Government rejects tenant compensation proposal

The Welsh Government has rejected a recommendation that would have required landlords to provide two months' rent as compensation to tenants upon serving a Section 173 ‘no-fault’ possession notice. 

The proposal, which suggested that tenants could retain the last two months' rent as compensation, raised significant concern within the sector – particularly that it could deter future investment. By rejecting it, the Welsh Government has recognised the need to balance tenant protections with landlords’ rights – helping to maintain sector stability and ensuring landlords can continue to act lawfully without fear of arbitrary financial penalties. 

Crucially, an approach of this kind is also likely to have had unintended consequences – disrupting housing benefit payments and disproportionately favouring tenants with greater financial resources, while putting low-income renters at a further disadvantage in an already constrained housing market. 

Ben Beadle, Chief Executive of the NRLA, commented: 

"We welcome the Welsh Government’s common sense decision to drop proposals that would have imposed arbitrary compensation payments on landlords using legitimate grounds for possession. 

Confidence in the Welsh private rented sector has been knocked significantly in recent years, but the decision to reject this measure outright is a step in the right direction. I am delighted that our concerns have been listened to.”

You can read the Welsh Government’s response to the recommendation in full here.

ENDS

Notes to Editors

• Under Department for Work and Pensions (DWP) rules, housing benefit and the housing element of Universal Credit can only be paid where a tenant has a legal liability to pay rent. The proposal would have waived this responsibility and could have left low-income tenants unable to cover future rent or fail credit checks. 
• If you’d like to receive more details about this news, feel free to contact the NRLA’s Communications Team at [email protected].